Schreiber Foods International, Inc.
Importers of Ambrosia® and Other Fine Brands
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Welcome to the SFI Market Blog

Update: Current Tuna Market

For months the market has been advancing for all species of tuna; Bonito, Skipjack, Yellowfin, Tongol, and Albacore.  The main reason the market has been firm is that fishing hasn’t been good since there is a lack of raw material.  To further exacerbate the problem, some countries such as Indonesia, have instituted fishing restrictions to help the fish population regenerate.  It is now illegal to have carriage vessels transport fish from the ‘fishing’ vessels back to land, so the fishing vessels stay out at sea.  The smaller fishing vessels can’t store enough fish on their boats to keep returning to land.  Also, the declining fish population doesn’t swim as close to shore as they used to so boats now have to travel 100+ miles further to fish.

For some other oceans, a fishing ban (ending October 31st) has been implemented.  Of course it makes sense to restrict fishing to help the population redevelop. We all want there to be enough fish for generations to come, but balancing supply and demand with social responsibility is a difficult business.

Skipjack raw material, which is the high volume industry standard, has been rising steadily throughout the year to now hover around $2,100/ton in Bangkok with no relief in sight.  Typically around this time of year, it is a busy buying season for importers because they are purchasing their first quarter requirements. Due to higher prices and the shortage of fish, buying has been slow.  Unfortunately, there is little doubt that the tuna market for all species will remain strong through at least January and we can expect to see some shortages along the way.

Thai Pineapple Supply Is Slowly Recovering

As Thai pineapple processors are getting ready to make a push for 2018 at the ANUGA Food Show in Cologne, Germany October 7-11th, 2017, they are reporting that the fruit supply is slowly recovering from last year’s low levels. Thai canned pineapple products have taken a lot of “beating” from end-users during the last 12-18 months because of lack of flavor; fruit was picked and processed before it had a chance to mature during the period when supply was low and demand was high.

Pineapple growing areas have been getting a good amount of rainfall this year which helped increase the yield and improve the quality of the fruit. According to a report published by the FoodNews, “Thailand’s processing pineapple harvest this year will be slightly larger than last year’s 1.49 million tons, but still way below historical norms.” The total tonnage for 2017 is estimated to be around 1.7-1.8 million tons or about 20% more than last year.

According to our local sources, factories will face difficulties hiring workers to fill their maximum processing capacity because of the latest government regulations. In an effort to prevent human trafficking, the Thai government has recently enacted new laws for hiring migrant workers and set quotas for companies that desire to hire temporary migrant workers. This can be a major problem for processors during high season because they can’t just hire extra labor when the fruit is pouring in. Instead, they must get work permits first and they cannot exceed their assigned quotas.

A factor that we have to take into consideration is the strengthening of the Thai Baht against the US dollar. The Baht has gained about 8% in value against the USD during the past two months. However, given the better fruit supply, we expect the prices to get back to “normal” levels. The Thai pineapple processing industry has traditionally endured a lot of “boom and bust” cycles and they hope that supply and demand situation will balance out during the next 12-month period.

Update: Anti-dumping Duty Petition Moving Forward (Spanish Ripe Olives)

Spanish Ripe Olives: Anti-dumping Duty Petition Moving Forward

On August 4th the International Trade Commission issued an affirmative decision regarding the anti-dumping duty petition filed on Spanish ripe olives, as published in the Federal Register.

This means that the case will continue in the final phase. Such decision is not surprising; the ITC typically finds affirmative in the preliminary phase, giving themselves more time to investigate the issues they need to consider in the case before they make a final determination. One of the major issues is the pricing of retail (branded and private label) and foodservice ripe olives. The ITC was made aware by the respondents (exporters and importers) about the substantial differences in retail pricing and required further information from the petitioners (domestic packers). This will be an important question that they will continue to review in the final phase.

The Department of Commerce is also moving forward with their investigation into the countervailing duty side of the case and has issued questionnaires to the Government of Spain and to the European Commission. The DOC has also named three mandatory respondents (Spanish ripe olive manufacturers) in the anti-dumping case: Aceitunas Guadalqivir S A, Agro Sevilla, and Angel Camacho Alimentacion S.L. Respondents received various questionnaires from the DOC this week that they have to complete in a very short period of time.

Breaking News: Anti-dumping and Countervailing Duty Investigations (Ripe Olives From Spain)

RIPE OLIVES FROM SPAIN: Anti-dumping and Countervailing Duty Investigations

As published in The Federal Register on Wednesday, June 28, 2017, the USITC (United States International Trade Commission) has just initiated an investigation to determine whether the domestic industry is “materially injured or threatened with material injury … by reason of imports of ripe olives from Spain.”

These investigations are instituted in response to a petition filed on June 22, 2017, by the Coalition for Fair Trade in Ripe Olives, consisting of Bell-Carter Foods, Walnut Creek, CA, and Musco Family Olive Company, Trace, CA. The Coalition alleges that Spanish ripe olives are sold in the United States at less than fair value and that their production is subsidized by the Government of Spain. Unless the Department of Commerce extends the time for initiation, the ITC must reach a preliminary determination in antidumping and countervailing duty investigation in 45 days, by August 7, 2017. The alleged dumping margins range from 84% to 232%.

It’s important to know that antidumping duties (AD) are assessed if foreign exporters sell to U.S. customers at “dumped” prices AND the U.S. industry is found to be injured or threatened with injury as a result of such imports. Countervailing duties (CV) are assessed if unfair subsidies are provided by a foreign government to benefit the production or exportation of the goods AND the U.S. industry is found to be injured or threatened with injury as a result of such imports. In this case the petitioners allege that both circumstances prevail.

The timing of the petition couldn’t have been worse; most Spanish olive packers and importers were busy preparing for and then attending the Summer Fancy Food Show in New York last week and earlier this week. With the long holiday weekend coming, the interested parties in the U.S. don’t have too much time to respond to the ITC’s quite extensive questionnaire that is due back on July 6th. Interested parties include Spanish manufacturers and exporters, as well as U.S. “importers of record” whose name appears on the Customs entry of products whose HTS numbers are listed in the scope of the petition.

The public records of the investigations can be found on the USITC website:

Tuna: Pricing and Current Supply

Skipjack, the bellwether of the tuna market, has been steadily rising in price to near historic levels.  Typically the new fishing season begins in spring, but not much fish have been landing.  Pricing a few months ago was around $1,750/ton for raw material, and the market expected it to bottom out at $1,500/ton.  Due to low volume of fish, the market is now expected to hit $1,900/ton this week!  We expect prices to continue to rise with no reductions in sight.  Shipments are also delayed due to this shortage of raw material.

Tongol is now very high priced but a good alternative is Yellowfin.  Typically, Yellowfin is only a couple of dollars lower than Tongol which is why most have gravitated towards Tongol.  Now the cost difference is about 10%, and Yellowfin is good looking tuna and looks even better with a bigger price spread.

Albacore has been firm and steady in pricing, but raw material has been tight on the supply side, creating some delays in exports out of producing countries such as Thailand and Indonesia.

A word of caution; be alert to some below market quotes!  There is a lot of product being quoted with drained weights below the US FDA minimum, by almost 12%!  Caveat Emptor, ‘Let the buyer beware’!

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