OCT 2, 2010
Cashew Market continued to be quiet in Week 39 – there has been very little export activity from India for more than six weeks now. Some processors in Vietnam have been selling at lower levels e.g. W240 around 3.50 and W320 around 3.25-3.30 FOB but volume has been limited. The large processors in Vietnam and India are at least 10 cents higher and they are able to make some sales at the higher levels. Brazil processors are very quiet. In the last few days, there have been reports of some importers offering at lower levels for 2011 deliveries but origins are not prepared to follow. Indian domestic demand and prices continue to be very firm and this situation is likely to continue atleast till end of the year.
Nothing new to report on RCN front. Spot RCN prices continue to be firm. No clarity about Indonesia & Brazil crop. No movement in East Africa. Vietnam and India processors access to new RCN is limited to max 175,000mt (including small quantities from 2010 West Africa crop) until the Northern crops start in March 2011.
USA & EU buyers seem to be content to buy limited quantities “as needed”. They are reluctant to take forward positions due to uncertainty of demand trend – especially because prices are on the higher side of the long term range. Processors also are comfortable with regular sales of small quantities as they have seen prices moving up with each round of buying (and at all times, there has been some market which has been active). At some stage, trend will change and prices could come down but this is unlikely to happen in short or medium term.
Tipping point will be when there is a big improvement in supply or a big drop in usage. Impact of high prices on usage will not be known until Mar/Apr 2011. Supply cannot increase till May/Jun 2011. At this time, it is impossible to predict either. Trend of regular activity for spot / nearbys will keep the market volatile. Small events can create large price movements. Wide range of prices at any given time will become the norm.
Until there is some indication of demand trend for 2011 or easing of supply tightness, market can be expected to hover around current range.
Would appreciate your comments on market situation, views & forecast of trend in coming weeks + months and any other info + news
Regards,
Pankaj N. Sampat
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1 comment:
This will not have effect in fact, that's exactly what I suppose.
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