The Peruvian quinoa harvest is about to end in 1-2 weeks. As pointed out in our previous update, stocks in Peru seem rather low. Even with new product in the market, prices are not being pushed down. We’re even seeing an uptick in white quinoa prices. In Bolivia the harvest has already ended.
The carry-over in Bolivia is still quite healthy but the aggressive purchasing from intermediaries (contraband to Peru) is putting a pressure on the supply and disrupting market dynamics since they pay cash and have less quality standards than private companies.
Our suppliers informed us that the farmer’s speculations are caused by the following factors:
- Even though climate conditions in Bolivia have been favorable this year, some areas report smaller yields than expected (regular harvest, not better than 2017).
- Weather conditions in Peru are not favorable for the remaining crop
- Pressure on white quinoa prices.
- Continuous demand for quinoa from the private and informal sector.
- China as a new export market for Bolivia (expectations of increased demand this year)
It’s important to note that the pressure on prices can only be applied to white quinoa which accounts for 70%-75% of the market. It is not clear whether there will be a notable increase in prices, but we anticipate at least some stabilization in the upcoming months and a strong chance of them rising towards the end of the year and first couple months of 2019.
On the other hand, we are seeing that red quinoa prices are decreasing and we might see another drop once the Peruvian harvest is completed. Both Bolivian and Peruvian farmers have planted much of this product this year due to more appealing prices in 2017.
Black quinoa has also seen a decrease in prices. The exact direction of this variety is harder to guess since it’s the most volatile. That said, we expect that black quinoa prices should be a bit more competitive the next 3-4 months.
Note that, since the start of the year, white quinoa prices have been at higher levels than the average price in 2017. In April prices started to rise. Although they didn’t increase much, it is still an interesting tendency to keep in mind, given that April/May is the time of Harvest in Bolivia. Usually prices come down during crop time.
Red and Black are already quite below their averages in 2017. They have been stable for the past month but it will be important to pay attention to variations once the Peruvian (specially the red) quinoa becomes available.
Published: 05/06/2018
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