Good Monday morning,
The USDA issued the Prospective Plantings Report this morning.
Peanut acres are estimated to increase 16% over 2007 crop to 1,430,000 acres.
This would yield a little more than 2,100,000 tons, with an average yield.
This is certainly not too many peanuts when you consider a demand of 1,950,000 tons and the short carry-in to the 2008 crop.
I will give a more detailed report, later.
Have a Great week. Richard
Peanuts: Area Planted by State
and United States, 2006-2008
--------------------------------------------------------------------------------
: Area Planted
State :---------------------------------------------------------------------
: 2006 : 2007 : 2008 1/ : 2008/2007
--------------------------------------------------------------------------------
: --------------- 1,000 Acres --------------- Percent
:
AL : 165.0 160.0 180.0 113
FL : 130.0 130.0 120.0 92
GA : 580.0 530.0 650.0 123
MS : 17.0 19.0 28.0 147
NM : 12.0 10.0 9.0 90
NC : 85.0 92.0 86.0 93
OK : 23.0 18.0 20.0 111
SC : 59.0 59.0 65.0 110
TX : 155.0 190.0 250.0 132
VA : 17.0 22.0 22.0 100
:
US : 1,243.0 1,230.0 1,430.0 116
--------------------------------------------------------------------------------
1/ Intended plantings in 2008 as indicated by reports from farmers.
2008 PEANUT CROP ACREAGE ESTIMATE 3/31/2008
ACRES YIELD PRODUCTION
2006 1,210,000 2,863 1,732 ,125
2007 1,195,000 3,130 1,870 ,325
2008 1,430,000 2,800 2,002 ,000
1,430,000 3,200 2,288 ,000
Over the last five crop years U.S. yield hasn't been
lower than 2,863 pounds per acre and hasn't been
higher than 3,159 pounds per acre. Speculation on
the possible low and high production for 2008 crop.
Stewart
Monday, March 31, 2008
Wednesday, March 26, 2008
UPDATE ON PEANUTS March 24, 2008
Supply
2005 Peanut Crop production 2,410,000 tons of farmer stock
2006 Peanut Crop production 1,737,000 tons of farmer stock - Down 28%
Tonnage was down due to 25% reduction in acres and poor growing conditions
Carry-in from 2006 is estimated at 585,000 tons. (Aug 1, 2007)
USDA final estimate (1/10/08) 2007 Crop at 1,870,325 FST. FSIS has only graded 1,811,228 tons, as of 3/18/08. (1,815,000 FST is going to be close)
Demand
Demand onUS Peanut crop 1.98 mil tons
Demand includes Peanut domestic usage 1.45, seed .13 mil, exports .40 mil tons.
Supply 2,520,000 = 1,815,000 ’07 Crop + 585,000 carry-in + 120,000 import
Demand – 1,980,000 = 540,000 FST carry-out (Aug 1, 2008)
This is a tight carry-out. (we need 475,000 to cover Aug – Oct).
There is an unusually high demand out of Mexico and EU at this time. This is due to China not offering and Argentina has sold out of the ’07 crop.
US demand is just seeing the price increases being put into effect Jan ’08. It will take a month or two for us to evaluate the impact on demand. P/B is usually a strong seller in a bad economy, so I would expect it to stay strong. Candy and Snack could take a hit as fuel cost take a big part of the consumers cash.
Market ’07 Crop
Very few offers on 2007 Crop - Peanuts with EU specs or Hi-Oleic specs would be higher.
’07 crop market going forward depends on 1) US demand – how does the consumer react to the higher prices and the weaker economy. 2) China - Recent reports indicate China will need all their peanuts for oil and consumption within the country. 3) Argentina – how will the crop be in Argentina? Acres were up 4%.
Jan ’08 export of peanuts is up 48% over Jan ’07. Shellers indicate significant export sales have been made going forward. We are just starting to see this in the Govn’t numbers. This will help keep the US market tight and prices firm.
’08 Crop
Farmer stock has been contracted at $500 - $550/ton. The majority was at $500 - $525. I would estimate that 65 -70% has been contracted. (more in the SE than SW)
Last week cotton prices fell along with other small grains. This has taken the pressure off of peanuts. Farmers seem to be complaining less about the $500 peanut contracts. Cheaper cotton may help us with peanut acres.
