If you’re an American over a certain age, you might recall the experience of staining your fingers while prying open red pistachios. They were a somewhat exotic treat, put out on occasion in a special bowl. That might seem strange to younger Americans who are only familiar with the natural tan pistachios that are ubiquitous as a post-workout food and snack.
The different associations are the result of a dramatic shift in where pistachios were produced and shipped after 1979 when the United States imposed sanctions against Iran in response to the Iran Hostage Crisis involving the taking of more than 50 American diplomats.
Pistachios are a biblical fruit, renowned as a court favorite of the Persian Queen of Sheba, a frequent traveler on the Silk Road and Mediterranean maritime routes. Iran has cultivated them for thousands of years, though large scale commercial production in Iran began just over one hundred years ago. American production is a much more recent phenomenon.
In 1929, American botanist William Whitehouse explored Persia on behalf of the U.S. Department of Agriculture, scooping up pistachio samples from farms located in modern day Iran. He returned in 1930 and planted test plots. When the trees matured a decade later, only one proved fruitful – Whitehouse named it Kerman after a city in Iran’s Rafsanjan central plateau. Pistachio trees can live hundreds of years and take their time to reach peak production – around twenty years.
Ironically, the U.S. pistachio industry – born from a single Iranian seed – matured in the 1970s precisely at the moment Iran’s trade with the United States, including of pistachios in dyed-red shells, came to a crashing halt.
The tale of U.S.-Iran pistachio trade has four plotlines that dramatize the broader quirks of global agricultural trade.
For most of history, Iran has been the world’s biggest source of pistachios. They are Iran’s most significant agricultural export by volume and value. Iran was the biggest supplier to the United States, but damaged relations following the Islamic Revolution of 1979 changed that. U.S. sanctions imposed since that time have a complex and layered history but have almost always involved a complete embargo on Iranian exports to the United States.
Following the lifting of the initial embargo in 1981, Iran’s food exports to the United States rebounded somewhat before the embargo was reintroduced in 1987. In an easing of sanctions in 2000, very modest amounts of foods from Iran were imported through Treasury Department-issued licenses. By 2010, imports of foods from Iran were again fully prohibited. The 2015 Iran Nuclear Deal would have enabled Iran to export pistachios and other agricultural products and lifted restrictions on financing, which Iran hoped would inject much needed capital investment in the agricultural sector. U.S. withdrawal of the Nuclear Deal in May 2018 saw a return to strict U.S. sanctions on imports from Iran.
When sanctions were first imposed in 1979, U.S. pistachio production was 7,700 metric tons, up quite substantially from the first U.S. commercial crop in 1976 of just 680 metric tons. In comparison, Iran had averaged 19,504 metric tons per year in the decade leading up to sanctions, but peaked in 1978 at nearly 59,874 metric tons. At the time, Iran accounted for nearly 100 percent of U.S. imported pistachio nuts. After falling off during the embargo, Iran renewed exports when the embargo was lifted in the early 1980s.
In March 1986, the Commerce Department found in favor of a U.S. industry petition that complained the Iranian government was subsidizing pistachio production. Iran (as many developing countries do) was providing supports to its agricultural producers by subsidizing the cost of key inputs such as fertilizer, chemicals, seeds, water and energy and by guaranteeing a minimum price for their output. The investigation resulted in a 99.5 percent countervailing duty on in-shell pistachios and a 318 percent duty on roasted pistachios.
Because Iran was not a signatory to the General Agreement on Tariffs and Trade (GATT) and is not a WTO member (the United States has repeatedly blocked its application for accession), no injury determination was required.
In a parallel 1986 investigation, the U.S. International Trade Commission (USITC) found that the volume of raw in-shell pistachios imported from Iran had increased significantly after the embargo was lifted in 1981. U.S. producers had secured 93.2 percent of the U.S. market in 1980, which was about 12.5 million pounds. By 1985, the overall size of the U.S. market had swelled to 61 million pounds, and Iran’s share had grown to 42.3 percent, accounting for almost 100 percent of all imports.
At the same time, the unit value of imports from Iran (import price) fell by around half. The USITC determined that raw in-shell pistachios imported from Iran were being sold at “less than fair market value” (or, being “dumped”) in the U.S. market, causing material injury to the U.S. industry. The Commerce Department calculated an offset in the form of a 241 percent antidumping duty, which would be applied in additional to the 99.5 percent countervailing duty.
In years of embargo, the duties were irrelevant and thus only two reviews have since been conducted to determine whether the duties should remain in place. In both 2005 and more recently in 2017, the USITC determined they should.
According to the Iran Pistachio Association (IPA), Iran has around 150,000 farmers, but more than 70 percent of the production is small-scale on orchards of 2 hectares or less. In a “good” year, annual pistachio production capacity reaches 280,000 metric tons in Iran, but harvesting is inefficient. Pistachios are picked by hand from fallen clusters, their hulls removed by hand, and the nuts graded manually. Inadequate water management undercuts Iranian production, but when Iran’s yield is strong, the country’s pistachio exporters hold a price and geographic advantage. And IPA says they are competitive globally based on strong demand for the wide variety of Iranian pistachio cultivars with different flavor profiles and a higher kernel to in-shell ratio.
In contrast, the United States has some 950 growers, mainly in California, whose mechanized production is highly efficient, yielding a whopping 487,500 metric tons over the 2018-19 season (though output is cyclical and weather-dependent so yields may be down over 30 percent this year). Achievements in increased outputs made during a period when the U.S. market was closed to Iran, its only major competitor, enabled the U.S. industry to reach a position where it could both serve the domestic market and challenge Iran for market share all over the world. Iran has barely exported any pistachios to the United States since 1986 but it remains a contender in key third markets.
