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WEEKLY FEED GRAIN AND PROTEIN REPORT February 25, 2017
SECTION 1: US FEED GRAINS and VEGETABLE AND ANIMAL PROTEIN
The USDA held its annual Outlook Forum this week and the projections issued at the forum were probably a little positive for wheat and soybeans but even for corn. According to some in the trade there was nothing new for the market to consider or at least not much that will affect current prices.
Overall corn was down by a couple of dollars on the week and the nearby premium for export corn seems to be shrinking as the logistic situation improves, at least in the US Gulf. There is still much talk about the corn situation with Mexico and speculation on the US corn business to Mexico slowing down – so far this is all guess work.
Soybeans and soymeal were down all week – although the futures market did move a tad higher on Friday and "a tad" is not much. On the week, soybeans were down USD 8 to 10 m/t while soymeal followed at about USD 10 m/t lower. Trade reports say that a shift in soybean business to South America is putting downward pressure on US soybean/soymeal prices. It also seems that every forecast of soybean production from Argentina and Brazil shows increases – tough to maintain prices or support a rally when supplies seem to grow every day.
Even wheat prices were down on the week and no one much seemed to care that the USDA wheat plantings for 2017 would be at the lowest level since WW1 and that is a long time ago. Of course, you also have to consider that crop yields are way up since WW1 so plantings may be a very poor statistic to look at from 60 years ago.
One factor that is quite interesting for wheat is the situation in France where the winter wheat crop looks fantastic compared to last year and will probably get France right back into the soft wheat export market once again. While the US doesn't really compete much with France, the other countries that have been covering former France business this year will be back competing in other markets after the 2017 winter wheat harvest --- and they should bump into US wheat.
Estimated Bulk Grain Freight in USD per m/t, basis heavy grains
| US Gulf to Europe: 60/70,000 (10,000 disch) | $14.50/15.00 | Steady | x |
| US Gulf to Spain: 30,000 m/t (5,000 disch) | $24/25.00 | Steady | x |
| US Gulf Israel: 50,000 MT | $23/24.00 | Up $1.00 | x |
| US Gulf to Egypt: Panamax(6,000 disch) | $22/23.00 | Up $1.00 | x |
| US Gulf Turkey: 50,000 | $24/25.00 | Up $1.00 | x |
| US Gulf Morocco: 30,000(5,000 disch) | $24/25.00 | Up $1.00 | x |
| US Gulf Algeria/Tunisia: 30,000 (3,000 disch) | $26/27.00 | Up $1.00 | x |
| US Gulf Nigeria: 30,000 m/t | $52/53.00 | Steady | x |
| US Gulf other Med: 30,000 MT(5,000 disch) | $28/29.00 | Steady | x |
| US Gulf Japan: Panamax | $36/37.00 | Steady | x |
| US Gulf China: Panamax | $34/35.00 | Steady | x |
| US PNW South Africa – 40,000 m/t | $39/40.00 | Steady | x |
| US PNW Japan: Panamax | $19/20.00 | Steady | x |
| US PNW China: Panamax | $18/19.00 | Steady | x |
| US East Coast Egypt: Panamax | $44/45.00 | Steady | x |
| US East Coast Nigeria: Handisize | $51/52.00 | Steady | x |
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| France/Germany to Algeria: 30,000 m/t(3,000 disch) | $18/19.00 | Down $1.00 | x |
| France/Germany to Egypt: 50,000 m/t (10,000 disch) | $13/14.00 | Steady | x |
| France/Germany to Jordan: 35/45,000 m/t (4,000 disch) | $33/34.00 | Steady | x |
| France/Germany to Morocco: 30,000 m/t (3,000 disch) | $16/17.00 | Down $1.00 | X |
| France/Germany to Saudi Arabia: 50/60,000 | $26/27.00 | Up $1.00 | X |
| France/Germany to South Africa: 30,000 m/t | $35/36.00 | Steady | X |
| France/Germany to Yemen: 30,000 m/t | $49/50.00 | Steady | x |
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| Argentina to Algeria: 25/30,000 m/t(3,000 disch) | $27/28.00 | Up $1.00 | X |
| Argentina to China: 50,000 m/t, with top-off | $31/32.00 | Up $2.00 | X |
| Argentina to Japan: 50,000 m/t, with top-off | $32/33.00 | Up $2.00 | X |
| Argentina to Egypt: 50,000 m/t | $25/26.00 | Up $1.00 | X |
| Argentina to Europe: 50/60,000 m/t | $22/23.00 | Up $1.00 | X |
| Argentina to Morocco: 25/30,000 m/t(3,000 disch) | $24/25.00 | Steady | X |
| Argentina to Saudi Arabia: 25/30,000 m/t | $39/40.00 | Down $1.00 | X |
| Argentina to South Africa 25/30,000 m/t (3,000 disch) | $26/27.00 | Up $1.00 | X |
| Argentina to Spain: 30,000 m/t | $24/25.00 | Steady | X |
| Argentina to Tunisia: 25/30,000 m/t (3,000 disch) | $27/28.00 | Up $1.00 | X |
| Argentina to US Gulf: 25/35,000 m/t | $19/20.00 | Steady | x |
