Weekly Report - Jan 12, 2013

 

 

Hammersmith Marketing Ltd  - Grain Trading

WEEKLY FEED GRAIN AND PROTEIN REPORT   January 12, 2013

                                                       (a Bahamas Corporation)

 

 

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

 

Head 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

 

Well Friday was the day for the latest USDA WASDE report and after the smoke had cleared a little it is seen to be not too bad a report after all.  Seems that, as happens many times, the anticipation of the report is much bigger than the reaction to the actual report.  In corn, perhaps the biggest surprise was the stocks level for the old crop, which was down close to 40% from the last report and shows that corn supply is going to be very tight in the USA.  From the looks of things there appears to be quite good reason for corn prices to move higher in coming weeks and this could switch corn export business to other origins but that is what is needed if the price is to steady and the supply cover all the needs.

 

On the soybean side of things, the USDA has increased the expected production level for soybeans but they also increased the expected crush and the level of exports but we still get to an ending stock number that is more than double the previous estimate and the best level seen in several years.

 

It is expected that the old crop soybean prices should still be reasonably firm but that new crop prices will be quite soft as buyers realize that come next crop there should be lots of soybeans around.  But still, the next crop is a long way away and like corn we are going to have to make do with limited USA supply until we see a new crop next fall --- of course we do have the South American crop coming and we all know where that is pushing prices: much lower.

 

With the report coming out on a Friday it will probably be sometime next week before all the experts have analyzed all the numbers in detail --- so next week could be an exciting week for price volatility.   

 

 

 

Due to all the holidays in various parts of the world it has been very difficult to update all the prices for various grains and protein meals --- where not possible is just show "n/a" – not available.

 

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 306>>302
Wheat, USA Hard Red Winter 12 protein	USD 340/343
Wheat, milling Black Sea 11.5 pro	USD 355/360
Wheat, soft milling, France, Rouen port	USD 334/336
Wheat, milling, Argentina, Necochea port	USD 354/365 Feb/Mar
Wheat, feed, Black Sea	USD 295/300
Barley, France, Rouen port	USD 306/308
Barley, feed, Argentina, Necochea port	USD 290/302 Mar/June
Barley, feed, Black Sea	USD 335/340
Barley, feed, USA Pacific Northwest	USD 320/325

 

 

Corn, FOB NOLA USA	USD  304>>300
Corn, FOB Argentina ----- spot price	USD 294/297 Jan/Feb
Corn, FOB Argentina port, upriver	USD  270>>263  Apr/Jun
Corn, FOB Brazil port ----- spot price	USD  282/284 Jan/Feb
Corn, FOB Brazil port	USD  248>>242  July/Aug
Corn, FOB Black Sea	USD  290/295
Corn, FOB France	USD  315/317
Sorghum, Black Sea	USD  n/a
Sorghum, FOB Texas, low tannin, GMO free	USD  304/306
Sorghum, FOB Argentina port, high tannin, GMO free	USD  asked 240/bid 220 Mar/May

 

 

Soymeal,  48 protein, FOB NOLA	USD  499/505  January
Soymeal, 48 protein, USA, Rotterdam	USD  525>>468 Jan/Mar/Apr
Soymeal, Argentina, Rotterdam	USD  505>>448 Jan/M/A/M
Soymeal, 47 pro, FOB Argentina	USD  476>>418  Jan/M/J/J
Soymeal, 48 protein, Brazil, Rotterdam	USD  510>>450 Jan/Apr/May
Soymeal, FOB Brazil	USD  473>>412  Jan/M/J/J
Soymeal, 48 protein, India FOB	USD  515/520

 

Bulk vessel shipments, minimum 5000 m/t

 

Corn Gluten Feed,  USA FOB NOLA	USD   277/280 m/t
Corn Gluten Meal,  USA FOB NOLA	USD   800/820 m/t
DDGS, 35 profat, USA FOB NOLA	USD   339>>336 m/t
DDGS, 35 profat, CNF Asian ports	USD   375/383 m/t

 

Not much change in the past couple of weeks in corn by-product export prices – perhaps corn gluten meal has dropped a tad but there has really been no weakness seen in the price for DDGS at export ports.  According to the US Grains Council comment this week, it could be that there has been quite a bit of export business done in advance of the Chinese New Year and this could be keeping export prices a little higher than they might normally be.  If so the there should be some weakness in prices in coming weeks – assuming that there is no rally in corn prices.  The USGC also reports that with the new registration requirements in China and the very few USA producers who are registered so far this has pushed prices to China up by as much as USD 20 m/t, another case of limited supply and good demand.

 

We will have to see what happens with both corn and protein prices over the next while in order to know exactly where by-product prices are going.

