Despite difficulties in accessing foreign exchange by palm oil importers, a total of 650,000 metric tons of crude palm oil valued at N132.1billion ($439.1 million) has been imported to meet Nigerian industrial and domestic needs.
The commodity is among the products banned by the Central Bank of Nigeria (CBN) from sourcing forex at the interbank market.
The product was ferried from Indonesia, Thailand, and Malaysia between 2017 and August 2018 as annual consumption reached 2.7 million tons.
It was revealed that despite the 35 percent duty paid by manufacturing firms and other importers to bring the product into the country, importation of crude palm oil has increased by 50,000 metric tons from 300,000 tons in 2017 because of the 1.73 million tons deficit being experienced in the country.
The imports were 16.7 percent higher than what obtained last year because of high demand as Thailand palm oil price crashed from $732 per ton to $567 per ton in the first week of October 2018.
New Telegraph gathered that the country required 2.7 million tons to meet its consumption as local production had remained static at 970,000 tons since 2015.
In July this year, Lagos Port Complex, MV Tina Theresa discharged 5,700 tons at the Apapa Bulk Terminal Limited (ABTL), while MV Champion Cornelia offloaded 4,999 tons at Josepdam in Tincan Island Port.
Also in March 2018, 55,699 tons were imported as Susan Victory and Desert Spring offloaded 45,000 tons of the commodity.
It would be recalled that the Senate had, in February this year, called on the Federal Government to ban the importation of palm oil in order to protect local production.
The lawmakers feared that importation of palm kernel and allied palm products was a threat to government’s campaign on diversification of the economy through increased agricultural production and exports.
Meanwhile, the World Economic Forum (WEF), in its forecast, said that palm oil market would expand to an estimated $88 billion a year by 2022 as Indonesia reduced its export tax for crude palm oil between 0 and 22.5 percent to attract importers from Nigeria and other countries.
Also, Indonesia has imposed a $50 per metric ton levy on crude palm oil export and a $30 per metric ton levy on processed palm oil products.
Indonesian Vegetable Oil Refiners Association (GIMNI) explained that the growth in export of palm oil and processed palm oil products to major markets would continue because of the country’s long-term target of producing 40 million tons of crude palm oil per year from 2020.
Nigeria, which was the largest producer of palm oil in the world with a market share of 43 percent in the 1960s, now has a world share of 2.9 percent, with Indonesia leading with 33 million tons; Malaysia, 19.8 million tons; Thailand, two million tons; Colombia, 1.108 million tons and Nigeria, 970,000 tons.
As Hurricane Michael made landfall Wednesday, farmers in the Southeast were still recovering from the devastation caused by Hurricane Florence just weeks ago. Michael, which brought 155-mile-per-hour winds and could dump several inches of rain on the region, was threatening crops and livestock from the Florida Panhandle to North Carolina.
Pecan, cotton and peanut harvests were at risk as the dangerous storm plowed its way through Florida, Georgia, Alabama, and the Carolinas. In 2016, Hurricane Matthew caused the loss of 10 percent of the Southeast’s pecan trees, which blew over in the wind. With Michael’s excessive rain and winds, unharvested peanuts could rot in the ground and cotton bolls could be stripped from the plants.
“The track of the hurricane is almost like you could name it the ‘Southeast Cotton Industry Hurricane,’ because it’s coming into Panama City, and there are about 140,000 acres of cotton in the Florida Panhandle,” David Ruppenicker, CEO of Southern Cotton Growers, told CNBC.
Although farmers in the region were reportedly working around the clock to harvest as much as possible before the storm arrived, much of the season’s crop remained in the ground. As of October 7, only 58 percent of Florida’s peanut crop had been harvested, and just 28 percent of Alabama’s. In Georgia, just 15 percent of cotton and 33 percent of fall vegetables had been harvested when the storm hit.
Michael was also endangering dairy and poultry operations in its path. Power outages from storms can be life-threatening to animals in confined farm operations.
