Tuesday, September 03, 2013


TRADE: The West Coast MTO Agreement (WCMTOA) announced an 8.1 percent increase in the Traffic Mitigation Fee at the Ports of Los Angeles, Long Beach and San Pedro, effective Aug 19, 2013. The new rates are $66.50 per 20’ container and $133 per 40’.

CURRENCY: Several Asian currencies have weakened recently versus the US dollar. The Thai baht is at its 3 year low, down 10% since May; the Malaysian ringgit has dropped 11% since May, the Philippine peso is 7% lower and the Indonesian rupiah is almost 20% lower.

TUNA: While the FAD ban period (July 1-Oct 31 this year) normally brings about a firming market, tuna raw material costs have remained remarkably stable over the past month. Daily catches have deteriorated 20-25% but slow worldwide demand and the weakened Thai baht have kept raw material costs down in the $1900-1950/mton range. Yellowfin continues to track with skipjack and trades at $2650. Tongol is flat. Albacore, after falling considerably last year, has been holding steady for the past few months at around $2700.

TOMATOES: After a delayed start, the Italian tomato crop is finally underway. Deliveries are still slow and most packers are not yet operating at full capacity due to insufficient raw material. As a result, pricing is quite firm. Packers are hoping the season may extend a bit longer in order for prices to stabilize. Unfavorable weather in Canada has packers there predicting one of the worst crop in recent years.

PINEAPPLE: There has been a decline in exports from major Asian producers in the first half of the year, mainly due to weak demand in Europe. In the USA, imports have actually increased by 11%. Winter crop will be starting soon, and initial expectations are for a normal crop of about 700-800,000 mtons in the next 4 months. The predicted raw material pricing is 5-5.8 baht/kilo with a lower than normal percentage availability of choice/fancy grade. In an ominous sign, the price of pineapple juice concentrate is up 30% since the beginning of the year.

MANDARIN ORANGES: Early reports indicate that drought conditions have affected the trees and could bring about a 30% decrease in 2013/14 output. The real situation will be clearer towards the middle of September. Over the past 5 years, the average annual exports from China were 320-350,000 mtons. The large 2011/12 crop of 430-450k mtons brought about a significant price drop last year. In 2012/13, total production was reduced to about 260-280k m/tons, and it is predicted there will be 50k mtons carryover going into the November 2013/14 crop. Of last year’s reported 337k mtons in exports, the USA market took about 170k; Japan 60k, and Europe 50k.

PEACHES: In Greece, canning will end later this week and pricing is still several dollars higher than from China. In China, the harvest finished on Aug 20 in the main growing area of Dangshan and final yield was about 30% shorter than last crop. The harvest in the second growing area in North China will finish mid-September and is estimated to be off 20%. Due to the short harvest and rising labor costs, the price of raw materials increased by 20%. Last year, China processed 600,000 mtons but the majority was for domestic consumption. The total processing yield this crop is predicted to be 450k m/tons. Exports last year were 132k mtons; 44k to USA, 37k to Japan, and 13k to Russia.

FRUIT COCKTAIL/MIX: Peaches and pears account for the majority of fruit cocktail/mix components; so fruit cocktail/mix pricing is firm. Last year, China exported 57k mtons; the USA took 16.5k; Europe 15k and Canada 7k.

APPLES: The USA is expecting a bumper 2013 apple harvest; the 12th largest in history.