Wednesday, November 24, 2004

Artichoke Duty Rates Going Down

The President should soon sign the Miscellaneous Tariff Bill, which includes the Association of Food Industry's request to reduce duties on processed artichokes. Fifteen days after the bill is signed, the following duty rates will apply:

HTS# 2005.90.80 (artichokes in brine) will decrease from 14.9% to 13.8%

HTS# 2001.9025 (marinated artichokes) will decrease from 10.2% to 7.3%

(Note Peruvian artichokes are already duty free).

Friday, November 12, 2004

Updated Government Study Finds Mercury Levels in Women and Young Children Are Not of Concern

By finding that mercury levels in women and young children are very low and “not of concern,” a new study from the federal Centers for Disease Control and Prevention (CDC) should reassure all Americans that eating fish, such as canned tuna, is safe and should be encouraged because of the many health benefits associated with seafood consumption.

Published in the November 5 issue of the Morbidity and Mortality Weekly Report, the CDC’s new study confirms that mercury levels from fish consumption for women and young children in the U.S. are well below any level of concern.

Of added significance, the new CDC study updated previous estimates of mercury levels in women and young children and found that concentrations in the blood of American women have actually declined over a four-year period (1999-2002). At the same time, the new CDC report confirms previous findings that no child in the U.S. has mercury levels that are even close to the EPA’s reference dose and are not at risk from consuming seafood.

Thursday, November 11, 2004

High tuna raw material cuts factory earnings

One of the world's largest tuna canneries, Thai Union (publicly traded in Thailand), reported that higher raw material costs have cut it's 2004 YTD profits by 32% compared to last year.

Only Hawaiian canned pineapple plant to cut half of workers

As reported by Foodnews:

MAUI Land & Pineapple Company, the USA's sole remaining pineapple cannery, will cut its canning staff by half next year as it continues to shift towards more profitable fresh pineapple preparation. The company is sending out notices to its 334 cannery workers saying that nearly 149 positions will be cut early next year.

Monday, November 08, 2004


The European Trade commissioner, Pascal Lamy, announced an end to a five-year trade dispute with the U.S., lifting $4 billion in sanctions on American products as President Bush signed a new tax law repealing American export tax breaks.
The “Safe Food Act of 2004” was just introduced in Congress. The bill would consolidate federal oversight of the nation’s food supply under one super-agency called the Food Safety Administration. The proposed agency would have a budget of $1.9 billion and employ 14,250. It’s not expected that the bill will be acted upon before the close of this year.
Effective Monday Nov 8, 2004, phase 5 of the Bioterrorism Act will be implemented. FDA will now refuse goods entering the U.S. if “Prior Notice” has not been filed.

Despite President Bush’s reelection, the stock market rally, and a strong job report, the dollar skidded about 5% against the euro last week. With one euro now equal to $1.296, the dollar is at its weakest point since the euro was introduced several years ago, and within 11% of the weakest it’s ever been against European currencies (pre-euro) since the dollar became a free-trading currency in the early 1970’s.
While one would (and should) expect price increases on European products, the weak dollar also puts upward price-pressure on non-European and even domestic items. In this global economy, the strong euro gives more purchasing power to European countries, allowing, for example, Asian companies to get "more" dollars for their tuna even if they don't change their euro-based pricing. The same applies to any domestic plant that sells an item that can be exported. In short, in a world economy, the weakening of one's currency will bring inflation - higher prices on virtually all products ­ not just imports.

After increasing for many months, tuna pricing has fallen over the past two months, and is now trading at more realistic levels. While fish is still in the $900-1000/mt range, packers are bidding lower and already taking orders at lower equivalent prices. Yellowfin has followed suit, but less dramatically than skipjack. Tongol, which is a locally caught Thai and Indo species, has been relatively steady in catch and price. Albacore, on the other, has fallen several dollars per case over the past month.
U.S. imports of canned tuna, as of October 4, were 245,738 tons, 40% higher than during the same period last year and already surpassing the 245,195 tons total for full year 2003.

Peach pricing is firming significantly. Chinese packers sold out early. Greek packers, while experiencing a large pack, are faced with the very poor currency problem against the dollar and higher ocean freight costs. As a result, Greek canneries packed mostly to European specs, in supermarket 1 kilo cans. The next possibility for supply to the U.S. are the Southern Hemisphere packers - but it’s still too early for pricing. While South Africa will not be able to compete, as their currency is stronger than even the euro, prospects in Argentina and Chile look promising.

While the winter season has so far been weak, packers are praying for a good summer 2005 season. Much rests on the outcome of the El Nino effects next year. While some random marketing efforts have recently helped pineapple sales efforts, most packers are not yet lowering their offers. Meanwhile, Maui Pineapple reported a 3rd quarter 2004 loss of $3.4 million in its pineapple operation.

Increases in the euro, ocean freight rates, and metal can costs have Italian tomato packers scrambling to increase pricing. However, a massive worldwide crop is making this a tortured process on all but the higher quality products.

Chinese mandarin pricing is higher than last year, but not quite as strong as originally anticipated by Chinese canners. Overall higher costs for ocean freight and tinplate are being mitigated somewhat by a better than expected crop. Unfortunately, Chinese packers expect to pack for only 70 more days, and in Zhejiang province (the major mandarin source), packers face labor shortages as China’s superheated economy offers better paying jobs. A better picture should emerge over the next few weeks. In Spain, while the Satsuma crop used for canning is down 4%, quantities should be sufficient, as a very large Clementine crop (up 14%) will leave little demand for Satsumas in the fresh market. More urgently though, given the generally higher costs in Spain as well as the euro situation, Spanish packers have little hopes for competing in the U.S. market in anything but specialized packs.

While the Spanish crop is lower than last year, other countries including Italy, Greece, Turkey and Tunisia have bigger new crops. Even though total quantities worldwide will not change much compared to last year, the concentration will no longer be in the hands of the few Spanish companies that, like a cartel, pushed prices up last year even as a record crop came in. While euro pricing for Extra Virgin should fall this year, the weak dollar could reverse this for the U.S. In addition, more efficient plants are also turning out less pomace olive oil (which is a by-product), so pomace production may not significantly increase.

Currency concerns are creating havoc for the Spanish and Moroccan olive packers. Large sized olives especially are expected to be tight this upcoming season.

Much of the turmoil from the past year, caused mainly by anti-dumping concerns, appears to have been for naught, as anti-dumping duties did not increase for most packers.

Imports this year are expected to surge as overseas packers jump on the opportunity to export to a less than optimal U.S. pack.

At under 200,000 short tons, the California raisin crop is expected to be the smallest in decades. As a result prices are soaring and demand for imports is very strong.

Season so far looks promising, but currency concerns are now on everyone’s minds.

A much-improved crop overseas should bring lower prices, even with the strong euro.

A bigger than usual pack in South America could bring some relief against ever increasing Spanish prices.

A short crop, and weak dollar spell continued trouble and higher prices for roasted peppers and pimentos.

Sunday, November 07, 2004


Despite President Bush's re-election, the stock market rally and a strong job report, the dollar skidded about 5% against the euro last week. With one euro now equal to $1.296, the dollar is at its weakest point since the euro was introduced several years ago, and within 11% of the weakest its ever been against European currencies (pre-euro) since the dollar became a free-trading currency in the early 1970’'s.