Olive oil International prices, in Rands per Litre, excluding VAT.
|ZAR/Euro (a)||Achievable Euro rate/MT (b) (FOB)||CIF & Landside (c)||Final costing / Lt
(a x b x 0.92)/1000 + c
|21 - Sep||R15.85||€ 3892.48||R3.69||R60.44|
|28 - Sep||R16.13||€ 3774.05||R3.69||R59.70|
|05 - Oct||R16.14||€ 3807.30||R3.69||R60.21|
|12 - Oct||R15.68||€ 3858.75||R3.69||R60.21|
The table below shows other costs of importing (already included in the table above) (Units; Rands/Lt)
|Transit ex works, Spain, to "landed at Cape Town harbour"||R2.00|
|Local "landside" costs (bank charges, clearing, and delivery to Cape Town suburbs)||R0.40|
|SA Olive levy||R0.40|
|Interest on the 7-week lead time between ordering and receipt (may take the form of a premium in the cost of forward cover over the spot price) (@12% pa)||R0.89|
|Total extra cost, per Lt||R3.69|
Remark (July 6 2017); although the bulk price has come off by nearly 3%, the Rand/Euro rate has deteriorated by over 4%. We just can’t win!
- Commodity pricing based on http://www.poolred.com/Publico/GraficoEvolucion.aspx?tipo=0.
- Spot buying prices used (ie not moving average, and not futures).
- Costing assumes a “cash on order” deal.
- Costings are for bulk EVOO in a 21 MT flexitank,
- Costings are for EVOO of EU origin. Although one could negotiate a 5% better price by buying from, for example, Argentina/Tunisia/Turkey, oil imported into RSA from outside the EU would attract duty of 10%.
- Conversion of Kgs to Lts based on SG of edible oil of 0.92. So, for example, 1 Kg oil translates to 1.087 Lts thereof.
- This table updated every week, using
- the ruling FNB “casual” Euro selling rate, less 2%, and
- the closing EVOO pricing of the preceding day, plus 3% (in practice, we’ve been unable to buy at Poolred rates)
-My intention is full transparency in negotiations, and our spreadsheet workings are available on request. When we buy bulk oil, these values are the starting point for negotiations.
Local farmers can expect to achieve a minimum selling price of not less than “import parity”.
Producers in the Mediterranean basin generally retain their best quality olive oils for local consumption, and export their lesser oils.
Local olive oils are generally superior and, in bulk, command a premium of about 12% (great value for that quality!)
October 25 2017; the fall in Rand by nearly 2% today* was aggravated by a 4% increase in the commodity price.
*Bleak mid-term Budget speech 🙁