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| Brazil to Algeria/Tunisia: 25/30,000 m/t | $29/30.00 | Up $1.00 | x |
| Brazil to China: 55,000 m/t | $25/26.00 | Up $1.00 | x |
| Brazil to Japan: 55,000 m/t | $26/27.00 | Steady | x |
| Brazil to Europe: 30,000 m/t | $29/30.00 | Steady | X |
| Brazil to Morocco: 25/30,000 m/t | $27/28.00 | Up $1.00 | X |
| Brazil to Saudi Arabia 30/40,000 m/t | $39/40.00 | Up $1,00 | X |
| Brazil to Turkey/Egypt: 50,000 m/t | $24/25.00 | Up $1.00 | X |
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| Australia to China: 40-55,000 m/t – round trip | $19.00/19.50 | Up $1.00 | x |
| Australia to Japan: 40-55,000 m/t – round trip | $19.50/20.00 | Up $1.00 | x |
| Australia to Saudi Arabia: 40-55,000 m/t | $25/26.00 | Steady | x |
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| Ukraine to China: 50,000 m/t | $27/28.00 | Up $1.00 | x |
| Black Sea to East Med: 30,000 m/t (3,000 disch) | $16/17.00 | Steady | X |
| Ukraine to East Med: coaster (1,000 disch) | $27/28.00 | Steady | X |
| Black Sea to Egypt: 40/50,000 m/t – (6,000 disch) | $17/18.00 | Steady | X |
| Black Sea to Egypt: 30,000 m/t – (4,000 dich) | $18/19.00 | Steady | X |
| Ukraine to Egypt: coaster 3,000 m/t (1,000 disch) | $27/28.00 | Steady | X |
| Black Sea to Iraq: 50,000 m/t (4,000 disch) | $27/28.00 | Up $1.00 | x |
| Black Sea to Morocco: 30,000 m/t (3,000 disch) | $20/21.00 | Steady | X |
| Black Sea to Spain: 40/50,000 m/t (8,000 disch) | $13/14.00 | Steady | x |
| Black Sea to Jordan: 50,000 m/t (4,000 disch) | $20/21.00 | Steady | x |
| Black Sea to Saudi Arabia – Jeddah – 50k | $23/24.00 | Steady | X |
| Black Sea to South Africa – 30,000 m//t | $36/37.00 | Up $1.00 | x |
| Black Sea to Tunisia/Algeria: 30,000(5,000 disch) | $19/20.00 | Steady | x |
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| Baltic Dry Index | 875 | Up 134 | x |
| Baltic Capesize Index | 1165 | Up 426 | x |
| Baltic Panamax Index | 947 | Up 30 | X |
| Baltic Supramax Index | 809 | Up 80 | X |
| Baltic Handisize Index | 428 | Up 37 | x |
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FOB port or location specified. Prices in US$, in metric tons:
All shipments in bulk grain vessels unless stated otherwise
(NOLA is New Orleans, Louisiana, USA.)
ALL PRICES ARE FOR March 2017/May 2017
| Wheat, USA Soft Red Winter, NOLA | USD 190/192 | x |
| Wheat, USA Hard Red Winter 12 protein | USD 224>>212 | x |
| Wheat, Ukraine 11.5 pro, 30,000+ m/t | USD 185/188 | X |
| Wheat, Russia 12.5 pro, 30,000+ m/t | USD 189/192 | x |
| Wheat, Romania 12.5 pro | USD 193/196 | x |
| Wheat, Superior, France, Rouen | USD 193/195 | x |
| Wheat, milling, 12.0%, Argentina, upriver | USD 179/182 | x |
| Wheat, feed, Black Sea | USD 174/178 | x |
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| Barley, France, Rouen port | USD 166/168 | x |
| Barley, feed, Argentina | USD 159/163 | x |
| Barley, feed, Black Sea, 30,000+ | USD 167/170 | x |
| Barley, feed, USA Pacific Northwest | USD 190/195 | x |
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| Corn, FOB NOLA USA | USD 168>>164 | x |
| Corn, FOB USA Pacific northwest | USD 199>>176 | x |
| Corn, FOB Argentina port, upriver | USD 170/174 | x |
| Corn, FOB Brazil port | USD 185/188 | x |
| Corn, FOB Black Sea, 30,000+ m/t | USD 169/173 | x |
| Corn, FOB France | USD 187/190 | x |
| Corn, FOB Romania | USD 176/178 | x |
| Sorghum, FOB Texas | USD 163/166 | X |
| Sorghum, FOB Argentina port | USD 160/163 | x |
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| Soymeal, 48% protein, FOB NOLA | USD 372/375 | X |
| Soymeal, 48% protein, USA, Rotterdam | USD 397/400 | x |
| Soymeal, Argentina, Rotterdam | USD 377/379 | x |
| Soymeal, 47% pro, FOB Argentina | USD 352/357 | x |
| Soymeal, 48% protein, Brazil, Rotterdam | USD 367/371 | x |
| Soymeal, 48% protein, FOB Brazil | USD 341/344 | x |
| Soybeans, FOB NOLA | USD 395/398 | x |
| Soybeans, Argentina, FOB | USD 384/388 | x |
| Soybeans, Brazil, FOB | USD 392/396 | X |
| Soybeans, Black Sea | USD 404/407 | x |
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| Corn Gluten Meal, USA FOB NOLA | USD 590/600 m/t | x |
| Corn Gluten Feed, USA FOB NOLA | USD 140/145 m/t | x |
| DDGS corn, 35 profat, USA FOB NOLA | USD 159/163 m/t | x |
Not too much excitement in the corn by-product market this week. DDGS prices seem to have calmed down a little although the nearby prices are still at a premium to the more distant prices. With soymeal prices off by about USD 10 m/t this week there is little reason for corn by-product prices to move higher.
