Brazil nut market update
The harvest for 2021 Since the high swings in 2017, the Brazil nuts market has seen a lot of changes, causing prices to rise by percentages we didn't think would happen again anytime soon.
A number of factors caused the market to be wary of offering content in an unpredictable market. The main reason for packers' refusal to sell has been a lack of raw material.
The main reason for packers' refusal to sell has been a lack of raw material. Raw material prices have risen dramatically, and ongoing negotiations between collectors and packers have resulted in a market with very few shelled new crop offers. Packers were unable to obtain raw materials at reasonable prices, and as a result, were unable to manufacture and sell kernels.
Currently most factories are running on previously contracted volumes.
According to forecasts, the 2021 crop will be 30-35 percent smaller than last year's. In general, the supply of the 2020 crop was sufficient to meet market demand.
We'll have to wait and see how demand grows this year. Higher prices will affect demand from end-users, who may choose other commodities to use in their own purchases.
On the other hand, while Europe is beginning to see some relief in covid-19 measurements and a return to a more usual summer, South America continues to be severely impacted. Domestic consumption of Brazil nuts will also be impacted, potentially adding to the tightness.
Looking ahead to the next crop, we anticipate favourable conditions for a new crop to emerge early this year due to heavy rains. By the end of the year, we could even see a new crop ready to ship.