It’s been two weeks since my last Market report and for good reason, there is no point in a report unless we have some fresh news and market prognosis, which we do.
As always, let me start with cashews. Nothing really has budged since the last report (dealing with China and Vietnam etc) while it hasn’t really come down, no one is running to produce offers either. Indian packers still remain higher because they can and Vietnam is not seeing a great amount of demand. We are still experiencing record shipments but most savvy buyers have booked their forward contracts over the last few weeks (at our advice) through till December. Now is still a good time to forward book and very little downside risk at these current prices.
LPs: so finally we are getting offers on LPs but we are hesitant to spring into action since the shipments we have already booked keep getting delayed, so even though we finally are getting offers it’s still very shaky as to if these containers will finally leave port and steam towards us.
but we doubt it. (side note: last time Brazil lost the World Cup at home in 1950 the country went into a deep depression) saying that new crop is coming in October and then will should be flush with offers.
And now on to the main course. It’s been a funny last few weeks and we are deeply involved and intune speaking constantly trying to gleam every bit of information to advise you our clients on what we think is the best way to move forward. Right now it’s a game of minds, think The Wild Wild West who blinks first. Sellers are being incredibly bullish and even with a record crop think that they will prevail with going out with these high prices on new crop (compared to last year’s opening prices) Now the reason they believe is based on a boatload of impending doom of their situation. Farmers are sprouting the mantra of “high future water cost” another drought (even with the predicted El Nino) and a multitude of other reasons to fuel their/your/our fears. They can also just hold out and store crop even though at some point they will need the space so they will need to ship.
As buyers and traders we have a somewhat different perspective. Top of the list is the lack of European buying activity, Spain has had a better crop then last year (even though it could have been a bumper crop) and they can buy from there and save on time and shipping, we are not seeing forward bookings out of Europe (beauty of being a subsidiary of UK company Barrow Lane and Ballard Est 1887) With this mindset we believe that price will have to at some point adjust at a four % ratio up or down (sideways market) which we can take advantage of at that later point, but that’s not for a while.
Based on that our analysis its rather simple. Not much up/down risk to book smartly through till January and then hold. Seller confidence could start to wane and pricing can come down post Jan and no more shipping reports. (in light of new crop, we have adjusted our current crop pricing and bringing it lower as reflected in our price list) based on this analysis you are not exposing yourself to a tremendous amount of risk and that is always the best way to trade and buy.
As per my last report, based on the fact that there is very little product available right now in the market, but not us, we are sitting pretty with a good amount of stock, so we would like you to forward book the next two months at the current pricing (this week only) with the market getting stronger it is very prudent to book and hold at this price. Demand prior to the holidays is going to be huge and no new crop till post that will leave those who don’t make any moves in a very precarious situation and buying at a very high price. Right now the market is already going up and we are pretty confident it’s going to go up to $6;00 so don’t dally if it’s an item you need and use.
Its Ramadan and we have Medjool dates packed in 11lb boxes with 180 on a pallet. Chinese Pine nuts market is also moving on an upward scale while Brazil nuts have moved lower. We again have organic Almonds and organic Cashews and White Quinoa in stock. We also have 2011 Macadamia crop that we are looking to move, its vacumm packed and good quality and we entrertain bids in the high $4:00 range.