End of Calendar Year…How goes it? Where’s it Going?

So many things are happening at once to us that that best part of this change in Gregorian calendar event is that we pause to look back, evaluate and hopefully improve on our lives and of those around us. We at Blue Planet Foods want to wish everyone a very healthy and prosperous Newest Year!

To take a snap shot of who we are here in America check out this link.


And where will we be going in the newest year with only 386 days left in President Bush's term of office and elections coming sooner than later? Where will the Dollar be next year (this year's New Year's Day finds the rate of exchange 20% lower vs the Euro than last year's)? Will crops be good, will a recession in the global economy cause friends to loose jobs and income? Will the price of Queen Olives ever come down?

Like forecasts, our guesses are just that and we'll spare you that here.

I will forecast with certainty that Blue Planet Foods, Ltd (not Inc.) will continue to do our best to serve our clients and customers with respect and effort. We will continue to try to communicate effectively any changes in our mutual businesses so that we can all adjust our sails on these many seas of changes.

Happy New Year from Blue Planet Foods, Ltd.

New Year brings New Olive Prices

Green Olives prices for finished goods are starting to be presented and option contracts held for quantities are being closed for pricing in the coming days.

Here’s where we are basically for finished goods in Euro Terms:

Queens are up a whopping 12% to 16%....

Manzanillas are up about 5% to 6%...

The price pressures are classically market driven with Supply Shortages evident in the Queens and only energy/production cost pressures showing on the Manzanillas.

For some customer’s we have been suggesting they accept a wider allowable range in the sizing (counts per kilo) to help offset the high rise in Queen prices.

None of this takes into account the US Dollar ($) vs. the Euro (€) rate. We had pegged initial forex price hikes last October that take effect mostly January 1st at 1.42 to 1.44 band. If these rates should deteriorate during the first quarter of the coming year, further forex adjustments could be expected.

Other cost factors that are on the rise include Transportation (Ocean and Drayage) costs.

And then on the US side, costs are rising too from Storage to Pier Passes and User Fees.

End Results are Finished goods are up and new prices will take effect in March at the latest.

Update Olives

I receive the following information:

"Spanish Campaign: in quantities a good harvest generally improving the figures of last year. But,there is a dramatic difference in volumes depending on the variety.

There has been a good harvest hojiblanca and manzanilla but the cacereña and gordal (Queens) harvest has been disastrous.

As far as the hojiblanca is concerned, the problem comes from the hand of the average size of olives that have fallen significantly compared with last year. This smaller size makes the so-called olive mill has passed represent about 2% of total kilograms last year, a 9-10% this year. (AW note: Hojiis are the olive of choice for Oil).

Impact on export costs:

1) Raw Material: the cost of olives paid to the farmer has fallen between 15-20%.

After applying transportation costs (with the strong increase in the cost of fuel), other additives (cost of acetic acid has gone up 40%) and the impact of the Mill rate (from 2% to 9-10% of the production cost)the final cost reduction is only 10%.

This drop of raw material impacts finished goods cost's in different ways with the larger tins less approximately 6% and smaller cans (approximately 3%).

This is the end improvement from lower raw material (AW note in EURO terms).

2) Other cost impacts:

To make up the final cost of the finished product we have experienced very strong price increases as follows:
- Labor-between 4-5%
- Packaging .- increases ranging from 7% to 10%.
- Energy-there announced increases of 20-25%
Chemicals-related manufacturing and the subject of discharges .- rises 20-25%

All this is coupled with the status of USD vs. Euro and its influence both in transport costs and other increases.

The ultimate effect on prices of this new season of olives and prospects going forward are cost increases for next year. Biggest impact this year over last year is prices in USD and freight. "