Hammersmith Marketing Ltd - Grain Trading
WEEKLY FEED GRAIN AND PROTEIN REPORT January 25, 2014
Representative Office: +33.9.7044.4881 Mobile: +33.6.8068.4564 Fax: +33.4.5774.7575
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Corporate Office: Trident Services, Kings Court, Bay Street, PO Box N-3944, Nassau, Bahamas.
Email: tradegroup@hammersmith.biz WWW: hammersmithltd.blogspot.com SKYPE: bacon39a
SECTION 1: FEED GRAINS -- VEGETABLE AND ANIMAL PROTEIN
Corn prices were actually up a little bit on the week while soybeans and soymeal slipped lower. Corn market experts are saying that corn prices are currently in a trading range, plus or minus a few dollars a ton, and that without any major news items the prices will just drift along. Of course, with corn everyone is watching the weather in South America, the ethanol production in the USA and the GMO situation in China. It is interesting to see that two major USA grain trade organizations have asked Syngenta to stop the distribution of non-China approved GMO corn seed. It just shows you how much interest there is in the 4 million plus tons of US corn sold to China….my comment on this would be where were these people when the corn business to the EU all went to the Ukraine. So far in the 2013/14 crop year, just over 6 months, the EU has imported close to 7 million m/t of corn. I guess their opinion is that it is better to save China since the EU could be a lost cause. My opinion, and I may be the only one with this opinion, is that these two organizations should work more on the China end than pressuring the USA seed producer and corn farmers.
Soybean prices in the USA moved lower as every day we are getting closer to the South American soybean crop. USA export sales are continuing at a very good clip but everyone is looking south and knows that the days of fat US prices are coming to an end. But still, exports of soybeans and soymeal just keep chugging along and shipment of soymeal in particular are going into markets that have not bought US soymeal since this time last year. We are in the three month US shipment window where US beans and meal are the most competitive to almost every market. There was a note in one of the trade report this week that US export sales are so strong that there may have to be soybean imports by the USA later in 2014.
Overall it looks like there is not too much chance for a serious rally in soybean prices, unless there is some kind of crop disaster in South America.
One small note, it was announced on Thursday at the Grain and Feed Trade Association Annual General Meeting that the current Director General of GAFTA, Pamela Kirby Johnson OBE will be retiring in June 2014. She will be a very tough act to follow but a replacement has been found and an announcement will be made in due course. After all the years that I have been involved in GAFTA it will be very strange to no longer see Pamela in the GAFTA office in London.
Estimated Bulk Grain freight in USD per m/t, basis heavy grains
| US Gulf to Europe: 60/70,000 | $24.00 | Steady |
| US Gulf to Egypt: Panamax | $37/38.00 | down $2.00 |
| US Gulf other Med: 25,000 MT | $43/45.00 | down $3.00 |
| US Gulf Israel: 50,000 MT | $38/40.00 | down $2.00 |
| US Gulf Morocco: 25,000 | $45/47.00 | steady |
| US Gulf Turkey: 50,000 | $39/40.00 | down$2.00 |
| US Gulf Japan: Panamax | $55/57.00 | Steady |
| US PNW Asia: 45,000 m/t | $30/32.00 | steady |
| US PNW Japan: 50,000+ m/t | $28/30.00 | steady |
| France to Algeria: 25,000 m/t | $27.00 |
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| France to Saudi Arabia: 60,000 m/t | $35.00 |
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| Argentina to Egypt: 50,000 | $40.00 | steady |
| Argentina to Algeria: 25/30,000 m/t | $44/45.00 | steady |
| Argentina to Morocco: 25,000 | $42/40.00 | steady |
| Argentina to Saudi Arabia | $50.00 | steady |
| Brazil to Algeria: 25,000 m/t | $38/39.00 | steady |
| Brazil to Turkey/Egypt: 50,000 m/t | $33/34.00 | steady |
| Brazil to Morocco: 30,000 m/t | $36/37.00 | steady |
| Brazil to Saudi Arabia | $45.00 | steady |
| Black Sea to Spain: 30,000 m/t | $28/30.00 |
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| Black Sea to East Med: 30,000 m/t | $25/26.00 |
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| Black Sea to East Med: coaster | $35/38.00 |
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| Baltic Dry Index | 1246 | Down 175 – 12.3% |
| Baltic Capesize Index | 1880 | Down 49 – 2.6% |
| Baltic Panamax Index | 1496 | Down 75 – 4.8% |
| Baltic Handisize Index | 715 | Down 7 – 0.9% |
FOB port or location specified. Prices in US$, in metric tons:
All shipments in bulk grain vessels unless stated otherwise
(NOLA is New Orleans, Louisiana, USA.)