Combined, the United States and Iran account for more than 70 percent of global exports of pistachios. Iran tends to hold the top spot in the Middle East, India, and Eastern Europe and holds an edge in developing country markets. The key battlegrounds in the U.S.-Iran pistachio wars are Western Europe and China where demand is strong and growing.
American pistachio growers fretted when the Trump administration raised tariffs on products from China. When China retaliated, raising the tariff on U.S. pistachios from five to as high as 55 percent, that created an opportunity for China to substitute Iranian pistachios. However, Iran ultimately suffered a bad crop year and it’s not clear whether China collected the tariffs, so sales of U.S. pistachios in China actually increased.
The U.S. pistachio industry was concerned about the potential for renewed competition from Iran under the 2015 nuclear deal that eased sanctions. Their fears were allayed when the USITC voted to maintain the 1986 legacy of prohibitive tariffs. No matter, the Trump administration has strengthened sanctions and the embargo remains.
In the end, global demand for pistachios is higher than production, leaving room for both American and Iranian producers to find a market for all they can grow.
In an NPR interview four years ago, Brian Blackwell, a grower from Tulare County, CA wasn’t concerned about the reentry of Iranian pistachios in the U.S. market and explained the nature of global commodity markets this way: “This is a global marketplace nowadays. So, if Iran brought a million pounds of pistachios into the United States, that just means there’s a million pounds that didn’t get sold in China or Europe. U.S. pistachios could fill that market.”
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Andrea Durkin is the Editor-in-Chief of TradeVistas and Founder of Sparkplug, LLC. Ms. Durkin previously served as a U.S. Government trade negotiator and has proudly taught international trade policy and negotiations for the last fifteen years as an Adjunct Professor at Georgetown University’s Master of Science in Foreign Service program.
This article originally appeared on TradeVistas.org. Republished with permission.
IndexBox has just published a new report: ‘World – Ethyl Alcohol – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.
In 2018, the amount of ethyl alcohol exported worldwide amounted to 17B litres, going up by 24% against the previous year. In general, the total exports indicated prominent growth from 2007 to 2018: its volume increased at an average annual rate of +7.9% over the last eleven-year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, ethanol exports increased by +79.8% against 2014 indices. The growth pace was the most rapid in 2011 with an increase of 47% against the previous year. The global exports peaked in 2018 and are likely to see steady growth in the near future.
In value terms, ethanol exports stood at $8.7B (IndexBox estimates) in 2018. In general, the total exports indicated a buoyant expansion from 2007 to 2018: its value increased at an average annual rate of +7.9% over the last eleven-year period. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. Based on 2018 figures, ethanol exports increased by +21.6% against 2015 indices. The most prominent rate of growth was recorded in 2011 with an increase of 60% year-to-year. In that year, global ethanol exports reached their peak of $9.7B. From 2012 to 2018, the growth of global ethanol exports failed to regain its momentum.
The U.S. was the largest exporter of ethyl alcohol exported in the world, with the volume of exports finishing at 7.8B litres, which was approx. 45% of total exports in 2018. It was distantly followed by Brazil (1.6B litres), the Netherlands (1.2B litres), France (0.9B litres) and Pakistan (0.8B litres), together generating a 27% share of total exports. Hungary (550M litres), Belgium (535M litres), the UK (449M litres), Germany (432M litres) and South Africa (278M litres) held a relatively small share of total exports.
The U.S. was also the fastest-growing in terms of the ethyl alcohol exports, with a CAGR of +25.6% from 2007 to 2018. At the same time, Hungary (+22.6%), the Netherlands (+10.9%), Pakistan (+10.6%), Germany (+9.4%), Belgium (+7.6%), the UK (+7.4%), France (+6.7%) and South Africa (+3.9%) displayed positive paces of growth.
By contrast, Brazil (-4.0%) illustrated a downward trend over the same period. The U.S. (+42 p.p.), the Netherlands (+4.9 p.p.), Pakistan (+3 p.p.), Hungary (+2.8 p.p.), France (+2.8 p.p.), Belgium (+1.7 p.p.) and Germany (+1.6 p.p.) significantly strengthened its position in terms of the global exports, while Brazil saw its share reduced by -5.3% from 2007 to 2018, respectively. The shares of the other countries remained relatively stable throughout the analyzed period.
In value terms, the U.S. ($2.8B) remains the largest ethanol supplier worldwide, comprising 32% of global exports. The second position in the ranking was occupied by Brazil ($892M), with a 10% share of global exports. It was followed by the Netherlands, with a 9.4% share.
In 2018, Brazil (2,270M litres), Canada (1,626M litres), Germany (1,321M litres), the U.S. (1,318M litres), the Netherlands (1,056M litres), Japan (875M litres), the UK (683M litres), India (571M litres), South Korea (422M litres), the Philippines (415M litres), the United Arab Emirates (383M litres) and France (271M litres) was the largest importer of ethyl alcohol imported in the world, committing 74% of total import.
From 2007 to 2018, the most notable rate of growth in terms of imports, amongst the main importing countries, was attained by Brazil, while imports for the other global leaders experienced more modest paces of growth.
In value terms, Germany ($832M), Brazil ($777M) and the U.S. ($705M) constituted the countries with the highest levels of imports in 2018, with a combined 28% share of global imports. The Netherlands, Canada, Japan, the UK, India, the Philippines, South Korea, France and the United Arab Emirates lagged somewhat behind, together comprising a further 40%.
The Philippines recorded the highest growth rate of the value of imports, in terms of the main importing countries over the period under review, while imports for the other global leaders experienced more modest paces of growth.
