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Summary
Recent cyclonic conditions in South India have significantly impacted black matpe (urad) crops, leading to price increases across global markets. With Myanmar's new crop expected in early 2024 and emerging supply routes from Brazil and Russia, the market is experiencing interesting dynamics between immediate shortages and potential future stability.
Weather Impact on Indian Production
The recent spell of wet weather in Tamil Nadu and Andhra Pradesh has dealt a significant blow to black matpe cultivation. Cyclone Fengal and subsequent low-pressure systems have created challenging conditions for farmers, triggering an upward trend in prices. The situation in Tamil Nadu has been particularly severe, with reports indicating substantial crop losses.
Global Price Movements
The market has responded quickly to these developments:
- Global prices increased by $10-20 per tonne last week
- Brazil maintains its offer to India at $1,040 CNF
- Myanmar's superior quality black matpe saw a $15 increase, reaching $1,025 for January delivery
- Pakistan market prices rose by $20 to $1,040
- Myanmar's husked whole/split superior quality is now at $1,080 FOB
Regional Production Status
India
- Tamil Nadu: Severe crop damage reported
- Andhra Pradesh: Facing yellow mosaic virus challenges
- Telangana: Showing positive production outlook with higher expected yields
Global Supply Chain
- Myanmar: Forecasting nearly one million tonnes from February harvest
- Brazil: Expected to more than double exports to India, from 50,000 tonnes
- Russia: Emerging as a potential new supplier to Indian markets
Supply-Demand Dynamics
Current market analysis shows:
- Total demand: 2.5 million tonnes
- Expected supply until Rabi harvest: 1.75 million tonnes
- Supply gap: Approximately 750,000 tonnes
Future Outlook
Short Term
- Prices likely to maintain upward trajectory
- Limited supply from various smaller sources
- Continued pressure on existing stocks
Medium Term
- Expected stabilization with Myanmar's February harvest
- Additional relief with Indian Rabi crop arrivals
- Diversification of supply sources with Brazil's increased participation
Conclusion
The black matpe market is currently navigating through a complex period of weather-induced supply constraints and evolving global trade patterns. While immediate price pressures are evident, the market shows signs of potential stabilization in Q1 2024 with new crop arrivals from Myanmar and India's Rabi harvest. The emergence of new supply routes from Brazil and Russia suggests a more diversified and potentially more stable supply chain in the longer term, though careful monitoring of quality and logistics will be crucial for market participants.