Merry Christmas logo with a unicorn head

We wish all our friends a Merry Christmas, thank everyone for their support in 2023 and look forward to working with you all in 2024.

We have once again opted to donate to the Cheetah Conservation Foundation of Namibia instead of Christmas Cards. Updates can be found on our website regarding their news and developments.

Currency update:

It is noticeable the movement in the last month of US$ dollar weakening against € and £, which have stayed more or less aligned with each other. Whilst providing an opportunity for import prices of US$ based commodities it has the opposite impact on export prices. We are seeing this reflected in origin pricing levels, particularly in China. Here the situation is exacerbated by the weak Chinese economy causing concern for exports. As a consequence, we are having to secure contracts in local currency in the forward positions to achieve the best pricing.

The US Dollar is however expected to strengthen through 2024, with forecasts of as low as parity against the € and around 1.15 against Sterling. There is a long time to go, but with head winds in both the EU and UK economic zones being forecast for 2024/25, and an unsettled world, these predictions have some weight to them and play a major factor in forward pricing.

FX Monthly movement

  • US$/£ 1.27
  • US$/€ 1.10
  • £/€ 1.16

General news

Generally, as forecast, markets have turned now on pretty much all products. Driven more by poor and disappointing harvests or climatic issues than demand, which remains cautious and shorter term.

Organic business and indeed conventional imports remain challenged by lower MRL levels for pesticides. As we regularly advise we conduct extensive pre shipment analysis for pesticides, as well as annual screening tests to ensure all products comply with current legislation. We know we are amongst a few importers who do this because it adds cost to the supply chain, but it does mean we are as confident as possible of the correct levels on importation. There is such a price differential now between compliant and non compliant material that any significant price variation should have a big ‘CAUTION’ label on it!

Freight rates are increasing for 2024 now too, as vessels are taken out of service due to a general slowdown in economic demand everywhere.

Pumpkinseed kernels

With the crop down 30%, and availability especially tight on GWS prices rallied during November. The quantity of free stock is low now, estimated to be below 20% of the harvest. Prices have stabilised, but demand has been weak in both grades. This was not expected on shine skin, which is normally well supported by domestic demand, but the cost-of-living issues in China have dampened this for now.

So, with little available free material, and most processors stock held against firm orders placed the price will depend on whether the latent demand returns. From our perspective the current quantity has to supply all demand for 2024 in EU/USA and knowing customers are generally more cautious about their forward cover we see upside potential as 2024 progresses.

Linseed

New crop Kazakhstan material is arriving in EU now, with an old crop carryover still in warehouses, is making nearby prices more favourable than forward. The harvest which was late has been stopped by cold weather and snow and will now be lost. This will tighten supply and continue the price firming we are seeing in the forward positions. Cheap offers relate to material originating in Russia, which are still permitted to be imported into EU, whilst UK as set a duty of 35% to restrict the activity.

Other origins are currently uncompetitive, we are unlikely to see Canada return this season, but might see some more Indian material from their new crop as prices here are declining ahead of the harvest in April, but overall volume is not sufficient to move the market or prevent a price escalation.

Sesame seed

No good news here. India crop for hulling quality seed, just get smaller. Last estimate was 145,000mt. Flooding in parts of East Africa just as harvest approaches is very bad news for sesame. Pesticides in Brazilian material discount it for EU/UK use. Nigeria remains an option for now, but GFSI supplies are limited and logistics continue to be an issue.

Sesame prices can be cheapened by adding lower grades; double skinned, Bengali and others. This will reduce the shelf life and up the FFA and peroxide levels leading to rancidity and poor taste. So once again; know your supplier!

Hulled Millet

Some good news with the harvest in Ukraine larger than expect in the circumstances the country is suffering. The 2023 quality is not so good however. Long queues of lorries at borders to EU, localized bans on imports from the region into EU all add frustration to this supply chain. A lack of containers challenges sea routes. The price is also under pressure as Ukraine attempts to empty silos as fast as possible to avoid problems with missile/drone attacks on infra structure stopping the movement of goods.

Sunflower

Buyers are focused on the South American harvest of vegetable oil items currently where excessive heat has been impacting crops and causing downward revisions in harvest quantities for 2024. Generally, demand for vegetable oils in 2024 will drive prices. This is ever increasing as countries such as Indonesia, USAS & Brazil gear up their biofuel industries.

Sunflower kernel producers compete directly for the same material as oil crushers, so an escalation in demand and a reduction in supply of oilseeds feed directly into the sunflower kernel price.

Prices are already in an upward cycle. We do not see a reversal in this, just that it will continue.

Poppy

Where is the poppy going to come from? Global supply is so low especially for low alkaloid varieties. But why doesn’t the price climb faster? Well, the major demand is Ukraine & Russia, and they have their hands full currently. But demand is picking up, availability is dropping, and a situation is developing.

Quinoa

The crop is reduced 40-45% in Peru the cheapest source of material. Bolivia continues to trade at a premium over other origins due to generally excellent quality. So, prices are expected to climb through until mid 2024.

Many regions are looking at developing Quinoa crops; China, India, EU, UK are all growing small quantities and are likely to change the dynamics on this market in coming years. All face various issues, but these will be overcome and the global trade pattern will change.

Chia

Hard to secure seed to meet EU requirements on pesticides, but this seed has many alternate homes. We are aware of lots of rejected cargo in EU due to paraquat contamination, which is a strong indicator of the issue with the entire crop. So, care on sourcing, and sufficient comprehensive analysis is required on all parcels to ensure compliance.

Asian and USA demand continues to be strong and this will see prices rise further in 2024.

Get in touch

Frank Horan
Frank HoranDirector
Nikki Divers
Nikki DiversDirector
Jake Yerrell
Jake YerrellCommercial Manager
Vera Grosse-Drieling
Vera Grosse-DrielingCommercial Manager
Micaela Camantigue
Micaela CamantigueAccount Manager