We have the most uncertain and volatile time of this era, especially when it comes to commodities. Along with this, container availability, freight hikes, and long transit destinations are major concerns.
Last year, about this time, Indonesia was the most aggressive selling origin. We saw pricing as low as USD 4.200 PMT CFR basis. This time around, Indonesia, the world’s biggest influence on the cloves market, the largest producer by far, is the most expensive origin. Their crop seems to be surely down by 50/60%, and some say even more.
Comores came and went without much of a noise. Hardly any substantial quantities are expected. They used to sell about 500/600 MT. This year, they have sold just 150 MT!
Zanzibar: has lost its charm in cloves as they have not been consistent in terms of quality.
Madagascar: The whole world will be looking at this origin. It isn’t easy to get offers from this origin.
There may be a decent crop size, probably about 10.000-12.000 MT. Indonesia supplied about 30,000 MT last year. This year, they may not export even 10.000 MT. Traders are wondering if this shortage of about 20.000 MT will be fulfilled by which origin? Many Chinese importers have recently descended south of Madagascar and will soon start to pay crisp cash dollars to accumulate whatever cargo they can find in Madagascar.
Brazil is reported to have adverse weather in Bahia, their cloves growing region; however, no clear picture has emerged. The Western World and the Latin American markets which use this origin will also be looking at either resellers in Dubai, Singapore, EU or Madagascar, IF they don’t find enough quantities in Brazil soon.
Sri Lanka: It is too early to expect any details about the Sri Lankan cloves market.
Scenario in Consumption markets/ destinations:
India hasn’t bought as actively as they should be buying so far. It’s been almost 3 months, Indian Importers are probably running on thin inventories, and the main consumption months are about to set in.
China: has been exporting cloves!!!!! Can you imagine?? China has been Exporting Madagascar and Indonesian cloves for the last 3 months from Mainland China. Now finally, they have come to an end. Soon their local inventories will be over, without new imports in the pipeline.
Singapore resellers and traders have not been aggressive.
Dubai traders have been selling whatever cloves they had to nearby regions without replacing their material, and soon they will have to start buying.
Indonesia – Soon, they might need to buy cloves? No one knows as of now.
For 3 months, there has been a lull in the market. It is high time to review the Cloves pricing and markets. We suggest our clients be cautious in buying approach but shouldn’t be caught unaware.
Indian Cloves Spot Market Prices as of now is prevailing around :$ 9,78 Per kg FOB basis.
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