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African tea prices falls 4% at latest auction in Mombasa.
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the deal
#1 Posted : Tuesday, July 06, 2010 10:07:55 PM
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Location: Windhoek/Nairobbery
According to www.bloomberg.com African tea prices fell 4% to $2.06 at the latest auction in Mombasa...is it game over for tea stocks??? Should we take that WTK warning seriously???
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qw25041985
#2 Posted : Tuesday, July 06, 2010 10:23:56 PM
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Accordin to me the alarm bells ar already ringing - sell ,sell , sell tea stocks. Definately i take Wtk seriously. This probably explains the sell of at sasini. Now is time 2 b like buffet buy frm pessimist sell to optimist. Whereever optimism in this case.
Your future depends on your dreams so go to sleep !
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VituVingiSana
#3 Posted : Tuesday, July 06, 2010 10:45:49 PM
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Joined: 1/3/2007
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4% fall in price... Oh, let's all start panicking... The sky is falling... 4% fall in price... We are finished... The collapse of the tea industry...

[Erm, so what? Tea production has JUMPED way more than 4% vs 2009 so overall the outlook is good]
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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VituVingiSana
#4 Posted : Tuesday, July 06, 2010 10:51:21 PM
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the deal wrote:
According to www.bloomberg.com African tea prices fell 4% to $2.06 at the latest auction in Mombasa...is it game over for tea stocks??? Should we take that WTK warning seriously???


Yes, coz I want folks to SELL Williamson... I wanna buy at lower prices...
EPS was 96/- so even 50% reduction is 48/-... for a share that costs 230/-?

Of course, that dividend was CRAP...
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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the deal
#5 Posted : Tuesday, July 06, 2010 11:13:16 PM
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well bad news can be good news sometimes...LOL...as long as it doesnt become a weekly fall...
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sparkly
#6 Posted : Wednesday, July 07, 2010 8:42:01 AM
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Question is what is driving down the prices. If because of more supply no prob as long as volumes increase and the dollar holds strong against the shilling.
Life is short. Live passionately.
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VituVingiSana
#7 Posted : Wednesday, July 07, 2010 8:53:51 AM
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sparkly wrote:
Question is what is driving down the prices. If because of more supply no prob as long as volumes increase and the dollar holds strong against the shilling.

Well, let's see...

Volumes +++ (60% in 1Q 2010 vs 1Q 2009)
KES/US$ ++ (74 to 80)
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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The Merchant
#8 Posted : Wednesday, July 07, 2010 11:09:08 AM
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@ the deal....Isn't that fall in tea prices going to be buffered by about 6% weakening in the shilling versus the dollar? I believe this would make the drop in prices incapable of affecting performance. Besides, the indian companies are coming over to get a stake of our tea companies. Do you really want to miss out on this action?
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VituVingiSana
#9 Posted : Wednesday, July 07, 2010 11:14:53 AM
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The Merchant wrote:
@ the deal....Isn't that fall in tea prices going to be buffered by about 6% weakening in the shilling versus the dollar? I believe this would make the drop in prices incapable of affecting performance. Besides, the indian companies are coming over to get a stake of our tea companies. Do you really want to miss out on this action?


I am (slightly) surprised the multinational Indian Tea firms havent bought a Kenyan firm like in Uganda & Rwanda...

On the other hand, why bother in Kenya with the crazy volatile politics & talks of expropriation of land...
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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cnn
#10 Posted : Wednesday, July 07, 2010 11:24:16 AM
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I agree prices could be down,but that is largely mitigated by the volumes,which are higher at half year.The exchange rate is better too.Kakuzi half year next month will reflect better performance .I am holding on to tea.
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The Merchant
#11 Posted : Wednesday, July 07, 2010 11:30:27 AM
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VituVingiSana wrote:
The Merchant wrote:
@ the deal....Isn't that fall in tea prices going to be buffered by about 6% weakening in the shilling versus the dollar? I believe this would make the drop in prices incapable of affecting performance. Besides, the indian companies are coming over to get a stake of our tea companies. Do you really want to miss out on this action?


I am (slightly) surprised the multinational Indian Tea firms havent bought a Kenyan firm like in Uganda & Rwanda...

