Saturday, June 29, 2013

Weekly Report -- June 29, 2013

 

 

Hammersmith Marketing Ltd  - Grain Trading

WEEKLY FEED GRAIN AND PROTEIN REPORT   June 29, 2013

                                                                       

France:  Rep. Office: +33.9.7044.4881   Mobile: +33.6.8068.4564    Fax: +33.4.5774.7575

UK: Rep. Office:     +44.131.208.0308    Mobile: +44.7762.640.270

Email:   tradegroup@hammersmith.biz    WWW:  hammersmithltd.blogspot.com       SKYPE: bacon39a  

 

 

SECTION 1:  FEED GRAINS -- VEGETABLE AND ANIMAL PROTEIN

 

It is interesting to see that the two reports from the USDA last week had one bearish and one bullish. There is nothing like a good tussle in the market until everyone figures out which report is the most important and should be setting the trend for prices.  As it was the futures market closed on Friday with the old crop prices for corn and soymeal moving higher while the new crop price slipped lower – not actually too much of a surprise. These days it seems that the stocks numbers have a much larger effect on prices than has been seen in years past --- especially in a time when current stocks are tight.  But then we didn't really need a USDA report to tell us that stocks are tight but at least now we know how tight they are.

 

Looking at corn, the USDA report had higher planted acres than expected which, with a good crop yield, will give a very good 2013 corn crop and, as we saw, certainly helped to push corn futures prices lower on Friday.  Some experts are saying that the new crop corn prices could quite easily drop another USD 20 m/t in coming weeks and even lower if the crop and the weather remain good. Normally you see the low price of the year on corn in September or perhaps late August after that prices tend to move a little higher as people start to think about the cost of storing and handling new crop grain.

 

One expert this week said that will good weather and a decent yield we could seen new crop corn USD 90 to 100 m/t below the current July prices --- it does need to be remembered that the July old crop prices are currently very high due to the tight supply. 

 

Soybean prices were also affected by the USDA report, as stocks levels were lower than expected which caused old crop prices to take a good jump higher while good weather and expected great new crop pushed prices lower after September.  The planting of soybeans is probably all but finished and early reports on the crop are certainly as good as any average year.

 

Most experts feel that prices for soybeans and meal will continue strong for July and August but that the new crop is going to see prices slide lower if the growing weather continues good, as is currently expected.

 

But then, as with every year, there could always be a change in the weather and an interesting rally in corn, soybean and soymeal prices --- actually, it is not a "could" it is a "will" since there are normally several weather related price rallies every summer.  

 

 

USA crop condition

Report 2013

Very poor

%

Poor

%

Fair

%

Good

%

Excellent

%

Corn

2

6

27

51

14

Last year

4

10

30

45

11

 

 

 

 

 

 

Soybeans

2

5

28

54

11

Last year

4

    11

32

45

8

 

 

 

 

 

 

Sorghum

5

8

33

48

6

Last year

4

11

41

39

5

 

 

 

 

 

 

    

 

FOB port or location specified .. prices in US$ .. in metric tones:

All shipments in bulk grain vessels unless stated otherwise

(NOLA is New Orleans, Louisiana, USA.)

 

Wheat, USA Soft Red Winter, NOLA

USD 258/270 Jun/Oct  

Wheat, USA Hard Red Winter 12 protein

USD 298/311 Jun/Oct  

Wheat, milling Black Sea 11.5 pro – 30,000 m/t

USD 280>>250 July/Sep

Wheat, soft milling, France, Rouen port

USD 257/259

Wheat, milling, Argentina, upriver

USD 263/270 Dec/Jan new crop

Wheat, feed, Black Sea

USD 255>>240 July>>Sep

Wheat bran, Black Sea

USD 210/215

Barley, France, Rouen port

USD 242/245

Barley, feed, Argentina, upriver

USD 215/230 Dec/Jan new crop

Barley, feed, Black Sea

USD 248>>242 July>>Sep new crop

Barley, feed, USA Pacific Northwest

USD 270/275

 

