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The following information contains the 2010 predictions of the primary luxury crops produced in the tropics. This information is based on research I've done online or that was sent to me. If you have additional information on any of the current annual price predictions for tropical foods, flavors or ingredients, please send it and I will post it. Thank you. VQ
Cocoa - Chocolate
Cocoa continues to be expensive due to shortages in the Ivory Coast according to the International Cocoa Association (ICCO). The following are the daily prices and futures for cocoa as of January 15, 2010:
ICCO daily price (SDRs per ton): 2257.64
ICCO daily price (US$ per ton): 3560.28
London futures (£ sterling per ton): 2280.00
New York futures (US$ per ton): 3411.33
World production for 2009 came in at 3, 515,000 tons, a demand deficit of about 28%. Cacao growers can expect prices to remain high, at least for now. Learn as much as possible about the future market before planting additional trees.
According to Barry Callebaut, the global chocolate market demand dropped more than 2% in 2009, but appears to have hit bottom and is likely to main flat through 2010. The market has stabilized in Europe and the United States, but demand in Eastern Europe and Russia is still quite low and not showing signs of recovery. The US market does not show increased use. Callebaut reports that their last quarter had a 7.2 percent increase, however, and they anticipate continuing their growth pattern. They also acknowledge that with cacao and sugar prices very high, it's difficult to predict with certainty when the chocolate market will begin to grow again.
Coffee
The Executive Director of the International Coffee Organization released the annual report in November, 2009, with crop totals for 2009 and expectations for 2010. Here is a synopsis of the report.
Total production for the crop year of 2008/2009 was about 128 million bags. The total world demand was approximately 130 million bags. The 2009 crop came in lower than anticipated in Central America and Colombia. World coffee supplies may be limited in 2010 given that there isn't a large volume of beans and adverse weather conditions could affect the quality of crops and stimulate the occurrence of diseases affecting coffee trees.
Stable production in Africa and a number of other countries may not be enough to offset the lower production of countries currently experiencing supply problems. The increase in labor and fertilizer costs is one of the main factors in this limitation of supply. The preliminary estimate of total production in crop year 2009/10 will be around 123.7 million bags. Although Brazil anticipates a solid crop this year, it will not create an overabundance of coffee given the low stock.
Coffee supplies are likely to remain tight in 2010 as a result of low production and problems in the quality of coffee beans as a result of adverse weather conditions during harvesting. Despite the current world economic crisis, coffee use has remained stable so prices will remain strong.
Tea
According to the Food and Agricultural Organization of the United Nations, tea prices reached record levels in 2009 but should ease in 2010 as weather patterns returned to normal in the main tea-producing regions of Asia and Africa.
The FAO Tea Composite price, the overall world price for black tea, rose to $3.18 a kilo in September due to droughts in India, Sri Lanka and Kenya, compared with an average price of $2.38 per kilo in 2008.
The FAO has expressed concern that tea producers might plant more tea, creating a glut in the market.
"Some producing countries, such as India, have acted responsibly and announced that they would not be expanding current tea areas beyond what is required for replanting and rehabilitating existing tea gardens," according to Kaison Chang, Secretary of the FAO's Inter-Governmental Group on Tea, the only international tea authority.
Established tea growers can expect stable to slightly dropping prices, but the market will move toward normal in the next year, so don't increase plantations.
Vanilla
In June of 2009 Michel Manceau reported that Madagascar may reinstate The Vanilla Organization as a way to stabilize prices and assist growers. It remains to be seen as to whether this will actually take effect and how much it will help.
Prices have been extremely low in the past four years, with cured Madagascar beans selling for as little as $27 a kilo at source. This will change dramatically within the next twelve months according to Manceau and other reports coming out of Madagascar.
Although Madagascar produced 2300 metric tons of vanilla in 2009, only part of that crop is expected to be released into the marketplace. The prediction for 2010 is that the Madagascar crop will drop to 800 tons and fall further in at least through 20013. With only 400 - 500 tons coming onto the market from all other origins, there will be roughly only half of the world demand for pure vanilla in 2011.
The cause of the drop is partially because farmers have over-pollinated their plants, hoping to make up in volume for the shortfall in prices. As a result, most of the plantations in the SAVA region of Madagascar have been destroyed by fusarium. This is also true in Sumatra and some plantations in India.
Farmers who have healthy vines should maintain them and even increase their vanilla production, with higher prices coming soon.
Sugar
Sugar rose in New York, extending a rally to the highest price since January 1981, on renewed concern that a global-supply deficit may widen. The International Sugar Organization reports that as of January 15, 2010, sugar prices are 25.87 cents per pound.
"Demand continues to increase," according to Jurgens H. Bauer, the head of Jurgens Bauer & Associates, a broker in New York. "Supply problems are anticipated to continue."
Production shortfalls primarily caused by heavy rain in India and Brazil, have pushed world sugar prices to a 29-year high, nearly tripling in the past year.
High prices will likely encourage farmers to plant more cane or move away from producing ethanol, which will increase supply and push prices lower. The International Sugar Organization expects a small world sugar surplus from 500,000 to one million tons in the next crop season.
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