Market Report November 2018

The Market in General

Favorable weather during the summer months saved the season in Southern Europe after a very cold and wet start in spring. Except in Turkey crop results are generally satisfactory. This stands in contrast to Northern Europe where severe draught affected the yield and quality of most crops. Worldwide supply should be quite stable from this year’s harvest season now ending in the northern hemisphere.

Market Info and Recommendations

Tuna: The unusual drop of skipjack prices in Bangkok in July/August was corrected quickly, jumping up by USD 200/t, however now softening again at currently approx. USD 1.600/t. Manta is following this trend, but at a slightly higher level. Current prices should be considered "normal average". Catches are still unsatisfactory after the "FAD-ban" ended in the West Pacific. Demand is still weak but should pick up soon with discussion of annual contracts for 2019 and also the free USA-quota coming closer. "FAD-free" catches are quite scarce, especially from origins that are EU-duty free. This especially applies to "flakes".

Pineapples: The winter crop is underway in Thailand and it is still unclear how soon and to what extent pineapple prices may recover. What is certain however is that cultivation is being reduced and fields are being neglected and thus raw material is decreasing. Demand however is quite weak at the same time as buyers have covered their needs long-term at the rock-bottom price level of the previous crop. Same applies to Kenya and the Philippines, it is definitely still a buyers’ market. IQF pineapple from Vietnam is offered at attractive prices likewise, the new crop there has started as well. We are also offering pineapple pieces from certified organic cultivation from a reliable, proven source.

Mandarin oranges: A good crop is expected in the Chinese provinces of Hunan and Hubei; however forecasts for Zhejiang, being a major supplying province, look less favorable. The season will be short, finishing already at the end of January due to an early Chinese New Year. Shortage of labor continues to be a major problem, both in the orchards and factories. As a consequence, some factories are switching to machine peeling now also in China. Prices are around last year’s level, being the result of “penalty” import levies charged by the USA, a weaker Renminbi Yuan, rising cost of labor/sugar/packaging material. Spain will have a good crop, but the volume is small with only two canneries still in operation. Currently, prices are at last year's level.

Tomato products: Favorable weather resulted in a good quality (high brix and good color values) in Portugal/Spain/Italy. The wet and cold spring, however, clearly affected the yield which is well below last year. This also applies worldwide for the third year in a row with total tonnage globally now reduced to 34.8 MT in 2018, down from 41.4. MT in 2015! Prices are moving up since September and quite opposite to last year we do recommend to cover any open demand now. The situation for sun-dried tomatoes coming from Turkey remains to be quite dismal. Weather damage reduced the volume to only 60% of last year and supply needs to be secured until next year’s crop will be available in July.

Peppers/Peperoni: This was a very bad season for Turkey for peperoni and also sweet peppers (especially Capia). Heavy rainfall and hail, followed by extreme heat, ruined the first picking and also the second was a disappointment with hardly any yield coming from the third. The harvest was done already by the end of September. We are sourcing from alternative countries, requirements until summer 2019 should definitely be secured now!

Kidney beans: As a result of the trade dispute with the USA, there is a high 25% EU import tax now on pulses. This has strongly affected prices of canned kidney beans, amplified by a bad crop in China. “Canning quality” is hard to find with only little relief coming from Ethiopia and Argentina due to unsuitable quality. Prices will go up further, demand should be covered if possible for the whole of 2019.

Olives: Despite the harvest starting three weeks late in Spain, expectations are clearly better than in previous years. First offers should be available early December, once the yield and the distribution of calibers can be estimated. Results in Morocco are quite good again; prices are at last year's level, slightly softening. Greece however is suffering from a reduction of up to 50%, especially large calibers are short.

Capers: Normal yields in Turkey respectively central Asia, where most of the raw material is coming from. Prices are at about last years' level. The volume in Morocco however, being a major supplier, will be well down due to the cold spring weather. The crop started late and yields are clearly reduced. Contracts should be signed now, the market is tight and the supply may be insufficient, prices should move up soon.

Quinoa: Still in short supply and expensive with relief only coming from the new crop in Peru/Bolivia, available not before July next year. There is no alternative for the small kernel grade which is in strong demand.

Tahini/Sesame paste: Deliveries of seed, coming mainly from East African countries, continue to be slow and expensive. Prices should rise further also due to continuously strong demand. The market will be tight, certainly until the end of the year. First offers for raw material from the new crop are expected by the end of November.

Figs, dried: There was a good prognosis for the crop in Turkey, however, strong rain and hail ruined the quality and yield in the important region of Aydin. The price level has increased substantially since then, moving up further.

Dates, dried: Good or even excellent quality, however, the yield is clearly down to last year in North Africa. The harvest started late with less fruit on the trees. There is hardly any stock, prices are pointing up.

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(issued on 12 November 2018)