Thailand is currently in between its Winter and Summer crops. There is still limited processing and fruit pricing remains relatively firm at THB4.50/kg, compared with THB2.60-4.50/kg last year. While it is not unusual for price levels to appreciate at this time of year, there are some signs that these higher raw material costs may continue into the summer crop. Some analysts suggest that raw material price levels could average THB5.00/kg for 2019.
The eastern parts of Thailand are under a mild El Nino and the coming months are expected to be very dry. In addition, the lower rewards the famers have been receiving for fruit for over a year now has probably led to lower investments in the plantations. These factors, say analysts, could result in smaller fruit and an overall lower level of production during the forthcoming Summer crop, which will begin after the Songkran festival in Thailand next month.
For the moment, price levels for concentrate are still under pressure from the second-hand stocks sitting in Europe, which are offered around USD1100 / ton. However, current offers out of Thailand are higher at USD 1250 – 1300 / ton 60/65 brix FOB Bangkok. Traders say that buyers could probably fix reasonable quantities for delivery until the end of the year at the latter price. Speculative old season stocks in Thailand are reportedly minimal.
There are also problems with low ratio supplies from Costa Rica and processors are struggling to produce juice above 18 ratio due to excess rains. Ratios would usually be registering between 20-35.. The industry is now keeping a close eye on the new crop in Thailand and demand could pick up at the end of this month in anticipation of higher pricing. If prices do begin to climb it is expected to be a gradual process and there is unlikely to be a significant hike due to continued lackluster uptake from the key markets. Nevertheless, prices have been too low for two long, say analysts, who cite the sustained three-year boom-then-bust production cycle that the global pineapple juice market is subject to.
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