Weekly Report - Oct 19, 2013

 

 

Hammersmith Marketing Ltd  - Grain Trading

WEEKLY FEED GRAIN AND PROTEIN REPORT   October 19, 2013

                                                                       

 

 

France:  Rep. Office: +33.9.7044.4881   Mobile: +33.6.8068.4564    Fax: +33.4.5774.7575

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Corporate 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

 

Another week without anything from the USDA and now word that some reports will be delayed omitted or avoided.  We have all become so used to having a steady stream of reports from the USDA that we are at a bit of a loss when there are no reports.  Ah well, at least they will start flowing again very shortly – at least until the next US Government crisis in January.

 

Corn prices traded in a narrow range this week, up and down only about USD 2 m/t perhaps due to a lack of information on crops, yields, harvest, etc from the US. From the looks of what is happening in the futures market, the short side seems to be controlled by spec interest while the long side looks to be almost all commercial interest. With all the spec side looking for a drop in prices with the next crop and yield reports, there could be one devil of a reaction in the market if they don't see lower prices and decide to get out of their short positions.

 

In general it looks like near term corn prices have little reason to move higher: in the US the harvest is rushing along, yields are at very good levels, trade experts are looking for higher total crop and corn plantings for next year forecasted to be much like this year.

 

USA export corn prices are quite competitive, depending on the destination, so, there looks to be a good chance that corn exports will be strong over the next few months.  

 

Soybeans had an up week this week, driven higher mainly by reports of very strong export sales for both soybeans and soymeal. However the increase in prices was not overly strong and most market experts seem to feel that prices will not go any higher in the short-term as there is just too much harvest pressure and too little information available in the market.

 

Some private forecasters are increasing their estimates of US export sales to levels quite a bit higher than the last USDA estimates, which should be bullish for prices but at the same time the 2013 crop estimates are creeping higher as yields seem to be better than previously forecasted.  So we have markets being pushed and pulled depending on which information you read.

 

As with corn, normally the market tends to move lower during harvest and this is probably the most likely for soybeans and soymeal during the harvest. After the harvest or after the next USDA report is all a new ballgame.

 

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 297/300 Oct/Dec
Wheat, USA Hard Red Winter 12 protein	USD 335/339 Oct/Dec
Wheat, milling Black Sea 11.5 pro – 30,000+ m/t	USD 252/256
Wheat, soft milling, France, Rouen port	USD 277/280
Wheat, milling, Argentina, upriver	USD 348/355 Dec/Jan new crop
Wheat, feed, Black Sea	USD 242/245
Wheat bran, Black Sea	USD 190/205
Barley, France, Rouen port	USD 255/257
Barley, feed, Argentina, upriver	USD 210/220 Dec/Jan new crop
Barley, feed, Black Sea – 30,000+	USD 243/247
Barley, feed, USA Pacific Northwest	USD 250/255

 

Corn, FOB NOLA USA	USD 210>>205 Nov>>Dec
Corn, FOB USA Pacific northwest	USD 235>>219 Oct>>Dec
Corn, FOB Argentina port, upriver	USD 205/209 Oct/Dec
Corn, FOB Brazil port	USD 180/186 Oct/Dec
Corn, FOB Black Sea – 30,000+ m/t	USD 201>>194 Spot>>Nov/Dec
Corn, FOB France	USD 241/246 Oct/Nov
Sorghum, FOB Texas, low tannin, GMO free	USD  232/234 Oct/Dec
Sorghum, FOB Argentina port, high tannin, GMO free	USD  195/200 Oct/Dec

 

Soymeal,  48 protein, FOB NOLA	USD 545>>529 Oct>>Jan 2014
Soymeal, 48 protein, USA, Rotterdam	USD 586>>574 Spot>>Jan 2014
Soymeal, Argentina, Rotterdam	USD 590>>560 Spot>>Jan 2014
Soymeal, 47 pro, FOB Argentina	USD 532/535 Oct/Dec
Soymeal, 48 protein, Brazil, Rotterdam	USD 586>>545 Spot>>Jan 2014
Soymeal, FOB Brazil	USD 522/526 Oct/Dec
Soymeal, 48 protein, India FOB	USD 530/540

 

Bulk vessel shipments, minimum 5000 m/t

 

Corn Gluten Meal,  USA FOB NOLA	USD   710/720 m/t
Corn Gluten Feed,  USA FOB NOLA	USD   225/230 m/t
DDGS, 35 profat, USA FOB NOLA	USD   295>>285 m/t Oct>>Dec
DDGS, 35 profat, CNF Asia	USD   354/360 Oct/Dec

 

The trade reports that demand for DDGS remains very good and that supplies are almost all fully booked into January 2014 this, of course, is pushing export prices higher but does not seem to be having much effect on export buyers as the trade says export business is flowing in and exports for 2013 may be at record levels.

