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100 YEARS OF AGE

100 YEARS OF AGE. WE SALUTE YOU. INTERNATIONAL BEAN MARKETS. WHAT IS GOING ON IN THE WORLD? HOW DO WE MARSHALL OUR THOUGHTS AND ACTIONS? HAVE WE LOST SIGHT OF REALITY? HOW DO WE HANDLE THE TRAIN COMING AT US?. GRATUITOUS WASTE IN THE WEST !.

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100 YEARS OF AGE

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  1. 100 YEARS OF AGE WE SALUTE YOU

  2. INTERNATIONAL BEAN MARKETS • WHAT IS GOING ON IN THE WORLD? • HOW DO WE MARSHALL OUR THOUGHTS AND ACTIONS? • HAVE WE LOST SIGHT OF REALITY? • HOW DO WE HANDLE THE TRAIN COMING AT US?

  3. GRATUITOUS WASTE IN THE WEST ! FAMILIES IN UK ARE THROWING AWAY A TOTAL OF 4.1 MILLION TONNES OF PERFECTLY GOOD FOOD EVERY YEAR! AVERAGE HOUSEHOLD IN UK SPENDS JUST 9% OF INCOME ON FOOD

  4. UK TELEGRAPH JULY, 2008 “ GORDON BROWN AND HIS FELLOW WORLD LEADERS HAVE SPARKED OUTRAGE” “ENJOYED A 6 COURSE LUNCH FOLLOWED BY 8 COURSE DINNER AT THE G8 SUMMIT WHERE THE GLOBAL FOOD CRISIS TOPS THE AGENDA “THE PRIME MINISTER WAS SERVED 24 DIFFERENT DISHES DURING HIS FIRST DAY AT THE SUMMIT- JUST HOURS AFTER URGING THE WORLD TO REDUCE THE “UNNECESSARY DEMAND FOR FOOD AND ON BRITISH FAMILIES TO CUT BACK ON THEIR WASTEFUL USE OF FOOD” MR. BROWN AND HIS WIFE SARAH WERE AMONG 15 GUESTS AT THE ‘BLESSING OF THE EARTH AND THE SEA SOCIAL DINNER’ (INCLUDING THE G8 FANTASY DESSERT”)

  5. INDIA NEWS JULY 3, 2008 REPORTS INDIA’S PRANAB MUKHERJEE’S MEETING WITH HIS EGYPTIAN COUNTERPART AHMED ABOUL GHEIT, AND THE MAJOR EMPHASIS ON FOOD SECURITY. EUBUSINESS JULY 7, 2008 EUROPEAN COMMISSION CHIEF JOSE MANUEL BARROSSO SAID MONDAY HE WOULD PROPOSE THE CREATION OF 1 BILLION EURO’S TO FIGHT HUNGER AND HELP FARMER’S IN POOR COUNTRIES. TURKEY DAILY NEWS JUNE 30, 2008 “ THE GLOBAL FOOD SCARCITY AND TURKEY” “UNEQUAL DISTRIBUTION OF THE WORLD WEALTH BECAME EVEN WORSE IN THE LAST YEARS. IT IS SAID THAT THE AMOUNT WHICH EQUALS THE REVENUE OF 40% OF THE WORLD POPULATION IS UNDER THE CONTROL OF 200 FAMILIES. NEW IMPERIALISM CALLED GLOBALIZATION STARTED TO SQUEEZE PEOPLE LIKE A LEMON”

  6. TODAYS ZAMAN JULY 7, 2008 TURKEY AND IRAN CONSIDER BARTER AGREEMENT FOR FOODS. “NEW RAILWAY LINE PROPOSED. “TURKEY WILL CONSTRUCT A NEW LINE NORTH OF VAN, AN EASTERN PROVINCE OF TURKEY, TO OPEN ANOTHER DOOR FOR TRANSPORTATION AT A COST OF $400-500 MILLION” “ THE GLOBAL FOOD CRISIS HAS LED IRAN TO REQUEST 2 MILLION TONNES OF WHEAT FROM TURKEY WORTH $1 BILLION, WHILE THE LATTER IS CONSIDERING AN EXCHANGE OF THE GRAIN FOR LENTILS, CHICKPEAS OR RICE”

  7. The Global Food Crisis International bureaucrats call the world food situation a “silent tsunami” Devastating impact as million’s of people, resort to eating “fried or baked dirt cakes” (Pakistan).

  8. Man made crisis. How? Market oriented and liberalizing policies adopted by choice or force in nearly all countries. Neglected agriculture, shift in global price’s and changing cropping patterns, leave bureaucrats choking on the word “speculation”. Subsidized developed countries dumping in the undeveloped world.

