1.Current market situation
Even if the logistics situation came worst and worst starting from middle of Nov 2020, it looks the exports of the tomato paste from September till nowadays were not really influrence quite much .As we can study from the Customs clearance statistics as shows below :
Sept 2020
Quantity: 43,694mts
Average FOB net price (all mixed brix including DAF level by train): USD 771
Oct 2020
Quantity: 59,211mts
Average FOB net price (all mixed brix including DAF level by train): USD 770
Nov 2020
Quantity: 68,015mts
Average FOB net price (all mixed brix including DAF level by train): USD 769
Dec 2020
Quantity: 50,600mts
Average FOB net price (all mixed brixincluding DAF level by train): USD 772
Totally 221 520Mt
Average FOB net price USD 700 /Mt
RMB/USD exchange rate moved from May 2020 to Feb 2021 from 7,17 to 6,43, against 1 USD means an increase of 10% from crop 2020 concluded orders time till now. This RMB increase caused to packers a big pressure with the management of their exports.
Regarding Jan 2021 – export statistics not yet available – : checking with big players exports will not be less than 55,000mts for shipments done by train and/or conventional vessel used to avoid the heavy current cost for using sea containers.
Through offers communicated from differents packers the today FOB value is between USD790 and USD820/Mt based on various parameters such as quality ,shipment period and payment terms. There is a possibility having those FOB value to increase again from April /May after the logistics situation will be back to normal at that moment.
2, Forecasting of crop 2021
According the WPTC new publication the preliminary estimation for world 2021 crop size of tomato mentions a global increase of the crop size expected around 4% from last crop results. Americas and Amitom countries look they will pack more than crop 2020 meanwhile China should be down from 5,9 to 5,4 millions of fresh tomatoes or even less.
From our channel we are with the impression that the 2021 tomato farming in China will face a potential competition from good profit crops for farmers such as cotton , maize and chili. Today most of the players- including COFCO and GUANNONG -have only arranged/signed for 60-65% of their last year contracts for fresh tomatoes .
Farmers want and need higher price level for their raw material estimated to 460-470RMB/mt, meanwhile food industries want only to accept an increase to 420RMB/Mt maximum.
On the top packaging increased ( drums/aseptic bags ) : new cost will be around USD17/18-Mt.
That’s why China is not having for the time being a clear picture about its 2021 tomato crops and what will be finally sowed and processed. If 5,2 millions of fresh tomatoes will be processed as per existing forecast we strong believe that crop 2021 net FOB prices will increase to 820-850 per Mt to compensate the lost from the exchange rate, raw material and packaging increases.
Let’s wait for the final exchange between farmers and processors. Further news should be given around middle of coming March.
