Market News : Herb & Spice Market
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Herbs & Spices - October 2011

 

 

 

ANISEED

 

FIRM

The market price, which has been stable for a few of months, has started to firm up again with increased demand for flu remedies in advance of winter. We are waiting for final news of this season's crop in China which had been forecasted to be short.

 

BASIL

 

STEADY

As predicted last quarter the Basil crop in Egypt is finishing this month with the usual softening in market price for late picking.

 

BAY

 

STEADY

No change in an ongoing very stable market for Bay Oil.

 

BUCHU

 

STEADY

The market situation remains steady with weak demand.

 

CAPSICUM/CHILLIES

 

FIRM

Late monsoon rains in India delayed sowing for the 2012 crop and weather problems are continuing to affect the market now crops have been planted. In Andhra Pradesh favourable weather is giving a forecasted crop increase of 15 to 20%. However in Madhya Pradesh there have been incessant and heavy rains which have damaged their crop. Furthermore, the crop in Pakistan has been damaged by heavy rains, and this is putting extra demand pressure on India. Presently only poor quality, low heat Chillies are arriving at market. The high grade, high heat Chillies in cold stores are ruling very high and the price of Capsicum Oleoresin is following.

 

CARAWAY

 

STEADY

The market situation remains stable.

 

CARDAMOM

 

STEADY

The new season in India appears to be yielding a good crop despite stories from Kerala that some plantations were been rotted by incessant monsoon rains. Heavy demand will continue until December due to Indian winter festivals. The new crop from Guatamala is reported to be about +15% higher than last season, and harvest will commence this month. High prices on the market have stabilised.

 

CASSIA

 

FIRM

The new crop from China is being harvested for distillation, but there is no let up in the overall firm market situation which has caused the price of Cassia Oil to reach an unprecedented level. The situation in Indonesia has stabilised due to weaker demand for ground cassia and oleoresin.

 

CELERY HERB

 

STEADY

The market is stable.

 

CELERY SEED

 

STEADY

Harvesting of a bumper crop in India was concluded in July. In an effort to bolster prices, the biggest growers have withheld from the market up to 15% of the total crop. However the market price is expected to remain steady.

 

CHAMOMILE

 

FIRM

The 2011 English grown crop of Roman Chamomile was severely stressed by drought conditions in April/May, followed by incessant rains during July/August, which caused harvest difficulties. Remarkably, the final yield was up to forecast despite these problems. Only fuel cost of distillation is putting pressure on prices.

 

CINNAMON LEAF

 

FIRM

As reported last quarter, the market price has risen in Sri Lanka, due to damaging rains.

 

CINNAMON BARK

 

FIRM

The Madagascan crop is now being gathered for shipment during the dry season between August and December. The market price has risen > 50% since the end of 2010 because other spices are showing a better return for farmers, so some have given up on Cinnamon. Also there are stories that trees have been overharvested in recent years which has caused unsustainablity and loss of yield.

 

CLOVES

 

VERY FIRM

The balance deficit of Cloves and its derivatives on the global market continues to drive prices ever higher. We have come to realise that these extraordinary prices are not reducing the demand coming from very rich speculators in the Far East. From the supply end, the Indonesian crop is finished, and the Madagascan crop will be available soon, and there are optimistic reports of a favourable crop. Comores has shipped most of its crop to Singapore, and poor crops were reported from Zanzibar and Brazil.

 

CORIANDER LEAF

 

STEADY

Availability of crops from the main origins in Russia and Egypt has been sustained this season.

 

CORIANDER SEED

 

STEADY

For the first time in years there have been favourable weather conditions to produce an abundant crop with high quality seeds. Strong demand for the seeds is keeping the market for Coriander Seed Oil firm, as distillers will not pay the export price for their feedstock.

 

CUMIN

 

FIRM

Good output has been reported from India after completion of their Cumin crop. However all the other main origins have problems which underline a firm global market. There has been drought in China and heavy rains in Turkey to add to an hiatus in supply of a good crop in Syria due to the political turmoil in that country. Normally China is a net exporter of Cumin Seeds, but current domestic demand is adding to the overall shortage on the global market.

