Market Report - April 2012

MARKET REPORT up to May 2012.

Food commodity prices are now stable but with significant uncertainty caused by the Eurozone, the fear of conflict with Iran and the general state of World economies.

EXCHANGE RATES.

  • Against the $, Sterling opened the month at 1.588 and was at 1.58 as at 10th March.
  • Against the Euro, Sterling opened the month at 1.19 and ended at 1.195 as at 10th March.

CRUDE OIL.

Energy prices rose in February, in line with higher crude oil prices, given instability in the Middle East. Brent crude oil rose 10% on ICE London with U.S. light sweet crude oil on NYMEX also up 6%. E.U. Diesel prices increased 10% and petrol 8%.

FATS AND OIL.

Vegetable Oil prices rose recently, supported by uncertainty over the size of the South American soya bean crop.

WHEAT.

Milling Wheat futures fell slightly on Paris LIFFE, while spot market prices increased 3% in the U.K. and 6% in Germany. News of reduced Ukrainian exports supported prices later in the month.

DAIRY.

Butter - prices continued to fall given good worldwide supplies. U.K. prices fell 4%.

Milk E.U. milk deliveries continued to increase, supported by high farm gate prices seen across the continent. Volumes rose 3.2% in December 2011 year-on-year.

S.M.P. U.K. prices fell 2%.

Egg - The implementation of the E.U. Welfare of Laying Hens Directive, banning battery cages, has created a shortage of product as some producers struggle to meet the criteria. Egg product prices rose sharply - Liquid Egg 35% and powdered products by 16%. E.U. shell egg prices also rose 17% due to increased producer costs, lower supply and the higher demand experienced at this time of year.

COCOA.

Prices for Cocoa and its products are largely unchanged. Cocoa beans fell 1% on LIFFE but remained steady on ICE. U.K prices for Cocoa Powder and Cocoa Butter were unchanged.

DRIED FRUIT & NUTS.

Turkish Raisins are sold out at origin and sultana stocks are running down, although demand has started to slow. The current Currant crop is sold out and any surpluses are in the hands of importers. Prices will therefore remain high for the rest of the season.

PLASTIC PACKAGING.

Prices for chemicals and plastics rose, driven by increases in petrochemical feed stocks and higher crude oil prices. European propylene price rose 18%, whilst L.D.P.E. and P.E.T. increased 10%.

Report by Frank Wade

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