Midnite Bee-Beekeeper's: Article HONEY UPDATEHoney Update:
Raw honey prices on the world market continue to rise, and these price increases are beginning to escalate.
Beekeepers are reporting more & more bee losses, as Colony Collapse Disorder appears to be rearing its' ugly head again. Although it appears that the losses are not as devastating as last year, there is growing concern that the affects of CCD will be much greater than originally expected.
Projections for the 2008 South American honey crop are still unfavorable, due mostly to the extremely cold weather, a late spring, and heavy bee losses.
The European ban on Brazilian honey will soon be lifted. With the great demand for honey on the world market by Europe, packers are contracting for Brazilian honey in anticipation of the ban being lifted and much of the South American honey, including Brazilian honey, is destined for Europe, and won't make it into the U.S. because of the extremely high prices. Europe is sourcing raw honey throughout the world, and with the strength of their dollar versus the weaker U.S. dollar, Europe is aggressively buying honey even at the higher prices.
Some countries such as Turkey have turned from a honey exporting country into a honey importing country because of poor crops and higher demand. Even China is utilizing more of its' honey crop for its' own needs and reducing exports. Chinese honey exports are also limited due to ongoing quality concerns, and hesitation from quality conscious countries and packers to buy Chinese honey.
The India honey crop is still selling for higher than anticipated prices as Europe continues to aggressively compete for that honey
Projections for the 2008 South American honey crop are still unfavorable, due mostly to the extremely cold weather, a late spring, and heavy bee losses.
The European Union banned Brazilian honey over 2 years ago, not because of quality issues, but because of a failure between the EU and Brazil to agree on testing procedures and standards. It appears that the EU and Brazil are close to an agreement on these issues at this time, and a meeting between the EU and Brazil scheduled for February 28, 2008 could result in the ban being lifted. With the great demand for honey on the world market by the EU, packers are contracting for Brazilian honey in anticipation of the ban being lifted. This has again raised prices for Brazilian honey, and basically all raw honey on the world market. This comes on the heels of steadily increasing raw honey prices over the last year. World raw honey supplies continue to struggle to keep up with world demand, thus it appears that we will see increasing raw honey prices over the next several months even if South America ends up producing an average or better honey crop.
There are still limited raw honey offerings in the world market at this time. Prices remain strong as crop projections are reduced for in season honey crops. The U.S. crop will be smaller than last year, unable to recover from a very poor California crop. Regarding Colony Collapse Disorder, there are isolated reports of heavy bee losses, but most beekeepers are reporting fairly healthy colonies at this time.
Early projections for the South American honey crop are not favorable. A very cold winter has resulted in up to 30% bee losses in some areas, and the late spring will probably set back honey producing floral sources. The honey crop could be delayed up to 3 or 4 weeks. This will intensify competition for South American honey and will probably escalate prices earlier than expected. By January, we should have better indications of how the South American honey crop is fairing, and have a better indication of prices going forward into 2nd quarter 2008.
There are not a lot of raw honey offerings in the world market at this time. Prices remain strong as crop projections are reduced for in season honey crops. Prices are expected to remain strong, with strong demand in the world market. With the demand remaining strong, much of the available honey in the world market is being held off the market in anticipation of increasing prices, or it is being offered at very high prices, thus creating a somewhat artificial supply shortage.
The USA crop is smaller than originally expected. It should be comparable to last year’s crop, which was well below normal. Drought stricken California produced a very poor crop. A hot dry summer through the West and Midwest reduced floral sources in those regions. Although a late honey flow is possible, many beekeepers are opting to shut down their hives, treat for mites, and prepare for winter migration and pollination. Overall bee health is pretty good, as beekeepers are taking better care of their bees to reduce stress, and hopefully prevent a reoccurrence of Colony Collapse Disorder. There are some reports of bee losses but most beekeepers are reporting fairly healthy colonies. It is still too soon to know if dramatic die offs will happen this fall into winter. The Canada honey crop is also much smaller than normal. Low bee populations, and poor spring weather conditions are responsible.
