Saturday, August 31, 2013

Weekly report -- Aug 31, 2013

 

 

Hammersmith Marketing Ltd  - Grain Trading

WEEKLY FEED GRAIN AND PROTEIN REPORT   August 31, 2013

                                                                       

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

13+220 Quartier La Galine, St Remy de Provence, 13210 France

 

UK:   Rep. Office    +44.131.208.0308    Mobile: +44.7762.640.270

Suite 143, 196 Rose Street, Edinburgh EH2 4AT, Scotland, United Kingdom.

 

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

 

 

SECTION 1:  FEED GRAINS -- VEGETABLE AND ANIMAL PROTEIN

 

Overall we had a strong up week for grain and oilseeds – Monday started the week of strongly with hot dry weather causing crop concern and a slide lower in the USDA crop condition – experts feel that the crop condition will drop a little again in next Tuesday's report.

 

One trade report this weekend has said that there are a great many speculators who are short corn futures who want the market to move lower so that they can make some decent profits but that they are likely to panic and cover their shorts if the market looks to be going higher due to the weather.  If a pack of short speculators start to cover that could give corn a good (but probably short-term) pus to higher levels.

 

Normally, this time of year prices would be drifting lower and reaching their yearly lows in Sep/Oct as the harvest moves along and storage gets filled up. Once the corn gets in the elevator the prices increase each month by the storage and handling costs, so from the end of harvest onwards prices don't normally go lower --- unless the actual harvest is larger than had been expected.

 

We have a long weekend in the USA with Monday being a holiday and that has made many people be a tad more conservative as no one wants to take any risk over a three day weekend – so the finish of the week on Friday was mainly everyone getting their positions sorted for the holiday.

 

Soybeans were strong again this week with the old crop running much further ahead, as the tightness in old crop soybeans just keeps getting tighter.  Old crop soybeans were up USD 20 m/t and soymeal up Usd 35 m/t while for the new crop soybeans were up USD 10 m/t and soymeal up USD 5 to 7 m/t.

 

There were some comments in reports this week that, strictly from a technical point of view, the soybean market should now be taking a move to lower price levels, not a sudden drop but a quiet slide to lower prices as we get closer and closer to the harvest but, on the other had some are saying that the hot weather has been very bad for soybeans and that next weeks Crop Report will show a drop of about 5 to 6 percent in the crop condition.    

 

For the next couple of weeks the most important factor for soybeans and meal will be what happens with the weather and if the hot and dry weather continues we could see lower yields and higher prices.  One should expect some very exciting up and down days in the next couple of weeks as everyone watches the sun and hopes for a rain cloud or two.

 

 

USA crop condition

Report 2013

Aug 26

Very poor

%

Poor

%

Fair

%

Good

%

Excellent

%

Corn

4

10

27

44

15

Last year

26

26

26

19

3

 

 

 

 

 

 

Soybeans

3

10

29

46

12

Last year

17

    21

32

26

4

 

 

 

 

 

 

Sorghum

3

9

32

46

10

Last year

23

27

26

18

6

 

 

 

 

 

 

 

 

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 269/277 Sep/Nov  

Wheat, USA Hard Red Winter 12 protein

USD 313/318 Sep/Nov  

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

USD 235/240

Wheat, soft milling, France, Rouen port

USD 252/254

Wheat, milling, Argentina, upriver

USD 285/295 Dec/Jan new crop

Wheat, feed, Black Sea

USD 225/230

Wheat bran, Black Sea

USD 190/200

Barley, France, Rouen port

USD 236/238

Barley, feed, Argentina, upriver

USD 225/240 Dec/Jan new crop

Barley, feed, Black Sea

USD 240/245

Barley, feed, USA Pacific Northwest

USD 250/255

 

Corn, FOB NOLA USA

USD 236>>223 Sep>>Nov

Corn, FOB USA Pacific northwest

USD 254>>241 Sep>>Nov

Corn, FOB Argentina port, upriver

USD  233/236  Sep/Oct

Corn, FOB Brazil port

USD  195>>189  Sep/Oct

Corn, FOB Black Sea – 30,000 m/t

USD  205>>190  Sep>>new crop  

Corn, FOB France

USD  226/234 new crop

Sorghum, FOB Texas, low tannin, GMO free

USD  245/247 Sep/Nov   

Sorghum, FOB Argentina port, high tannin, GMO free

USD  asked 207/bid 200 Sep/Oct

 

Soymeal,  48 protein, FOB NOLA

USD  543>>517 Sep>>Oct new crop

Soymeal, 48 protein, USA, Rotterdam

USD  584>>557 Sep>>Oct new crop

Soymeal, Argentina, Rotterdam

USD  575>>560 Spot>>Oct  

Soymeal, 47 pro, FOB Argentina

USD  521>>510 Sep>>Oct/Nov  

Soymeal, 48 protein, Brazil, Rotterdam

USD  572>>543 Spot>>Oct   

Soymeal, FOB Brazil

USD  510>>500 Sep>>Oct/Nov   

Soymeal, 48 protein, India FOB

USD  520/530

 