| Wheat, USA Soft Red Winter, NOLA | USD 265>>252 Jan/Apr |
| Wheat, USA Hard Red Winter 12 protein | USD 289>>285 Jan/Apr |
| Wheat, Black Sea 11.5 pro, 30,000+ m/t | USD 275>>270 Feb/Apr |
| Wheat, soft milling, France, Rouen port | USD 272/274 |
| Wheat, milling, Argentina, upriver | USD 330>>320 Feb>>Apr |
| Wheat, feed, Black Sea | USD 245/250 |
| Wheat bran, Black Sea | USD no prices |
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| Barley, France, Rouen port | USD 241/243 |
| Barley, feed, Argentina, upriver | USD 222/230 Feb/Mar |
| Barley, feed, Black Sea, 30,000+ | USD 240/245 Feb/Apr |
| Barley, feed, USA Pacific Northwest | USD 245/250 |
| Corn, FOB NOLA USA | USD 208>>203 Jan>>Mar |
| Corn, FOB USA Pacific northwest | USD 232>>223 Jan>>Mar |
| Corn, FOB Argentina port, upriver | USD 198/202 March/May new crop |
| Corn, FOB Brazil port | USD 184/191 June new crop |
| Corn, FOB Black Sea, 30,000+ m/t | USD 210/214 Spot/Apr |
| Corn, FOB France | USD 241/250 Jan/Mar |
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| Sorghum, FOB Texas, low tannin, GMO free | USD 234/236 Jan/Mar |
| Sorghum, FOB Argentina port, high tannin, GMO free | USD 185/188 Feb/Mar |
| Soymeal, 48 protein, FOB NOLA | USD 551>>529 Jan>>Mar 2014 |
| Soymeal, 48 protein, USA, Rotterdam | USD 586>>565 Spot>>Mar 2014 |
| Soymeal, Argentina, Rotterdam | USD 566>>544 Spot>>Mar 2014 |
| Soymeal, 47 pro, FOB Argentina | USD 513>>498 Feb/Mar |
| Soymeal, 48 protein, Brazil, Rotterdam | USD 550>>515 Spot>>Mar 2014 |
| Soymeal, FOB Brazil | USD 503>>477 Jan/Mar |
| Soymeal, 48 protein, India FOB | USD 570/580 |
| Soybeans, FOB NOLA | USD 558>>532 Jan/Mar |
| Soybeans, Argentina, FOB | USD 481/485 new crop May 2014 |
| Soybeans, Rotterdam | USD 559>>526 Jan>>Mar |
| Soybeans, Black Sea | USD 490/505 Feb/Apr |
Bulk vessel shipments, minimum 5000 m/t
| Corn Gluten Meal, USA FOB NOLA | USD 745/755 m/t |
| Corn Gluten Feed, USA FOB NOLA | USD 217/220 m/t |
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| DDGS, 35 profat, USA FOB NOLA | USD 272>>263 m/t Jan>>Mar |
| DDGS, 35 profat, CNF Asia | USD 345>>343 m/t Jan>>Mar |
According to trade sources the volume of export DDGS business to China has dropped of quite a bit due to the GMO problems and the Chinese Lunar New Year. Other buyers in the region are looking at DDGS but are only booking small quantities as they expect that the lack of China business could cause prices to drop lower. So far there has not been too much of a drop in DDGS prices as US domestic business remains good but if the 350,000 m/t of monthly China business disappears then there is going to be quite a bit of product looking for a home. It seems that there could be a good chance that DDGS price will move lower.