The US Grains Council mentioned in their weekly report that the container freight rates to Asia are moving higher and as much of the corn by-product business moves in containers this will push up CNF prices. They note that containers to Vietnam were up by USD 14 m/t while to Japan the increase was USD 9 m/t.
The USDA feedstuffs report shows that, on the domestic side, corn gluten meal prices were up by about USD 5 m/t with corn gluten feed down by about USD 1 m/t and DDGS prices down by about USD 3 to 5 m/t.
Container shipments, minimum 200 m/t
| Argentina Meat & Bone meal, 45/50 protein Argentina poultry meal, 57/60 protein Argentina feathermeal, 78/80 protein | USD 420/430 m/t CNF Asia USD 530/540 m/t CNF Asia USD 460/470 m/t CNF Asia |
| Paraguay Meat &Bone meal, 45% protein | USD 420/430 m/t CNF Asia |
| Australian MBM 45 protein Australian MBM 50 protein Australian Feathermeal, 80 protein Australian Poultry Meal, pet food | USD 460/470 m/t CNF Asia USD 510/520 m/t CNF Asia USD 530/540 m/t CNF Asia USD 770/790 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 465/485 m/t CNF Asia USD 540/550 m/t CNF Asia USD 630/640 m/t CNF Asia USD 760/780 m/t CNF Asia |
According to this week's Jacobsen, there looks to be a rally in meat and bone meal prices in Asia with both Indonesia and China said to be showing higher prices. Hard to say if this is a serious rally as prices for soymeal certainly aren't moving higher which should put a cap on any MBM rally.
There was also a bump up of USD 10 m/t or so in feathermeal and poultry meal with the trade saying that some of the buying may be advance Ramadan buying – Ramadan is still quite a ways away, as it won't begin until about May 27, so it does seem to be too early for a Ramadan price rally.
Jacobsen also notes that Asian demand for US feathermeal and poultry meal is also quite good which has helped to raise export prices by about USD 10 m/t.
If any readers wonder why the animal protein comments always seem to cover just Asia this is because a very large percentage of animal protein shipments, from all origins, are to Asia. There is really no other export market for animal proteins that is as important as the Asian market.
SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN
There is still no fishing allowed in the southern zone in Peru. For the northern zone, the exploratory research cruise will run from Feb 28 to April 08 – seems like a long research cruise but what do I know about research cruises.
Speculation seems to be that the next north quota will be between 2.5 million m/t catch up to 3 million m/t. Of course, this is all just guess work at present.
New sales for the next northern fishing period remain quite brisk with the trade reporting that all of June and July look to be sold out with estimates of about 200,000 m/t of fishmeal sold – mostly to buyers in China. Producers are said to be wanting to pre-book about 50% of their next production – at 2.5 million m/t this would be about 600,000 m/t of total fishmeal production with a target of pre-booking 300,000 m/t or so.
As to prices, nothing new to report this week as the prices below seem to be about correct with some up and down range – depending on who you talk to.
European fishmeal prices – FOB North German port.
| Type | Protein % | Price per m/t USD |
| Herring fishmeal | 72% protein | 1,415 |
| Danish fishmeal | 64% protein | 1,330 |
| Peru fishmeal | 64% protein | 1,350 |
| Chile fishmeal | 67% protein | 1,400 |
| Iceland fishmeal | 70% protein | 1,410 |
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 | Price per m/t Chile port |
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| 65% protein | 1150/1180 m/t |
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| 65/66 protein | 1250/1270 m/t |
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| 67% protein standard steam | 1300/1320 m/t | 1330/1350 |
| 67% protein 150 TVN | 1340/1360 m/t | 1380/1400 |
| 67% protein 120 TVN | 1390/1410 m/t | 1430/1450 |
| 67% protein 1000 hist, 120 TVN | 1440/1460 m/t | 1480/1500 |
| 68% protein 500 hist, 120 TVN | 1490/1510 m/t | 1520/1540 |
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| Fish oil, crude bulk | 1450/1500 | 1500/1550 |
| Fish oil, crude drums | 1550/1600 |
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| Fish oil, flexi tank | 1700/1750 |
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| Fish oil, Omega 3: 28%EPA/DHA | 1900/2000 |
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INFORMATION: gtee = guarantee, TVN = total volatile nitrogen, hist = histamine
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 © 2017 Wayne S. Bacon