Corn, FOB NOLA USA

USD 303>>229 July>>Oct new crop

Corn, FOB USA Pacific northwest

USD 330>>256 July>>Oct new crop

Corn, FOB Argentina port, upriver

USD  257>>235  July/Aug

Corn, FOB Brazil port

USD  210>>204  July/Aug/Sep

Corn, FOB Black Sea – 30,000 m/t

USD  268>>235 June>>Sep 

Corn, FOB France

USD  287/308

Sorghum, FOB Texas, low tannin, GMO free

USD  281>>240 Jul>>Sep new crop  

Sorghum, FOB Argentina port, high tannin, GMO free

USD  asked 215/bid 205 July/Sep

 

Soymeal,  48 protein, FOB NOLA

USD  594!!!!>>465 July>>Oct new crop

Soymeal, 48 protein, USA, Rotterdam

USD  625!!!!>>510 July>>Oct new crop

Soymeal, Argentina, Rotterdam

USD  540>>495 Spot>>J/A/S  

Soymeal, 47 pro, FOB Argentina

USD  507>>454  J/A/S  

Soymeal, 48 protein, Brazil, Rotterdam

USD  552>>475 Spot>>J/A/S   

Soymeal, FOB Brazil

USD  498>>445  J/A/S    

Soymeal, 48 protein, India FOB

USD  610/620

 

Bulk vessel shipments, minimum 5000 m/t

 

Corn Gluten Feed,  USA FOB NOLA

USD   210/215 m/t  

Corn Gluten Meal,  USA FOB NOLA

USD   700/710 m/t 

DDGS, 35 profat, USA FOB NOLA

USD   288>>285 m/t July>>Sep  

DDGS, 35 profat, CNF Asian ports

USD   371>>366 m/t July>>Sep 

 

 

With most corn by-products, the nearby prices have moved higher while the more distant prices slide lower – this is all a result of the cost of old crop corn versus new crop and with old crop corn selling at a USD 50 m/t premium to new crop there is bound to be some spread in by-product prices.

 

One trade report was saying that the high price of old crop corn could reduce the production of ethanol which will limit the DDGS supply and could push prices up in the near term.  For corn gluten feed it is still a case that CGF follows the corn prices quite closely so CGF for September on is quite weak.  Corn gluten meal is another story as the nearby prices are very strong due to the comparison with strong soymeal prices but there does not seem to be much, if any, weakness in CGM prices going out a couple of months.  Perhaps weakness will show up as we get by the current tightness in corn supply.

 

Trade reports this week say that there was very good buying interest for DDGS from Asia and that some business was done to China, Vietnam and South Korea.

 

After reporting last week on CGF in Turkey that had to be re-exported, I was advised from Turkey that there was another 6,000 m/t rejected due to GMO but that this had all been sold to a buyer in Israel – I expect that there will continue to be these GMO problem lots in Turkey until either the Government changes their GMO requirements or suppliers stop shipping.    

  

 

Container shipments, minimum 200 m/t

 

Paraguay Meat & Bone meal, 45 protein

Paraguay Meat & Bone meal 48/50 protein

USD 530/540 m/t CNF Asia

USD 560/570 mt CNF Asia

Argentina Meat & Bone meal, 45 protein

USD 550/560 m/t CNF Asia

Europe Meat & Bone meal, 45 protein

Europe Meat & Bone meal, 50 protein

USD 530/540 m/t CNF Asia

USD 570/580 m/t CNF Asia

Australian MBM 45 protein

Australian MBM 50 protein

Australian Feathermeal

Australian Poultry meal, pet food grade

USD 650/660 mt CNF Asia

USD 730/740 m/t CNF Asia

USD 680/690 m/t CNF Asia

USD 1030/1070 m/t CNF Asia

USA Meat & Bone meal, 50 protein

USA Feathermeal, 80 protein

USA Poultry Meal, feed grade

USA Poultry Meal, pet food grade

USD 750/770 m/t CNF Asia

USD 830/850 m/t CNF Asia

USD 700/720 m/t CNF Asia

USD 1040/1070  m/t CNF Asia

 