 

 

USA exports of corn by-products to 11 months to Nov 30, 2012 – major destination -  in m/t

 

	Distillers Dried Grains – DDGS	Corn Gluten Meal	Corn Gluten Feed
China	2,063,000	5,000	000
Mexico	1,388,000	51,200	33,700
Canada	542,100	71,100	34,800
Vietnam	362,000	19,900	1,100
Japan	354,200	18,900	000
South Korea	329,400	10,200	13,600
Thailand	193,900	25,100	000
Taiwan	189,900	21,700	000
Philippines	156,300	1,200	000
Israel	154,600	800	194,300
Indonesia	152,300	176,500	6,200
Turkey	133,400	11,800	159,800
Morocco	114,300	000	97,200
Egypt	88,600	136,182	6,800
Ireland	80,700	000	144,300
Columbia	72,200	60,900	26,600
Chile	8,800	110,700	000

 

 

Container shipments, minimum 200 m/t

 

Argentina Meat & Bone meal, 45 protein	USD 740/760  CNF Asia
Brazil Meat & Bone meal, 45 protein	USD   no prices   CNF Asia
Paraguay Meat & Bone meal, 45 protein	USD 560/570 m/t CNF Asia
Europe Meat & Bone meal, 45 protein	USD 480/520 m/t CNF Asia
USA Meat & Bone meal, 50 protein	USD 725/740 m/t CNF Asia
Australian MBM , 45 protein	USD 670/690 m/t CNF Asia
Australian MBM, 50 protein	USD 710/730 m/t CNF Asia
Australian Feathermeal	USD 760/780 m/t CNF Asia
USA Feathermeal, 80 protein	USD 800/820 m/t CNF Asia
USA Poultry Meal, feed grade	USD 710/740 m/t CNF Asia
USA Poultry Meal, pet food grade	USD 1030/1060 m/t CNF Asia
Australian Poultry meal, pet food grade	USD 980/1010 m/t CNF Asia

 

 

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

 

Meat and bone meal, USA, 50 protein	USD  360/390 m/t
Feathermeal  80 protein USA	USD  570/600 m/t
Poultry meal  57 protein, Eastern USA	USD  580/610 m/t

 

There has been no change in USA animal protein prices this week but the feeling is that the domestic prices are going to have to move lower due to the very high spread between soymeal and MBM.  It s true that the spread has come down some since the early December but experts still feel that it is too high and does have some room to drop lower.  On the export side of things there has been no change at all in USA export prices and much the same can be said about the prices from Australia and New Zealand.

 

There was a little MBM available for both Argentina and Paraguay this week but the Argentina is much too expensive for buyers while the Paraguay is still just a little too high compared to recent prices out of Europe to Asia.

 

As I have been saying for a few weeks now, with very high fishmeal prices it is probably not too likely that we will see a significant drop in animal protein export prices.   

 

 

USA exports of animal protein to 11 months to Nov 30, 2012 – major destination -  in m/t

 

	Feathermeal	Meat and Bone Meal, includes poultry meal and pork meal
Indonesia	39,300	67,100
Mexico		59,700
Canada	16,700	35,800
Philippines		26,500
China		12,700
Thailand		11,100
Netherlands		4,400
Ecuador		4,300
Malaysia		2,100
Hong Kong		2,000
Vietnam		1,800
Bangladesh		1,277
Chile	19,900
Japan	700
Taiwan	1,300

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

The January fishing in Peru is chugging along at a good speed with about 170,000 m/t of fish landed up to mid week – if another 7 or 8 days could be done at the same level then the entire quota could be finished by the 15/17^th of January, not too bad a month.  With between 250 and 300 vessels out fishing everyday the catch performance is quite good and hopefully the weather will continue to co-operate.

 

According to trade sources in Peru, all the current production is being used to cover old orders on hand, which is leaving very little available for new buyers.  It is also said that quite a chunk of business for the current period has been moved to the next season, in April/May, due to the lack of supplies for this fishing season.  So it looks like whatever is produced in Peru this season has been sold and that we are working away on the supply for next season.

 

If all these sales ideas are correct then there seems to be little or no reason to expect any weakening in prices in the near term – at least not before the next fishing season.  One thing that has been changing quite a bit is the spread between various grades of fishmeal with the higher quality grades now being priced at a significant premium to lower grades, much more of a premium than is expected during a normal fishing season.  Of course, the higher grades are always in short supply and with a much-reduced fishing quota the supply is even more limited.

 

So, high prices continuing, buyers can't be hesitant and unsold supplies are very tight.

 

 

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	1820/1830 m/t
65/66 pro standard steam	1850/1860 m/t
67 protein standard steam	1910/1920 m/t
67 protein SD 150  TVN	2000/2020 m/t
67 protein SD 120 TVN	2040/2050 m/t
67 protein SD 1000 hist, 120 TVN	2060/2070 m/t
68 protein SD 500 hist, 120 TVN	2100/2110 m/t
Fish oil .. crude bulk	2400/2450
Fish oil – crude drums	2450/2500
Fish oil – flexitank	2500/2550
Fish oil – Omega 3 – 28%EPA/DHA	2600/2900

 

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