Shellers are withdrawn from the ’08 market until we see peanut acres planted.
I believe an increase in Peanut acres of less than 15% will be bullish on prices, 15 – 18% will be neutral and 18% + will be bearish.
Long range weather forecast are still calling for warmer and dryer in the peanut areas. In spite of this, we have had good rains in the SE over the last 2 months.
Stewart Parnell
2005 Peanut Crop production 2,410,000 tons of farmer stock
2006 Peanut Crop production 1,737,000 tons of farmer stock - Down 28%
Tonnage was down due to 25% reduction in acres and poor growing conditions
Carry-in from 2006 is estimated at 585,000 tons. (Aug 1, 2007)
USDA final estimate (1/10/08) 2007 Crop at 1,870,325 FST. FSIS has only graded 1,811,228 tons, as of 3/18/08. (1,815,000 FST is going to be close)
Demand
Demand onUS Peanut crop 1.98 mil tons
Demand includes Peanut domestic usage 1.45, seed .13 mil, exports .40 mil tons.
Supply 2,520,000 = 1,815,000 ’07 Crop + 585,000 carry-in + 120,000 import
Demand – 1,980,000 = 540,000 FST carry-out (Aug 1, 2008)
This is a tight carry-out. (we need 475,000 to cover Aug – Oct).
There is an unusually high demand out of Mexico and EU at this time. This is due to China not offering and Argentina has sold out of the ’07 crop.
US demand is just seeing the price increases being put into effect Jan ’08. It will take a month or two for us to evaluate the impact on demand. P/B is usually a strong seller in a bad economy, so I would expect it to stay strong. Candy and Snack could take a hit as fuel cost take a big part of the consumers cash.
Market ’07 Crop
Very few offers on 2007 Crop - Peanuts with EU specs or Hi-Oleic specs would be higher.
’07 crop market going forward depends on 1) US demand – how does the consumer react to the higher prices and the weaker economy. 2) China - Recent reports indicate China will need all their peanuts for oil and consumption within the country. 3) Argentina – how will the crop be in Argentina? Acres were up 4%.
Jan ’08 export of peanuts is up 48% over Jan ’07. Shellers indicate significant export sales have been made going forward. We are just starting to see this in the Govn’t numbers. This will help keep the US market tight and prices firm.
’08 Crop
Farmer stock has been contracted at $500 - $550/ton. The majority was at $500 - $525. I would estimate that 65 -70% has been contracted. (more in the SE than SW)
Last week cotton prices fell along with other small grains. This has taken the pressure off of peanuts. Farmers seem to be complaining less about the $500 peanut contracts. Cheaper cotton may help us with peanut acres.
Shellers are withdrawn from the ’08 market until we see peanut acres planted.
I believe an increase in Peanut acres of less than 15% will be bullish on prices, 15 – 18% will be neutral and 18% + will be bearish.
Long range weather forecast are still calling for warmer and dryer in the peanut areas. In spite of this, we have had good rains in the SE over the last 2 months.
Stewart Parnell
Monday, March 24, 2008
U.S. peanut industry may need more acres in 2008
U.S. peanut farmers need to increase acreage by as much as 20 percent in 2008 to meet demand and shellers have offered contract prices as high as $500 a ton to compete with corn, cotton, wheat and milo for available land.
“Supplies are very tight,” said Richard Barnhill, president of Mazur and Hockman Peanut Brokers, Albany, Ga.
Barnhill spoke from his Georgia office by phone to the Oklahoma Peanut Expo recently at Lone Wolf, Okla. Barnhill said the current National Agricultural Statistics Service (NASS) peanut estimate of 1.87 million tons from the 2007 crop “is optimistic. Industry estimates put the figure at 1.805 million tons. That other 65,000 tons is simply not there,” he said. “Either the harvested acreage number or estimated yield is off.”
He said demand for the 2007 crop is about 1.985 million tons, with 1.43 million tagged for domestic consumption, 130,000 tons for seed and 425,000 for export.