On the other hand, why bother in Kenya with the crazy volatile politics & talks of expropriation of land...


@vvs... do you suppose the indian companies are trgeting other tea co's in Uganda/ UG and if so which ones(the listed ones)? The interest in the tea companies here in kenya is enough to drive the share prices up. No actual boardroom meeting necessary. The hype is enough which when coupled to potentially good earnings this year may very well push the stock prices higher.
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VituVingiSana
#12 Posted : Wednesday, July 07, 2010 12:19:19 PM
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@TheMerchant - All are private farms/firms in UG + Rwanda.
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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The Merchant
#13 Posted : Wednesday, July 07, 2010 1:34:23 PM
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@vvs...then they are not of much use to us who invest in publicly traded stocks, are they? I still think agriculturak stocks are not a bad idea although so many wazuans do not seem to agree...
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VituVingiSana
#14 Posted : Wednesday, July 07, 2010 1:41:49 PM
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The Merchant wrote:
@vvs...then they are not of much use to us who invest in publicly traded stocks, are they? I still think agriculturak stocks are not a bad idea although so many wazuans do not seem to agree...

Nothing wrong in being a contrarian...
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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cnn
#15 Posted : Wednesday, July 07, 2010 1:48:47 PM
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Let CMA approve a sharia compliant mutual fund.Agric and oil companies will be their target,but the bottom line is i expect tea firms to continue doing well.
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the deal
#16 Posted : Wednesday, July 07, 2010 1:51:30 PM
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The Merchant wrote:
@ the deal....Isn't that fall in tea prices going to be buffered by about 6% weakening in the shilling versus the dollar? I believe this would make the drop in prices incapable of affecting performance. Besides, the indian companies are coming over to get a stake of our tea companies. Do you really want to miss out on this action?

lets hope so...but kakuzi and REA are down today...i will keep this thread updated...looks like www.bloomberg.com tracks the tea auction every week...
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cnn
#17 Posted : Wednesday, July 07, 2010 2:06:30 PM
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Africa tea brokers provides weekly reports and you can look up all the parameters on trading at the mombasa tea auction.
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VituVingiSana
#18 Posted : Wednesday, July 07, 2010 8:07:18 PM
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Sigh... Folks are starting to look at prices for the NEXT day...

As much as I enjoy following prices... the TRUTH is that unless you are a trader... so not follow prices... follow performance/profits...

Do not buy at any price... buy a good firm at a FAIR (you need to figure out what fair is) price...
[I bought a lousy firm at a 'fair' price to speculate & it go me nowhere!]

Going back to Warren Buffett... Once you have bough a good (management, industry, sector) firm at a fair (or cheap) price... relax... look into it once in a while... but do NOT panic with a slight price drop... So what?

If there is a substantial price drop WITHOUT change in fundamentals... maybe buy more...

If the price makes it 'too expensive' then you can sell some or all of your position!
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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qw25041985
#19 Posted : Wednesday, July 07, 2010 8:29:36 PM
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There'll definatly be a change in the fundermentals . Because come the next few years they'llnt be able to replicate the good performance they had this yr. WTK said it themselves im their report that they'llnt b able to reproduce the splendid results come 2011 and beyond. So dnt be foold that ur agricultural stocks 'll grow. Sell now and get out wen its safe. The sell off begun long time ago.
Your future depends on your dreams so go to sleep !
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VituVingiSana
#20 Posted : Wednesday, July 07, 2010 8:43:46 PM
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WTK is illiquid... so those who say SELL, SELL, SELL... is a useless call coz who will buy?

Same for the BUY, BUY, BUY...

Anyway, I have stated I go for fundamentals... and even put my picks online in an earlier discussion... I am not a politicians with vague pronouncements...

I had picked KQ, KPLC & Williamson... all 3 are either where I thought they would be or ahead...

Another approach I like is @Stocksmaster who PUT his cash where his mouth is INCLUDING all costs...

So any 'prediction' should also include costs which are quite high on the NSE...
Greedy when others are fearful. Very fearful when others are greedy - to paraphrase Warren Buffett
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