Little honey remains from this years Argentina honey crop. A much smaller than expected crop this year strengthened world prices, which have steadily increased since last February, except for a brief period during the summer before a projected bumper crop from the USA fizzled into a less than average crop due to extreme heat and little moisture.
The European ban on honey from Brazil should be lifted in time for their fall crop to be sold. Forward contracting from Europe for that crop has strengthened Brazilian raw honey price.
As usual, most of the honey crop from Mexico is headed for Europe with small volumes coming into the USA. There are few offerings from India & Viet Nam as they await their new crops this fall.
China is again expected to use much more of their honey crop for their own needs. There was not a lot of “real honey” coming into USA from China until last month when the U.S. imported over 4 million lbs. The USA had previously been receiving a lot of packer’s syrup from China. (honey blended with other sugar syrups) It is uncertain if this was actual packer’s syrup, or possibly actual honey sold as packer’s syrup to avoid duties. The probability is high that any actual packer’s syrup entering this country would be blended with and sold as real honey.
This has been a summer of concern, speculation, and some over exuberance of a possible bumper honey crop in the upper Midwest of the U.S. Excessive heat and a lack of rain have quickly dried up a once flourishing clover crop in that region. Drought in the West, especially California, had already reduced the honey crop in those areas. Raw honey prices, which had been rising since last February, stabilized a bit in July, but now have bumped up again on the realization that the U.S. crop will be smaller than originally projected. With the increased U.S. demand for honey, supply is still a bit short on the world market. The E.U. ban on Brazilian raw honey should be lifted in September, and the E.U. is already contracting for that honey, which has also firmed prices. It appears that raw honey prices will remain strong going into 2008. Improved Asian honey crops, and a good South American honey crop are needed to increase world honey supply, and possibly soften prices. Colony Collapse Disorder is still a real threat throughout the world, and if some of the colonies that have been rebuilt start to die off again this fall, supply concerns could again start to raise raw honey prices.
Many have heard or read of a beehive disease called 'Colony Collapse Disorder'. There have been many reports and articles recently regarding this disorder. The website attachment below will help to explain the disorder and what it means. The brunt of the affect of this disorder is now in the hands of the beekeepers that will have the responsibility and expense of rebuilding their hives.
As far as what effect this will have on the beekeeping industry, honey supply, and honey pricing remains to be seen. If hive rebuilding resolves the problem, then the impact could be minimal. If colonies continue to disappear as fast as they are rebuilt, the situation could become critical. Sioux Honey Association together with S. Kamberg & Company will continue to monitor the situation very carefully, and we will keep you posted on any new developments or projected long range effects of this disorder.
There has not been a lot of buying activity for raw honey on the world market the last few months as most packers had filled there inventory needs in anticipation of even higher raw honey prices. This lack of activity plus projections of a very good South American raw honey crop has driven prices lower in the last month, and that trend should continue until packers start buying again, which should be in the very near future. With a good supply, prices should remain softer. If all packers start buying at once, prices may firm a bit in the short term, but the long term trend will probably be declining prices heading into the U.S. crop in late summer. Even though U.S. prices will remain higher than most imported prices, price pressure from imported honey should drive U.S. raw honey prices down as well.
Honey prices have gone up steadily for about a year and a half now. First quarter 2007 prices will reflect the highest raw honey prices that we have seen for over 2 years. The good news is that Raw honey prices appear to be flattening as we enter 2007 and we hope those prices will begin to soften when the South America honey crops come in February and March 2007. This should translate to stable or lower prices entering the 2nd quarter of 2007 and should carry into the 2nd half of 2007.
The world raw honey market is reported to be extremely volatile at this time. Prices continue to rise, and this trend is expected to continue for several months by some within the industry. Offerings for raw honey on the world market are few as demand exceeds supply for this honey. Honey packers have scrambled to buy whatever honey is available on the international market, as some suppliers could not deliver honey that had been previously contracted for.
The U.S. honey crop is smaller than average again this year with reduced production in Florida, Texas, California, and parts of the upper Midwest. Much of this honey is being held off the market in anticipation of higher prices.
