Often around this time of year, there are many concerned about things being dry, but it usually comes from the thought of trying to chew through the overcooked and bone-dry turkey that was left in the oven too long. Thank goodness for gravy. This year, of course, the most significant dryness concerns are focused on South America, and with generally dry weather over the weekend, we have seen bean and corn prices extend into higher highs to kick off the week.
Weather conditions for winter crops in Europe appear to be a sight better than South America, and France AgriMer now estimates that the winter barley conditions are 95% good/excellent. A year ago, at this time, it was rated 79%. No ratings were issued for the winter wheat crop, but planting at 95%, was ahead of last year at 88%, and appeared to be in good shape. A bit further east in Ukraine, the overall grain harvest is estimated to be 95% complete (a lot of 95’s in this paragraph), totaling thus far, 60.3 MMT. The current government estimate is for a total crop of 68 MMT compared with last year at 75. Of course, we have hashed these numbers over repeatedly.
Generally speaking, Taiwan and the United States appear to maintain a good relationship, much to China’s chagrin, but some groups in that nation are pushing back against one particular American product; Pork. Reportedly over the weekend, thousands of people took to the streets to protest the easing of restrictions on the import of pork from the U.S. The reason for this outcry? The use of the growth stimulant, Ractopamine. At least 160 countries around the world ban the use of this product, including the European Union, Russia, and China, but not here in the U.S. or Canada. Most of the major packers in the U.S. have already banned or are reducing the slaughter of hogs who have been fed this product, but obviously, there remain concerns around the globe over its use here.
Even though I have never reached the point to seek professional help, I fully admit that I am a chocoholic. As such, it was with no little concern when I read an article in the Financial Times last week that tensions between chocolate companies and the two major west African producers of cocoa beans, Ivory Coast and Ghana, have driven prices sharply higher over the past two weeks. These two countries account for over 60% of global production. At issue appears to be a $400 MT premium the two nations have implemented to support their farmers. While I certainly do not know all the fine details of this “living income differential,” chocolate manufacturers are looking for some flexibility in the pricing. Needless to say, this appears to be a “sticky” situation and has left a “bitter” taste in the mouth of some. Be that as it may, it did prompt the Hershey company to take the seldom-used step of taking delivery on futures positions, which appear to have settled prices down this morning.