The average ethanol import price stood at $0.5 per litre in 2018, waning by -13.1% against the previous year. Over the period under review, the ethanol import price continues to indicate a mild contraction. The growth pace was the most rapid in 2011 when the average import price increased by 19% y-o-y. The global import price peaked at $0.8 per litre in 2012; however, from 2013 to 2018, import prices remained at a lower figure.
Prices varied noticeably by the country of destination; the country with the highest price was France ($0.7 per litre), while Brazil ($0.3 per litre) was amongst the lowest.
From 2007 to 2018, the most notable rate of growth in terms of prices was attained by the Philippines, while the other global leaders experienced more modest paces of growth.
Source: IndexBox AI Platform
Iran has been among the worst affected countries from COVID-19, having emerged as an early hotspot outside China. As of April 7, there were an estimated 62,589 confirmed cases with over 3,800 deaths. Iran’s cases appear to have peaked in late March, but exact numbers are unknown due to the secretive nature of its totalitarian regime. Other countries throughout the Middle East began reporting cases in late February and continue to battle spread of COVID-19 due to travel linked to Iran.
U.S. offers of assistance were rejected by Iran’s Supreme Leader Ayatollah Ali Khamenei, who said publicly on March 22, “You might give us a medicine that would spread the disease even more or make it last longer.”
According to the U.S. State Department, the United States has offered more than $100 million in medical assistance to foreign countries, including to the Iranian people, and reports that Iranian health companies have been able to import testing kits without obstacle from U.S. sanctions since January. The U.S. government has urged Iranian leaders to be more truthful about its efforts to contain the virus.
U.S. economic sanctions against Iran include a general exemption for U.S. exports of agricultural commodities, food, medicines and medical devices to Iran and an authorization process to obtain licenses for a specific list of medical supplies and equipment not covered under the general exemption. Such licenses are usually given for one year.
The U.S. government recently reinforced its messaging that sanctions are directed at the Iranian regime, stating: “[Sanctions] are not directed at the people of Iran, who themselves are victims of the regime’s oppression, corruption, and economic mismanagement.”
A 2019 Congressional Research Service report suggests U.S. sanctions have limited access by the Iranian population to “expensive Western-made medicines such as chemotherapy drugs,” due to a lack of bank financing for such transactions and that the limited supplies that exist have gone to elites.
Between 2018 and 2019, overall U.S. trade with Iran went from small to very small under tightened sanctions. In 2018, U.S. exports to Iran were valued at $425.7 million. In 2019, U.S. exports had decreased 82 percent to $73.1 million.
Underlying that decrease in trade, even of humanitarian-related goods and services, reflects a tendency toward over-compliance by banks and multinational firms that avoid transactions with Iran to minimize possible violations of U.S. sanctions. Doing so, even inadvertently, could cut off their access to vital U.S. financial markets. The U.S. government has also explicitly cited concerns about the Iranian regime’s abuse of humanitarian trade to evade sanctions and launder money.
To close these loopholes, in October 2019 the Treasury Department announced a new payment mechanism “to facilitate legitimate humanitarian exports to Iran.” The measure restricts the role of the Central Bank of Iran in facilitating humanitarian trade, which the U.S. government views as financing terrorism. It also imposes rigorous reporting requirements to thwart diversion of funds intended for humanitarian use.
By late February 2020, as the COVID-19 medical crisis unfolded in Iran, the U.S. Treasury Department issued a general license authorizing certain humanitarian trade transactions involving the Central Bank of Iran while also approving the use of a Swiss financial channel to finance such transactions.
The Swiss Humanitarian Trade Arrangement (SHTA) enables Swiss-based exporters and trading companies in the food, pharmaceutical and medical sectors to access a secure payment channel with a Swiss bank to guarantee payments for their exports to Iran. Novartis was the first Swiss company to send medicine for use in cancer treatments. Germany, France and Britain have also used this new channel to offer a $5.5 million package to Iran to help fight the coronavirus.
Much has been written recently about governments restricting exports and otherwise increasing the cost of traded medical supplies during the pandemic.
For two decades now, the Trade Sanctions Reform and Export Enhancement Act of 2000 (TSRA) has ensured that each U.S. country-based sanctions program provides for trade of agriculture, medicine and medical devices under a broad humanitarian exemption. This is intended to limit potential adverse effects on civilian populations who are not the target of sanctions.
The United Nations Security Council maintains 14 active sanctions programs that also include humanitarian exemptions driven by the belief that a supportive and healthy citizen population is necessary to achieve improvements in a sanctioned regime.
Recently, the United Nations Security Council approved a humanitarian exemption to sanctions against North Korea (DPRK) requested by the World Health Organization for diagnostic and medical equipment to address COVID-19. The United States supported this decision.
The health impacts of embargoes are difficult to isolate and quantify. They may not become apparent until years after resource shortages occur. Domestic production challenges can also play a role. For example, Iran produces 97 percent of its medicines locally, but a third of these drugs rely on active ingredients that are imported, according to the head of Iran’s Food and Drug Organization.
Although humanitarian trade exemptions are intended to mitigate shortages of essential supplies, totalitarian regimes are known for putting their goals before the needs of their citizens. The negative impacts of sanctions are often compounded by inequitable distribution or outright theft of essential goods and ongoing civil conflicts.
In any case, it’s difficult to know the net effect of sanctions and humanitarian trade exemptions because data on key indicators of health effects are often missing or unavailable from embargoed regimes. However, it is clear that enabling trade in essential goods like food and medical supplies has served a role in health diplomacy for decades.
During her career in international trade and government affairs, the author worked with pharmaceutical and medical device manufacturers to navigate U.S. sanctions policies and requirements.
