Strike on US East Coast could disrupt global shipping

Posted onOctober 4, 2024by VPA

04
Oct

A potential strike at US East Coast ports could disrupt the global shipping industry, with lengthy recovery times creating major challenges for supply chains and freight rates.

The potential strike at all US East Coast and Gulf Coast ports is expected to cause severe disruptions in the global supply chain, creating major problems for shipping stakeholders around the world.

As operations at 36 major US ports – which handle 40-50% of the country’s imports and exports – face the possibility of shutdown on October 1, the global shipping industry is under strain.

“If the strike goes ahead, we have reason to expect negative impacts on shippers shipping goods to the United States,” said Han Deng, a transportation partner at law firm Reed Smith. “Not only is there a potential increase in shipping costs, but we also expect this to impact retailers’ ability to meet demand for the holiday shopping season in the United States.”

Notably, in 2023, a single day of closure of US West Coast ports caused three weeks of delays, with storage times increasing by as much as 148%, according to supply chain platform Project44. Reports suggest a potential East Coast strike could last longer, possibly several weeks. Project44 estimates that recovery could take four to six weeks for each week of port closure. Similarly, Danish data firm Sea Intelligence predicts that a single day of strike action by the International Longshoremen’s Association (ILA) of America would take five days to recover.

“The impact of such a strike could linger even after it is resolved, with the disruptions mentioned taking weeks or months to restore, in a highly inflationary economy with regional conflicts and geopolitical instability,” Mr. Deng commented.

With peak shipping season already underway, Project44 analysts say it's too late to divert cargo volumes to the West Coast, jeopardizing holiday season inventories and prices.

Deng also noted that the Port of New York & New Jersey would be one of the ports most severely affected by the strike. According to the nonprofit research organization Mitre, the major U.S. port could lose about $640 million a day.

“It’s no surprise that the Port Authority of New York & New Jersey is trying to ramp up operations as much as possible ahead of the deadline,” the transportation attorney pointed out. “This includes encouraging shippers to deliver as much cargo as possible and coordinating with supply chain partners.”

According to the port authority, about $240 billion in goods are transported through the port each year.

“As we have seen with major port delays, supply chain disruptions, delayed shipping schedules, and altered shipping routes in recent history, such as the global Covid-19 pandemic and the Baltimore Bridge collapse in March 2024, the same will happen again,” the attorney said.

While it is difficult to make direct comparisons between periods, it is worth noting that the last ILA strike on the US East Coast in 1977 brought ports to a standstill for 44 days.

Source: Phaata.com

 

 India's pepper imports soar

Pepper Market October 2, 2024: Price remains unchanged

Posted onOctober 2, 2024by VPA

02
Oct

Pepper prices today, October 2, continued to fluctuate between key producing localities. Data from the Indian Ministry of Commerce shows that India's pepper import demand has increased sharply since the beginning of the year and Vietnam is currently the second largest supplier to this country.

According to the General Department of Customs, India was Vietnam's fourth largest pepper consumer market in the first eight months of the year, accounting for 4.9% of total  export  volume  with 9,012 tons, worth nearly 41 million USD, up 11.8% in volume and up 45.6% in value over the same period last year.

According to data from the Indian Ministry of Commerce, by the end of July this year, the country's pepper imports reached 24,557 tons, an increase of 52% (8,401 tons) over the same period in 2023.

In July alone, India imported 7,130 tons of pepper, up 2.9 times compared to the same period last year. Of which, 5,088 tons were imported from Sri Lanka, a sharp increase of 5 times compared to the same period last year. Next was Vietnam with 1,414 tons, up 173%.

With a surge in July, Sri Lanka surpassed Vietnam to become the largest pepper export market to India in the first 7 months of the year with a volume of 9,567 tons, double the same period last year and accounting for 39% of the market share.

Vietnam was the second largest pepper supplier to India in the first seven months of the year with a volume of 7,988 tonnes, up 52% ​​year-on-year and accounting for 32.5% of the market's import capacity.

In addition, India also increased 61% of pepper imports from Brazil to 4,291 tons, Indonesia increased 9.1% to 1,852 tons...