“Exports are up more than 20 percent this year,” he said. Those figures don’t mesh with NASS either, but Barnhill said the government does not know what has been exported until after the fact, not “until a bill of lading comes through.”
He said the big three peanut buyers, Clint Williams, Birdsong and Golden Peanut, all indicate increased export sales.
Carryover will be 180,000 tons less than from the 2006 crop. “Supplies got tight last fall. We need peanuts for 2008 to meet demand and build up carry-in. If we have production problems we might not have enough for the industry.”
Demand has pushed up prices. “For three or four years, from about 2003 through 2005, we produced more peanuts than we needed. Prices stayed around 40 cents a pound for medium runners. In 2007, price jumped to 68 cents a pound.”
He said prices likely will remain firm but that the $500 contracts signed last fall will mean an average 2008-crop price around 57 cents a pound. “The market is trying to figure out how many peanuts it has and how many it will need.”
Several other market factors influence peanut prices. “Europe bought a big volume of U.S. peanuts in 2007. Argentina is finished with its crop and China is using more of its production (domestically) than ever. Demand (in China) for oil and edible peanuts has increased.”
He said China is not exporting peanuts this year and that makes Japan, Europe, Mexico and Canada more dependent on the U.S. market. “China typically exports 500,000 metric tons of peanuts. They are not exporting any in 2008.”
Mexico could be a good market for Oklahoma growers. “Oklahoma has a freight advantage to Mexico,” Barnhill said.
The weak U.S. dollar also makes exports a bargain for other countries. “A 65 cents per pound U.S. peanut equals 47 cents a pound in Euros,” he said.
The U.S. energy policy also affects peanuts, though indirectly. Energy and world demand for food have driven grain and soybean prices up so crops are competing for farmland to meet demand.
“The question is, what will U.S. peanut farmers plant?” Early estimates point to a 17.5 percent increase. “But that was before the recent run up in the cotton market. That could have an effect.” He said a 15 percent increase seems more likely.
A 1.43-million acre crop and a yield of 2,900 pounds per acre would net a bit more than 2 million tons of peanuts. “That would be a comfortable carry-out and a hedge if we have lower yields but still not a risk of too many peanuts. The industry is not comfortable with just a 300,000-ton carryover each year. Industry uses about 140,000 tons a month so it takes at least 300,000 to cover transition (from one crop to the next).”
Barnhill said domestic demand likely would stay strong, despite of or maybe because of potential recession. “Peanuts and peanut butter do well in an economy that’s struggling,” he said. “Consumers have less disposable income and one of the first things to go is eating out. Restaurant numbers are already declining.”
When that happens, peanut butter provides a good protein source. “Peanut butter use is up 24 percent over last January,” he said. “So far, higher prices have not caused any sign of decline in demand.”
He doesn’t anticipate that a price in the middle 50 cents per pound range will affect consumption significantly. He also doesn’t anticipate prices for corn, beans and other grains to decline within the next year or two but expects a three- to five-year trend for “grain and peanut prices at these levels or better.”
Barnhill also advised any growers with 2007 peanuts in the loan not to forfeit. “See a local sheller,” he said.
Alan Orloff, Clint Williams Company in Madill, Okla., said he’s “more optimistic about peanuts than at any time in recent years. China has a huge impact on the market and they are not exporting. For years China dumped millions of tons of peanuts on the world market at low prices. They can’t compete with U.S. peanuts on quality. This year they reneged on contracts and blindsided the industry.”
Mexico was a big buyer and with China out of the market, “Mexico is a big reason for today’s higher peanut prices,” Orloff said. “Things are looking up for peanuts.”
Tyron Spearman, Tifton, Ga., editor of Peanut Market News, an electronic newsletter, said Georgia growers likely will increase acreage in 2008. “Soil moisture has been replenished,” he said.
Early estimates point to a 1.225 million-acre U. S. crop. “A 15 percent to 18 percent increase in acreage will not hurt,” he said. But getting that bump may not be easy with competition from soybeans, corn and cotton.
“Soybean seed supply is short, however. We’ll need to treat more peanut seed if we plant this acreage.”