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Sarah Smiley is a strategic communications and policy expert with over 20 years in international trade and government affairs, working in the U.S. Government, private sector and international organizations.
This article originally appeared on TradeVistas.org. Republished with permission.
As a nation, we look to the economy to answer our basic questions about the future. What will fluctuations in global markets and supply chains bring? How will the dollar recover from the circumstance of a stalling consumer market? And what impacts, if any, will change the way we do business? As spring approaches, the anticipation around these questions builds. We watch for signs of our shuttered economy lurching back into motion.
Businesses, much like individuals, have coping mechanisms when faced with a crisis. There are ways to build a business contingency plan, even with unforeseen challenges. Some industries have not dusted off their plans since the financial crisis of 2008, and there is anxiety around what it means to enact it. But the truth is: business contingency plans are built precisely for moments like the spread of COVID-19. And while words like “unprecedented,” “alarm,” and “volatility” rule headlines, reactivity is not how businesses run. It is through preparedness and foresight. It is with a business contingency plan.
While no leader takes comfort from enacting their company’s plan, the ability to swiftly empower crucial business functions with ease is possible. Uncompromising company and financial data security and work-from-home procedures are not mutually exclusive. A bit of knowledge is required to migrate an office environment to the home without opening new vulnerabilities.
Dividing and conquering is the oldest trick in the book for any opportunist looking to damage their business. Security hackers and other ill-intentioned opportunists look for times of organizational chaos to strike. They trust that business leaders have overly-divided their attention and that employees will not adhere to traditional protocols for data security or safe treatment of sensitive information.
There are also a substantial number of leaders who will focus on the uncertainties of the future, preventing them from seeing vulnerabilities that are right in front of them. This, of all things, means that many companies and their leaders must know the enemy is not the distractionary dips and dives of the economy, but the complexity of an organization that prevents it from responding elegantly to uncertainty. Military strategist Sun Tzu of The War of Art provides insight into how we should prepare for battles with the unknown:
“Know the enemy and know yourself; in a hundred battles, you will never be in peril. When you are ignorant of the enemy, but know yourself, your chances of winning or losing are equal. If ignorant both of your enemy and yourself, you are certain in every battle to be in peril.”
Having a business contingency plan is only the beginning. Redraw your battle lines when uncertainty strikes, and you will unmask the hidden areas that need better solutions.
Your employees will not naturally intuit where the new boundary lines exist. Spell it out so that everyone is on the same page. Barring in-person meetings, you may need to host a company-wide Zoom call with a panel of C-Suite leadership to reassure, set new expectations, and answer questions.
Most importantly, leadership should use this as a chance to gather further information. Seek out the experiences of those who serve your customers directly to get their perspective. How are customers responding to the shift? What are their emerging needs, and is there a niche there that your industry can uniquely fill? Keep your company’s ears to the ground.
In environments of economic hardship, businesses with leaner operations and less organizational drag do better. Cutting out redundant manual processes is crucial to eliminating complexity. A business contingency plan will help enact the first line of defense for your business. However, this is not all you will need. The second wave of reinforcements is crucial to keep your business advancing through times of uncertainty.
Automation is your greatest ally in this fight. Now is the time to abandon stale processes. If they’re manual or paper-based, requiring cartons of messy file work or repetitive wet-ink signatures, its time to rethink. Lean heavily on electronic AP solutions, which can clear up the bottlenecks choking out crucial supply chain relationships.
Never in history has the value of a swift and reliable supply chain been more evident than now, as hospitals face shortages of both personal protective equipment and crucial medicines. Industries are re-learning a valuable lesson: that while necessity is the mother of invention, the cost of waiting to innovate can be incredibly painful.
This year is unlikely to offer many sunny prospects in the realm of profits. Yet cost-cutting initiatives will provide the kind of stability a company needs to make impressive cumulative gains in the coming years. What does this mean? Playing defense isn’t your only strategy. You can also cut costs to preserve the liquidity you do have.
With electronic tools already up and running for staff communication or remote meetings, it’s time to ask yourself how you might unburden other areas of the office from slow performance inefficiencies. What is sending through the mail that could be automated? How might making payments to suppliers electronically cut back on paper check costs? Explore every avenue for cost savings. There are many electronic solutions at the ready to lift manual-based work with minimal if not zero downtime for your business. Now is the time to employ these solutions and not hold back when better-designed options exist.
Everyone at this point could do with one more great IT hire, but the point of a business contingency plan is to be resourceful with what resources do exist. Making quantum leaps from the office to a remote setting is much easier for companies who have already made steps toward digital transformation.
Instead of losing more time to processes like answering phones, getting approvers to hand-sign checks, and sending paper mail to closed-up company headquarters, make them digital, with greater control and traceability. Fraudsters’ potential access to your systems diminishes when you have greater visibility and fewer cooks in the kitchen. Higher thresholds for security mean that problems or threats are identified in real-time and careless or lagging processes fall by the wayside.
It’s tempting to lose steam during a crisis and consider it the wrong time to try creative solutions, but the logic doesn’t stand. Now is absolutely the time to try new things.
Since volatility has introduced new stressors into the equation for your business, the target has shifted. A brand new segment of the market may have just locked into place in the form of potential customers. You have the potential to attract them by showing that you understand their needs quicker than anyone else in the space. This requires agility and a bit of risk, but it’s a risk worth taking, even under present circumstances. Innovation isn’t an optional advantage in times of plenty. Innovation is essential to the survival of every business.
In the words of Sun Tzu, “In the midst of chaos, there is also opportunity.” Do not take advantage of the chaos, but respond with resilience to its demands.