India’s pepper production is expected to reach around 60,000 tonnes in 2023-24, up around 6% from the previous year. However, India is still facing a shortage as domestic demand is expected to exceed 66,000 tonnes, putting pressure on both production and imports.

According to VietnamBiz.vn

REPORTED JUNE 2, 2024 - CLOVE - 2024 - NEW SEASON UPDATE

Madagascar Cloves season is about to begin and so is Brazil.
Therefore we find it very usefull to recall this report below, written in June but still very valid.

CLOVE - 2024 - NEW SEASON UPDATE.

Mutsamudu, Anjouan, Comoros, 1st June, 2024:-

The new season of Clove 2024 is about to begin.
Starting with Comoros Islands in June 2024, [June, July, August is the prime season in Comor Islands, shipment might continue up to October-November] followed by Indonesia in July & August 2024, continued with Zanzibar also in July and August, and Tanzania [Tanzania is not a big name internationally] in August September, and in Madagascar harvest starting in August and trade season in October-November - so the 2024 Clove season is on the verge.

So what is in the basket this year ? Quantity estimation and price expectation ? And how would be the demand ?

Even now, isolated enquiries and demands are in the market. Buyers in India and few Arab countries waiting to buy at around USD 8400-8600 levels ! Meaning there by, demand is still there - but just waiting for price suitability. Even though the historic concept of DEMAND AND SUPPLY should be the main factors to decide price, Clove has grown a step ahead, and only this economic factor cannot fix Clove price anymore. Clove market is witnessing too much of speculation, too much of forward selling, and equal size of market making and cycle trading as well.
Meaning thereby, price levels are created manually by these market phenomena.

Comoros, and Zanzibar, are estimated to be at normal and regular quantity in this season also ranging between 2500 Mt to 3500 Mt. Both these countries together would have roughly 6000 to 6500 [anyway less than 7000 Mt] only. And Comoros domestic market just started with a reasonably good average price level - not much below nor above the expected levels ! It is good for the market as well. I will comment on the existing price levels in origin countries in my next blog by mid of June. It is too early to declare the origin price levels.

Indonesia started at USD 9200 level, but now eased down to USD 8700-8800 level on forward offers for July shipment. Indonesia is expecting a crop size of 80,000 Mt in June to August harvest ! which is not a big crop for Indonesia. However, the slow pace of intake by the cigarette industries and very cool demand in the domestic market in Indonesia points to a lower priced market only to come up. Even if Indonesia enters the international market to import, [if so happens], there is enough stock ready available waiting Indonesia orders in Singapore and Dubai. No shortage of stock even if Indonesia imports now. Therefore, we cannot expect any surge in price even if Indonesia imports.

This year Madagascar would have good crop, a size better than last year, because of good weather, and more trees for first harvest. Cultivation is increasing in Madagascar year on year, and new area is becoming ready for first harvest every year. This would keep on Madagascar crop size in normal terms. New Season harvest would start from South Madagascar during first half of August, however, trading would begin only by end September-October. And in Madagascar, issue of Clove Export Permit to be waited to commence the trading and export season.

Based on present market intelligence and information, more than 6000 Mt Clove available in Singapore and Dubai; and roughly 3000+ Mt is available in India, which is ample to meet any demand during this off season. And new crop shipment would start with Comoros by end June or July.

TAIL END:- During March 2024, there was too much expectation around the world that after Ramdan, Clove price would shoot up to USD 10,000 level and many sellers stayed back with their stock to see these price to come. Sellers and exporters in Madagascar also spread domestically that farmers would get better price after Ramdan. My readers would recollect that in my March and April blogs, I wrote without doubt that, fundamentally and technically no chances for price to move high; there was no basic reason to expect such increase in price.

Today also my view is that clove price would continue at the average level only; no reason to go do
n much; nor any chances to move very high. Historic levels cannot repeat this year. No ground for that. Ideally one should anticipate USD 7000 to USD 9000 is the range where Clove would be traded.
Any market making or speculative market creation can make some impact for a short period, but that cannot take on the market price for very long time. It would be only a temporary phenomenon, which is now common in the commodity market.
Wish you all a happy reading and wait for next blog by mid June with price indications.