Offerings later in the fall for some Asian honey may help feed the supply chain, but prices will be high. China is still not offering much honey into the world market at this time. Some supply relief could come in February or March 2007 as the South American honey crop comes in. This honey will most likely be snapped up quickly, prices will be high and may even still continue to escalate until the supply chain is completely full.
The year has seen steadily increasing raw honey prices. With light amber honey in very short supply, the price gap between light amber honey and white honey has narrowed. Most of last seasons honey crops from South America, India, Viet Nam, and other Southern Asian Countries has been sold. The expected price stability with the onset of new crop honey from North America & China has not come to fruition. China’s honey crop is poorest in 10 years. Reports are that the Chinese crop may be down 30% to 50% of normal. China has been slow to get their crop into the world market. Prices for the honey that they are selling have been higher and more typical of other world raw honey prices. China is using more of their honey for their own consumption, replacing honey for sugar, as their sugar crop is also extremely short. The new shipper bill has passed both the House & the Senate and will be signed into law. This legislation will remove the loophole for exporting duty-free honey from China into the U.S., retroactive back to April 1, 2006. Passage of this bill has already raised world raw honey prices .05 to .07 / lb., and this trend should continue, as demand remains greater than the supply. U.S. raw honey prices continue to rise as the crop comes in. Production looks good in some regions while exceptional drought has severely limited production in other regions. The total crop looks to be smaller than last year, which was well below average in a succession of below average years. Canada’s honey crop looks to be below average as well, with prices reflecting U.S. prices.
Activity is still slow in the U.S. honey market. Many domestic honey producers are still holding some honey for higher prices. Light Amber honey is virtually unavailable, and White Clover honey prices have risen dramatically in the last month. U.S. packers are still apparently only buying U.S. honey for their immediate needs. The California crop is looking good with the possible exception of the early sage honey and orange blossom honey as these crops look to be smaller than average. Texas will start producing some light amber honey later this month into June with an average crop projected. It is still too early to project the crop in the prime clover honey producing states of the West and Midwest, but spring rains have given an improved outlook for an average crop. Prices for early domestic honey will remain high as demand will be high, and those prices could remain strong as the majority of the crop comes in later this summer into early fall.
Import raw honey prices have shown a steady strengthening since December. The remainder of South American raw honey is still in high demand, with Europe and the U. S. competing for this honey. Argentina withdrew their honey from the market in March as new antibiotic issues arose with both Chinese and Brazilian honey. They reentered the market in early April at a substantially higher price. Most South American honey has been sold, as well as India and Vietnam honey.
New crop Chinese honey will be entering the market soon. Prices for legitimate Chinese honey have already risen based on world market pricing and the projected passage of the New Shipper Bill by both the House of Representatives and the Senate. This bill would effectively stop exporters from shipping duty free honey from China into the U.S. Circumvention of Chinese honey will still be an issue. This honey will be sold at a cheaper price, but contamination and adulteration could and will still be prevalent with this honey. The Chinese honey crop coming in, along with the U.S. crop entering the market in late summer, should help stabilize pricing.
The domestic raw honey market seems to be stagnant at the moment. Activity has been slow with a large volume of U.S. honey being held off the market. Income from lucrative almond pollination contracts, and the ability to place their honey under loan, has allowed producers to hold their honey for projected higher prices. Some had sold at higher prices but still had honey on hand, so packers were evidently buying only for their immediate needs. With weather conditions in the West and Midwest not favorable for honey production at this time, one would say it is possible to projecting escalating prices at least until fall, even with the extra 2005 crop honey on hand. At that time pricing could stabilize somewhat before the onset of the 2007 South American raw honey crop.
South American raw honey is still in high demand, with Europe and the U. S. competing heavily for this honey. Reports seem to confirm that Argentina's crop could be down as much as 20-30%. It is reported that import prices have shown a steady strengthening since December and there appears to be nothing in the near future which would cause them to decline. Thus, South American raw honey prices, which usually start higher than other world raw honey prices, remained higher. This generally raised other world raw honey prices with the possible exception of Chinese honey, which continued to be of questionable quality.
