Weekly Report -- Feb 09, 2013

 

 

Hammersmith Marketing Ltd  - Grain Trading

WEEKLY FEED GRAIN AND PROTEIN REPORT   February 09, 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

 

I don't think that there was much excitement stirred up by the USDA WASDE report on Friday. As a number of trade experts pointed out, the February report is normally a report with no surprises as there is just not much that can be changed in February from the January numbers – how much excitement can their really be in the middle of winter in the USA.

 

However, corn was down on the week by USD 10/12 m/t as traders and speculators seemed to want to get out of their long corn positions before the report, just in case it was bearish and prices fell.  But it really wasn't bearish now was it bullish – so where will corn prices go on Monday: it probably all depends on what is happening in Brazil and Argentina and how their corn crops are doing.

 

Soybeans and soymeal had a very weak finish to the week, even though the report was not really bearish on beans.  One suspects that the report was just brushed aside and the situation in South America brought to the front.  Any hint of good or better or improving weather in Argentina and/or Brazil is enough to push market prices lower and with the USDA increasing their Argentina crop numbers that seemed to be enough to get prices sliding lower. 

 

Will the lower soybean prices hold into next week – well that probably depends on what the weather is doing over the next few days.

 

As I have been saying for weeks, the game is now all in 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 311>>304
Wheat, USA Hard Red Winter 12 protein	USD 342/347
Wheat, milling Black Sea 11.5 pro	USD no availability
Wheat, soft milling, France, Rouen port	USD 335/337
Wheat, milling, Argentina, Necochea port	USD 355/360 Mar/May
Wheat, feed, Black Sea	USD no availability
Barley, France, Rouen port	USD 305/307
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  304>>301 Feb>>May
Corn, FOB Argentina ----- spot price	USD  284/286 Feb/Mar
Corn, FOB Argentina port, upriver	USD  279>>269  Apr/Jun
Corn, FOB Brazil port ----- spot price	USD  290/294 Feb/Mar
Corn, FOB Brazil port	USD  258>>249  July/Aug
Corn, FOB Black Sea	USD  300/310
Corn, FOB France	USD  311/313
Sorghum, Black Sea	USD  n/a
Sorghum, FOB Texas, low tannin, GMO free	USD  308/310
Sorghum, FOB Argentina port, high tannin, GMO free	USD  asked 230/bid 220 Apr/June

 

 

Soymeal,  48 protein, FOB NOLA	USD  518/524  Feb/Mar
Soymeal, 48 protein, USA, Rotterdam	USD  543/547 Feb/Mar
Soymeal, Argentina, Rotterdam	USD  523>>448 F/>>/J/J
Soymeal, 47 pro, FOB Argentina	USD  478>>425  F/>>/J/J
Soymeal, 48 protein, Brazil, Rotterdam	USD  524>>452 Feb/>>/J/J
Soymeal, FOB Brazil	USD  480>>447  May/J/J
Soymeal, 48 protein, India FOB	USD  540/545

 

Bulk vessel shipments, minimum 5000 m/t

 

Corn Gluten Feed,  USA FOB NOLA	USD   282/285 m/t
Corn Gluten Meal,  USA FOB NOLA	USD   700/730 m/t
DDGS, 35 profat, USA FOB NOLA	USD   333>>323 m/t Feb>>Apr
DDGS, 35 profat, CNF Asian ports	USD   392/396 m/t

 

As has been seen for a while, the supply of DDGS in the USA is getting tighter with the reduced ethanol production and good levels of demand in the USA but trade reports feel that prices are getting to the top and end-users in the USA will be looking at other alternatives to DDGS if the strength continues.  There is some weakness seen in prices a couple of months out but there are not too many producers who want to sell out very far.

 

The DDGS export business will be slow for a couple of weeks with Chinese New Year closing much of the buying interest for ten days or so.

 

Corn gluten meal prices slipped a little lower this week and according to the Jacobsen report in the USA are now down by about USD 60 m/t from prices about one month ago.  Corn gluten feed didn't have too exciting a week and seemed to be about where it was last week.

 

 

USA Corn by products and soymeal exports, major importers  – total 2012 – in m/t

 

	DDGS	Corn Gluten Feed	Corn Gluten Meal	Soybean meal
Canada	591,500	38,500	76,600	1,046,600
China	2,167,500
Chile			126,900
Columbia	87,500	26,600	75,700
Venezuela				705,800
Vietnam	370,800		19,300
Israel	170,100	211,900
Ireland		165,300
Indonesia			189,300
Japan	377,600		19,100
Mexico	1,498,300	34,600	52,000	607,700
Morocco	117,100	97,200		407,800
Ecuador			8,500	326,000
Guatemala	81,700		10,000	248,200
Dominican Rep				244,700
Philippines	164,500			216,800
South Korea	345,600	13,600	10,200
Thailand	209,500		26,600
Taiwan	208,000		23,000
Turkey	176,000	167,700	11,900	187,700
Egypt	95,300	6,800	147,600	176,300
Total all exports	7,422,100	800,800	919,100	6,679,600

 

It is interesting to note that exports of soymeal, except for 2009 and 2010 are at the same level as was exported in 2008 while DDGS exports have increased by 64 percent since 2008, corn gluten feed exports have dropped by 37 percent since 2008 and corn gluten meal down by 13 percent from 2008 after three years where shipments were down by 33 percent.

