Severe weather conditions first in Israel, later in Western Europe and Russia have strongly affected the prices for capsicums during the past month.
First, drought and extremely hot weather in Israel caused lower crops. Later, strong snowfalls in Europe caused lower demand from end consumers and delivery delays, which was followed by over supply of capsicums that were expected to arrive and sell before Xmas, but in fact arrived afterwards.
Russian customers, on the other hand, didn’t rush their New Year purchases and rapidly changing weather conditions in Central Russia first produced delays in supply and then oversupply of the market. Hopes were, that after everyone returns from winter holidays, the demand and price will rise, but it didn’t happen. Earlier last week there were still hopes that the Russian market will pick up, but it didn’t happen.
However, rumors are that Spanish growers have fewer than expected good-quality capsicums for the following months, so expectations here in Israel that prices will go up as much as 50% in 3 weeks time and more than double by April. To make things more interesting, two German supermarket chains turned down last week’s delivery of Spanish capsicums (more here) and are expected to switch to Israeli capsicum instead.
Will this influence the market? Still unknown, as it will depend on how long they are going to stick with Israeli capsicum and what volumes they are intending to purchase.
Prices: on week 51 the price of capsicum in Moscow reached as high as 750 rubles per box, while now it sells for around 350 rubles. This reflects CFR price of around 8 USD, a very low price by any means. Expectations are that this week the capsicum will return to around 13 USD mark, but whereas this is true or not remains unclear.