RGT Pepper Market Report Week 43/ 2021

Vietnam after a back-to-back notching record high, mid-week 42 market was seen slowly reversing its course by about 1-2% from beginning week level trend.

 The pricing trend stood flat at level 88000 VND/kg reportedly the earning momentum week. This have finally urged most shippers to cover their needs particularly for White Pepper materials.

Though shippers were attempting to bid lower, as usual, no raw material was available for sale at a low level than the current market supporting price.

Hence, opening week 43, pricing tightens to level 88000-89000 VND with market still in a sleepy stretch with allegedly scarce availability of raw material.

This week market direction might have taken a reverse turn closing week October, nevertheless, overall, it can still be seen 4.5% higher average price trend compared to last month same period, while about 59% gain from last year same month period average pricing level.

Indonesia
Indonesia remains stable with Lampung staying at level $4350 FOB. The local currency Rupiah noted as South-east Asia’s best-performing currency since the beginning of September this year which is influencing country’s local commodities increased pricing.

The problem persists with reported issue in port congestion resulting to tight container and space availability alongside the reported overwhelming export of coal to China which have hit record highs.

Brazil
Still one of the best weeks for Brazil sellers as demand continue to pour in during the beginning of week 42. Though supportive levels are available, there are some who are still very firm with their offers at level $4200- 4300 FOB.

A more aggressive demand is expected opening week 43 as Europe reopens from their holiday last week.

Our Take-Away View
Vietnam Pepper elevated pricing these past few weeks could assimilate the near future event; taking into consideration the current reported stock positioning along with farmers bullish bias perspective that seems noticeably invincible. However, we should also take note that a smalltime correction will automatically be included in bull-favored journey. 


Freight Market Highlights
Asia to USA Freight Expected to Soften With a dip in demand for the most expensive destination ports it remains unclear if rates will continue to ease down, further reduce or even increase.

Though carriers continue to report that demand outlook remains bullish ending quarter alongside the existing port congestions. Asia To Europe Still at All Time High Extremely critical space condition with rates that remain at record high level.

Global Ports Facing Intense Congestion Port of Savannah known as home to the largest single terminal container facility of its kind in North America is reportedly at top with 81% congestion rate, while both LA and Long Beach had a combined congestion rate of 56%.

Overall, an estimated 77% of ports globally are experiencing port congestion heading to holiday season. 

© Royal Golden 2021. All Rights Reserved.

 

Vietnam spices market update 18th Oct 2021 – week 41

 

 

•         Pepper price last week increased fast 50 – 100$ at the beginning of the week. After that correction again when some speculators / dealers sell stock to take profit. Otherwise some dealers have been selling pepper stock to make a budget for coffee business when the coffee crop starts at the beginning of this month.  However, prices rose again on the weekend and were stable at 90.500 – 91.000 vnd raw material.

•         Pepper prices have increased by 1% last week and up 10% within the first half October.

•         USD has been stable compared with VND.

•         Europe and the US have started buying again.

•         The Middle East to cover raw material again after a long time by hand to mouth.

•         China's very slow buying continued from the beginning of October regardless; they  only imported 1.293 tons in Sept (normally needing around 5.000 metric ton per month).

•         Currently, the Central Highlands provinces (key pepper provinces) are still experiencing heavy rain. Vietnam is in the rainy season, so it is forecasted that there will be more widespread rains, or tropical depressions and storms. This will significantly affect the 2022 crop.

•         The 2022 pepper crop is forecasted to continue to decrease quickly compared to 2021. The crop will also come later because of the phenomenon of many leaves and pepper trees starting to have flowers. The main crop forecast of the harvest will be late in February-March 2022. (Please note; Vietnam Coffee crop has already been delayed 1 month at least this crop. Now harvesting but very slowly and coffee quantity in the new crop not much available)

 

Please see the REPORT FILE & FULL QUOTATION LIST by click to download.