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Lauren Ruef is a research analyst for Nvoicepay, a FLEETCOR company, with years of experience conducting market research and crafting digital content for technology companies. Nvoicepay optimizes each payment made, streamlines payment processes and generates new sources of revenue, enabling customers to pay 100 percent of their invoices electronically, while realizing the financial benefits of payment optimization.
IndexBox has just published a new report: ‘World – Dry Bean – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.
The global dry bean market revenue amounted to $30.1B in 2018, reducing by -2.4% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). In general, dry bean consumption continues to indicate a relatively flat trend pattern.
The pace of growth appeared the most rapid in 2016 with an increase of 7.7% year-to-year. In that year, the global dry bean market attained its peak level of $31B. From 2017 to 2018, the growth of the global dry bean market remained at a lower figure.
The countries with the highest volumes of dry bean consumption in 2018 were India (6.9M tonnes), Myanmar (3.9M tonnes) and Brazil (2.8M tonnes), together accounting for 36% of global consumption. These countries were followed by Nigeria, Niger, the U.S., Tanzania, Mexico, Kenya, Uganda, China and Burkina Faso, which together accounted for a further 34%.
From 2014 to 2018, the most notable rate of growth in terms of dry bean consumption, amongst the main consuming countries, was attained by China, while dry bean consumption for the other global leaders experienced more modest paces of growth.
In value terms, India ($6.9B) led the market, alone. The second position in the ranking was occupied by Myanmar ($2.7B). It was followed by Nigeria.
The countries with the highest levels of dry bean per capita consumption in 2018 were Niger (111 kg per person), Myanmar (72 kg per person) and Burkina Faso (35 kg per person).
Driven by increasing demand for dry bean worldwide, the market is expected to continue an upward consumption trend over the next decade. Market performance is forecast to decelerate, expanding with an anticipated CAGR of +2.1% for the period from 2018 to 2030, which is projected to bring the market volume to 48M tonnes by the end of 2030.
The countries with the highest volumes of dry bean production in 2018 were India (6.2M tonnes), Myanmar (4.9M tonnes) and Brazil (2.9M tonnes), with a combined 37% share of global production. Nigeria, Niger, the U.S., Tanzania, China, Mexico, Uganda, Kenya and Burkina Faso lagged somewhat behind, together comprising a further 36%.
From 2014 to 2018, the most notable rate of growth in terms of dry bean production, amongst the main producing countries, was attained by Niger, while dry bean production for the other global leaders experienced more modest paces of growth.
In 2018, approx. 48M ha of beans (dry) were harvested worldwide; going down by -3.2% against the previous year. The harvested area increased at an average annual rate of +2.2% from 2014 to 2018; the trend pattern remained consistent, with somewhat noticeable fluctuations throughout the analyzed period. The growth pace was the most rapid in 2016 when harvested area increased by 8.8% year-to-year. Over the period under review, the harvested area dedicated to dry bean production reached its maximum at 49M ha in 2017, and then declined slightly in the following year.
In 2018, the global average dry bean yield amounted to 788 kg per ha, jumping by 3.9% against the previous year. The yield figure increased at an average annual rate of +1.2% from 2014 to 2018. In 2018, the average dry bean yield reached its peak level and is likely to continue its growth in the immediate term.
Global exports amounted to 3.9M tonnes in 2018, therefore, remained relatively stable against the previous year.
In value terms, dry bean exports amounted to $3.3B (IndexBox estimates) in 2018.
Myanmar was the key exporter of beans (dry) exported in the world, with the volume of exports amounting to 1M tonnes, which was approx. 27% of total exports in 2018. The U.S. (439K tonnes) held an 11% share (based on tonnes) of total exports, which put it in second place, followed by China (10%), Argentina (8.9%) and Canada (8.8%). Brazil (162K tonnes), Ethiopia (136K tonnes), Egypt (102K tonnes), Nicaragua (83K tonnes), Australia (75K tonnes) and Kyrgyzstan (75K tonnes) followed a long way behind the leaders.
From 2014 to 2018, average annual rates of growth with regard to dry bean exports from Myanmar stood at +11.1%. At the same time, Brazil (+25.7%), Australia (+24.2%), Kyrgyzstan (+19.2%), Argentina (+8.3%), Egypt (+4.8%), Nicaragua (+4.2%) and Canada (+3.9%) displayed positive paces of growth. Moreover, Brazil emerged as the fastest-growing exporter exported in the world, with a CAGR of +25.7% from 2014-2018. By contrast, the U.S. (-2.5%), China (-5.7%) and Ethiopia (-12.1%) illustrated a downward trend over the same period. Myanmar (+9.1 p.p.), Brazil (+2.5 p.p.) and Argentina (+2.4 p.p.) significantly strengthened its position in terms of the global exports, while Ethiopia and China saw its share reduced by -2.3% and -2.7% from 2014 to 2018, respectively. The shares of the other countries remained relatively stable throughout the analyzed period.
In value terms, the largest dry bean supplying countries worldwide were China ($573M), Myanmar ($570M) and the U.S. ($390M), with a combined 47% share of global exports. Canada, Argentina, Egypt, Brazil, Nicaragua, Ethiopia, Australia and Kyrgyzstan lagged somewhat behind, together comprising a further 34%.
In terms of the main exporting countries, Australia recorded the highest growth rate of the value of exports, over the period under review, while exports for the other global leaders experienced more modest paces of growth.
The average dry bean export price stood at $831 per tonne in 2018, shrinking by -6% against the previous year. Over the period under review, the dry bean export price continues to indicate a deep decrease. The most prominent rate of growth was recorded in 2016 an increase of 0.3% against the previous year. Over the period under review, the average export prices for beans (dry) attained their maximum at $1,083 per tonne in 2014; however, from 2015 to 2018, export prices remained at a lower figure.
