While the US $ drives the deals, there are other related costs that are being absorbed in the goods we manage. Particularly, freight related costs, costs in production from energy to the cans and glass jars,to the cost of labor... all are pressuring upward, regardless of the cost impacts up or down of the Raw Material.
The latest news is:
Mandarin Oranges...
We predicted and were correct that costs are going up about $2.00 per case on the base units of 6/#10 Mandarins in LS... The new season is going to be reflecting these by the beginning of 2008.
Ripe Olives...
The market is stable in raw material. FOB EURO costs are little changed from last year but that means they are solidly higher from FOREX alone. I am looking at our costing of Sliced Ripes which I had done only a few weeks back and find that I am off by 5%! That time, I used 1.40 to 1.42 range... we are no longer there...
Time will tell... But the short term does not look good for the US $....
Perhaps a break next year or perhaps as we are all so herding south, the market may turn around in a contrary move!
Only time will tell...
And in the meantime... PRICES ARE GOING UP... Sorry to say....
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