Weekly report August 17, 2013

 

Hammersmith Marketing Ltd  - Grain Trading

WEEKLY FEED GRAIN AND PROTEIN REPORT   August 17, 2013

 

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Email:   tradegroup@hammersmith.biz    WWW:  hammersmithltd.blogspot.com       SKYPE: bacon39a  

 

This weeks report is a little shorter than usual as i am traveling in North Africa this week and available time to get information and write reports is just a little tight -- so, i hope that i at least can hit the highlights in the market 

SECTION 1:  FEED GRAINS -- VEGETABLE AND ANIMAL PROTEIN

Well now, seems that the USDA surprised everyone with their report this week as they gave us some bullish numbers for corn and soybeans. Of course, here we are a few days later and many experts are saying that the USDA numbers are wrong and that the crops are going to be amazing.  Tough to know who is actually correct --- the USDA goes to a great deal of work to get the numbers as accurate as possible but when you get to the end everything is still just a best estimate.

Most trade comments at the end of the week seemed to feel that corn prices are going to be going lower, some say another USD 30 m/t lower.

On the actual crop side of things, the weather remains good in much of the USA but with a frost risk in a couple of areas. Early reported corn yields in the southern US are very high.

Experts feel that the corn crop ratings on Monday could drop by 1 percent, not much but perhaps enough to push Monday price a little higher.

Soybeans had a very strong week and here there may be yield concerns -- perhaps greater than the lower yields that the USDA was forecasting. Some reports say that cooler than normal weather is causing lower pod setting with soybeans and this would mean lower yields come harvest.

South American - mainly Brazil - soybean prices are very low and this will certainly help to stop soybean prices running up too high --- that is unless there is a crop disaster in the USA and that does not look likely.

Soybeans and soymeal will probably have difficulty in keeping prices moving higher -- there just does not seem to be any good reason for expecting higher prices at present.         

 

USA crop condition Report 2013 Aug 12	Very poor %	Poor %	Fair %	Good %	Excellent %
Corn	3	8	25	46	18
Last year	26	25	26	20	3
Soybeans	2	7	27	50	14
Last year	16	22	32	26	4
Sorghum	7	11	35	41	6
Last year	21	27	27	19	6

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 267/273 Aug/Nov
Wheat, USA Hard Red Winter 12 protein	USD 314/317 Aug/Nov
Wheat, milling Black Sea 11.5 pro – 30,000 m/t	USD 250/255
Wheat, soft milling, France, Rouen port	USD 243/245
Wheat, milling, Argentina, upriver	USD 270/280 Dec/Jan new crop
Wheat, feed, Black Sea	USD 225/230
Wheat bran, Black Sea	USD 190/200
Barley, France, Rouen port	USD 233/235
Barley, feed, Argentina, upriver	USD 230/240 Dec/Jan new crop
Barley, feed, Black Sea	USD no price
Barley, feed, USA Pacific Northwest	USD 255/260

Corn, FOB NOLA USA	USD 229>>217 Aug>>Oct new crop
Corn, FOB USA Pacific northwest	USD 277>>235 Aug>>Oct new crop
Corn, FOB Argentina port, upriver	USD  223/226  Aug/Sep
Corn, FOB Brazil port	USD  191/195  Aug/Sep
Corn, FOB Black Sea – 30,000 m/t	USD  205/215  Sep>>new crop
Corn, FOB France	USD  220/222 new crop
Sorghum, FOB Texas, low tannin, GMO free	USD  241>>237 Aug>>Oct new crop
Sorghum, FOB Argentina port, high tannin, GMO free	USD  asked 195/bid 185 Sep/Oct

Soymeal,  48 protein, FOB NOLA	USD  525>>480 Aug>>Oct new crop
Soymeal, 48 protein, USA, Rotterdam	USD  569>>520 Aug>>Oct new crop
Soymeal, Argentina, Rotterdam	USD  565>>502 Spot>>A/S/O
Soymeal, 47 pro, FOB Argentina	USD  475>>455  Aug>>Oct/Nov
Soymeal, 48 protein, Brazil, Rotterdam	USD  568>>479 Spot>>A/S/O
Soymeal, FOB Brazil	USD  465>>460  Aug>>Oct/Nov
Soymeal, 48 protein, India FOB	USD  550/570