There were significant differences in the average prices amongst the major exporting countries. In 2018, the country with the highest price was China ($1,422 per tonne), while Myanmar ($548 per tonne) was amongst the lowest.
From 2014 to 2018, the most notable rate of growth in terms of prices was attained by the U.S., while the other global leaders experienced a decline in the export price figures.
Source: IndexBox AI Platform
The turbulent economy has lately made it difficult for field service and transportation businesses to thrive. The industry is morphing into an intricate space, meaning that it has become critical to gain an in-depth understanding of your transportation costs and how you can mitigate the rising expenses to improve your profit margin and keep your head above water.
There are many reasons why your transportation logistics costs are skyrocketing. For example, a lack of planning and transparency or bad decision making can lead to increased overall costs, failed delivery or appointment targets, unhappy customers, and ultimately a loss of business.
So, what should you do instead to reduce transportation costs? Well, here are five important things you should consider doing.
A bad route can make all your route planning efforts be in vain and your entire route could be a mess if you’re planning routes using a pen and paper. Poor routes also mean that your drivers will spend more time on the road being stuck in traffic and traveling longer distances which will skyrocket the fuel usage and expenses. When you add the overtime costs of your drivers spending more time than estimated on the road, the transportation costs look even worse.
So, instead, ensure you always provide 100% accurate and well-optimized routes to your drivers.
You can do this with an advanced technology solution, such as a route planner, which will automate the route planning process and make logistics management seamless. Such software will plan accurate routes while factoring in traffic, weather conditions, sunrise/sunset times, one-ways, avoidance zones, weight and load capacity, and more, within a minute. In this way, your vehicles will never run empty and your drivers will have balanced workloads and better routes. They’ll ultimately make more stops without you spending more on fuel.
Planning optimized routes may be the most important step, but it won’t have any impact on your costs if your field reps or drivers don’t follow it. They may make personal stops, idle vehicles for too long, brake frequently, or even accelerate harshly to make up for delayed deliveries or appointments. All such actions will inevitably lead to increased fuel expenses. Bad driving behavior can even lead to excessive fuel usage or cause road mishaps which means that the damage costs will also add up.
Therefore, you should track your drivers and vehicles and see what the drivers do on the road. To do this, you can use a GPS tracker to monitor your vehicles in real-time and set up speed alerts to get notified as soon as a driver speeds. A tracker can even help you protect your vehicles from theft.
Also, if you go for a route optimization software that comes with GPS tracking, you’ll get the best of both worlds: you’ll be able to plan routes and track the drivers’ progress.
Drivers and field reps are the most important stakeholders in transportation and you cannot reduce costs without their 100% involvement, even with the best process in place. So, let them know why it is important for the business to save on fuel costs as well as how they can contribute in keeping the expenses down. Then, reward them for fuel-efficient driving which will boost their morale and commitment to saving more.
A route optimizer will go a long way in helping you with this. Its reporting and analytics feature will give you the data you need to identify every fuel expenditure which you can then use to provide feedback to your drivers about their performance.
One vehicle breakdown can jeopardize your entire plan and the downtime costs can vary from $448 to $760 per vehicle per day. Can you afford that?
Therefore, you should have a preventive maintenance program in place because regular vehicle inspections and maintenance will prevent breakdowns and keep your vehicles in optimal shape to provide better mileage and save you money. Also, you must change air filters, replace spark plugs, and change the oil and oil filters in regular intervals. Here are six vehicle maintenance tips you should be following.
The reporting and analytics feature of a route planner we discussed above will also be useful here. It provides critical data, such as the total distance traveled, total stops, and the fuel used, which will help you identify when vehicles require maintenance. For example, if a vehicle needs maintenance every 2,000 miles, you can easily predict how soon it may need maintenance again.
Every failed delivery will put a dent in your profits. Your drivers may show up on time but it will still be for naught if the customer is unavailable. Such a missed customer will not only jeopardize your other deliveries or appointments but will also cost you more as your drivers need to go to that stop again.
One of the best ways to improve first-time delivery success is allowing your customers to choose their preferred delivery windows. This will ensure that someone will indeed be available at the location when the driver shows up.
You can also allow your customers to track their package delivery statuses or notify them when their packages are nearby. For example, Route4Me offers customer notifications and alerts feature that does just that. It also comes with a customer portal feature that helps customers monitor their own package delivery progress. You can even set access restrictions, depending on how much information you want to reveal regarding the visit, including custom fields, driver identities, and estimated arrival times.
So, what’s your strategy for reducing logistics costs? Do you have any other cost savings methods to add?
IndexBox has just published a new report: ‘Middle East – Cheese and Сurd – Market Analysis, Forecast, Size, Trends and Insights’. Here is a summary of the report’s key findings.
The revenue of the cheese and curd market in the Middle East amounted to $5.5B in 2018, growing by 5.5% against the previous year. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price).
The market value increased at an average annual rate of +1.1% from 2013 to 2018; the trend pattern remained consistent, with somewhat noticeable fluctuations being recorded over the period under review. The most prominent rate of growth was recorded in 2014 with an increase of 8.3% against the previous year. In that year, the cheese and curd market attained its peak level of $5.6B. From 2015 to 2018, the growth of the cheese and curd market remained at a lower figure.
The countries with the highest volumes of cheese and curd consumption in 2018 were Saudi Arabia (377K tonnes), Iran (237K tonnes) and Turkey (202K tonnes), with a combined 57% share of total consumption.
