News

December 29, 2008

Markets’ Tit-for-Tats .. . But Cocoa Rises 27 Per Cent To Win

Sally White

Tit-for-tat spars and protectionism cast a nasty bad-tempered pall over agriculture markets as 2008 closed, giving a gloomy warning for 2009 with recession biting into demand. Indian has begun to take Indonesian, South Korean and Vietnamese oilmeal importers to task for failing to open letters of credit for consignments received. This follows a move by the Indonesian Oil Association to blacklist Indian importers for defaulting. Meanwhile the US is demanding that food importers identify countries of origin and Russia has raised its meat import barriers again.

Star commodity for 2008 looks like being cocoa, which was up 27 per cent on the year last week. This makes it the top performer on the Reuters/Jefferies CRB Index. No end of troubles in the world’s largest producer, the Ivory Coast, have decimated supplies this year and are expected to do the same in 2009. The likely shortage cannot be filled by other producers, although Ghana, number two supplier, and Cameroon, number seven, are sending in encouraging reports.

Ivory Coast crops are being...