Bulk vessel shipments, minimum 5000 m/t

Corn Gluten Meal,  USA FOB NOLA	USD   655/660 m/t  Aug
Corn Gluten Feed,  USA FOB NOLA	USD   170/175 m/t Aug
DDGS, 35 profat, USA FOB NOLA	USD   288/257 m/t Aug>>Oct
DDGS, 35 profat, CNF Asian ports	USD   355>>324 m/t Aug>>Oct

DDGS prices jumped around quite a bit this week as some produces were still offering at prices set by old crop corn while others were lower due to expected earlier new crop corn. There is currently a USD 30 m/t discount for new crop production and this is very interesting to buyers. Exporters say that there is a great deal of interest in late 2013 shipment.  However, while the corn prices are dropping and helping DDGS, CGF and CGM move lower on a FOB USA basis, increasing container freight rates will be pushing CNF prices higher, so that overall the prices paid by overseas buyers will not be quite attractive as they would hope.

The US Grains Council reported this week that China has booked several bulk vessels of DDGS, due, they say partially to the increases in container freight.

Corn gluten feed and corn gluten meal also moved lower this week on a FOB NOLA basis and both should now be very competitive in export markets.      

Container shipments, minimum 200 m/t

Paraguay Meat & Bone meal, 45 protein Paraguay Meat & Bone meal 48/50 protein	USD 500/510 m/t CNF Asia USD not available
Argentina Meat & Bone meal, 45 protein	USD 520/530 m/t CNF Asia
Europe Meat & Bone meal, 45 protein Europe Meat & Bone meal, 50 protein	USD  no prices USD  no prices
Australian MBM 45 protein Australian MBM 50 protein Australian Feathermeal Australian Poultry meal, pet food grade	USD 620/630 mt CNF Asia USD 690/700 m/t CNF Asia USD 790/800 m/t CNF Asia USD 950/960 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 700/720 m/t CNF Asia USD 780/810 m/t CNF Asia USD 730/750 m/t CNF Asia USD 900/920  m/t CNF Asia

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

Meat and bone meal, USA, 50 protein	USD  510/520 m/t
Feathermeal  80 protein USA	USD  690/700 m/t
Poultry meal  57 protein, Eastern USA	USD  580/600 m/t

USA domestic meat and bone meal prices dropped this week as they tried to get back to the normal ratio versus soymeal but with soymeal up strongly on the week MBM in the USA now seems like a bargain and could move a little higher -- especially if soymeal stays strong. 

On the international side of things, prices for MBM in Asia are down on the week, at least from the USA and Australia. Feather meal export prices are firmer from all origins as demand just keeps ticking along but there are stories that the prices are too high and could slip n coming weeks.

However, with soymeal prices currently moving higher it is difficult to see any protein prices dropping.

There are a number of South American MBM shipments looking for new buyers after importers in Vietnam backed away from opening letters of credit.  It looks like falling prices and banking problems are making business with Vietnam very difficult at present.      

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

Fishmeal business in Peru continues quite slow again this week as most buyers are staying out of the market.  Of course, with low stocks on hand there is not a great amount available in some grades. Estimates of actual stocks on hand vary from 60,000 m/t to about 90,000 m/t. Prices are down a little bit this week with a couple of trades done at about USD 10 below last week.

As to when the new season will start and what the quota will be, the experts seem to be leaning toward an early November start with  a quota right on 2 million m/t.  However, with the governments survey trip being delayed due to very cold water perhaps fishing could be delayed a little.  There have also been some rumblings in the government that could be pointing toward a quota of less than 2 million m/t but this is only speculation at present.

It doesn't look like much will happen to prices in the next few weeks as limited supply should keep prices reasonably steady -- unless some producers want to clean out their warehouses.

     

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
65 protein standard steam	1440/1450 m/t
65/66 pro standard steam	1460/1470 m/t
67 protein standard steam	1480/1490 m/t
67 protein SD 150  TVN	1510/1520 m/t
67 protein SD 120 TVN	1530/1540 m/t
67 protein SD 1000 hist, 120 TVN	1550/1560 m/t
68 protein SD 500 hist, 120 TVN	1570/1590 m/t
Fish oil .. crude bulk	2050/2050
Fish oil – crude drums	2200/2250
Fish oil – flexitank	2150/2200
Fish oil – Omega 3 – 28%EPA/DHA	2700/2800

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