Monday, July 29, 2013

REMA FOODS MARKET FLASH July 29, 2013

TRADE: The Generalized System of Preferences (GSP), which provides duty-free treatment to about 5,000 products imported from more than 100 beneficiary developing countries, is scheduled to expire July 31, 2013.  A bill (H.R. 2709) introduced July 17 would extend GSP through September 2015.   While this is a positive first step, the House will not actually vote until the Senate approves similar legislation. The bill likely will need to pass the Senate by unanimous consent, meaning any one senator can block renewal, as happened in 2010.  Any attempts to amend the bill also jeopardize passage before July 31.  Import foods items that will be affected include pickles, baby corn, pepperoncini, capers.
 
FDA last week announced the release of two proposed rules under the Food Safety Modernization Act.  The first relates to the Foreign Supplier Verification Program; the second pertains to the accreditation of third-party auditors.  The proposed rules for the first time put the main onus on companies to police the food they import.  Michael Taylor, deputy commissioner at the FDA, said the new rules on imports would cost companies $400 to $500 million.  Large importers are generally in favor of the new rules as most already have similar measures in place.

CURRENCY: The dollar weakened to euro/dollar 1.328, close to its 52 week low and about 4% weaker than just a few weeks ago.

PINEAPPLE: The relatively poor Thai summer pineapple crop is coming to an end and most packers will soon shut down for maintenance as fruit deliveries dwindle.  Raw material prices have leveled off at 5.50 baht/kg this season as compared to 3.00 baht/kg in 2012.  It’s hoped the higher pricing will encourage more farmers to plant and will contribute towards a better supply situation in 2014.

PEACHES -  The Greeks have finally started their season, but initial pricing is several dollars higher than expected just a few months ago before frost and hail hit the crop.

MUSHROOMS –  European suppliers (Holland, France, Spain) have dominated the US mushroom market for the past year, but the recent devaluation in the dollar could push up US pricing if these levels persist. India’s main packer remains shut with no expectation of re-entry into the market.  Chinese packers continue to face pesticide issues and anti-dumping duty rates of over 300%, effectively keeping them out of the market as well.