  9. …… (cont’d) IMF data shows all food prices up 40% so far since 2007. (Since the start of 2008 alone, that staple “side” dish to beans, rice, increased by over 150% in first 100 days of the year.) Haiti, Guinea, Mauritania and Mexico are just 4 countries that have seen food riots in recent times. The global cost of imported foodstuffs in 2008 is forecast by the FAO at USD 1035 Billion up over USD 200 Billion on 2007.

  10. To put all this in perspective, the numbers published for the world, in 2005 were USD 379 Billion and in 2006 USD 388 Billion!! Of course to contextualize all this would need currency guru’s and financial wizardry to factor in the USA Dollar weakness during the same period against many countries, and the impact of oil, transportation and other associated inflationary costs to market.

  11. What I did calculate was this………….. In 2005 average imported food cost, basis 6.537 billion people on planet, July 15 that year? USD59.78/peron In 2008 that same cost basis 6.827 billion people on planet, July 15 this year? USD151.60/person.Up over 2.5times or 253%!! If we look at USA navy bean prices as a good barometer…..20 cents versus 50 cents a lb? 250%.If we take Chinese black beans to Venezuela …$450/tonne versus $ 1100/tonne….. 244%!!

  12. What I did calculate was this………….. (cont’d) Do we take comfort in beans being in line with the imported food bill/costs as outlined by FAO? It might give us a clue on how we are doing? The factor we then have to understand is…….global bean supply in 2005 versus now, in 2008. We can argue that supply today is down…………and demand today is up….!! Both those numbers, were they properly known, are friendly to prices increasing, while every day we have crop challenges……..is another day we can expect to run to the bank for more money to ‘play’ with. (Note to self: If you are short don’t tell the audience this paragraph...or lay it on real thick if long!!).

  13. THEN THERES IS OIL!! THE PHILIPPINE STAR JULY 7, 2008 OIL AT $ 200/ BARREL BY YEAR END?? “IT NO LONGER SOUNDS FARFETCHED”

  14. AND DEMOGRAPHICS……. RUETERS JULY 2, 2008 CAIRO “SINCE PRESIDENT HOSNI MUBARAK TOOK OFFICE IN 1981, THE POPULATION HAS NEARLY DOUBLED. 76 MILLION PEOPLE IN AN URBAN AREAS NEAR THE NILE, ROUGHLY THE SIZE OF SWITZERLAND THAT HAS 7.5 MILLION PEOPLE” “ BEFORE YOU ADD ANOTHER BABY MAKE SURE HIS NEEDS ARE SECURED”.. PART OF A CAMPAIGN TO ENCOURAGE FAMILY PLANNING. ABOUT 1/5TH OF THE POPULATION LIVES ON LESS THEN $ 1/ DAY. DISCONTENT IS MOUNTING. WE ARE FAST APPROACHING 7 BILLION PEOPLE ON THE PLANET AND WILL BE 9.2 BILLION BY 2050!!!

  15. WORLD POPULATION 1950-2050 BILLIONS YEAR

  16. ……DON’T FORGET THE EMERGING MARKETS!! EUBUSINESS JULY 20, 2008 AMONG STRUCTUAL DRIVERS OF HIGHER FOOD PRICES HAS BEEN A STEADY RISE IN DEMAND FOR BOTH STAPLE AND HIGHER VALUE ADDED FOODS – PARTICULARLY IN LARGE EMERGING ECONOMIES- SUCH AS CHINA AND INDIA.

  17. OH AND DON’T FORGET THE SPIRITUAL!! IN RESPONSE TO DEMOGRAPHIC ISSUES? SALIM AWWA, SECRETARY GENERAL OF THE INFLUENTIAL INTERNATIONAL UNION FOR MUSLIM SCHOLARS…” FROM A RELIGIOUS POINT OF VIEW I AM AGAINST THE CALL OF PRESIDENT MUBARAK. THE STATE IS NOT GOD AND THE STATE IS NOT THE CREATOR- WE SHOULD NOT TRY TO LIMIT THE NUMBER OF CHILDREN” IN RESPONSE TO EMERGING MARKETS AND GLOBALIZATION?- TONY BLAIR FAITH FOUNDATION “DESPITE ITS CRUCIAL ROLE IN THE LIVES OF BILLIONS OF PEOPLE, THERE IS A WIDESPREAD VIEW, ESPECIALLY IN THE WEST, THAT FAITH IS INCREASINGLY IRRELEVANT OR EVEN A BARRIER TO MORDERN DAY CHALLENGES” SAYS TONY BLAIR: “RELIGIOUS FAITH WILL BE OF THE SAME SIGNIFICANCE TO THE 21ST CENTURY AS POLITICAL IDEOLOGY WAS TO THE 20TH CENTURY. IN AN ERA OF GLOBALIZATION , THEREI SI NOTHING MORE IMPORTANT THAN GETTING PEOPLE OF DIFFERENT FAITHS AND CULTURES TO UNDERSTAND EACH OTHER BETTER AND LIVE IN PEACE AND MUTAL RESPECT” AND TO GIVE FAITH ITSELF ITS PROPER PLACE IN THE FUTURE”