He’s fearful that a 24 percent jump might “bust the market next year.”
Spearman said the USDA estimate of domestic peanut use for food from the 2007 crop is 5 percent down. They also estimate a 5 percent drop in exports. He agrees with Barnhill that the export figure likely is wrong and he hopes the domestic consumption figure is also in error. “I think it is.”
Spearman said Japan will be back in the market for U.S. peanuts. “And Russia is now our number four customer after they built an M&M plant.”
He said peanut imports have declined by 91 percent in recent years.
Spearman said peanut framer numbers, unfortunately, have also dropped, down from 17,916 in 2001 to only 10,002 in 2007. “That figure has leveled off now,” he said.
“For now, we have a tremendous demand; the outlook is good.”
Oklahoma State University Extension economist Kim Anderson said farmers need to look closely at crop options this year and “use prices to figure out the best option to pay for land, labor, capital and management.”
He offered prices of crops competing for acres. Wheat futures market in early March was at $11.40 a bushel with contract prices 70 cents off that, $10.70. December corn was at $5.79 with contracts off only a dime at $5.69. Soybeans contracts with futures at $14.17 were $1 less at $13.17.
Peanut contracts were competing with the $500-a-ton contracts last fall.
“The soybean market started going up in October,” Anderson said. “The industry needed acreage and bid the price up. The corn market started bidding up in December. Cotton supplies are not tight but prices went up to buy land.”
Crop budgets indicate peanut production costs will hit near $535 per acre. A 2-ton yield at a $500-per-ton contract price brings in $1,000 per acre. Subtracting the $535 per acre production costs and another $60 per acre for drying leaves a $405 per acre profit.
“Prices are high, inputs are high, so growers have to invest more money for greater returns,” Anderson said. “Regardless of the crop, everything comes with risk. Take a pencil or a computer and look at the market, management, land, labor and capital and see which commodity gives the highest return.
“Don’t get enamored with price,” he said. “You don’t make money just selling; you make it on production and management. You have to have a quality product to sell.”
“Supplies are very tight,” said Richard Barnhill, president of Mazur and Hockman Peanut Brokers, Albany, Ga.
Barnhill spoke from his Georgia office by phone to the Oklahoma Peanut Expo recently at Lone Wolf, Okla. Barnhill said the current National Agricultural Statistics Service (NASS) peanut estimate of 1.87 million tons from the 2007 crop “is optimistic. Industry estimates put the figure at 1.805 million tons. That other 65,000 tons is simply not there,” he said. “Either the harvested acreage number or estimated yield is off.”
He said demand for the 2007 crop is about 1.985 million tons, with 1.43 million tagged for domestic consumption, 130,000 tons for seed and 425,000 for export.
“Exports are up more than 20 percent this year,” he said. Those figures don’t mesh with NASS either, but Barnhill said the government does not know what has been exported until after the fact, not “until a bill of lading comes through.”
He said the big three peanut buyers, Clint Williams, Birdsong and Golden Peanut, all indicate increased export sales.
Carryover will be 180,000 tons less than from the 2006 crop. “Supplies got tight last fall. We need peanuts for 2008 to meet demand and build up carry-in. If we have production problems we might not have enough for the industry.”
Demand has pushed up prices. “For three or four years, from about 2003 through 2005, we produced more peanuts than we needed. Prices stayed around 40 cents a pound for medium runners. In 2007, price jumped to 68 cents a pound.”
He said prices likely will remain firm but that the $500 contracts signed last fall will mean an average 2008-crop price around 57 cents a pound. “The market is trying to figure out how many peanuts it has and how many it will need.”
Several other market factors influence peanut prices. “Europe bought a big volume of U.S. peanuts in 2007. Argentina is finished with its crop and China is using more of its production (domestically) than ever. Demand (in China) for oil and edible peanuts has increased.”
He said China is not exporting peanuts this year and that makes Japan, Europe, Mexico and Canada more dependent on the U.S. market. “China typically exports 500,000 metric tons of peanuts. They are not exporting any in 2008.”
Mexico could be a good market for Oklahoma growers. “Oklahoma has a freight advantage to Mexico,” Barnhill said.