Both Florence and Michael hit at a time when low commodity prices and retaliatory tariffs from President Trump’s trade war threaten the livelihoods of even the most prosperous farmers.
“We started off the year with very good prices and a pretty good crop,” Wayne Boseman, president of the Carolinas Cotton Growers Cooperative, told Politico. “Now the hurricane is taking away the crop, and the trade war is taking away the price. That combination is putting a lot of farmers in severe financial constraints.”
Reference : http://www.agriculture.com
Soybeans are an edible legume native to Asia and are an important source of protein in many modern diets. Chinese farmers first domesticated soybeans around 1100 BC. Since that time, cultures around the world have cultivated the crop as a food source.
In the 1920s, the A.E. Staley Manufacturing Company began crushing soybeans and produced two new products: unrefined soybean oil and defatted soybean meal. The former soon became an important ingredient in margarine and shortening, while the latter became a staple in livestock feed.
How Are Soybeans Grown?
Soybean plants grow in any climate with a warm growing season and ample water and sun. Farmers plant seeds in rows, and in four to seven days they sprout into plants. The planting season in the United States is between May and July, and harvesting occurs around September when the crop has fully matured.
Soybeans grow in very similar conditions to corn, so many farmers grow both crops on the same acreage.
At the beginning of the planting season, farmers choose which crop to plant. To make this decision in an economically rational way, they compare the new crop futures prices for each of the two commodities. December is the new crop month for corn, while for soybeans it’s November.
The corn-soybean spread is the number of bushels of corn needed to buy a bushel of soybeans. When the ratio is below 2.2:1, corn is historically expensive, while a ratio above 2.4:1 signals historically expensive soybeans.
What Drives the Price of Soybeans?
The price of soybeans is usually highly correlated with the price of other grains, such as corn and wheat. Many of the economic and trade factors that move soybean prices affect agricultural commodities in general, including US Production, The US Dollar, Emerging Market Demand, Alternative Oils Ethanol Subsidies, and Health News
Link: https://commodity.com
Increasing interest in the health benefits of Moringa is likely to see a boost in production in Ethiopia.
An article in Addis Fortune explains that there are 13 species of Moringa tree in the world, the most common of which are Moringa stenopetala and Moringa oleifera.
The leaves of the moringa tree are rich in protein, vitamins A, B, and C. The seeds have considerable oil content.
Moringa is processed into a powder that can be mixed with tea or other foods. In the UK, 200 grams of Moringa sells for about 191 Br (about US $10) but in Ethiopia, the price is around 50 Birr (US $2.50)
In Ethiopia, Moringa stenopetala is the most commonly grown species, known locally as Shiferaw or Aleko. In southern Ethiopia, the leaf of the plant is used as a substitute for cabbage in the local diet. It is also used as animal feed.
The Agric produce is one of the least traded commodities in Ethiopia and the level of consumption is restricted to a few areas of the Southern Region.
But this is set to change. Interest in the Agric produce is growing, both in Ethiopia and worldwide. Production is expanding from the Southern Region to other parts of the country. Moringa powder is increasingly available in city supermarkets in Ethiopia and there are plans to increase export with several investors interested in establishing value chains for the product, supported by the government of Ethiopia. Research is also being conducted on the tree and its nutritional value.
As the United States’ top chocolate consuming holiday (Halloween) approaches and International Chocolate Day (Sept. 13) has just passed, the cocoa industry finds itself with plenty of supply, uncertainty about demand and a widely-fluctuating futures market. Meanwhile, the industry continues to grapple with sustainably sourcing cocoa beans often grown and harvested in poor regions under less-than-acceptable circumstances.
The International Cocoa Organization (I.C.C.O.) estimates global 2017-18 cocoa bean production at 4,645,000 tonnes, down 2% from the prior year. World cocoa bean grindings, an indication of demand, were estimated at 4,568,000 tonnes, up 3.9% from 2016-17. Carryover stocks on Oct. 1, 2018 (the beginning of the 2018-19 cocoa bean marketing year), were forecast at 1,757,000 tonnes, up 1.8% from 2017, with a stocks-to-grindings ratio of 38.5% compared with 39.3% the prior year.
