In December 2018 we visited our Mexican chia supplier in Jalisco. The crop had almost come to an end. We visited the last fields that were being harvested. It looks like a very healthy crop with an estimated volume of approx. 5600mt. The advantage of Mexican chia is the favorable climate and high altitude. It’s less humid compared to South America, which results in less insects and moulds. It also has higher oil content because the plant produces more oils to protect against the high altitude, chilly nights, so this translates to higher omega 3’s and over all percentage of oils.
We have started to receive the first shipments of new crop conventional and organic chia. Please consult your sales manager for a quotation.
Demand for chia has somewhat slowed down over the past few weeks, but prices have remained quite stable. Many markets are still well-stocked. Organic is still available in most origins but the few buyers in the market are after conventional product. The organic premium has shrunk as a result, i.e. organic offers have been decreasing while conventional is getting more expensive. Buyers in the US and to some extent Europe, are still reluctant to follow the price offers. Many have been expecting that more conventional product would become available in the course of the season when organic lots are converted into conventional ones as a result of pesticide residues. This has not occurred much yet. Pesticide residues are less of a concern than in previous years as growers have adapted agricultural practices. Although the differential between organic and conventional has narrowed, exporters are reluctant to sell organic product as conventional. They would prefer to wait until demand for organic recovers.
Organic prices in Bolivia and Paraguay demonstrated relative stability, starting at 3.300 – 3.700 $us FOB at the beginning of this year and reached 3.100 – 3.500 $us FOB by December. Conventional prices did the opposite, they started at 2.100 $us FOB and rose to 2.600-2.900 $us FOB at the end of the year. Stocks are almost gone now and crop is expected to be very good due to November-December rains, so prices could come down even further. The main problem is that farmers and exporters cannot afford to work much longer under equilibrium prices (2.500 – 3.000 $us Conventional, 3.000 – 3.500 $us Organic) so they could try to push prices back up by speculating after the harvest. December and January are usually very weak months in the business. February should be the time to act.
According to exporters, the chia market could not develop its entire potential if it continues operating under this range of prices for long. Chia farmers could grow more interested in other crops and supply could become irregular in the long term.