The weak U.S. dollar also makes exports a bargain for other countries. “A 65 cents per pound U.S. peanut equals 47 cents a pound in Euros,” he said.
The U.S. energy policy also affects peanuts, though indirectly. Energy and world demand for food have driven grain and soybean prices up so crops are competing for farmland to meet demand.
“The question is, what will U.S. peanut farmers plant?” Early estimates point to a 17.5 percent increase. “But that was before the recent run up in the cotton market. That could have an effect.” He said a 15 percent increase seems more likely.
A 1.43-million acre crop and a yield of 2,900 pounds per acre would net a bit more than 2 million tons of peanuts. “That would be a comfortable carry-out and a hedge if we have lower yields but still not a risk of too many peanuts. The industry is not comfortable with just a 300,000-ton carryover each year. Industry uses about 140,000 tons a month so it takes at least 300,000 to cover transition (from one crop to the next).”
Barnhill said domestic demand likely would stay strong, despite of or maybe because of potential recession. “Peanuts and peanut butter do well in an economy that’s struggling,” he said. “Consumers have less disposable income and one of the first things to go is eating out. Restaurant numbers are already declining.”
When that happens, peanut butter provides a good protein source. “Peanut butter use is up 24 percent over last January,” he said. “So far, higher prices have not caused any sign of decline in demand.”
He doesn’t anticipate that a price in the middle 50 cents per pound range will affect consumption significantly. He also doesn’t anticipate prices for corn, beans and other grains to decline within the next year or two but expects a three- to five-year trend for “grain and peanut prices at these levels or better.”
Barnhill also advised any growers with 2007 peanuts in the loan not to forfeit. “See a local sheller,” he said.
Alan Orloff, Clint Williams Company in Madill, Okla., said he’s “more optimistic about peanuts than at any time in recent years. China has a huge impact on the market and they are not exporting. For years China dumped millions of tons of peanuts on the world market at low prices. They can’t compete with U.S. peanuts on quality. This year they reneged on contracts and blindsided the industry.”
Mexico was a big buyer and with China out of the market, “Mexico is a big reason for today’s higher peanut prices,” Orloff said. “Things are looking up for peanuts.”
Tyron Spearman, Tifton, Ga., editor of Peanut Market News, an electronic newsletter, said Georgia growers likely will increase acreage in 2008. “Soil moisture has been replenished,” he said.
Early estimates point to a 1.225 million-acre U. S. crop. “A 15 percent to 18 percent increase in acreage will not hurt,” he said. But getting that bump may not be easy with competition from soybeans, corn and cotton.
“Soybean seed supply is short, however. We’ll need to treat more peanut seed if we plant this acreage.”
He’s fearful that a 24 percent jump might “bust the market next year.”
Spearman said the USDA estimate of domestic peanut use for food from the 2007 crop is 5 percent down. They also estimate a 5 percent drop in exports. He agrees with Barnhill that the export figure likely is wrong and he hopes the domestic consumption figure is also in error. “I think it is.”
Spearman said Japan will be back in the market for U.S. peanuts. “And Russia is now our number four customer after they built an M&M plant.”
He said peanut imports have declined by 91 percent in recent years.
Spearman said peanut framer numbers, unfortunately, have also dropped, down from 17,916 in 2001 to only 10,002 in 2007. “That figure has leveled off now,” he said.
“For now, we have a tremendous demand; the outlook is good.”
Oklahoma State University Extension economist Kim Anderson said farmers need to look closely at crop options this year and “use prices to figure out the best option to pay for land, labor, capital and management.”
He offered prices of crops competing for acres. Wheat futures market in early March was at $11.40 a bushel with contract prices 70 cents off that, $10.70. December corn was at $5.79 with contracts off only a dime at $5.69. Soybeans contracts with futures at $14.17 were $1 less at $13.17.
Peanut contracts were competing with the $500-a-ton contracts last fall.
“The soybean market started going up in October,” Anderson said. “The industry needed acreage and bid the price up. The corn market started bidding up in December. Cotton supplies are not tight but prices went up to buy land.”