Regionally, second-quarter cocoa bean grind (the most recent data available) showed mixed results. North America grind, reported by the National Confectioners Association, was down a disappointing 3.1% from the same period last year. But European grind jumped 7% from April-June 2017, and Asian grind surged 15% from a year earlier.
Cocoa powder prices in the United States have shown mixed price moves in 2018 with 10% to 12% natural powder up about 10% since Jan. 1 at 85c to 95c a lb, as quoted by Milling & Baking News. The price of black cocoa powder also was up about 7% so far in 2018. But prices for 10% to 12% alkalized and red alkalized (Dutch) both were down about 5%. Prices for all grades of cocoa powder were slightly below year-ago levels.
Trade sources indicate cocoa powder buyers mostly are well covered into 2019 and some even buying into 2020. With only a minimal carry in New York cocoa bean futures (about $100 per tonne from nearby December to May 2020 last week), and no indication of supply tightness, there has been little incentive to book too aggressively. At the same time, the flat price may have encouraged some booking as a move up in futures appears a bit more likely than a significant move down.
Malaysian palm oil futures were up slightly on Tuesday, as the market traded mostly sideways, looking for new catalysts.
The benchmark palm oil contract for December delivery on the Bursa Malaysia Derivatives Exchange was up 0.14% at 2,160 ringgit (US$521.74) a tonne.
Trading volumes stood at 42,844 lots of 25 tonnes each.
“Palm could have gone higher, but there’s a lot of liquidation in the nearby contracts rolling over to the forward months,” a Kuala Lumpur-based trader said.
The trader expects the futures contract to continue trading sideways until new industry data and forecasts are available.
Another trader said the market was waiting for new leads, while rising stockpiles continue to be worrisome, keeping the futures contract range-bound at 2,137-2,200 ringgit per tonne.
Malaysian palm oil inventories rose to a seven-month high of 2.49 million tonnes in August, official data from a Malaysian industry regulator showed.
Industry analyst Dorab Mistry also pegged Malaysia’s peak end-stocks at 3-3.3 million tonnes for the year, while estimating Indonesia’s inventories are currently close to 5 million tonnes and will keep rising.
In other related oils, the Chicago September soybean oil contract was last down 0.4%.
The Dalian January soybean oil contract and January palm oil contract were un-traded, as the Dalian Commodity Exchange was closed for national holidays in China.
Palm oil prices are affected by movements of other edible oils, as they compete for a share in the global vegetable oils market.
Plans by the world’s top cocoa growers Ivory Coast and Ghana to harmonize bean prices are unlikely to have much effect on world markets because of differences between their marketing systems and minimal domestic processing, Fitch Solutions analysts said.
The two countries account for about 60 percent of global output but exert limited influence over international prices, which have stayed low in recent years due to overproduction.
In response, they struck a deal this month to coordinate their farmgate prices for the upcoming October-to-September growing season. The collaboration is meant to emulate the OPEC oil cartel.
But a report by Fitch Solutions, a unit of rating agency Fitch, said that would be difficult to achieve, citing wide differences in how Ivory Coast and Ghana export their crop, most of which leaves West Africa in a raw or semi-finished state.
“Though the countries’ influence on global supply and international trade is substantial … various structural barriers will inhibit their ability to manipulate the cocoa market,” the report said.
Talks between Ivory Coast and Ghana followed intense market volatility over the last two years. Ivory Coast was forced to cut farmgate prices sharply last season while Ghana incurred losses of at least 2 billion cedis ($410 million).
In order to effectively harmonize prices, Fitch Solutions said, one of the countries would need to overhaul its market structure, but neither side has indicated it is prepared to make wholesale changes.
Ivorian farmers sell cocoa to international producers such as Barry Callebaut through state-organized auctions, meaning local prices are relatively responsive to global prices changes.
