Spain was hit by the frost at the beginning of April. It is still too early to predict the impact on this summer’s harvest but the first estimates are between 10 and 50% of damage, and prices have increased accordingly.
The frost that hit California in March seems to have caused considerable damage in the north but relatively little damage in the other production areas, so the impact on the 2022 harvest should be limited. Few offers are circulating right now for the upcoming harvest, or only with a premium. The official “subjective” estimate will be published on May 12th, probably accompanied with some activity on the market due to the high level of anticipation. Terra Nova published its non-official estimates last week, which were also highly awaited for. The famous trader predicts a Californian harvest of 2.9 billion lbs, with an average yield of approximately 2,100 lbs/acre for 1,380,000 cultivated acres. Although lower than the average of the past 10 years, some consider these predictions to be far too “optimistic” for a year marked by frost and drought.
March is the 4th consecutive month with higher sales volumes Vs N-1. This is now reflected in the commitments (registered sales not shipped) which are higher than last year (+2.55%) for the first time this year. Note the sustained activity of India which, because of the delays in logistics, has no choice but to buy everything they need from this 2021 harvest in order to cover the consumptions related to Diwali. On the other hand, the activity of the Middle East is now slower due to Ramadan and China is almost completely absent due to the country’s lockdowns. Logistical difficulties make the situation in Europe quite heterogeneous.
The volumes that have been shipped or sold so far do not yet reach last year’s levels (-15% and -10%, respectively). The logistics crisis in Asia and the United States are disrupting the market and causing huge delays. It will most likely be impossible to keep the carry-out level below 800 million lbs. This significant volume of unshipped merchandise is a glass ceiling that should limit the increase in prices in case of a poor 2022 harvest.