Hammersmith Marketing Ltd - Grain Trading
WEEKLY FEED GRAIN AND PROTEIN REPORT February 23, 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
It was an up and down week this week with both corn and wheat sliding lower while soybeans and soymeal moved higher. Much of the activity in the USA market was as a result of the USDA Outlook Conference and the numbers for crops and such that were discussed there.
On the corn side of things the USDA is expecting about the same corn planting as last year and with the estimated yield at a good average level then the 2013 crop could be very good and prices, according to the USDA, could drop by close to 35 percent come the end of the next season. Based on today's prices that could be a price drop of as much as USD 95 m/t – certainly a very significant price drop. Of course, if you look at the current USA futures prices you will see that September/December prices already reflect much lower corn prices, so the USDA comments are just confirming what the market is already expecting.
None the less, barring bad weather and other disasters, 2013 looks to be another record or close to record crop year for USA corn production --- lets just hope that with the lower prices it will be very competitive in world corn markets.
Soybeans and soymeal were higher on the week although on Friday both markets took a bashing and dropped much lower on the day. Without this Friday drop the prices would have been much higher on the week. There does not seem to be any one factor that pushed prices down – just a bunch of bearish items: rain in Argentina, higher USDA expected yields, some new China business. But with Brazil looking to have some serious export delays (as usual every year) and quite good demand for limited available supplies then it does not look like prices are in for much of a drop lower at present.
Looking at the USDA Outlook Conference, ending soybean stocks for 2012/13 are still expected to be low with stock levels improving in 2013/14 but with increased stock levels come lower prices and 2013/14 prices are expected to be down by close to 30 percent from current levels – but then 2013 /14 is still quite a way off.
For the time being, on soybeans, there is still some tightness in supply and prices should remain reasonably firm until we get good supplies flowing out of South America.
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 291>>285 |
| Wheat, USA Hard Red Winter 12 protein | USD 323/326 |
| Wheat, milling Black Sea 11.5 pro | USD no availability |
| Wheat, soft milling, France, Rouen port | USD 324/326 |
| Wheat, milling, Argentina, Necochea port | USD 350/360 Mar/May |
| Wheat, feed, Black Sea | USD 315/320 |
| Barley, France, Rouen port | USD 296/299 |
| Barley, feed, Argentina, Necochea port | USD 295/305 Mar/May |
| Barley, feed, Black Sea | USD 317/325 |
| Barley, feed, USA Pacific Northwest | USD 330/335 |
| Corn, FOB NOLA USA | USD 297>>292 Mar>>May |
| Corn, FOB Argentina ----- spot price | USD 270/272 Feb/Mar |
| Corn, FOB Argentina port, upriver | USD 267>>264 Apr/Jun |
| Corn, FOB Brazil port ----- spot price | USD 283/285 Feb/Mar |
| Corn, FOB Brazil port | USD 250>>239 July/Aug |
| Corn, FOB Black Sea | USD 290/300 |
| Corn, FOB France | USD 299/301 |
| Sorghum, Black Sea | USD n/a |
| Sorghum, FOB Texas, low tannin, GMO free | USD 301/303 |
| Sorghum, FOB Argentina port, high tannin, GMO free | USD asked 230/bid 220 Apr/June |
| Soymeal, 48 protein, FOB NOLA | USD 525/528 March |
| Soymeal, 48 protein, USA, Rotterdam | USD 547/550 March |
| Soymeal, Argentina, Rotterdam | USD 558>>480 Mar/>>/J/J |
| Soymeal, 47 pro, FOB Argentina | USD 498>>453 Mar/>>/J/J |
| Soymeal, 48 protein, Brazil, Rotterdam | USD 546>>475 Mar/>>/J/J |
| Soymeal, FOB Brazil | USD 471>>458 May/>>J/J |
| Soymeal, 48 protein, India FOB | USD 550/555 |
Bulk vessel shipments, minimum 5000 m/t
| Corn Gluten Feed, USA FOB NOLA | USD 278/280 m/t |
| Corn Gluten Meal, USA FOB NOLA | USD 690/700 m/t |
| DDGS, 35 profat, USA FOB NOLA | USD 338>>328 m/t Mar>>May |
| DDGS, 35 profat, CNF Asian ports | USD 393>>388 m/t |
There is some weakening in DDGS prices looking out a few weeks as corn prices are expected to continue to fall and production of ethanol could pick up a little with lower corn cost and better margins. It is reported in the trade that Asian buyers are trying to book DDGS supplies for later in the year at significantly lower prices but producers are not all that willing to book distant positions at discounted prices as there is still too much uncertainty in the corn market. In the USA the DDGS buyers are buying more as they need in order not to pay too much in what they see as a falling market. But, for buyers in Asia, who have to buy then wait several weeks for shipment arrival, there is no chance to buy hand to mouth, they have to take a buying position and hope that it is correct.