From 2013 to 2018, the most notable rate of growth in terms of cheese and curd consumption, amongst the main consuming countries, was attained by Saudi Arabia, while cheese and curd consumption for the other leaders experienced more modest paces of growth.
In value terms, Saudi Arabia ($1.6B), Israel ($826M) and Turkey ($674M) appeared to be the countries with the highest levels of market value in 2018, with a combined 56% share of the total market.
The countries with the highest levels of cheese and curd per capita consumption in 2018 were Israel (17 kg per person), Lebanon (13 kg per person) and Saudi Arabia (11 kg per person).
Driven by increasing demand for cheese and curd in the Middle East, the market is expected to continue an upward consumption trend over the next decade. Market performance is forecast to retain its current trend pattern, expanding with an anticipated CAGR of +1.9% for the period from 2018 to 2030, which is projected to bring the market volume to 1.8M tonnes by the end of 2030.
The cheese and curd production stood at 1.1M tonnes in 2018, surging by 4.1% against the previous year. The total output volume increased at an average annual rate of +2.5% over the period from 2013 to 2018.
The countries with the highest volumes of cheese and curd production in 2018 were Turkey (244K tonnes), Iran (238K tonnes) and Saudi Arabia (237K tonnes), together accounting for 68% of total production.
From 2013 to 2018, the most notable rate of growth in terms of cheese and curd production, amongst the main producing countries, was attained by Saudi Arabia, while cheese and curd production for the other leaders experienced more modest paces of growth.
In 2018, the amount of cheese and curd imported in the Middle East amounted to 510K tonnes, surging by 33% against the previous year. The total import volume increased at an average annual rate of +1.7% over the period from 2013 to 2018; the trend pattern remained consistent, with somewhat noticeable fluctuations being recorded throughout the analyzed period. Over the period under review, cheese and curd imports reached their peak figure at 520K tonnes in 2014; however, from 2015 to 2018, imports stood at a somewhat lower figure.
In value terms, cheese and curd imports totaled $2.1B (IndexBox estimates) in 2018.
Saudi Arabia was the key importer of cheese and curd imported in the Middle East, with the volume of imports resulting at 172K tonnes, which was near 34% of total imports in 2018. Iraq (54K tonnes) occupied an 11% share (based on tonnes) of total imports, which put it in second place, followed by the United Arab Emirates (8.8%), Lebanon (8.3%), Yemen (7.8%), Kuwait (7.5%) and Jordan (6.4%).
From 2013 to 2018, average annual rates of growth with regard to cheese and curd imports into Saudi Arabia stood at +5.1%. At the same time, Jordan (+7.1%), Yemen (+5.6%) and Iraq (+2.5%) displayed positive paces of growth. Moreover, Jordan emerged as the fastest-growing importer imported in the Middle East, with a CAGR of +7.1% from 2013-2018. The United Arab Emirates experienced a relatively flat trend pattern. By contrast, Lebanon (-2.0%) and Kuwait (-13.5%) illustrated a downward trend over the same period. While the share of Saudi Arabia (+7.5 p.p.), Jordan (+1.9 p.p.) and Yemen (+1.9 p.p.) increased significantly in terms of the total imports from 2013-2018, the share of Kuwait (-7.9 p.p.) displayed negative dynamics. The shares of the other countries remained relatively stable throughout the analyzed period.
In value terms, Saudi Arabia ($626M) constitutes the largest market for imported cheese and curd in the Middle East, comprising 30% of total cheese and curd imports. The second position in the ranking was occupied by the United Arab Emirates ($214M), with a 10% share of total imports. It was followed by Iraq, with a 9.9% share.
From 2013 to 2018, the average annual growth rate of value in Saudi Arabia was relatively modest. In the other countries, the average annual rates were as follows: the United Arab Emirates (-3.2% per year) and Iraq (-0.3% per year).
The cheese and curd import price in the Middle East stood at $4,094 per tonne in 2018, shrinking by -3.1% against the previous year. Over the period under review, the cheese and curd import price continues to indicate a relatively flat trend pattern. The pace of growth was the most pronounced in 2016 an increase of 4.3% against the previous year. The level of import price peaked at $4,323 per tonne in 2014; however, from 2015 to 2018, import prices remained at a lower figure.
There were significant differences in the average prices amongst the major importing countries. In 2018, the country with the highest price was Kuwait ($4,929 per tonne), while Yemen ($3,083 per tonne) was amongst the lowest.
From 2013 to 2018, the most notable rate of growth in terms of prices was attained by Kuwait, while the other leaders experienced a decline in the import price figures.
Source: IndexBox AI Platform
Acknowledging potential weaknesses in your supply chain before they are exposed by elements beyond your control is of critical value. With current events in mind, managing future supply chain disruptions will be an integral component of corporate strategy. Calling it Supply Chain Resilience, Supply Chain Disruption, or Business Continuity Management (from the ISO 22301 standard) does not affect the necessity of having strategies in place that may make the difference between following or leading in a disrupted economy, and even between surviving or folding.
To identify potential soft spots, a review should not be limited to a single product flow or single supply chain element. For any company, the next big disruption does not have to be a pandemic; it can be something minuscule on a global scale, yet have the same devastating effect on the ill-prepared in particular trade lanes or in a particular industry. Unpredictable is not a reason to be unprepared. Creating supply chain resilience is a holistic exercise that involves more than just a few savvy logistics people. HR, finance, compliance/legal (to name a few) are all stakeholders in a healthy case of business continuity management.
How then to build a strategy? Like any other strategy, the process seems logical: review, assess, and mitigate. In this particular case: 1) review your tradelanes, products, and materials flow by matching them against risk categories (i.e., labor, business risk, global trade, nature, and materials), 2) assess risks for each combination, and 3) mitigate risks by either changing behavior now or planning for alternate (sourcing) options should the anticipated risks become reality.