Some new issues have risen regarding both Chinese and Brazilian honey. Reports have surfaced of antibiotics in honey again, with Chinese honey and possibly Brazilian honey involved. With the amount of circumvention reported, it is difficult to know if other countries other than China are actually involved. With this, and the apparent non-compliance to meet sanitary issues required by the EU, reports are that Brazilian food products, including honey, may be banned from the EU, with a reported effective date of March 17, 2006. The EU is already shying away from Chinese honey, and if contaminants are confirmed, another ban on Chinese honey may follow. This has caused Argentine exporters to temporarily withdraw from the market in anticipation of even higher demand for their honey. If Chinese and other honeys are held out of the market even for a short period, there could be a surge in honey prices due to short supply concerns.
In other world markets it appears that much of the Indian and Vietnam honey crop has apparently already been sold.
Raw honey prices have risen the last several months, and it is felt by many in the industry that this is a trend that could continue into next year.
Another smaller than average US crop has kept domestic honey prices high, and created a shortage of domestic light amber honey.
Europe is buying large volumes of honey in the world market, but shying away from Chinese honey as much as possible. Europe is paying higher prices for better quality honey, which has caused world raw honey prices to rise. Much of the previously contracted raw honey in South America that was destined for the U.S. was sold out from underneath these contracts as Europe offered higher prices.
New crop South American honey, which will hit the market in January or February, 2006 will start out higher priced, and remain there as long as demand holds, which could be for their entire crop.
China has lowered their raw honey prices to try to sell their honey, but much of this honey is still sub-standard and (or) adulterated.
Raw honey prices have risen the last couple months, and this is a trend that could continue through the end of the year. A projected short U.S. crop has raised domestic honey prices, and imminent passage and execution of the English / Thomas Bill will probably raise imported raw honey prices in the coming months. This bill closes the loophole allowing new shippers in China to export Chinese honey to the U.S. without tariffs. With this loophole closed, Chinese honey prices should be higher, and since Chinese honey prices usually dictate price for all foreign honey, these prices could rise as well. Congress is also looking for ways to stop circumvention of Chinese honey.
The 2005 South American honey crop has basically been sold. The crop was short and darker than usual. South American prices started out high and then dropped when packers did not buy. Packers who contracted at lower prices for South American honey are now finding out that their honey has been sold for higher prices, and those packers are now paying higher prices to fill their needs.
The U.S. crop has been affected by drought in the upper Midwest and West and failure by some beekeepers to rebuild their hive populations after mites devastated their colonies. Many beekeepers opted to rebuild colonies instead of producing honey this season to be ready for the now more lucrative pollination business. The government loan program for beekeepers has assured a price level for U.S. beekeepers’ honey to maintain a healthy beekeeping industry.
Although supply still looks good worldwide, it will probably be lower than the last 2 years. Many of the beekeepers who got into the business when supplies were low and prices were high are now leaving the business due to lower prices.
The South America honey crop is below average, and most of the honey has been higher priced than the average world raw honey market price. World raw honey prices have risen somewhat in the past month while South American honey prices have declined under pressure from world honey market pricing, narrowing the price gap. With lower South American honey prices, Europe has been buying more South American honey. The U.S. has lifted duties on Argentina honey for 8 exporting companies, so more Argentina honey is coming into the U.S. Argentina has a higher proportion of dark honey than usual. Almost half the crop remains to be sold due to higher pricing and low demand. Argentina appears to have done a good job policing themselves in regards to cleaning up Nitro Furans contaminated hives, and restricting sales of contaminated honey.
China is still the largest raw honey supplier into the world market, and world honey prices are usually defined by Chinese honey prices. Chinese honey prices have risen slightly in the last month. Much of the Chinese honey entering the world market is highly suspect for adulteration as the Chinese continue to ultra-filter chloramphenical out of their honey.
The India honey crop started out well before drought greatly reduced the Eucalyptus honey crop. Prices have risen in the last month for India honey.
The Yucatan honey crop is poor due to drought, and prices have been comparable to Argentina honey.
