Korean Tender July 23rd.

The Korean tender for 6000 Mt was awarded today and as expected India managed to bag 5000 Mt at a price range of USD 1137-1143 , Pakistan was awarded the other 1000 Mt. Interestingly in contrast to expectations the African prices were seen ruling higher by 40-50$/MT . We believe the reason for the same is a confirmed Chinese crop failure, the total damage due to floods and crop shifting is expected to be in the range of 30-35% and going by previous trends African suppliers know they can always manage to fetch a better price in the Chinese market when their New Year demand starts and are not is a rush to sell at cheap levels as their new crop doesn't arrive until Feb/March 2008.

Indian crop is also not shaping out too well , Gujarat and Maharashtra will be lucky to have 50 % of what they had last year and the northern states of U.P,M.P and Rajasthan even with a big crop may at best substitute the gap , but even that depends on the rains which have dried up for the last 10-12 days and if it doesn't pick up again we may see some damage to the crop in U.P and M.P as well , atleast in terms of yield leading to lower volumes.The delay is inevitable now and we don't see new crop arriving in full swing before 2nd half October now.