The Philippines continues its struggle with deliveries, averaging 4-6 weeks in delayed shipment of old orders. Meantime they are now completely sold uptil Sept and looking to sell only Oct shipment and onwards. Prices have increased in the Philippines week on week.
Sri Lanka prices have reduced somewhat due to the fact that they have an excess in supply of domestic coconut oil thereby temporarily reducing the consumption of raw nuts in the country, hence the recession in prices. Its expected that once the excess inventory has been consumed and there is a balance brought in the supply dynamics, prices will firm up once again
Indonesian millers are now facing reduced and intermittent arrivals of raw materials owing to the fact that we are now approaching lean crop and also weather related issues. Sellers are most cautious in offering and prices have shown an increase week on week.
Meantime the situation with the meteoric rise in freights is continuing and causing shippers and importers alike a whole lot of grief. The temporary closure of the Yantian port in China over Covid and congestions in the main ports in North America and Europe are adding an enormous strain to the already difficult situation. Freights have gone north and are expected to continue to do so well into the year.
In the 3rd and 4th quarter of each year, demand for all products including Coconut will surge. This especially so since there is a sharp absence of physical stocks in most markets. In addition this period is also the time when Typhoons usually happen in the Philippine archipelago, something all traders must be wary off. A big typhon could totally upset the already fragile supply chain.
We suggest partial and constant covers of any open requirements to mitigate against rising freights and possible supply disruptions as we do see this market to be going north for reasons highlighted above