The situation with the desiccated coconut market is as follows:
Philippine prices remain rock steady. All mills there are sold out for the year and if orders are placed, if you are lucky, shipments would be in December. Most likely deliveries would be in January. Crop supply remains a problem and demand has far outpaced supply
Sri Lankan prices remain relatively steady on the back of good demand coming from the Mid-East after they have come out of their recent holidays from the holy Festival Of Eid. Crop levels are not exciting here either.
Vietnam's prices are strong and continue to remain steady. There is a huge take off of goods from Vietnam into China. Further, recently Thailand has become a huge importer of raw nuts from Indonesia and Vietnam both for domestic consumption as well as for use in their many coconut milk factories has been importing very large quantities of nuts from Vietnam. Meanwhile, it’s important to note that crop levels are poorer than earlier in the year.
Indonesian prices have now steadied and stabilized. Most of the factories in Indonesia are fully sold out for October. They are close to being well sold for November as well. There has been a lot of buying recently from the domestic consumption of Indonesia which has filled the order books of these factories. Many are not under this pressure any further. Also, Indonesian crop supply has begun to reduce leading to prices for raw materials begining to increase. Some factories with whom we work with have told us that they even had to stop work on more than once in the last week due to inadequate raw nut supply. To add further pressure, Thai importers have been buying up raw nuts at a good premium of late for domestic demand driven by coconut milk factories.
If one were to analyze the present situation, you can see clearly that raw material supplies in all origins have begun to reduce. This while we are going into a period of very high demand from the Christmas and Thanksgiving holidays. After these American holidays, Chinese New Year from China which will create a massive demand in the start of 2015. The start of 2015 also brings the traditional high demand from the Mid-East as temperatures are more conducive to the storage of coconut. We are therefore going into periods of low crop and high demand.
The market prices are expected to rebound after the Winter as a result of the above.