 

DILL SEED

 

FIRM

For the second year in succession there has been a shortfall in Dillseeds coming from Eastern Europe. Not enough has been planted to satify demand, thus the market remains firm.

 

DILL WEED

 

FIRM

The new crop from Western Canada and USA has recently finished. Dillweed Oil is just starting to arrive on the market, but availability is scarce as most of it has already been sold. The market price will continue to rise as supplies from North America diminish with farmers moving to alternative cash crops.

 

FENNEL

 

STEADY

This years crop of Fennel in India has exceeded expectations, and the quality is good. India is now more attractively positioned for Fennel than the normally preferred origin Egypt. Prices are stable.

 

FENUGREEK

 

STEADY

Fenugreek supplies have been steady and available from all origins for a couple of years, which makes it an unusual commodity in the prevailing economic climate.

 

GARLIC

 

STEADY

It is confirmed that the recently completed Chinese Garlic crop is +30% higher than last year. As demand for fresh garlic in China remains strong, farmgate prices have not fallen enough to significantly affect the prevailing price of Garlic Oil.

 

GINGER CHINESE

 

FIRM

With a shortfall of > 40% reported for the last crop record high prices should be incentive for Chinese farmers to increase their plantings for the upcoming October crop. Whether or not there will be sufficient surplus Ginger to dry and distil depends on domestic demand for fresh Ginger which has been growing in line with their economic wealth.

 

GINGER OTHER

 

FIRM

During this period between the major crops, market prices are drifting higher and higher. In Nigeria there are increased occurrences of shipments rejected for aflatoxins with all non-contaminated stock having been sold out. Area under cultivation is reported to be the same as last year. In India there is more incentive for farmers to grow Ginger this upcoming season, rather than Turmeric, which is the spice that commonly competes for planting space. Harvesting starts in December of the crop which is forecasted to be higher than last year. The Ethiopian government's decision to place Ginger on the commodity exchange to provide a better return to farmers will render this origin uncompetitive in the future.

 

JUNIPER

 

FIRM

Last year's crop from the Tyrol was short and recently Juniper prices increased about 20% due to high demand in the period preceding the new crop. This is reported to be a good one, and distillation will go on until November, so it is expected that the market will remain firm in the short term.

 

LAUREL

 

STEADY

Demand remains steady as the new Turkish crop becomes available, with continuing price stability.

 

LEMONGRASS

 

STEADY

The market has softened with the new crop from India which was harvested in September, and demand is picking up again.

 

LITSEA CUBEBA

 

FIRM

Optimistic reports of the recently completed crop in China have yet to be confirmed. Weather conditions were said to be favourable, and it is hoped that the market has steadied.

 

LOVAGE

 

FIRM

The new crop from Poland is just starting, with early reports that it will be scarce again like last year. Prices continue to rise.

 

MACE

 

VERY FIRM

The chronic market pressure has further intensified with demand for Mace chasing diminishing supplies. New record high prices have been reached, although this month there has been a short period of price stability, geared to the general situation with Nutmegs. Reflecting on how high prices have escalated, against a benchmark October 2009, the current market price is 4 times that level.

 

MARJORAM

 

STEADY

Egypt is reporting good crops this year for both Green and Grey Marjoram. The Grey crop that is harvested later in the season is preferred for extraction and distillation.

 

NUTMEG

 

VERY FIRM

At the start of October there is has been a short spell of price stability in an inherently firm market which we have been reporting for the past two years. In this situation it is worth reflecting on the market price of Sri Lankan BWP Nutmegs, which are most suitable for extraction of Oleoresin Nutmeg, which are now over 4 times what they were two years ago. The BWP season is finished now and in India unseasonal rains have damaged the flowers of the next crop resulting in a forecast reduction of up to -40%, so the situation is predicted to worsen. The price of Nutmeg Oil continues to firm up, if not at quite such an alarming rate.