MADAGASCAR CLOVES SEASON 2024 - 2025

 

Pepper Market on September 30, 2024

 

Pepper Market on September 30, 2024: Fluctuating around 147,500 - 148,000 VND/kg

Posted onSeptember 30, 2024by VPA

September 30

Pepper prices today fluctuate around 147,500 - 148,000 VND/kg.

Province/district (survey area)	Purchase price on September 30 (Unit: VND/kg)	Change from previous day (Unit: VND/kg)
Dak Lak	148,000	–
Gia Lai	148,000	–
Dak Nong	147,500	–
Ba Ria – Vung Tau	148,000	–
Binh Phuoc	148,000	–
Dong Nai	148,000	–

In the world market

According to an update from the International Pepper Community (IPC), at the end of the most recent trading session, the price of Indonesian Lampung black pepper was listed at 6,942 USD/ton.

The price of Brazilian black pepper ASTA 570 reached 6,750 USD/ton, while Malaysian Kuching black pepper also remained stable at 8,800 USD/ton.

In Vietnam, the offering prices of 500 g/l and 550 g/l black pepper remained stable at USD 6,800/ton and USD 7,100/ton.

Type name	World black pepper price list
	September 29 (Unit: USD/ton)	% change from previous day
Lampung Black Pepper (Indonesia)	6,942	0
Brazilian Black Pepper ASTA 570	6,750	0
Kuching Black Pepper (Malaysia) ASTA	8,800	0
Vietnamese black pepper (500 g/l)	6,800	0
Vietnamese black pepper (500 g/l)	7,100	0

At the same time of survey, the price of Indonesian Muntok white pepper reached 9,430 USD/ton. The price of Malaysian ASTA and Vietnamese white pepper remained unchanged at 11,200 USD/ton and 10,150 USD/ton.

Type name	World white pepper price list
	September 29 (Unit: USD/ton)	% change from previous day
Muntok Indonesian White Pepper	9,430	0
ASTA Malaysian White Pepper	11,200	0
Vietnam white pepper	10,150	0

Vietnam exported  186,000   tonnes of pepper through August, equal to this year’s output and  imports   , according to a recent report by Nedspice. Exports in the fourth quarter will depend on the release of multi-year carryover stocks held by major investors and additional import volumes.

 Typically, the October coffee  harvest  prompts middlemen to liquidate pepper to trade coffee. However, this year with lower inventories and the coffee harvest delayed until November, liquidation of pepper stocks could be significantly reduced.

High prices have prompted replanting and more intensive cultivation. Combined with favorable weather, this could lead to a larger crop in 2025. However, reduced acreage over the years and aging pepper plants limit production potential until new crops begin to produce.

The global inventory-to-demand ratio is falling, pushing prices up and encouraging farmers to invest in maintaining and expanding their pepper farms, Nedspice said.

Meanwhile, in Brazil, the main harvest has begun in the states of Para and Espírito Santo. Exports in July and August from Brazil fell by more than 20% compared to the same period last year, as the May-June harvest in Espírito Santo was severely affected by harsh weather conditions at the beginning of the year.

Adverse weather conditions, including an unprecedented drought, have damaged crops in Brazil. A state of emergency has been declared in the state of Espírito Santo, including restrictions on irrigation. Brazil’s pepper exports reached 45,000 tonnes through August, down 10% from the same period last year.

In contrast, Indonesia’s export volume increased by 67% as of August 24, largely supported by a larger black pepper crop. In addition, the rapid price increase has triggered the liquidation of long-term stocks.

According to VietnamBiz.vn

Pepper Market September 29 - Vietnam reduces pepper imports from Brazil

 

Pepper Market September 29

Posted onSeptember 29, 2024by VPA

September 29

Although it increased again on the weekend, overall over the past week, pepper prices still decreased by about 1,000 - 3,500 VND. Statistics also show that Vietnam's pepper imports from Brazil have dropped sharply to the lowest level in many months.