 

One other small note, and something that many don't realize, the exports of DDGS are now greater than the USA exports of soymeal and all that DDGS growth came in a very short period of time. But then, of course, ethanol-based DDGS is a new product.

 

Container shipments, minimum 200 m/t

 

Argentina Meat & Bone meal, 45 protein	USD 720/740  CNF Asia
Brazil Meat & Bone meal, 45 protein	USD   no prices   CNF Asia
Paraguay Meat & Bone meal, 45 protein	USD 525/530 m/t CNF Asia
Europe Meat & Bone meal, 45 protein	USD   no prices  CNF Asia
USA Meat & Bone meal, 50 protein	USD 750/770 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 700/730 m/t CNF Asia
USA Feathermeal, 80 protein	USD 870/890 m/t CNF Asia
USA Poultry Meal, feed grade	USD 710/750 m/t CNF Asia
USA Poultry Meal, pet food grade	USD 1100/1150 m/t CNF Asia
Australian Poultry meal, pet food grade	USD 940/1000 m/t CNF Asia

 

USA Animal protein exports 12 months 2012 – major importers --- in m/t

 

	Meat and Bone Meal Incl pork and poultry meal	Feathermeal
Indonesia	69,700	46,000
Mexico	64,400
Canada	38,100	17,000
Philippines	32,800
China	15,000
Thailand	12,900
Netherlands	5,500
Ecuador	4,900
Chile		24,200
Total all exports	259,500	90,800

 

Meat and bone meal exports, including pork and poultry meal, are down by about 14 percent from 2008 while feathermeal in 2012 is up by 24 percent over 2008, after three very bad export years: 2009/2010/2011, which were all well below 2008 exports.

 

 

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

 

Meat and bone meal, USA, 50 protein	USD  425/440 m/t
Feathermeal  80 protein USA	USD  680/700 m/t
Poultry meal  57 protein, Eastern USA	USD  570/600 m/t

 

USA meat and bone meal prices along with feathermeal and poultry meal put in a very strong week with domestic and export prices higher for all products.  As mentioned last week the soymeal/mbm ratio is getting close to normal levels as MBM moves higher while soymeal slides a little.  China has announced that they will be taking Australian MBM from approved producers and this will change the price and shipment pattern in Asia as China has been paying a very good premium for MBM.  One wonders what effect this could have on producers in Uruguay who have been shipping most of their export business to China and pocketing at least an extra USD 50 m/t over other destinations.

 

Sorry that I don't have better price info from South America and Europe this week but some weeks it is just tough to get good data.

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

It looks like the total not caught in the January period is going to be about 25,000 m/t which works out to 5,500 m/t or so of fishmeal, so overall for the two months the catch was just over 5 percent short which counts for about 10,000 m/t of fishmeal – at the lowest grade price level this equates to USD 18 million, which is a fair chunk of money to anyone.

 

The trade reports from Peru mention that the last couple of weeks catch had a high level of undersized fish and the hope is that there has been no significant damage to the biomass due to the number of juvenile fish caught. Reports show that the juvenile level reached as high as 45 percent for the final week of fishing.

 

There was a little business this week but not much as buyers are looking elsewhere for product and with Chinese New Year coming up business will be quiet.  Also, Iceland is reported to have increased their capelin quota from 150,000 m/t to just over 200,000 m/t – not a huge amount but certainly enough to steal a little more business from Peru.

 

MSI Ceres published their update on the Middle East and Africa this week and as everyone has known for a long time – there is just no market in those regions for Peru/Chile fishmeal.  With less than 4,000 m/t being shipped in 2012 to all of Africa and the Middle East, we seem to come to the end of the line for fishmeal (at least from South America) in those regions.

 

As to prices – don't see any changes at present.  Perhaps once Chinese New Year is over and there is a little more buyer activity then there could be some price changes but with very little stock available for sale in Peru there seems to be no reason to expect any sudden drop in prices.

 

The situation is that, no matter what happens, Peru is still the major fishmeal producer and, as much as buyers can look to other origins, there is just not enough other production to offset the very large Peruvian share. At some point in time, the major fishmeal users will be back to buying Peruvian 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	1800/1810 m/t
65/66 pro standard steam	1840/1850 m/t
67 protein standard steam	1840/1850 m/t
67 protein SD 150  TVN	1900/1920 m/t
67 protein SD 120 TVN	1950/1970 m/t
67 protein SD 1000 hist, 120 TVN	2000/2020 m/t
68 protein SD 500 hist, 120 TVN	2050/2070 m/t
Fish oil .. crude bulk	2500/2550
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