 

The USGC report this week says that Asian buyers are very active in 2014 business, for both the first and second quarter. Perhaps not booking as yet but certainly feeling out the market.

 

The spread between DDGS and corn at the US Gulf is quite steep with DDGS selling at a premium of USD 80 to 85 m/t over corn but, when you get to the destination, the logistics advantages of DDGS make the CNF premium much less.

 

Both corn gluten feed and corn gluten meal moved higher this week. Probably a little higher than one would expect with the small rise in corn prices. As usual CGM is being pushed higher by export demand – seems that you can always count on export buyers to be in the market for CGM supplies and this tends to put a floor price under CGM.

 

As too prices, everyone seems to expect corn to go lower which should allow all corn by-products to drift lower, at least in the domestic market, but strong export demand may keep export prices a little stronger than domestic prices.

 

Container shipments, minimum 200 m/t

 

Argentina Meat & Bone meal, 45 protein	USD  sorry no updated prices this week
Paraguay Meat &Bone meal, 45 protein	USD
Europe MBM 50 protein	USD
Australian MBM 45 protein Australian MBM 50 protein Australian Feathermeal Australian Poultry meal, pet food grade	USD 510/530 mt CNF Asia USD 560/580 m/t CNF Asia USD 630/650 m/t CNF Asia USD 750/770 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 570/600 m/t CNF Asia USD 700/720 m/t CNF Asia USD 600/620 m/t CNF Asia USD 810/830  m/t CNF Asia

 

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

 

Meat and bone meal, USA, 50 protein	USD 410/430 m/t
Feathermeal  80 protein USA	USD 550/570 m/t
Poultry meal  57 protein, Eastern USA	USD 500/520 m/t

 

It has been another down week for prices for animal proteins and some trade experts are forecasting even lower prices in days to come.  The supply of animal proteins seems to be at quite a high level in most exporting countries and this is putting pressure on CNF prices, especially to Asia, since Asia is the main destination for animal protein products these days.

 

Exporters in South America are said to be discounting the market but not doing much business as lower quality and long delivery times are not what buyers are looking for when they can get quite quick delivery and decent quality from European sources.

 

USA domestic prices are also continuing lower and this is helping the slide of export prices. However, US animal protein prices still seem a little too high versus soymeal and look to have more room to move lower.

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

Well, here we all are just waiting to see what the new fishing season brings.  Not much going on in new business this week, as buyers wait for lower prices and producers try to get higher prices.  MSI Ceres Peru says that the gap between buyers and sellers is about USD 50 m/t this week, a bit too wide a gap to get any business done.

 

Fishmeal stocks in China are reported to be building as shipments from Peru arrive but there is little current fishmeal consumption.

 

As mentioned the last couple of weeks, all the fishmeal folks are off to Asia for the various fishmeal related conferences and meetings. Major buyers and sellers are going to be face to face for a few days so we will have to wait and see if there are any exciting developments coming out of Asia.

 

Prices seem to have moved up a little this week but that is more the effect of sellers having raised their prices rather than buyers being willing to pay these higher levels.  It is quite possible that there was no business done at the producers expected price levels.

 

As a matter of info, Peru fishmeal exports for the first nine months of the year show that China represents almost 62% of export sales with Germany, Chile and Japan covering another 24%.  The total export sales for the YTD are just shy of 640,000 m/t of fishmeal, which represent just over 2.7 million m/t of catch. 

 

 

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	1300/1310 m/t
65/66 protein	1330/1340 m/t
67 protein standard steam	1360/1380 m/t
67 protein SD 150  TVN	1380/1400 m/t
67 protein SD 120 TVN	1400/1410 m/t
67 protein SD 1000 hist, 120 TVN	1430/1450 m/t
68 protein SD 500 hist, 120 TVN	1450/1470 m/t
Fish oil .. crude bulk	1800/1850
Fish oil – crude drums	2000/2050
Fish oil – flexitank	1950/2000
Fish oil – Omega 3 – 28%EPA/DHA	2400/2450

 

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