 

The following indications are at producer's factory, ex-works in bulk

 

Meat and bone meal, USA, 50 protein

USD  495/510 m/t   

Feathermeal  80 protein USA

USD  630/650 m/t          

Poultry meal  57 protein, Eastern USA

USD  510/550 m/t  

 

 

   Animal protein prices mover higher across the board this week as the rally in nearby soymeal prices tend to push price higher – at least for quick shipments.  As we have seen in both soybeans and soymeal, the prices for July to August are higher due to shortages then fall of as soon as there is some new crop. Animal protein prices will also be affected as demand s very good at present but will slide a little once the new crop soymeal is available at lower prices.

 

However, in the export market, the chance that Indonesia trade in MBM will be one once again has had some upward effect on USA MBM prices as everyone looks to new export volume. Of course, with soymeal and fishmeal dropping lower it is hard to imagine MBM being able to move much higher.

 

There was quite a bit of interest from Vietnam this week but buyers were even lower in their price ideas than in recent weeks – everyone seemed to want to pay USD 60 to 70 mt below current market prices.  The rumour in the market was that Polish exporters were selling well below other origins in the Vietnam market  -- buyers were saying that USD 460/470 m/t was possible from Poland.   

 

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

Fishing in Peru has slowed down a little due to bad weather in some areas and limited fishing bans in others.  We now have about 250,000 mt of fish left to catch with a daily average that is now at the 25 to 30,000 mt level – so looks like another 10 days or so needed but we don't have that much time left in the quota period.  It could be that we will end up not getting the entire quota landed before the end of the month, which would be quite a shame, as, with the reduced quota, every ton of fish is very important.

 

However, there is still no big buying rush for fishmeal and the prices do seem to be sliding lower as more major sellers are accepting lower bids. Buyers in China seem to have no reason to stock up at present as their market consumption is much lower than expected due mainly to a late aqua season and very bad local weather in China. Fishmeal supplies are said to be growing in Chinese warehouses as shipments arrive but demand is very low.

 

This year has been a very interesting year so far with greatly reduced fishing quotas that everyone expected would push prices much higher but then to see a large drop in demand from China at the same time which has certainly reversed any upward trend on prices.  However, I was reading a report from Chile this week that said that fishmeal prices should be up by about 20 percent on average in 2013 over the prices in 2012 --- I suppose that this could be true but only after we see China and Germany back in the fishmeal market in a big way.  

 

 

PERU "INDICATION" FISHMEAL PRICES:

 

ALL PRICES SHOWN ARE IN CONTAINER, ON VESSEL, AT ORIGIN --- US DOLLARS

Minimum shipment of 200 m/t for fishmeal

 

Specification

Price per m/t FOB vessel Peru port

 

 

FAQ basis 65 protein

1560/1580 m/t

65/66 pro standard steam

1600/1620 m/t

67 protein standard steam

1650/1670 m/t

67 protein SD 150  TVN

1690/1710 m/t

67 protein SD 120 TVN

1720/1730 m/t

67 protein SD 1000 hist, 120 TVN

1730/1750 m/t

68 protein SD 500 hist, 120 TVN

1750/1770 m/t

 

 

Fish oil .. crude bulk

2200/2250

Fish oil – crude drums

2350/2400

Fish oil – flexitank

2300/2350

Fish oil – Omega 3 – 28%EPA/DHA

2800/3000

 

 

 

INFORMATION:  gtee = guarantee, TVN = total volatile nitrogen, hist = histamine,

FAQ = fair average quality (normally flame or hot air dried), SD = steam dried

           

Wayne Bacon

 

The information contained herein is based on sources that we believe to be reliable, but we do not represent that it is accurate or complete.  Nothing contained herein should be considered as an offer to sell or a solicitation of an offer to buy.  All references to prices are subject to change without notice.  Any opinions expressed herein are solely those of the author.  As such, they may differ in material respects from those of, or expressed or published by or on behalf of, Hammersmith Marketing Ltd or its officers, directors, employees or affiliates

 

Copyright © 2013 Wayne S. Bacon