Weeks N°: 46/07 - 47/07 - 48/07 - 49/07- 50/07 - 51/07- 52/07- 01/08 - 02/08 - 03/08 - 04/08 - 05/08 - 06/08

LITCHI LETTER - Week N° 02/08

French Version

ORIGINS	GERMANY		BELGIUM		SPAIN		FRANCE		HOLLAND		UNITED KINGDOM
Weeks	01	02	01	02	01	02	01	02	01	02	01	02
Air	-	-	-	-	-	-	-	-	-	-	-	-
Mauritius (b)	-	-	-	-	-	-	-	-	-	-	-	-
Mauritius (s)	-	-	-	-	-	-	-	-	-	-	-	-
Madagascar (b)	-	-	-	-	-	-	-	-	-	-	-	-
Reunion (b)	-	-	-	-	-	-	6.00 - 6.50	6.00	-	-	-	-
South Africa (s)	-	-	-	-	-	-	-	-	-	-	-	-
Sea	-	-	-	-	-	-	-	-	-	-	-	-
Madagascar	1.30 - 1.70	1.30 - 1.50	1.30 - 1.50	1.00 - 1.30	1.30 - 1.50	1.20 - 1.50	1.20 - 1.40	1.20 - 1.50	1.10 - 1.50	1.10 - 1.50	1.35 - 1.60	1.35 - 1.65
South Africa	-	-	-	1.80	-	-	2.00 - 2.50	2.00 - 2.50	-	2.00 - 2.25	-	2.00 - 2.40

Price in Euros per kg - (b) : on stem/fresh ; (s) : +SO2 (Indicative and average price given by operators most representative of the industry for fruits of satisfactory quality)

Hereafter is an estimate of litchis exports from Madagascar by sea freighted containers. These volumes do not take to account volumes forwarded through transhipments by other lines.

SUMMARY OF ARRIVALS BY SEA
(In pallets)

INCOMING TONNAGES				FORECASTED TONNAGES
Departure Source	Vessels	Dates - Ports	Tonnage	Departure Source	Vessels	Dates - Ports	Tonnage
Total conventionnal	5 vessels	9-18/12/2007	17200	Tamatave 18/12			399
Tamatave 24/11	Ocean Trader	-	66	Tamatave 24/12			37
Tamatave 05/12	Atlantic Trader	Rotterdam	2700
Tamatave 11/12	Olivia	-	836

The above mentioned indications are subject to confirmation. Note: Mrs : Marseille / K : Koper / VD : Vado / SN : St Nazaire.

GENERAL INFORMATION

Logical drop in the demand for litchis following the end of the year celebrations. Some European markets are closing up more quickly than others (Italy and Spain for instance). After the slight raise in prices between Christmas and the New Year, prices are now on a downtrend especially at retail and supermarket level. There is a drop in the quality of fruits from Madagascar with fruits showing ageing signs as well as increasing spots of mould. The number of fruits being sent back to sellers is also increasing.

Arrivals from South Africa are progressing with imported volumes this week estimated around 10/15 containers. Fruits from this origin are generally of good size. On the other hand, their lack of colour is still an issue with fruits being less attractive than those from Madagascar. The bad weather conditions in producing areas seem also to affect the quality of fruits that are sometimes fragile.

Estimates of volumes received by air this week are as follows:

Estimates of incoming volumes by Air
(in tons) 

EUROPEAN MARKETS

Germany : The demand is still on a downtrend. Prices still hold for good quality fruits, but of lesser quality fruits are sold at much lower prices.

Belgium : Very average demand for fruits from Madagascar for which prices are beginning to drop. The arrival of fruits from South Africa that are of much better sized puts Madagascar sales under pressure, several buyers preferring South African fruits over Madagascar fruits.

Spain : Less dynamic demand for fruits from Madagascar. Consumers are loosing interest in the “festive” fruit. The increase of the selling price since last week is also slowing down sales.

France : Strange market this week with the widening of the price trend for fruits of satisfactory quality. Sales are still slow, with part of consumers loosing interest in the fruit. Up to now they were drawn to litchis by the attractive prices done by retailers but with the supermarkets increasing their prices, interest for the fruit has dropped. In addition, some operators are reducing the volumes marketed in order to be able to face the forecasted increase of the demand for the Chinese New Year. This voluntary reduction of volumes put on the market could be a good operation if the quality of goods retained manages to hold until the Chinese New Year celebrations. South African fruits could also benefit from this increase in the demand especially considering that volumes from this origin have increased all along the week.

On the whole there is a serious drop in the quality of litchis from Madagascar sold on the wholesale markets. There are more and more cases of mould spots on Madagascar fruits. There are also more and more signs of ageing fruits with shell indurations as well fruits showing a « blown » aspect. The irregular quality of fruits has a direct impact on sales that are done at low prices sometimes even below 1.00€/kg. Some lots of good quality are also sold at very low prices with some supermarket chains that are still reluctant to following last week’s upward price trend. The good increase in volumes of fruits from South African on the French market led to a drop in prices.
If some sales were still done around 2.50€/kg, they are now becoming very rare, the major part of fruits being sold on the basis of 2.00€/kg. The quality of these fruits is uneven with some fragile fruits showing rapidly signs of mould.Important decrease in volumes arriving from The Reunion for on or off stem fruits of uneven quality. There are always some stained fruits in the boxes, The uncertainty of the quality of fruits stops prices from progressing although the offer is limited.

Italy : Clear drop in the demand. The market is closing up to litchis that were sold at very good price during the end of the year celebrations. Prices are still rather firm because the limited (1.60-1.70€/kg).

Holland : Prices for good quality fruits are on a downtrend this week. The situation on the market lacks stability mainly because of the uneven quality of fruits from Madagascar and also because of competition from South African fruits. Despite the fact that the offer is on a down trend, prices continue to drop for Madagascar as well as for South African fruits.

United Kingdom : Decline of market conditions for litchis from Madagascar. Last week’s increase of price on the continent had an impact on the UK market especially at the beginning of the week, but with the increase of quality problems, there was a change in the price trend again. At the beginning of the week prices were around 1.60€/kg, they dropped to 1.50-1.55€/kg during the middle of the week to finally stabilise around 1.35€/kg at the end of the week. Last week’s price increase was badly received by several operators especially considering the fact that volumes were increasing but so were quality issues. Several lots were retuned to sellers at the end of the week. On the wholesale market, volumes were much more important and prices were more or less stable around 1.800-2.00€/kg. Due to the fact that they are cheaper, fruits from Madagascar sell more easily than those from South Africa that are more expensive.

Exchange rates (january  2008) :

1 EURO
United Kingdom	0.7438 GBP
Madagascar	2 621.54 MGA (Ariary)

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