Market Intel Weekly Nugget

• Yesterday Iran sent missiles to Israel and that increased the tension in the supply chain and logistics. The price of oil already started to rise.
• Despite the decrease in consumption of the Chinese market, at the beginning of April 51MT of Belgian pork meat arrived in China since the ban imposed to Belgium due to ASF.
• It’s expected that China will decrease the import of cereal due to the increase of their own production.
• The weather in northern Europe is still cold and rainy so the BBQ season has been delayed. Usually, after eastern season the price of pork decreases but this year is different. The pork prices are stable so less pressure on prices.
• In the USA pork prices in 2024 started to depreciate but even though the production levels forecasted could be lower than the European levels, it is expected that consumption will rise as summer gets close.
• The USA and Brazil are the countries that are exporting the most to Asia, despite the weak demand of China.
• The frozen stock in Europe is very low, which allows Europeans to defend their price but if there is an exporting demand then there will be problems in finding pigs to slaughter.

Also, we need to take into account:

Iran-Israel. Disruptions

The recent escalation of tensions between Iran and Israel, marked by Iran's attack on Israel and the seizure of an Israeli-linked container ship near the Strait of Hormuz, could have significant implications for the global supply chain and goods at sea.

This situation could impact the supply chain and maritime trade:

1. Disruption in Shipping Routes: The seizure of the container ship near the Strait of Hormuz and the potential for further attacks could disrupt shipping routes in the region. This could lead to delays in the transportation of goods, affecting supply chains that rely on timely deliveries by sea.

2. Increased Shipping Costs: Heightened tensions and potential risks to ships in the region could result in increased insurance premiums for vessels passing through volatile areas. This, in turn, could lead to higher shipping costs, impacting the overall cost of goods transported by sea.

3. Supply Chain Disruptions: Any escalation of conflict between Iran and Israel could lead to further disruptions in the supply chain, affecting the movement of goods between regions. Businesses may face challenges in sourcing raw materials or delivering finished products, impacting production and distribution processes.

4. Market Volatility: The uncertainty surrounding the situation in the Middle East could contribute to market volatility, affecting commodity prices and trade flows. Businesses may need to adapt to changing market conditions and geopolitical risks to mitigate potential disruptions to the supply chain.

This is not new and we already have experienced the Middle East conflict which is often referred to as a proxy war between Israel and Iran. Too early to say yet but as mentioned above, the trade will suffer in one way or another.

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