  18. WHAT OF GREEN HOUSE GASES DOES THE FOLLOWING LEND ITSELF TO FLATULENCE CONTROL?

  19. FAO Dry Edible Bean Production Estimates(metric tons)

  20. THE COLOR AND VIBRANCY OF THE CARIBBEAN COUNTRIES The likes of Cuba, Haiti, Dominican Republic, and Jamaica were reported by USA bean guru’s as increasing consumption and accessibility to USA exporters. We are seeing this also from our Chinese office perspective. Consumption in Cuba is pegged at over 46 /lbs per capita while here in N.America, whilst it is improving, is pegged at around 7 lbs only!! Sadly, what is happening in Haiti with the increasing rank poverty, leaves the onus on the World Food Programme to provide……….and as you are all aware by now, a recent tender was filled, perhaps oddly, by Ethiopian navy beans….about 2000 tonnes.

  21. AS WE CAST OUR EYES FURTHER SOUTH……… WE CANNOT IGNORE THE GIANT THAT IS BRAZIL

  22. BRAZIL Brazil is currently (we think!!) the worlds largest consumer and producer of edible beans. There are approximately close to 200 million people living there. Of the 26 states and 1 federal district in Brazil, 80% of the bean production comes from 8 states with an altogether production base of around 3 million tonnes. There are 3 distinctive crops…dry ,wet and winter. The first crop is harvested November through February from the southern regions of the country. The second is March through June throughout all regions of Brazil, while the winter crop is May through September in the tropical north! So 10 to 11 months of the year there is a harvest going on somewhere!!

  23. BRAZIL ….(cont’d) Amando from Notamil says: “There is a huge polemic, because if you take the government numbers, the second crop was expected to be 41.7% higher than last year, and there would not have been reason for these high prices to stay”. ( This seems to be a tactic of several governments of the world, Look at India for example. In an effort to try and curtail escalating food prices and curb inflationary impacts……. The industry is being asked to swallow some potentially contrived numbers?? No one envies their task for sure!!). As beans (and rice) are a national security issue in Brazil, the Brazilian Institute for Beans and the Ministry of Agriculture, have apparently agreed to a guaranteed minimum price to the growers of at least USD 845/tonne!! (38 cents per cwt.).

  24. BRAZIL….(cont’d) Amando goes on to say “ My particular opinion is that growers will plant a lot in September(1st crop). Let’s see, because in these CRAZY days, you will never know. Of course, some points must be observed like corn prices falling. That will help, but at the end, the reality will just be known in October!! In summary we have 4.5 months until the next big crop to feed Brazil and for sure Brazilian buyers will need to move itself to import more from the international market place.”

  25. BRAZIL….(cont’d) Domestic consumption is put at approx 33lbs per head per year. A quick calculation illustrates that 3 million tonnes is barely sufficient particularly if there is any major short fall in production. So far the Brazilian crop has disappointed their domestic bean dealers. The 2nd crop is about done. Prices are very high with US$1500/mt asked for black beans and USD 1950/mt for the most popular bean, carioca…..My Brazilian source says “please keep in mind that these are dealer values and grower bids are 10 – 15% lower”.

  26. For all types of beans acreages have fallen in successive years since 2005, from 605,000 acres to an estimated 513,000 this year. • Of these acres about half would be Alubia beans, 148,000 acres black beans, 25,000 acres cranberry beans, 18,0000 acres, light red beans and, about 10,000 acres of dark reds. • Production numbers as you can well imagine with the chaotic nature of grower strikes and export tax bill legislation, and ‘disappearance of beans, wholesale into neighbours Brazil are hard to pin down. • Alubia beans were expected at CICILS in May to produce 96,000mts. Now some say the number was 120,000mts. The fact that sizes of the beans tend to be smaller would support a yield of what? 110,000mts off 270,000 acres?

  27. Spain, Algeria, Italy, Portugal would win Gold, Silver, Bronze and an honorable mention for fourth as the main importers from Argentina in this Olympic year. (Brazil, Turkey and France would be in the same field of participants.) Black beans were guessed at 72,000mts …some say reality 60,000mts. Brazil wins gold as the main importer , at least 60 but maybe 70% this year!! Venezuela is a distant silver medalist at 25 – 30% whilst Costa Rica and Guatemala fight for bronze at least a lap or two behind!! Chile (30,000mts), Colombia(120,000mts) , Ecuador(30,000mts) , Peru(85,000mts) are all origins and destinations for edible beans that need factoring in to the global edible bean picture. But theirs is more niche……like blackeyes and large lima types from Peru, or Tortola (kind of creamy white kidney) bean from Chile.

