Reports indicate that the upcoming Brazilian Crop is much larger than last year’s. Prices have started to ease for both in an attempt to reduce high priced inventories before pricing for the new crop is set.
We have reports that state demand for both has increased. With limited availability prices continue to be firm. We have also received a report that advised that rains in certain growing regions in Yunnan are currently hampering collection, adding more pressure on prices. Sentiment is that pricing will not ease this summer.
We have seen more and more offers for “Garlic Oil” at low prices. However, when evaluated, these products do not qualify as “Oil” failing basic tests. Quality remains a serious issue and prices remain firm for the correct quality.
With carryover virtually consumed, any offers received today are for limited quantities with high prices. Reports on the new crop should be received shortly with the anticipation of prices softening.
There have been reports that the Monsoon Season this year has not provided enough rain to ease the conditions in drought stricken growing regions. This has kept prices firm. Strong demand has caused measures to be taken that have brought about serious quality issues.
Similar to Lemongrass, rain is needed in the growing regions. Prices remain firm and quality is questionable.
With Indonesia still not producing at a “normal” rate, prices continue to firm. These prices are expected to ease late summer as we are now in the “Dry” Season and very shortly production of oil should increase. In line with Indonesia, Madagascan oil pricing has risen. Madagascar crop should begin in August, so early Fall should see prices soften.
The Spice Market continues to advise that prices for new crop seeds are firming. We anticipate that seed oil prices will follow shortly. Herb oil is still firm and is reportedly being made to order.
Pricing from both China and Indonesia is firm as farmer disinterest and rains have kept production down. With crops in China due now, reports indicate that current rains in growing regions could add more pressure on prices.
Our most recent report (July 15th) is advising that Turpentine prices have stayed firm. Rain in the main Pine growing regions has not helped supply. This report also states that demand for derivatives is lackluster, as downstream plants reportedly have no urgent orders they need to cover. These plants expect prices to soften so are in no rush to buy at this time.
Prices remain high as production is still limited.
On July 1st a Goods and Services Tax (GST) went into effect, at a rate of 12%. Impact on pricing is what one would expect. With less acreage planted, increased strength of the Rupee and this new tax, prices have changed weekly. Several producers anticipate prices to continue to rise for some time.