Crop budgets indicate peanut production costs will hit near $535 per acre. A 2-ton yield at a $500-per-ton contract price brings in $1,000 per acre. Subtracting the $535 per acre production costs and another $60 per acre for drying leaves a $405 per acre profit.
“Prices are high, inputs are high, so growers have to invest more money for greater returns,” Anderson said. “Regardless of the crop, everything comes with risk. Take a pencil or a computer and look at the market, management, land, labor and capital and see which commodity gives the highest return.
“Don’t get enamored with price,” he said. “You don’t make money just selling; you make it on production and management. You have to have a quality product to sell.”
Tuesday, March 18, 2008
India: Cashew output on the rise, except in State
The government, on Monday, said cashew production in the country has increased, except in Kerala where the output has slumped to 72,000 tonnes in 2006-07 from 95,000 tonnes in 2003-04. "The production of cashew in the country is in an increasing trend, except in Kerala", Minister of State for Agriculture Kanti Lal Bhuria said in a written reply to the Lok Sabha. The data submitted by Mr. Bhuria shows that total cashew production in the country has gone up by 8.2% to 6.2 lakh tonnes during 2006-07, compared to 5.73 lakh tonnes in an year-ago period.Kerala, among the top cashew producing States, showed a declining trend in its output at 72,000 tonnes in 2006-07 against 95,000 tonnes in 2003-04, it said. Maharashtra topped in cashew production at 1.97 lakh tonnes, followed by Andhra Pradesh at 99,000 tonnes, West Bengal at 84,000 tonnes, Kerala at 72,000 tonnes and Karnataka at 52,000 tonnes. As far as acreage under the crop is concerned, the data showed a downward trend in Kerala, 80,000 hectares in 2006-07 from 1,00,000 hectares five years ago. However, the yield level has increased marginally to 900 a kg.Mr. Bhuria said the Kerala State Agency for Cashew Cultivation had not submitted any proposal for financial aid to enhance cashew cultivation in the State. However, to improve the cashew output in the country, the National Horticulture Mission is being implemented since 2005-06 to promote holistic growth of the horticulture sector, which includes cashew, Mr. Bhuria said. New plantation and replanting old and uneconomical cashew gardens with high yielding varieties are the major activities undertaken under the mission to increase cashew production in the country, he said.
Monday, March 17, 2008
Almond Market Update from Ned
Dear Friends:
Almond bloom is almost complete and pollination conditions were almost perfect the past 3 weeks. Accordingly, most expect a record 2008 crop—the 3rd record crop in a row. Until 2007 we had never had even 2 record crops in a row. The record crops are the result of increased plantings in 2003, 4 & 5 that are coming into production in 2006, 7 & 8. In April, we’ll have a look at the crop set on the trees, followed by the May crop and acreage estimates. With more than 50,000 more acres coming into production, I would expect the 2008 crop to exceed 1.4 billion. I would also expect that this will be a year similar to past record almond crops—starting at a low price with strong contracting and shipments bringing prices up as we move through harvest.
We all like to see a big crop but don’t like the price adjustment that goes with it. Almonds prices have come down .15 to .20 per lb over the past month. Buyers are waiting for some stability before stepping in to contract. Second hand traders have tried to move the price for Std S/R down into the mid 1.50’s but sales from California seem to have leveled off in the 1.60 to 1.65 range for 2007 and 2008 crops. The 1.50 price range for Std grade makes grower prices close to the cost of production and that is usually where prices stop.
A week ago, the Almond Board showed February shipments of 86 million—up 18%, compared with 73 million a year ago. Year to date shipments are 784 million—up 15% over last year. We expect to stay on this track and finish with a carry out inventory of about 240 million—100 million more than the past several years. This will make for a smoother transition to 2008 crop and keep market prices similar for the 2 crop years.
Following are approximate market prices, unpasteurized.
2007 crop (2008 is similar)
Nonpareil Supreme 23/25 2.50 USD/lb FOB/FAS California
Nonpareil Supreme 27/30 2.15
Carmel SSR 23/25 AOL 1.95
Butte SSR 27/30 AOL 1.75
Cal Std unsized 5% 1.65
Blanched Sliced 2.55
Happy St Patrick’s Day to all those with Irish blood, Irish names or Irish spirit. Please send your comments and questions.
