lunes, 15 de junio de 2009

The Agribusiness World Today

Ken Shwedel
Investigador de Agronegocios de Rabobank, México
15-19 de Junio de 2009

The World

Competing by blending and coloring: Over time the sweetener market has become increasingly more crowded. First there was really only sugar, then there were the artificial sweeteners and now there is stevia. For the most part each player had kept to their own segment. More than differentiation, strategy focused on name calling. Artificial sweetener plays blamed sugar the “obesity epidemic”. The sugar industry countered by saying that their product was “natural”. If there was an attempt at differentiation it existed at the single serving level, particularly in the North American markets. Single servings were offered in different color packets. Sugar, for example, generally came in a white package. Now all this is changing. To reach more consumers Domino’s, for example, has decided to launch an artificial product.

They say that while “sugar is the gold standard” there are “consumers who will not eat sugar; either they cannot or do not want to.” NutraSweet, for their part, looking to extend their product line has come out with what the have branded as NutraSweet Cane that is a blend of both sugar and artificial sweeteners, that is positioned to compete with Splenda. How are they competing against Splenda? NutraSweet’s product at the single serving level comes in yellow packet, which consumers have come to recognize as Splenda’s color. To compete against Equal that is single-service-packaged in a blue packet, NutraSweet launched a blended product in a blue packet. What all this is saying is that it is not only the products that are being blended, but also the market; we expect that companies will increasingly see themselves as sweetener companies, adjusting their business model accordingly.

Fishery’s looking at a flat 2009: The UN’s FAO has come out with their report on the state of the fishery’s industry. They place last year’s total production of fish products “(excluding seaweed and marine mammals)” at slightly above 2007 levels reaching 141.6 million MT. They say that the increase was due to the 2.5% growth in aquaculture output. Trade in fishery products, in terms of volume fell slightly going from 52.9 million MT (live weight) to 52.6 million MT. Because of high prices —the “FAO GLOBEFISH Price Index … reached an all time high in September”— trade, in value terms, jumped from US$92.8 billion to US$99.5 billion. This year, though, the outlook is not all that positive. In general, prices are lower, reflecting the global economic situation. Production is projected to be relatively flat growing only to 142 million MT. The interesting part of the FAO data and projections is that they show wild catch as flat. It is changes in aquaculture production that is driving the industry. They point to the virus attack on the Chilean salmon industry as “a warning sign for many countries targeting high growth in the aquaculture sector.” More than a warning for “many countries”, it is a warning for the future of fishery’s industry.


Running out of water? In 2007 with the political motivated demonstrations around the high price of tortillas, Mexico set the stage for the potential problems arising from the high commodity prices. Now the question is if the same thing is happening with water. Largely the result of growing urbanization, lack of maintenance and little conservation, the Mexico City area is running out of water resources. The city has already seen suspension of water delivery, particularly as the National Water Commission (CAN) worked to fix part of the delivery system. Now the CNA is saying that since rainfall is projected to be below normal the city could see a temporary suspension (up to 48 hours) of water delivery.

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