Olive Oil's Early Forecasting...

This was received today from one of the most knowledgeable followers of the Olive Oil Business:

The new season (Fall/Winter) is far ahead in time, though subsequently later meteorological events could bring eventual modifications to current data that (obviously) can´t be foreseen at this time. But, as of the current date here is what we have:

-along this past 2007 Winter months the climatological component had been excellent for the olive tree, with plenty water and mild temperature; under such conditions the crop evolution portends to be abundant and of good quality.

-current total production forecast for the new crop now reads from 1300 to 1400 million tonnes, basically 25% higher than 2006/2007.

-estimation of stock available for inter seasons overlap reads from 200 to 250 thousand tones, enough to allow a smooth transition without too many price changes...

Based on this current data we can "see"...

a) drop in prices has been raising consumption (domestic and overseas)
b) olive oil (health trend) remains in full fashion, world wide...
c) overlap stock looks solid but not massive

Therefore,

a) It does not seem convenient to run too far in contracts as clearly the new crop will tend to force prices to a decrease below 2007 levels,
b) But at same time we may see some sort of price reaction towards the end of the season depending on how far current stock runs.. (Slight Up Trend?)

Once new crop is in place (early 2008) we may find markets stable for a period of time and cost of raw material reaches a bottom level.

That would appear to be the oportune time to contract for the seasonal needs price points....

Saffron Goes Up UP UP!

Saffron markets continue to be short and prices keep rising. I expect prices to continue to climb from current levels... Expect to see more increases as previously reported this summer... Problem is... that will be EARLY SUMMER... and we are there now...





Another note... US FDA has been under more and more strain... Shipments from known producers and known countries (and not a threat in any way) are being reviewed more slowly and carefully... RESULT.... SLOW RELEASES OF PRODUCTS...

Delays are becoming more frequent....

Checking the Pulse of the World

Not much to report except poor news as we move towards the summer of 2007. But as it has been a while since my last update here are some of the pieces of news that may effect our businesses:

Bees keep disappearing. Here's The latest in the East.

Rising Energy Costs impact Food Costs more than you would know. Read this...

FDA has been in the news and the pressure on this underfunded agency grows. Here is a WSJ link (subscription needed)for more details. They propose "a new approach, countries and private businesses -- including foreign manufacturers, importers and U.S. manufacturers using imported ingredients -- might be required to provide the FDA with more information about the production, packaging and transportation of imported foods."

All this pales with the continued news from Iraq and Afghanistan of course. Indeed at times I wonder if any one but the soldiers and their families know that we are at war far away... This week we paid respects to a soldier in my son's Brigade who was KIA... Jake Lowell was a hero who died trying to save his buddies... It gives real pause.