Looking at corn gluten feed and corn gluten meal, China is not a major buyer of either so there should be little GM effect on these two items. Overall corn gluten feed exports are up by just under 20% this year with a big chunk of the increase being due to imports by the UK and Ireland. Corn gluten meal exports are also up this year, by about 15%, and much of this is due to higher imports by Indonesia and other Asian countries.
Corn by-products are perhaps priced a little high versus corn prices so we may see some weakness in coming weeks. Of course with CGM the rally in prices for fishmeal will probably limit any drop in this high protein item.
Container shipments, minimum 200 m/t
| Argentina Meat & Bone meal, 45 protein | USD 440/450 m/t CNF Asia |
| Paraguay Meat &Bone meal, 45 protein | USD 430/440 m/t CNF Asia |
| Europe MBM, 50 protein Europe Poultry meal, 65 protein Europe Feathermeal, 80 protein | USD no prices USD no prices USD no prices |
| Australian MBM 45 protein Australian MBM 50 protein Australian Feathermeal, 80 protein Australian Poultry meal, pet food grade | USD 580/600 m/t CNF Asia USD 630/660 m/t CNF Asia USD 760/800 m/t CNF Asia USD 880/900 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 600/630 m/t CNF Asia USD 780/800 m/t CNF Asia USD 620/640 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 490/510 m/t |
| Feathermeal 80 protein USA | USD 630/650 m/t |
| Poultry meal 57 protein, Eastern USA | USD 560/580 m/t |
The big problem in the animal protein market for the past couple of weeks has been feathermeal, as prices seem to be sky high due to very good export demand and, at least in OZ and NZ, a drop in available supply. One of this week's trade reports says that producers of feathermeal had been carrying quite large stocks but that these are all worked down and feather meal is just moving up to its normal price level versus other alternatives.
MBM prices were up a little this week but experts feel that the longer term trend will be to lower prices as all protein items are going to have to compete
SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN
PERU "INDICATION" FISHMEAL PRICES:
Not much fishing going on in Peru these days with only a few days left until the end of the season. The daily catch has fallen off to about 3,000 m/t using 20 or so vessels so it looks like the current balance available on the quota of about 80,000 m/t will not be landed this season. Interestingly enough there seems to be some disagreement about exactly how much is still to catch with some saying it is only 25,000 m/t not the 80,000 m/t that is widely reported. If it is only 25,000 m/t then that is almost nothing in the scheme of things.
Fishmeal sales are reported to be very brisk and the trade says that prices across the board are up by about USD 50 m/t. The level of unsold stocks seem to be dropping quite quickly and trade estimates have stocks in Peru at 70 to 75,000 m/t which hopefully will be enough allow us to squeeze through to the next fishing season in late April/May.
Everyone in the business says that fishmeal prices will be going higher and there are rumours that prices are actually higher than the indications listed below.
Now the talk in the fishmeal industry is turning to how large the next quota will be in Peru and there are thoughts that buyers should get in the market sooner rather than later as no one seems to be forecasting any significant increase in the quota….experts seem to think that 2 million m/t of catch will be about where the quota will be set. And if pre-fishing sales are good then prices should move higher.
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 |
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| 65 protein | 1370/1380 m/t |
| 65/66 protein | 1390/1400 m/t |
| 67 protein standard steam | 1410/1420 m/t |
| 67 protein SD 150 TVN | 1430/1440 m/t |
| 67 protein SD 120 TVN | 1450/1460 m/t |
| 67 protein SD 1000 hist, 120 TVN | 1480/1490 m/t |
| 68 protein SD 500 hist, 120 TVN | 1500/1520 m/t |
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| Fish oil, crude bulk | 1900/1950 |
| Fish oil, crude drums | 2100/2150 |
| Fish oil, flexi tank | 2050/2100 |
| Fish oil, Omega 3: 28%EPA/DHA | 2500/2550 |
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 © 2014 Wayne S. Bacon