Vietnam reduces pepper  imports   from Brazil

In a recent report, Nedspice said that Brazil’s main harvest has begun in the states of Para and Espírito Santo. Exports in July and August were down more than 20% year-on-year, as the May-June harvest in Espírito Santo was severely affected by harsh weather conditions at the start of the year.

According to data from the Brazilian State Center for Foreign Trade Statistics (Comex Stat), Brazil exported 45,699 tons of pepper in the first eight months of the year, worth $183.4 million. Although the volume decreased by 10.4%, the value increased by 19.3% compared to the same period in 2023.

Brazil's main pepper export markets in the first 8 months of the year include: Vietnam, UAE, Pakistan, India, Senegal...

Notably, exports to Vietnam - Brazil's largest pepper consumer market - in August fell sharply to the lowest level in many months, reaching only 243 tons, down 48.5% compared to the previous month and down 76.3% compared to the same period last year.

In the first eight months of the year, Vietnam imported 6,625 tons of pepper from Brazil worth US$23.5 million, down 30.2% in volume and 16.4% in value compared to the same period last year. Vietnam's market share in Brazil's total pepper exports also decreased from 18.6% to 14.5% after the first eight months of the year.

Vietnam's pepper import price from Brazil in the first 8 months of the year increased by 19.7%, reaching an average of 3,548 USD/ton. However, this is the lowest price among the top 16 pepper importing countries from Brazil, respectively 300 USD to more than 600 USD/ton lower than other markets.

In the first 8 months of the year, Brazil's pepper exports to some other markets also decreased, such as Senegal down 11.8%, Morocco down 15.6%, Egypt down 44.4%, the Netherlands down 30.9%...

In contrast, exports to the UAE increased by 7% during the same period, reaching 5,123 tons and accounting for 11.2% of the market share; Pakistan: 5,055 tons, up 46.2% and accounting for 11.1%; India: 4,944 tons, up 31.9% and accounting for 10.8%; especially exports to the US increased by 10.5 times and reached 2,102 tons...

According to VietnamBiz.vn

Lament of a pimento farmer - Jamaica

Reports are that pimento production has been trending downwards for a number of years.

Letters

September 26, 2024

Lament of a pimento farmer

Dear Editor,

A recent report in the media mentioned the decline in the production of pimento in Jamaica.

This has not come as a surprise to me, as I am one of those pimento growers who have ceased reaping pimento and no longer plant the trees. This is because the low price which the Jamaica Agricultural Commodities Regulatory Authority (JACRA), loosely referred to as the Pimento Board, pays for dry pimento.

Up to last year JACRA was offering farmers $450.00 per pound for dried pimento. This price is not economical and is, at best, oppressive to pimento growers. These growers have to pay someone to “break” the pimento, that is, clip the branches of pimento from the tree and thereafter pay others to pick the pimento, that is to separate the berries from the branches and the leaves.

After this, the process of drying the pimento is usually done on a flat concrete surface called a barbecue, and after all of this the pimento is bagged for sale — only to be offered $450.00 per pound.

I checked the price for which Jamaican wholegrain/ungrounded pimento allspice is being sold in London and I note that it is being sold for £1.99 per 70-gram pack. Seventy (70) gram is 2½ ounces. So my math is telling me that the pimento from Jamaica is being sold in England for around $3,500.00 per pound.

The question that the JACRA needs to answer is: Who is reaping the value added between $450.00 per pound and $3,500.00 per pound?

Floyd Green, minister of agriculture, needs to get a hold of JACRA and satisfy himself that the entity is acting in the best interest of Jamaica and, in particular, pimento farmers. The minister needs to accept that if JACRA continues to pay such a low price for pimento more and more farmers will cease growing and reaping pimento.

In the long or not-too-long run Jamaica will have to import pimento.

The minister should take a serious look not only at the pimento industry but generally at the operations of JACRA, given its monopoly over the export of a number of agricultural produce and see whether they are acting in the best interest of Jamaica.

 

Linton P Gordon

lpgordon@cwjamaica.com