Latest update in Spices and Food Ingredients!

BLACK PEPPER – BRAZIL/VIETNAM/ INDONESIA

Vietnam experienced favourable weather during berry setting, and the crop is still growing healthy.

Brazil’s crop is currently being harvested, and as a result of stockholders releasing volume in anticipation of the new crop, prices are lower than they were in Vietnam. Prices dropped 32% from the previous year. Brazil imports may soon be prohibited by the EU due to a significant increase in salmonella-related border rejections.

The crop in Indonesia has been harvested, and it is 5% smaller overall than it was last year (45KMT). Indonesian stocks are typically well-held, and the country has not recently followed the downward price trend of Brazil and Vietnam.

Brazil’s exports are down 12% this year, and Vietnam exported 19% fewer goods, primarily due to China. Large stock positions at destinations that were developed in response to the ocean freight crisis and pandemic-related uncertainties over the previous year have enabled this trend.

The pepper trade has close ties to the coffee trade in Vietnam’s primary production regions. Trading companies had to sell more pepper in order to buy coffee because the price of coffee rose while the price of pepper fell.

When prices reach bank margin call limits, the recent sharp price decline may generate additional downward pressure. Long-term investors may enter the market as prices continue to decline. After all, the trend in global production has been declining since 2019.

NUTMEG – INDONESIA

A good crop is anticipated for 2023 because the weather in Indonesia has been favourable during the flowering stage. However, the short-term availability of nutmeg is still constrained.

The nutmeg market in India is still robust. The second consecutive small crop has an impact on the supply shortage even though demand is not strong. According to reports, domestic demand has been rising steadily over the past few years, but production has not. Indonesia exported 14% less overall and 34% less to China this year. The volume of imports from Indonesia increased to Vietnam (for processing) and the Netherlands, while it decreased to the US (-27%) and Germany (-15%).

Prices for nutmeg in both India and Indonesia are steady. Slow demand may result in a slight price drop later. > The price of Indonesian nutmeg shrivel is stable at US$ 9,730/MT and may go up as there is a shortage of EU-guaranteed nutmeg.

PIMENTO

MEXICO

The crop size decreased as a result of hurricane Grace’s effects last year. There is very little carry-over inventory left because the majority of it was expensively sold before the new season began. Due to damage to the plantations last year, this year’s crop is expected to be 10–15% smaller and weigh around 6-7 KMT. Prices are up 8% from last year.

HONDURAS

The mature Pimento berries have fallen off the trees and rotted as a result of heavy rains and hailstorms that occurred prior to harvest time. The anticipated production for this year is 4000 tons, which is approximately 50% less than last year’s crop, which was already small due to hurricane Grace. Prices are up 2% from last year. The limited availability from the origin, however, also leads to significantly higher prices being quoted.

GUATEMALA

Due to last year’s hurricane damage to trees, the overall crop size shrank. Despite the favorable weather this year, local merchants have been holding onto their stock in preparation for higher prices. This year’s production is anticipated to be between 1400 tons.

CLOVES

INDONESIA

For the second year in a row, a lack of crops has been caused by excessive rain in the first half of the year. As compared to this year, which saw a production of around 10 KMT, the new crop cycle could increase the crop by as much as 50% the following year.

The cigarette market has already replenished all of its supplies. Other significant Indonesian exporters are looking for new suppliers because the domestic supply cannot keep up with the demand. Ahead of the upcoming winter and festival season, the Indian market will also be busy.

Prices are stable at US$ 8,850/MT, up 4.4% YoY, and are expected to stay high.

MADAGASCAR

13 KMT are predicted to be new arrivals, with a 1.5 KMT carryover. This is less than the 15KMT of the prior year. Trees were lost as a result of the cyclone that hit Madagascar in February, and market arrivals weren’t until the beginning of November. However, prices gradually dropped by 7.4% YoY, now standing at around 7800 USD/MT

ONIONS

INDIA

In Mumbai, onion prices have risen as a result of a supply slump. This essential commodity is up 60 to 80 percent in the past week. Experts say that the onion price increase will continue until the new crop arrives in the markets in the first week of November.

According to the APMC board, the old onion stocks are gradually running out and the current supply comes from old stocks and not from farmers.

EUROPE

The summer heat and drought had an adverse effect on onion cultivation throughout Europe, the size of the red onion was smaller, and the yields were lower. In the Netherlands, the production area of red onions decreased by 9 percent to 27.3 thousand hectares in 2022 compared to the previous year. The UK harvest is around 670,000 tons annually, experts expect the 2022 harvest to drop by up to 25 percent as a result of drought and lack of precipitation.

GINGER – CHINA

In China, new ginger crops entered the harvesting period in October. Generally, the harvest period lasts until the end of October or the beginning of November and would last before the following cold current.

According to statistics, the planting area of ginger in the year 2022 decreased by nearly half, and the yield rate decreased by 30%. Ginger quality was impacted by bad weather in 2022 during the growing season, compared to the previous year, 2021.

SESAME SEEDS

CHINA

This week, the stock price for Sesame seeds in Qingdao port, China, dropped after the National holiday, limiting trade activities. End buyers are buying on demand, and the price is still at a high peak as the supply of Tanzanian sesame seeds is decreasing. However, the availability of more sesame seeds is expected from Niger and Togo in the upcoming weeks.. Overall, the demand is lower than usual as traders are consuming inventory and are not motivated to purchase sesame seeds unless there is a specific buying request from buyers.

ETHIOPIA

Two weeks ago, the 2022 sesame harvest season began in Ethiopia’s Humera and Gonder regions, while its peak harvest season was during W40, in all Ethiopia’s sesame production regions, including Wollega and Benishangul. The sesame harvest season will not last more than a month and is expected to be concluded in a few weeks, with the new sesame supply becoming available starting from mid-November.

GARLIC – INDIA

Growers in Mandsaur district of Madhya Pradesh (India) are burning their garlic crops as garlic prices have fallen from Rs 25-30 (€0.31-0.37) per kilo last year to 2-5 Rs (€0.02-0.06) per kilo this year. These are incredibly low prices, as each grower has spent between Rs 35 and 40 (€0.43-0.50) per kilo over the past 6 to 7 months on cultivation.

GLOBAL SEA FREIGHT SITUATION

Container freight rates tumble as good times end for shipping industry. Despite the cost of sea freight being higher than pre-pandemic levels, there is a noticeable and rapid decline of prices happening, which gives hope to many exporters worldwide.

the Shanghai Containerized Freight Index (SCFI) recorded another decline of 3.7 per cent week-on-week in the week of 24 October and is now down 35 per cent quarter-to-date.