  28. OLYMPIC YEAR & THE MIGHTY COUNTRY CHINA! 8.08 P.M. 8TH DAY OF 8TH MONTH OF 8TH YEAR OF THE 21ST CENTURY. Feng Shui-the art of creating balance and harmony in our surroundings. A proclamation of different ways that facilitate balance of energies in the environment, so that people inhabiting the place enjoy sound health, wealth and are blessed by good fortune. Feng- suggests wind and Shui - water. Symbols include concentric rings, set around magnetic needles. So with the “8” s in the date and the Olympic circles symbol, it is perhaps little wonder that some devotees of this art and science, are lining up to have cesarean sections on the opening day of the Olympic games!!

  29. As usual it is a challenge to accurately project the Chinese up and coming new crop, by size or by class. We know acres are slightly off last years with blame on Soya prices in the main. The most accurate numbers come from the export figures. So we are told that in the period September 2007 to March 2008, close to 600,000mts were exported at a value of nearly ½ billion dollars. Tonnage wise, Kidney bean types win the gold medal at 440,000mts (black beans, red kidneys and whites………) , whilst 70,000mts of mung beans the silver and small red beans at 45,000mts the bronze. The Chinese pulses industry remain bullish as they state that world production of dry edible beans is down. We could argue for 10 -20% reduction in production world wide at a time when consumption needs are at their highest. (Prices aside). That is 2 to 4 million tonnes light in the world!? Sounds a little scary to me if true, and I am inclined to believe the number is more like 5 -10%. Still significant. For kidney exports, Africa at 32% increase over the same period as the previous season, and South America at 22%, showed the most gains. In fact Asia took 140,000mts, Africa 85,000mts, Europe 96,000mts and South America 112,000mts.

  30. Values started as low as USD500 FOB China and reached well over USD1000/mt depending again on class type. Unchanged to slightly lower 2008 crop plantings, calamities courtesy of Mother Nature, global warming, Soya, crude oil, Government influence for more oilseed production, are all weighing heavy on the Chinese suppliers, so much so that the message is “don’t expect any bargains this next crop!!”. Guesstimated breakdowns for 2008 by class? Black beans 140,000 – 160,000mts White beans 85,000 – 110,000mts Dark Reds 35,000mts Light Speckled long shapes 85,000 – 100,000 Cranberry types 30,000 – 33,000mts Other reds 70-80,000mts Carry over stocks all types about 28 – 35,000mts (So low end 473,000mts and high end 553,000 mts…WEATHER issues aside!). It is worth noting the discrepancy between the 7 month export number above and the new crop projections. Bottom line, it remains extremely challenging to compute accurate numbers into the world picture!!

  31. “A VIEW FROM SOUTH AFRICA” “I can offer some assistance but please do keep in mind these are ball park figures. I can say that South Africa is a producer of approximately 100 000 tons plus of light speckled beans annually ,however we are currently in a position where we feel our total crop production will be around 50 to 60 k metric tons. We normally would import about 20 k tons from China regardless of circumstances, however this year it will most certainly have to be more than that to cover our short production. Consumption domestically has also fallen as a result of the current high prices. Large white kidney bean requirements are around 5 to 6k tons annually with a current local production of only 2000 tons. Small white beans /navy beans requirements are somewhere in the region of 35k tons with a total domestic production of about 10 to 15k tons.”

  32. “A VIEW FROM SOUTH AFRICA”… (cont’d) “I feel $1300 to $1500 levels are way too expensive when compared with Chinese “Jap” whites. We are currently getting offers at $980 for HPS QUALITY FOB China. Current long shape LSKB are being offered at $1000 to $1030 FOB Chinese ports . There are a few export quality LSKB ,we have been exporting these to high end Niche customers .We can offer these at $1500 CFR pretty much anywhere within reason ,would you have interest ?

  33. A VIEW FROM NORTH AFRICA ETHIOPIA 1984 – 50 million people 2008 – 77 million people 2050 – 169 million people Staggering growth rate, and second in population to Nigeria within sub Saharan Africa. Today 10 million people facing starvation and death. (Recent conversation with WFP official) That same WFP official talks of difficulties in finding food within Ethiopia to supply needs of the starving. For bean market purposes, and a hesitant feeling of commercial guilt: Ethiopia navy bean production and projections continue to expand. We anticipate 80,000mts of navies this next crop, weather permitting.

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