Corn gluten feed and corn gluten meal prices were both steady this week with corn gluten meal not knowing whether it should go lower on slipping corn prices or move higher following soymeal prices. In the long run, since CGM is 60 percent protein, the price of soymeal will probably have the largest effect on prices as protein buyers are always alert to any protein bargains and CGM will not get too low priced before demand will jump.
As to corn gluten feed – it is just chugging along, following corn lower.
Container shipments, minimum 200 m/t
| Argentina Meat & Bone meal, 45 protein | USD 690/710 CNF Asia |
| Brazil Meat & Bone meal, 45 protein | USD no prices CNF Asia |
| Paraguay Meat & Bone meal, 45 protein | USD 510/530 m/t CNF Asia |
| Europe Meat & Bone meal, 45 protein | USD 470/500 m/t CNF Asia |
| USA Meat & Bone meal, 50 protein | USD 750/775 m/t CNF Asia |
| Australian MBM , 45 protein | USD 680/700 m/t CNF Asia |
| Australian MBM, 50 protein | USD 720/740 m/t CNF Asia |
| Australian Feathermeal | USD 750/770 m/t CNF Asia |
| USA Feathermeal, 80 protein | USD 900/920 m/t CNF Asia |
| USA Poultry Meal, feed grade | USD 740/750 m/t CNF Asia |
| USA Poultry Meal, pet food grade | USD 1130/1170 m/t CNF Asia |
| Australian Poultry meal, pet food grade | USD 980/1020 m/t CNF Asia |
The following indications are at producer's factory, ex-works in bulk
| Meat and bone meal, USA, 50 protein | USD 460/480 m/t |
| Feathermeal 80 protein USA | USD 690/720 m/t |
| Poultry meal 57 protein, Eastern USA | USD 570/600 m/t |
SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN
Prices for lower grades of fishmeal seem to have slipped a little this week and last – perhaps with China having been out of the market. However there are still no discounted prices for higher grades as with only about 30,000 m/t of unsold fishmeal available there is very limited supply of better grades.
China is now back to work and there have been a few bits of buying interest in the market but with China stocks still quite good and the main aqua season a few weeks away there seems to be no rush to place new orders.
European fishmeal supplies are still lower priced than Peruvian which has reduced buying interest from Europe and with the recent change in fishing laws relating to fish discard use in fishmeal production then we could see increased future production in Europe.
There are lots of rumours in the market in Peru as to what the next fishing quota will be with a very wide range of guesses floating in the market ---- but these are all only guesses.
MSI Ceres of Peru had some very good comments on the future of fishmeal in their report this week. They were pointing out how the growth in the market for all fish as food is going to reduce the production of fishmeal in years to come. They are also saying that the much improved handling of caught fish means that a higher quantity can now be used as food grade rather than fishmeal grade which reduced the raw materials for fishmeal.
There is probably never going to be any major growth in the world fishmeal supply, although there are increases in non-traditional fishmeal producing countries, and over the years we have seen fishmeal become less and less important in feed formulations, as lower cost alternatives have been found. However the fact still is that every year, every ton of fishmeal produced is sold – no matter what the price – there is just so much growth in animal feed and aquaculture feed production levels (including pet food) that even at lower inclusion levels there is still enough demand to use all available fishmeal.
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 | No quotes |
| 65/66 pro standard steam | 1650/1670 m/t |
| 67 protein standard steam | 1700/1720 m/t |
| 67 protein SD 150 TVN | 1800/1820 m/t |
| 67 protein SD 120 TVN | 1950/1970 m/t |
| 67 protein SD 1000 hist, 120 TVN | 2050/2060 m/t |
| 68 protein SD 500 hist, 120 TVN | 2100/2130 m/t |
| | |
| Fish oil .. crude bulk | 2600/2650 |
| Fish oil – crude drums | 2700/2750 |
| Fish oil – flexitank | 2650/2700 |
| Fish oil – Omega 3 – 28%EPA/DHA | 3000/3500 |
| | |
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