Best regards, Ned
Almond bloom is almost complete and pollination conditions were almost perfect the past 3 weeks. Accordingly, most expect a record 2008 crop—the 3rd record crop in a row. Until 2007 we had never had even 2 record crops in a row. The record crops are the result of increased plantings in 2003, 4 & 5 that are coming into production in 2006, 7 & 8. In April, we’ll have a look at the crop set on the trees, followed by the May crop and acreage estimates. With more than 50,000 more acres coming into production, I would expect the 2008 crop to exceed 1.4 billion. I would also expect that this will be a year similar to past record almond crops—starting at a low price with strong contracting and shipments bringing prices up as we move through harvest.
We all like to see a big crop but don’t like the price adjustment that goes with it. Almonds prices have come down .15 to .20 per lb over the past month. Buyers are waiting for some stability before stepping in to contract. Second hand traders have tried to move the price for Std S/R down into the mid 1.50’s but sales from California seem to have leveled off in the 1.60 to 1.65 range for 2007 and 2008 crops. The 1.50 price range for Std grade makes grower prices close to the cost of production and that is usually where prices stop.
A week ago, the Almond Board showed February shipments of 86 million—up 18%, compared with 73 million a year ago. Year to date shipments are 784 million—up 15% over last year. We expect to stay on this track and finish with a carry out inventory of about 240 million—100 million more than the past several years. This will make for a smoother transition to 2008 crop and keep market prices similar for the 2 crop years.
Following are approximate market prices, unpasteurized.
2007 crop (2008 is similar)
Nonpareil Supreme 23/25 2.50 USD/lb FOB/FAS California
Nonpareil Supreme 27/30 2.15
Carmel SSR 23/25 AOL 1.95
Butte SSR 27/30 AOL 1.75
Cal Std unsized 5% 1.65
Blanched Sliced 2.55
Happy St Patrick’s Day to all those with Irish blood, Irish names or Irish spirit. Please send your comments and questions.
Best regards, Ned
Weekly cashews update
Mar 15, 2008
Indian Cashews market was steady this week with a firm undertone. Business was reported for W240 around 3.15, W320 around 2.90, W450 around 2.60, FB/FS around 2.30 FOB for shipments upto June. Domestic market is quiet. Vietnam continues to be quiet and Brazil is selling some quantities for nearby
RCN prices were steady in India and slightly easier in Vietnam but there was not much buying by large processors. Most of them prefer to wait and see how things develop on kernel demand and RCN price in next few weeks before making any big purchases. There is some concern about size and quality of Vietnam crop but things are not clear. In West Africa, things seem to be okay and trend of pricing from IVC – the largest supplier – should be known in 3-4 weeks. When there is full flow, processors will not buy unless they are able to make forward kernel sales at workable price
Continuing delays in kernel shipments is keeping the pipeline tight. Traders are forced to buy every couple of weeks to keep the flow going. This is keeping the market firm. Processors and buyers are not able to take any big forward positions at current prices due to uncertainty of RCN pricing and kernel demand. Buyers do not want to cover now and find that demand is softer in second half. Processors do not want to sell now and find that RCN prices remain firm throughout the season
Although some people say retail offtake in some markets has been slow for last 2-3 months, impact has not been felt – probably due to tight pipeline. Since there is no reliable data, it is not clear whether slowdown is limited to some areas & some products or is in all major consuming markets & for all nut categories. If there is a definite slowdown in next 2 months, it could have significant impact in second half when supply situation should be easier.
