Weeks N°: 47/09 - 48/09- 49/09- 50/09- 51/09- 52/09- 53/09- 01/10- 02/10- 03/10- 04/10- 05/10- 06/10- 08/10

LITCHI LETTER- Week N°03/2010 - 18 to 22 january 2010

French version

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)

SUMMARY OF ARRIVALS BY SEA
(In pallets)

Litchis from Madagascar : Old litchis, dull in aspect. Shell indurations are in progress with/or without softening fruits

GENERAL INFORMATION

The last part of the marketing campaign for litchis from Madagascar is particularly difficult. The strong drop of the demand observed since the beginning of the year is not only ongoing but seems to be increasing. The campaign is sinking into a crisis that unfortunately seems long-lasting. The rather firm prices done during the end of the year celebrations seem to have led to a loss of interest of retailers in the fruit thus emphasising also the loss of interest of consumers for litchis. The drop in sales observed since the beginning of the year has contributed to a built up of stocks with fruit quality rapidly deteriorating. Time is now playing against litchis from Madagascar leading fruits into a negative cycle (lack of demand/ longer storage time/loss of quality/drop in prices). Moreover, South African fruits are more and more available increasing the pressure onsales for litchis from Madagascar. There are little chances that the market conditions will improve in the coming weeks considering the deterioration of the quality of the fruits. Despite a reduction of the supplies shipped from Madagascar this year, volumes of fruits available still seem to important considering the capacities of the European markets to absorb proposed supplies. It appears that operators have under estimated the possible impacts of the economic crisis on the demand. Let’s nevertheless hope that the good market conditions of the beginning of the campaign will contribute to showing good overall average prices for the whole campaign.

Estimate of incoming volumes
(in tons) 

EUROPEAN MARKETS

Germany : Limited sales due to an absence of demand for the fruit. Prices for litchis from Madagascar continue to drop.

Belgium : Difficult market conditions for litchis as well as for other exotics considering the weakness of the demand this week. South African fruit manage to sell at slightly higher prices considering their good size.

Spain : The demand for litchis is at a standstill this week. Strong drop in prices for litchis from Madagascar. If prices for South African fruit are slightly better, sales remain nevertheless very difficult considering the weakness of the demand.

France : The marketing of litchis from Madagascar is sinking into a long-lasting crisis. The market is breaking down strongly because of an absence of demand. In fact, there are no more “market prices” anymore. If good quality fruits are sold around 0.80€-1.00€/kg, several sales are done at much lower prices. Lots that are more “fragile” are sold on wholesale markets at “open prices” in order to help sell as much fruits as possible. Despite low prices operators show little interest in the fruit. Stocks are still very important and it is difficult to foresee a big change of trend before the end of the marketing campaign. The deterioration of fruit quality contributes to complicating sales despite the fact that poor quality lots are put aside.
The presence of good quality supplies from South Africa increases the pressure on sales. Several operators have shifted to South African supplies that are of better size and freshness. This however, does not keep South African litchis from knowing some quality issues with fruit quality evolving differently according to brands.

Litchis from South Africa with little mould stains and poor coloured fruits.

Italy : Important drop of the demand for the fruit following the end of the year celebrations. Prices done do not encourage consumers in buying the fruit. Prices are dropping around 0.80€ to 1.10€/kg.

Netherlands : Heavy market with slow sales. Prices remain stable this week. There more and more quality issues mentioned on South African supplies. These fruits seem to have very limited storage time.

United Kingdom : The situation on the litchi market is complicated and very difficult. Supplies that have considerably increased this week seem all the more important that the demand for the fruit is too low to absorb the fruit fruits available on the market. All this contributes to giving an impression of “over supplied” market. Prices thus continue to drop for fruits from Madagascar as well as for fruits from South Africa. The price trend is large and depends on the quality of fruits. On the wholesale market, litchis from Madagascar are sold between 1.00€ and 1.25€/ kg while those from South Africa are sold at slightly higher prices between 1.45€ and 1.60€/ kg.

Exchange rates (Janvier 2010) :

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