Bulk vessel shipments, minimum 5000 m/t

 

Corn Gluten Meal,  USA FOB NOLA

USD   660/670 m/t 

Corn Gluten Feed,  USA FOB NOLA

USD   200/205 m/t  

DDGS, 35 profat, USA FOB NOLA

USD   300>>276 m/t Sep>>Nov  

 

There is still a very big discount on DDGS for later purchase with November shipment being priced close to USD 25 m/t below current levels and this is all to do with what happens with the new crop.  It was reported in the USA that some ethanol producers are having trouble finding any old crop corn for their current production, which is reducing DDGS supply and keeping nearby prices high.  As reported last week, export buyers have no interest in prompt shipments and are quite happy to wait for Oct/Nov with the USD 25 m/t discount.

 

Corn gluten prices seemed to be off a little this week while corn gluten feed moved a little higher but much of this week to week fluctuation is due to the limited amount of price availability, especially for export shipments.  With both corn gluten meal and feed the actual price could easily be +/- USD 10 to 20 m/t on the prices listed.  We do our best to give good price indications but sometimes, in thinly traded export markets, coming up with an accurate export price ends up just being one's best guess. 

 

Container shipments, minimum 200 m/t

 

Argentina Meat & Bone meal, 45 protein

USD 520/530 m/t CNF Asia

Australian MBM 45 protein

Australian MBM 50 protein

Australian Feathermeal

Australian Poultry meal, pet food grade

USD 610/620 mt CNF Asia

USD 670/680 m/t CNF Asia

USD 770/780 m/t CNF Asia

USD 890/910 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 660/670 m/t CNF Asia

USD 760/770 m/t CNF Asia

USD 710/730 m/t CNF Asia

USD 880/900  m/t CNF Asia

 

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

 

Meat and bone meal, USA, 50 protein

USD  530/550 m/t   

Feathermeal  80 protein USA

USD  700/710 m/t          

Poultry meal  57 protein, Eastern USA

USD  560/580 m/t  

 

It is interesting to note that even though the domestic markets for animal proteins in some major originating countries have been quite strong the CNF prices into the major markets in Asia are trying to move lower.  This may be related a little to the very sudden and serious drop in the price for fishmeal into the region while some say that it is more related to very low prices for animal protein coming out of Europe.

 

There are a few bargains in price out of South America but some of these are for spot shipment due to defaulted contracts, as buyers want the benefit of the lower market prices.  Falling prices are a very difficult situation for sellers when buyers refuse to open letters of credit.  Buyers don't seem to realize that they will find it difficult to do any future business in a country if the have not honored past business. I still have buyers that I wont deal with who treated me badly 20 years ago – like an elephant I never forget.

 

The direction of animal protein prices over the next while should be related to what happens to soymeal prices but always with an eye to other proteins like fishmeal and corn gluten meal --- but it does look like we can expect to see some lower price levels coming – unless the USA crop turns into a disaster.

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

Well now, an interesting week for the fishmeal situation in Peru – the government seems to feel that the biomass is in great shape for the next fishing season, which is leading everyone to expect a fishing quota at a possibly higher level – perhaps 2.5 million m/t of catch.  The immediate reaction was for market prices to drop another USD 50/60 m/t.  There is not a huge amount of fishmeal on hand in Peru but producers seem to be willing to take a good look at almost all bids.  The remaining stock in Peru is said to be between 30k and 50k m/t and with recent weeks averaging about 10k m/t sales per week then all should be sold out by early October.

 

There does not seem to be much interest so far in booking any business for the new fishing season but one trade report did mention that there were a couple of buyers sniffing around at price levels about USD 50 m/t below the current prices – but, as I said, no reported sales as yet.

 

China is the main world market for fishmeal and so far in 2013 their import volume has been down by 30 percent but the exports from Peru to China are down by 63 percent – quite a drop – with Chile and Thailand picking up most of the lost business.

 

It is going to be very interesting to see what happens as we get closer and closer to the next fishing season as in past years there has always been a big chunk of preseason bookings and perhaps this will happen again this year but the feeling is that anyone buying big will also want to be buying cheap.

 

One more thing on fishmeal, this time from northern Europe where the merger of Denmark's TripleNine A/S with Norway's  Vedde AS has been finalized into a new company that will be known as the TripleNine Group – the group will have operations in Norway, Denmark, Chile, South Africa, Mauritania and China.  

 

 

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

 

 

65 protein standard steam

1340/1350 m/t

65/66 pro standard steam

1360/1370 m/t

67 protein standard steam

1370/1380 m/t

67 protein SD 150  TVN

1390/1400 m/t

67 protein SD 120 TVN

1420/1430 m/t

67 protein SD 1000 hist, 120 TVN

1440/1450 m/t

68 protein SD 500 hist, 120 TVN

1450/1460 m/t

 

 

Fish oil .. crude bulk

1900/1950

Fish oil – crude drums

2050/2100

Fish oil – flexitank

2000/2050

Fish oil – Omega 3 – 28%EPA/DHA

2500/2600

 

 

 

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