Kenya’s tea export earnings rise 13pc yr/yr in 2021
Kenya’s 2021 tea export earnings rose 13 percent to 136 billion shillings ($1.20 billion) compared with a year earlier, helped by rising export volumes, the industry’s regulator said. Kenya’s total tea production for the year fell to 533 million kg from 569 million kg a year earlier, while total exports rose to 558 million kg from 518 million in 2020, sources said . Kenya is a leading exporter of black tea worldwide, and tea is a major earner of foreign exchange alongside remittances, horticulture and tourism.
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Brazil sugar production headed for another drop
Brazil’s largest sugar-producing region is suffering from a second year of record drought, threatening to cause another short crop in 2022/23 that could prolong high sugar prices. The Gro Drought Index (GDI) shows that sugarcane-growing areas of São Paulo state, which produces more than half of Brazil’s total sugarcane, has experienced mostly “exceptional drought” since July 2021, according to Gro’s Climate Risk Navigator, which can highlight growing conditions for individual crops. Since the sugarcane growing season began in October, rainfall totals for São Paulo are 19 percent below the 10-year average. It’s the fourth year in a row of rainfall deficits for the region, and the cumulative impact threatens newly planted and aging sugarcane fields. While cane benefits from dry conditions during harvest, which begins in April, the crop needs sufficient rainfall during its vegetative period to stimulate rapid growth. Sugarcane production in Brazil, the world’s largest sugar producer and exporter, is down an estimated 14 percent in the current marketing year, which ends in March. That has sent sugar prices to multi-year highs. Sugar is an important ingredient across the packaged food landscape, and higher prices impact everyone from bakers and confectioners to breakfast cereal and ice cream manufacturers.
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Russia’s oil output could peak in 2023
Russia, the world’s third-largest oil producer, has long been an unknown when it comes to the OPEC+ production agreement which caps the petroleum output of participants to support higher prices. It was Moscow’s spat with Saudi Arabia over production quotas in early 2020 which, combined with the emergence of the COVID-19 pandemic, caused crude oil prices to plunge into negative territory for the first time ever. The North American benchmark West Texas Intermediate plunged to minus $37.63 per barrel before recovering, while Brent did not enter negative territory the international benchmark, plunged to an intraday low of less than $15 per barrel. During that time Moscow, Riyadh and other OPEC+ signatories were finally able to agree on production quotas. However, Moscow’s economic ambitions remain a threat to the agreement’s firmness, particularly with Washington threatening further sanctions. With OPEC gradually expanding production quotas set out in the agreement confirmed at the 19th ministerial meeting, there is considerable speculation as to how much global petroleum supply will expand and how that will affect crude oil prices. A key point of conjecture is whether Russia can grow its crude oil output as planned and allowed by its OPEC+ quota, with it speculated that the world’s third-largest oil producer is operating at or near capacity.
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Texas natural gas prices drift lower, despite permian basin production freeze-offs
Forecasts calling for warmer weather and weaker gas demand across Texas appear to be easing concern in the spot gas markets over a potential supply crunch resulting from a recent drop in Permian Basin gas production caused, most likely, by wellhead freeze-offs from Jan. 19 to Jan. 21.
On Jan. 21, spot gas prices across the Lone Star State were down from prior-day settlements. At the West Texas Waha Hub, cash prices dropped more than 20 cents on the day to around $3.64/MMBtu. In East Texas, prices at Houston Ship Channel and Katy Hub were down about 40 to 45 cents to the mid-$3.70s/MMBtu, preliminary settlement data from S&P Global Platts showed.
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Fertiliser shortage, price hike to dent wheat output
The increase in prices of di-ammonium phosphate (DAP) fertiliser coupled with unavailability of urea is expected to trigger a drop in wheat production in Pakistan this year. In a statement on Saturday, Pakistan Businesses Forum (PBF) President Mian Usman Zulfiqar said that output of wheat crop was under threat as farmers had been facing acute shortage of urea since the start of sowing season. “Despite government’s claims, growers are paying inflated prices in the range of Rs2,500 to Rs2,700 for a 50kg bag of urea,” he said, adding that the official rate was set at Rs1,768. Recalling his meeting with the minister concerned, Zulfiqar said that the latter termed fertiliser shortage mere propaganda and repeated pleas of PBF to keep agriculture out of politics were disregarded.
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World’s major dairy company lifts forecast farmgate milk price range
Fonterra Co-operative Group Tuesday lifted its 2021/22 forecast farmgate milk price range to 8.90-9.50 New Zealand dollars (5.96-6.37 U.S. dollars) per kilogram of milksolid (kgMS), up from 8.40-9.00 New Zealand dollars per kgMS. As New Zealand’s largest dairy company, Fonterra produces approximately 30 percent of the world’s dairy exports. The price increase lifts the range midpoint, which farmers are paid off, by 50 cents to 9.20 New Zealand dollars per kgMS. Fonterra CEO Miles Hurrell said the lift in the 2021/22 forecast farmgate milk price range is good news for both farmers and New Zealand communities. The new midpoint of 9.20 New Zealand dollars per kgMS would contribute 13.8 billion to the New Zealand economy this season. “The increase is the result of consistent demand for dairy at a time of constrained global milk supply. “In general, demand globally remains strong — although we are seeing this vary across our geographic spread,” he said, adding that overall, global milk supply growth is forecast to track below-average levels, with European milk production growth down last year and U.S. milk growth slowing due to high feed costs.