The relevant components to review within the supply chain include the importing and exporting country or countries, the manufacturing locations, the finished goods, and the (raw) materials. Ideally, for finished goods and materials, the associated Harmonized System (HS) codes are made available. Scratch what does not apply and move to the following step where each of the ‘inputs’ is categorically reviewed.
As mentioned, this should not be an exercise limited to supply chain professionals. For example, labor risks can be associated with the likelihood of strikes, wage volatility, and the availability of appropriate labor resources—not necessarily areas that keep the supply chain brain occupied every day.
In a similar fashion, other resilience elements expand across different areas of expertise. Business risks relate to cybersecurity, corruption, counterfeit products, and the chance of entering into business with bad actors that are on (any of the) denied party lists.
Global trade accounts for the compliance requirements related to the shipment of goods (i.e., licenses, documentation, permits, etc.), associates the products with the various duties and taxes, and identifies if Free Trade Agreements(FTA) apply and how to qualify for preferential treatment.
Arguably the most unpredictable, but not the least expected risk to account for, is nature. It’s important to identify the various kinds of disasters that may hit: natural hazards, pandemics or epidemics, flooding, earthquakes, hurricanes, volcanic eruptions, landslides, or drought can all play parts.
Lastly, consider materials. Understanding the market comes with insights into scarcity, sourcing locations, and price fluctuations.
Risk assessments match the input with the risk categories. For example, how vulnerable is the manufacturing location when it comes to labor regulations, corruption, or flooding? Is there an FTA in place that could potentially lower the import duty burden? Where in the supply chain can a cyberattack be most expected? In short, some homework is in order to create a thorough risk profile.
For many components, the sources are readily available, such as the Corruption Index at transparency.org, labor statistics on Statista or NationMaster, or duty rate information from the various global trade content providers (or the WTO).
As with cyber-security risks (PEN tests) or a regular laptop virus scan, supply chain risk assessments will point out the components that need immediate attention or, in this case, are a high priority for alternate sourcing or routing options. It’s then time to build that resilience.
Look for options by analyzing the market and tradelanes. Mine import and export data to identify alternative sources for goods and materials, even manufacturing locations. Map out alternative routes for products to get where they need to go. Document the reasonable options and share with as many people as possible—preparedness is, of course, an all-inclusive strategy.
Next and where possible: test run! Re-route shipments temporarily or source occasionally from a new supplier; in other words, make sure the alternative options are viable. In addition, communicate with external sources that would be part of continuity plans. Make them aware they are part of these plans; put people or suppliers on a retainer and try to agree on terms before disaster strikes so the projected costs can be anticipated better.
Lastly, keep those alternate plans up to date; otherwise, it may be too late to create and execute on alternate alternative plans.
Demand and prices for ginger have skyrocketed in recent weeks, driven by the faith of Russian citizens in its miraculous properties to fight coronavirus.
According to the IndexBox’s report ‘Russian Federation – Ginger – Market Analysis, Forecast, Size, Trends and Insights’, the revenue of the ginger market in Russia was estimated at $26M in 2018. This figure reflects the total revenues of producers and importers (excluding logistics costs, retail marketing costs, and retailers’ margins, which will be included in the final consumer price). Since ginger is not grown in Russia, demand in the local market was fully covered by import supplies.
In 2018, the ginger imports into Russia amounted to 11K tonnes, going up by 2.5% against the previous year. Overall, ginger imports continue to indicate skyrocketing growth. The most prominent rate of growth was recorded in 2009 when imports increased by 91% against the previous year. Over the period under review, ginger imports reached their peak figure in 2018 and are likely to continue its growth in the immediate term.
In value terms, ginger imports amounted to $26M (IndexBox estimates) in 2018.
The Netherlands (3.9K tonnes), China (2.5K tonnes) and Brazil (1.1K tonnes) were the main suppliers of ginger imports to Russia, together comprising 70% of total imports. Belgium, Belarus, Nigeria and Thailand lagged somewhat behind, together comprising a further 22%.
From 2007 to 2018, the most notable rate of growth in terms of imports, amongst the main suppliers, was attained by Belarus (+127.0% per year), while imports for the other leaders experienced more modest paces of growth.
In value terms, the largest ginger suppliers to Russia were China ($9.4M), the Netherlands ($8.5M) and Brazil ($2.9M), together comprising 80% of total imports. Belgium, Thailand, Nigeria and Belarus lagged somewhat behind, together comprising a further 13%.
Belarus (+105.5% per year) recorded the highest growth rate of the value of imports, in terms of the main suppliers over the period under review, while imports for the other leaders experienced more modest paces of growth.
In 2018, the average ginger import price amounted to $2,444 per tonne, falling by -7% against the previous year. In general, the import price indicated a remarkable increase from 2007 to 2018: its price increased at an average annual rate of +6.8% over the last eleven years. The trend pattern, however, indicated some noticeable fluctuations being recorded throughout the analyzed period. The most prominent rate of growth was recorded in 2010 an increase of 79% year-to-year. The import price peaked at $3,359 per tonne in 2014; however, from 2015 to 2018, import prices failed to regain their momentum.
There were significant differences in the average prices amongst the major supplying countries. In 2018, the country with the highest price was China ($3,842 per tonne), while the price for Belarus ($449 per tonne) was amongst the lowest.
From 2007 to 2018, the most notable rate of growth in terms of prices was attained by China, while the prices for the other major suppliers experienced more modest paces of growth.
Source: IndexBox AI Platform