In contrast, Ghana’s Cocobod buys the beans at a price set at the start of the season, which prevents farmers from selling to other buyers.
The African Development Bank last year agreed to provide $1.2 billion to finance the harmonization plan, which includes construction of modern storage facilities, farm rehabilitation, and disease control.
Source:http://www.uk.reuters.com
KUALA LUMPUR: Malaysian palm oil futures gained more than 1 percent in the second half of trading on Monday, snapping five straight sessions of declines, tracking strength in crude oil and U.S. Chicago Board of Trade (CBOT) soy oil.
The benchmark palm oil contract for December delivery was up 0.9 percent at 2,162 ringgit ($523.87) a tonne on the Bursa Malaysia Derivatives Exchange at the close of trade, its strongest daily gain in two weeks.
It earlier rose as much as 1.3 percent to an intraday high of 2,170 ringgit, after hitting a three-year low on Friday. Palm shed 3.6 percent last week in its second consecutive weekly decline. Trading volumes stood at 37,379 lots of 25 tonnes each at the close of trade.
CBOT soy oil’s gain on Friday and firm crude oil on Monday helped palm oil open on a strong note, said a Kuala Lumpur-based futures trader.
Oil prices jumped more than 2 percent to a four-year high on Monday after OPEC declined to announce an immediate increase in production despite calls by U.S. President Donald Trump for action to raise global supply.
Palm oil prices are impacted by movements in crude oil, as the palm is used as feedstock to make biodiesel.
In other related oils, the Chicago September soybean oil contract jumped 1.8 percent on Friday but was down 0.1 percent on Monday.
Chinese financial markets were closed on Monday for the Mid-Autumn festival. Trading will resume on Tuesday.
Palm oil prices are affected by movements of other edible oils, as they compete for a share in the global vegetable oils market. – Reuters
Source: http://www.thestart.com.my
The Central Bank of Nigeria (CBN) on Friday provided 317.52 million dollars and 58.40 million Chinese Yuan (CNY) to customers seeking foreign exchange in the agricultural raw material sector.
Mr. Issac Okorafor, the CBN Director, Corporate Communications said the sale in Chinese Yuan was done through a combination of Spot and Short-tenored Forwards.
According to him the Chinese Yuan is available only to customers with Renminbi denominated Letters of Credit for Agriculture as well as raw materials and machinery.
He went to say that the availability of Renminbi would eventually ease pressure on the Nigerian foreign exchange market and it will ease trade transactions between Nigeria and China and maintain financial market stability in the country.
Meanwhile, a dollar exchanged for N361 at the Bureau de Change (BDC) segment of the foreign exchange market, while CNY 1 exchanged for N53 in Abuja.
India stands to lose a significant share of over Rupees5,000-crore annual export earnings of cashew as export of the nut heads for its worst fall in a decade with over 80 percent of the factories in Kerala, which holds a major share of shipments, remaining closed.
The nut export has plunged by 34 percent for four months to July in FY19 from a year earlier to 20,667 tonnes. Despite an increase in the unit value of cashew, the export earnings for the period have also slumped by 32 percent to Rupees,1447 crore as per data of The Cashew Export Promotion Council of India (CEPCI). “Unless the Centre approves the revival package submitted by the industry and extends the time to meet the new input-output norms, the current trend may persist for the remaining year,’’ said S Kannan, CEPCI executive director.
In 2017-18, cashew export volumes had bucked the trend of the previous two years and registered a marginal rise in quantity at 84,352 tonnes. The value had shown a healthy rise of 13.5 percent to Rupees5,871 crore.
While cashew processing takes place in as many as 16 states, the export is dominated by the processors from Kollam district in Kerala. But apart from some big ones, 700 out of 834 units have wound up business in the past 2-3 years, defaulting on bank loans.
The trouble began with the imposition of 9.36 percent import duty to curtail misuse in 2016. This was followed by the rise in the price of raw nuts by over three times to touch $2,400 per tonne