Would appreciate your comments on current situation, your views on supply/demand/price trends and any other news or info
Regards
Pankaj N. Sampat
Mumbai - India
Indian Cashews market was steady this week with a firm undertone. Business was reported for W240 around 3.15, W320 around 2.90, W450 around 2.60, FB/FS around 2.30 FOB for shipments upto June. Domestic market is quiet. Vietnam continues to be quiet and Brazil is selling some quantities for nearby
RCN prices were steady in India and slightly easier in Vietnam but there was not much buying by large processors. Most of them prefer to wait and see how things develop on kernel demand and RCN price in next few weeks before making any big purchases. There is some concern about size and quality of Vietnam crop but things are not clear. In West Africa, things seem to be okay and trend of pricing from IVC – the largest supplier – should be known in 3-4 weeks. When there is full flow, processors will not buy unless they are able to make forward kernel sales at workable price
Continuing delays in kernel shipments is keeping the pipeline tight. Traders are forced to buy every couple of weeks to keep the flow going. This is keeping the market firm. Processors and buyers are not able to take any big forward positions at current prices due to uncertainty of RCN pricing and kernel demand. Buyers do not want to cover now and find that demand is softer in second half. Processors do not want to sell now and find that RCN prices remain firm throughout the season
Although some people say retail offtake in some markets has been slow for last 2-3 months, impact has not been felt – probably due to tight pipeline. Since there is no reliable data, it is not clear whether slowdown is limited to some areas & some products or is in all major consuming markets & for all nut categories. If there is a definite slowdown in next 2 months, it could have significant impact in second half when supply situation should be easier.
Would appreciate your comments on current situation, your views on supply/demand/price trends and any other news or info
Regards
Pankaj N. Sampat
Mumbai - India
Monday, March 03, 2008
Weekly cashews update
Mar 1, 2008
Cashew prices came down a few cents – W240 around 3.05, W320 around 2.75, W450 around 2.55 FOB but there was very little activity.
Most processors do not seem to be keen to make any big sales till they have a clear picture of RCN pricing in the three main producing areas.. But some processors have sold limited quantities at slightly lower levels
Kernel buyers also seem to do not want to make any big purchases till they see how demand develops in coming weeks given that current prices are quite high compared to last year’s levels. Meantime they are buying some quantities “when needed” or when they have some new enquiries from endusers.. If new demand is limited, buying trend will continue to be restrained
Apart from some “early” news of some concerns with Vietnam crop, there is no adverse news from any origin. Prices have softened a bit in India & Vietnam. Initial offers from West Africa were high but did not induce any significant buying interest. During March, RCN activity will pick up and depending on prices paid, we will see kernel price range evolving with offers from processors as they start buying RCN.
In last few months, all commodity prices have gone up substantially – it is to be seen whether these higher prices will be sustained in coming months and more specifically what impact these higher prices will have on demand for different categories of products
In cashews, we can expect higher volatility in Mar/Apr depending on news from origins and need of processors to make sales. After that, a medium term range for second half 2008 will be established – it seems it will be higher than last years range but it is to be seen how it will compare with the current levels
Would appreciate your comments and views & any news / info
Regards
Pankaj N. Sampat
Mumbai India
Cashew prices came down a few cents – W240 around 3.05, W320 around 2.75, W450 around 2.55 FOB but there was very little activity.
Most processors do not seem to be keen to make any big sales till they have a clear picture of RCN pricing in the three main producing areas.. But some processors have sold limited quantities at slightly lower levels
Kernel buyers also seem to do not want to make any big purchases till they see how demand develops in coming weeks given that current prices are quite high compared to last year’s levels. Meantime they are buying some quantities “when needed” or when they have some new enquiries from endusers.. If new demand is limited, buying trend will continue to be restrained
Apart from some “early” news of some concerns with Vietnam crop, there is no adverse news from any origin. Prices have softened a bit in India & Vietnam. Initial offers from West Africa were high but did not induce any significant buying interest. During March, RCN activity will pick up and depending on prices paid, we will see kernel price range evolving with offers from processors as they start buying RCN.
In last few months, all commodity prices have gone up substantially – it is to be seen whether these higher prices will be sustained in coming months and more specifically what impact these higher prices will have on demand for different categories of products
In cashews, we can expect higher volatility in Mar/Apr depending on news from origins and need of processors to make sales. After that, a medium term range for second half 2008 will be established – it seems it will be higher than last years range but it is to be seen how it will compare with the current levels
Would appreciate your comments and views & any news / info
Regards
Pankaj N. Sampat
Mumbai India
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