 

https://drive.google.com/file/d/1yMpoA9rdV59Iz6bkBybQBtCSjWPrh33p/view?usp=sharing

 

(Please note; market changing fast so price need to update & reconfirmation)

 

Sincerely Thank you!

Mexican Pimento crop 2021- A report by Van der Does

 

Crop failure, disaster, complete chaos are just a few words that are used by our shippers for Pimento/Allspice from Mexico to describe the current situation.


The 2021 hurricane season hit Mexico hard, extreme strong winds as well as flooding and landslides have caused a lot of damage in the growing area of Pimento trees. In Mexico most Pimento trees are wildly grown or in so-called walks, therefore the full impact is hard to calculate yet. Some farmers have reported to have lost their full crop this year.

The effects will probably not be for the short term only. Even when new plantings are done today, it will take some 5 years before a Pimento tree (Pimento dioica) starts producing, it is only full bearing after 20 years. Some spice traders will remember what happened to the nutmeg production from Grenada some 17 years ago and where we are today.

Allspice/Pimento is the only spice that is grown exclusively in the Western Hemisphere. This leaves us with only a few alternatives. Honduras might be a good alternative to the Mexican produce, but the exports are small compared to the amounts Mexico usually exports. The same for exports from Guatemala, these are also limited; an additional disadvantage is that Guatemalan material can hardly be imported by European buyers. Due to the machine drying process in Guatemala most of the times PAH-levels (Polycyclic Aromatic Hydrocarbons) are too high to comply to EU legislation. The last option is material from Jamaica. This material is considered as a premium variety and historically always sold at premium levels.

Clear reports on the current situation and the outlook for this season are still hard to find. We at Van der Does will be monitoring the situation a daily basis. Please contact our brokers if you need further information.

RGT Pepper Market Report Week 40/ 2021

 

Vietnam – market wrapped up third quarter with this period year ending at a strong note having raw material traded at about 81500 VND/kg with a reported alarmingly low stocks in raw material at origin.

Thus, full September month average is noticeably higher of about 62% from last year same month period, while a full third quarter average have soared of about 58% from last year same period quarter. 

Beginning of fourth quarter once again headed to a firm footing with week 40 raw touching at about 83000 VND/kg – highest raw price recorded so far with about 55% increased from beginning year until today. 

Shortage of raw materials and unavailability of containers are both throwing everyone out of balance with an earlier report that 2022 crop is projected to be poor causing majority of farmers/dealers to keep and hold their current remaining stock position today. 

Indonesia – continued to be inactive with lack of  export interest. This does not stop market to remain firm at level $4275 FOB. Situation in ocean freight remains an existing issue as well up until now. 

Brazil – in strong demand that boosted price to go up at about 2-3% from last noted price. However, there’s a risk factor involve with the worsening situation in Vitoria port of where majority of  order loads are being shipped.

News circulating that MSC carrier has lodged a bid to take over Brazil’s Log-In Logistica Intermodal of which latter is known to have seven (7) feeder box ships in its logistics portfolio.

If the takeover will happen, majority fears freight could increase as MSC is known to offer premium freight prices compared to other carriers.

Container shipping to USA remains uptight heading to last quarter of the year. We have noticed the elusiveness of Baltimore bookings from Vietnam since August month with a reliable source informing that vessel catering to this destination have quenched down to 34 containers. As peak season kicks off, port congestion worsens in China and USA, Daily Breeze reports 70 ships sitting outside the Ports of LA and LB—an estimated 525,000 40-foot containers that need to be unloaded. Though other sources are claiming there are more than double that—waiting off Shanghai and Ningbo in China

Nowadays it is either difficulty in sourcing raw material at origin or shipping it out of origin due to freight booking issues both influencing the current market scenario. Equally a serious exorbitant price must be paid whatever origin market you wish to participate or take a bet on. 

 © Royal Golden 2021. All Rights Reserved.