Monday, May 10, 2010

Weekly Cashews Update

MAY 8, 2010

Cashew market was quiet in Week 18. Very limited volumes were traded compared to the activity in previous two weeks (following the pattern of past several months). No change in prices – W240 around 3.15, W320 between 2.90 and 2.95, W450 around 2.75 FOB. Undertone was steady to firm.

RCN market is also steady with a firm undertone. IVC is being traded in 800-830 range depending on the quality. Some early sales of GB have been made around 1025 C&F. The number of players in RCN market has increased this year resulting in a wider price range. At the higher levels, buying interest is limited. Arrivals of WA RCN into India & Vietnam has just started. The fact of a short Benin crop has been factored into the supply situation but there will continue to be some uncertainty about other WA origins until Jun/Jul. Although there may not be big change in overall availability, market will be influenced by rumours and perception of crop prospects. RCN pricing will depend on this and the trend / pattern of kernel activity in next 8 weeks. If kernel market is quiet, processors will be reluctant to buy at higher prices.

There is nothing on the horizon to change view on kernel market prospects for coming weeks & months. The pattern of periodic activity will keep the market swinging in a range. Lower processing & shipments in Apr/May might lead to supply tightness in USA & Europe for some time – hopefully this should ease in third quarter (unless the delays turn into defaults).

If there is no large buying NEED in the next 6-8 weeks, we might see some selling pressure (and lower prices) in the third quarter. But if any significant volume needs to be bought in this period, prices will continue to remain around the higher end of the current range (meaning no respite in RCN prices) and probably move up in third quarter when the Asian (esp. Indian) demand will also be high.

Pankaj N. Sampat

Wednesday, May 05, 2010

USDA to buy up to $18 million in cranberries to help reduce surplus in Wisconsin, other states

By Associated Press
5:02 AM CDT, May 5, 2010
WISCONSIN RAPIDS, Wis. (AP) — The federal government will buy up to $18 million worth of cranberries to help reduce the surplus in Wisconsin and other states.Growers of the tart fruit saw record harvests in the last few years. That led to supply that outstripped demand, resulting in lower prices and surplus inventories.So the U.S. Department of Agriculture will buy excess cranberries for use in food-assistance programs.The next step is for the USDA to determine which farmers' crops it will buy. Wisconsin growers should be well represented among the beneficiaries because the state produces about 60 percent of the nation's crop.Tom Lochner is with the Wisconsin State Cranberry Growers Association. He tells Wisconsin Public Radio the USDA supply will be used for cranberry sauce and juice.___On the Net:Wisconsin State Cranberry Growers Association: from: Wisconsin Public Radio,

Monday, May 03, 2010

Weekly cashews update

MAY 1, 2010

Cashew prices moved up a few cents in Week 17. Business was done for W240 from 3.05 to 3.15, W320 around 2.90, W450 from 2.70 to 2.75 FOB. Most of the business was for May-Jul/Aug but some business was done for last quarter as well. Volumes traded were not very large but all markets have been buying some quantities in the last two weeks.

RCN shipments from IVC are slow due to various logistic problems. Prices there have gone up in the last two weeks. Opening prices for Guinea Bissau RCN are higher than expected. Supply does not seem to be a problem but the market is influenced by sentiments, increase in number of small buyers, disruptions in flow, fear of being left with inadequate rawmaterial, etc. Even if prices are unworkable, there is always someone in the market and this is providing support to the market. Unless kernel demand picks up during May, processors will find it difficult to buy big quantities at these higher prices.

On the kernel side, buyers seem to be content with buying when they need. They do not seem to have confidence to cover large volumes – they have been covering small quantities at all levels. Some buyers have started buying for forward positions but quantities have been limited. Asian markets are usually quiet during this period – activity will pick up in few weeks and will peak in third quarter. Asian markets traditionally buy spot / nearby and this leads to spikes in activity and prices.
Prices of almost all other nuts are higher than historical average – in some cases, the increase is much more than cashews. Overall nut usage in the two main cashew importing regions (USA & EU) may not be much different from last few years - there might be a shift in individual items depending on availability and extent of price changes. Change in buying pattern will keep the market volatile – decision making becomes difficult.

Our feeling is that unless RCN prices come down in May/Jun, downside for kernel market is limited. Upside will depend on when & how much buyers need to buy for second half deliveries.

Would appreciate your comments on market situation, views & forecast of demand and price trends and any other news or information

Regards,Pankaj N. Sampat