The Viet Nam honey crop is below average, and harvesting has been slowed by rain. Prices have remained steady to slightly higher over last month.
Projections are for another smaller than average USA honey crop. Mites have devastated hives, and beekeepers are struggling to strengthen bee populations going into the main honey crop season. Extended drought in much of the West and Upper Midwest of the nation is also expected to reduce the honey crop. USA honey prices should start out higher than average world market prices, which may raise overall world market prices. Unless the crop is extremely small, prices should soften somewhat under imported honey price pressure.
The Canada honey crop should be close to average with prices mirroring USA raw honey prices.
Overall raw honey prices appear to be bottoming out, and prices should remain somewhat stable over the next several months. A short USA crop coupled with a short Chinese crop may raise world raw honey prices, but sharp raw honey price increases are not forseen at this time.
With a good supply of honey, and many packers reluctant to buy for fear of continued declining raw honey prices, prices have dropped even more than what was projected last quarter going into this quarter. Prices cold firm quickly if buying becomes heavy heading into the South American crop season, but realistically this trend could continue even though South American honey prices will start out higher. Pricing will be driven down under continued price pressure from Asian honey, especially Chinese. With large volumes of Chinese honey, and ultra filtered Chinese sweetener being sold freely into the world market, supply, and price pressure should remain strong. This could continue until all contaminated Chinese honey has been ultra filtered and flushed through the system. It is uncertain at this time whether the Chinese are producing contaminate free honey or at what levels.
Some issues that we think could influence raw honey pricing are:
A short South American honey crop, or contamination issues (nitro furans), that plagued them last year.
Continued mite problems that have plagued U.S. beekeepers. Mites are devastating bee colonies and producers of replacement bees. Once effective miticides are no longer working, and biological controls appear to be years off.
Larger than suspected volumes of low priced ultra filtered Chinese sweetener flooding the market.
Passage of the New Shipper Review Amendment Act that would end importation of duty free honey from China, and essentially firm up or raise import honey prices.
The unknowns are probably the biggest factor in regards to future honey prices, any number of factors can dramatically alter raw honey price, but with all that we can see, honey prices will probably continue to drop into next summer with some leveling and stabilization at that time.
As new crop honey continues to be processed, most Southern Hemisphere honey has been reported to be all sold, and concentration is now on Northern Hemisphere Honey.
The USA honey crop is in, but final volume numbers are still out. The crop looks to be comparable to last year, which was well below average. Prices are declining under pressure from imported honey, but are still higher than most import honey prices. The Canadian honey crop is in, and appears to be well below average. Prices will parallel US honey prices.
Europe will need to import large volumes of honey for its’ needs. The EU has lifted the ban on both Chinese Honey and USA honey. Europe will probably rely more heavily on Chinese honey imports rather than South American honey. Europe will import Chinese honey under close scrutiny.
The Chinese honey crop appears to be below average. How much contaminated honey they still have, and how much ultra filtered sweetener they have left to sell is anybody’s guess. A large volume of Chinese honey is coming into the US either directly or circumvented through other countries. Much of this honey is still adulterated. Much of it is coming in duty free, due to some loopholes in the way duties are collected. Legislation is pending to close these loopholes, and to require cash deposits instead of bonds for the duties. If this legislation passes, Chinese honey prices may firm up very quickly, and may even rise. Even without this legislation, imported honey prices may be close to bottom.
The next South American honey crop will be ready for export starting in January or February 2005. With Europe allowing imports of Chinese honey, more South American honey will be imported into the US. Duties have been eased on imports of Argentina honey into the US, and Argentina seems to be doing a better job policing themselves on exports of honey contaminated with Nitro Furans.
The honey market as we all know has tumbled from very high levels. Many believe the key reason for the decline has been that new Chinese Shippers who, faced with high anti-dumping duties, have set up subsidiary “front” companies that neither pay cash deposits for their anti-dumping liabilities, nor even factor those anti-dumping duties into their selling prices. Instead, these front companies have used bonds and are prepared to disappear if and when confronted to pay cash rather than bonds. Legislation is in the works for cash deposits of Anti Dumping Duties.
