UPDATE TO THE TRADE  : July 2007

Australia 

The Australian Industry produces the highest % whole kernels of all of the major macadamia producers at between 50-55%. The current (2007) crop is forecast to yield between 36,000 and 38,000 MT of NIS. This compares to last year’s crop of 42,000 MT. Drought has been the underlying reason for the reduction. 

The 10-15% reduction in crop, combined with steadily increasing demand triggered by a record low macadamia price, has already started to exert some upward pressure on Styles 0, 1 and 2. The 2007 positions for these grades for most Australian producers are reported to be heavily sold. Logically, upward pricing pressure is likely to continue through the balance of the 2007 season.

 South Africa 

The RSA crop is said to be ‘average’ and comparable to last year’s level. While this industry traditionally produces only about 30% whole kernels, it is a significant supplier of Styles 1 & 2 to the European snack market. RSA is reported to be completely sold out of their whole grades for the 2007 crop.

 Hawaii 

The Hawaiian industry still represents 24 +/- % of the world macadamia supply. Current weather (drought) conditions do not bode well for the size of the Hawaiian crop which is due to be harvested in August. Most of Hawaii’s whole grades are consumed by the major Hawaiian retail snack and confectionery brands.

 Overall 

2008 looks like a tight year for whole macadamias. Demand has increased (in some cases significantly) in most major macadamia markets. Europe’s macadamia consumption now tops 4,000 MT. Crops (this year) will not kept pace with the growth. Carryover, which was high at the beginning of 2007, will reduce significantly by the start of the 2008 crop cycle.

 Under the current circumstances, it is not out of the question to predict a 15 % +/- increase for whole macadamia grades for 2008.

 Hope that this helps – still plenty of water to travel under the bridge between now and the next season.

 We will continue to keep you updated as we progress through the growing season.

If you have any questions or wish to discuss this information further, please give me a call

+ 322 568 00 68.

 Faithfully yours,

Jean Van Cappellen

CAPLENCO - BELGIUM