 

ONION

 

STEADY

The market remains steady with supply and demand well balanced.

 

OREGANO

 

STEADY

No problems are reported with the current crop. Supplies are good and demand is strong.

 

PAPRIKA

 

FIRM

In India sowing of the Paprika crop was delayed because the monsoon rains were late this year. The area under cultivation of the low heat KDL variety has been reduced in favour of higher yielding the medium heat Guntur variety. Although there seems sufficient stocks in cold stores to satisfy demand until the crop is harvested early in 2012, the market has firmed in sentiment. In China the new crop which has just started to be harvested, is reported to be 15 to 20% higher than last year.

 

PARSLEY HERB

 

STEADY

The crops this year are more limited than usual, but it is not expected that the market price will change much.

 

PARSLEY SEED

 

STEADY

Nothing significant to report about a stable market.

 

PEPPER BLACK

 

VERY FIRM

Since last quarter the market situation has worsened. Global supplies have fallen even further behind demand. Vietnam, which is the biggest single origin supplying a third of the world demand, has shipped most of its February crop. Crops from other origins such as Indonesia and Brazil are depleted thereby exacerbating the general firming tendency of the market. Sri Lanka, which is between crops, supplies the light (immature) berries which are best for extraction and distillation and market prices of Black Pepper Oleoresin and Oil have increased > 30% since the beginning of August. These high market prices are intimidating buyers to shorten their outlook.

 

PEPPER WHITE

 

VERY FIRM

The additional cost of preparing White Pepper is proving a serious disincentive in Indonesia and Vietnam. As with Black Pepper, supplies of White have dropped alarmingly, and the market price is more than double what it was a year ago.

 

PEPPERMINT

 

VERY FIRM

Globally prices for Mentha Arvensis and its derivatives have recently shot up to levels that have defied all predictions. There appears to have been adequate stocks produced from the Indian crop which concluded in July, but recent heavy demand has alarmed producers in India. Some traders and stockists of Menthol in Europe and USA who have allowed their positions to fall to unsustainable levels, have thus been forced to pay extraordinary high prices to airfreight small quantities of material from origin. The forecast for the US Piperita is lower than demand expectations, and prices are likely to rise.

 

PIMENTO

 

FIRM

With the the harvest in Jamaica coming to an end there seems to a shortfall on forecast. Heavy rains damaged the crop but fortunately there have been no major hurricanes this year. Sellers of Pimento Berries are reluctant to offer for immediate shipment, and the market price is starting to increase again.

 

ROSEMARY

 

STEADY

The market has stabilised after the uncertainity caused by the political instability in Tunisia.

 

SAGE

 

FIRM

Due to year on year difficulties with sustainability of the indigenous Dalmatian Sage crop from Albania and Montenegro, farmers in other countries like Turkey and Egypt are now cultivating this desirable variety. For the present the market remains firm.

 

One

 

Two

Three

 

SAVORY

 

STEADY

Nothing significant to report about a stable market.

 

SPEARMINT

 

FIRM

Egyptian area under cultivation of Spearmint is reduced. In China the main crop has recently concluded with reports of a shortfall in production. The overall market sentiment is firm.

 

TARRAGON

 

STEADY

Nothing significant to report about a stable market.

 

THYME

 

STEADY

The supply and demand situation of Thyme from Morocco and Spain are well balanced, rendering a stable market.

 

TURMERIC

 

WEAKENING

The new Indian crop due early 2012 is forecasted to be 20 to 25% higher than last season. With weak demand, prices are starting to decline as buyers hold off on the expectation further decreases. Oleoresin prices are not dropping so quickly as there is no carryover from the extraction grade Alleppy variety.

 

VANILLA

 

STEADY

In Madagascar the harvest of Green Vanilla Beans is completed and they are now being cured. This major crop will start to become available for shipment by November. The market is firming up as the carryover in Madagascar from 2010 is exhausted, and all the minor origins like Uganda, Indonesia, Papua New Guinea, Comores and India have reducing output due to insufficient price incentive to the farmers for this most labour intensive of all crops.

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