This factor has been even more negative in its impact than the illegal circumvention in 2003 of the county of origin law, which resulted, it is widely believed, in Chinese honey entering through third party countries.
American beekeepers have suffered from the decline of honey prices and are hoping the market reverses its downward trend. There is serious draught in many states suffering excessively dry conditions. The total US crop is predicted to be below normal. An optimistic estimate may be 185,000,000 pounds, to sustain consumption of about 400,000,000 pounds. A pessimistic estimate could be as low as 170,000,000 pounds.
The Chinese Honey crop did not start well. Strong efforts on the legal front and among Chinese beekeepers to prevent CAP and ultra-filtration of honey are making these largely problems of the past. Negotiations are under way to agree on the levels of testing for antibiotics that will allow for accurate and consistent results and avoid false positives.
The Argentine honey crop is both shorter than expected and darker than usual. Strict inspection for nitrofurans by the Argentine Government has made the actual export of Argentine honey slow and tedious. Argentina is taking this problem seriously.
The Vietnamese honey crop is normal. The Vietnamese Government has taken serious steps to prevent transshipment of Chinese honey.
In general it is felt within the industry that market conditions at home and abroad should lead to a more stable and firmer market unless, of course, the North American honey crop unexpectedly explodes.
Raw honey prices continue to decline under pressure from cheaper imported honey but the problem remains that much of the imported honey is still questionable quality.
Ultra-filtered sweetener adulteration is rampant. Argentina honey imports are down due to higher prices and possible nitro-furans contamination. Chinese and Argentina honey is finding its way into the US through other countries to avoid duties and to hide adulteration. Large volumes of adulterated and contaminated Chinese and Argentine honey is finding its’ way into Canada, either direct or circumvented thought other countries, and then make its way into the US.
Chloramphenicol contamination is still an issue, and nitro-furans contamination is becoming a larger problem. The FDA is finally starting to more closely monitor honey coming into this country from Canada and other countries. They are also increasing sampling of domestic honey, looking for adulterated products. If this action results in reduced honey imports, supply could tighten. If imports of cheaper, suspect honey slow, the price decline could slow and prices could firm up.
Raw honey prices continue to soften somewhat driven by lower import prices from Asia. Much of this Asian honey is still highly suspect for CAP & adulteration, so testing is still critical for all imported honey. Processed honey prices should continue to decline modestly through the rest of the year, with some possible firming at that time.
The price difference between Domestic raw honey prices and imported raw honey prices should continue to narrow bringing more price stabilization to the market. Although there may be some spikes, the overall trend should be mostly stable to slightly downward. While supply is now greater than demand, much of the supply is of questionable origin & quality. A large volume of ultra-filtered Chinese adulterated honey is creating an artificially large supply. This has, in some respects, created two separate markets - The higher priced legitimate raw honey market & the questionable lower price raw honey market. If the FDA or the honey packers & importers themselves decide to crack down on this adulterated honey entering the US, supplies could tighten. This could again firm up or even raise raw honey prices. Ongoing concern over illegal antibiotics is still an issue & could create some supply issues in the future.
The 2004 Argentina crop is reported to be smaller than average. Argentina raw honey prices, which generally set the market for all of South American pricing, are fairly high and stable. These prices will probably stay firm until the crop is sold. These prices could also rise as the value of the US dollar weakens against the European Euro.
The 2004 US crop will have a bearing on pricing. If floral sources, such as clover, recover from the drought damage and if weather conditions remain favorable, the US could expect a more average crop, which would keep supply even with or ahead of demand. US raw honey will still be more expensive than imported honey, but is of much higher quality.
The 2004 Chinese honey crop picture is still cloudy. It will still be an unknown as to how much uncontaminated raw honey they will produce & whether they will contaminate the clean honey they produce by blending it in with the large supply of chloramphenicol contaminated honey & ultra - filtered sweetener they still have. This would be done to get CAP readings under undetectable levels. Whether the Chinese sell their raw honey into the world market legally or illegally, the volume that they sell should keep supply strong.