Weekly report -- Feb 15, 2014

Hammersmith Marketing Ltd - Grain Trading

WEEKLY FEED GRAIN AND PROTEIN REPORT   February 15, 2014

 

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SECTION 1:  FEED GRAINS -- VEGETABLE AND ANIMAL PROTEIN

 

When you get to the end of the week and look back over what has happened it has to look like a reasonably calm week. A week that was much calmer than was expected prior to the USDA WASDE report being issued.

 

Corn did have its ups and downs during the week but nothing overly exciting as the somewhat bullish WASDE report was offset by the bearish influence of the trade that didn't seem to feel the corn market should really be going higher. There were not any major surprises for corn in the WASDE, some adjustments on exports and a little drop in the Argentina crop and a slightly lower than expected ending stocks level….but nothing that would light a fire under the market.

 

Over the next few weeks, while the US is the major player in corn, everyone will be watching export sales with one eye while keeping the other eye on the weather in South America and wondering about the US corn planting in the spring – once all the recent snow mountains disappear.  

 

Next week is the USDA AG Outlook Conference and it is expected that new numbers will forecast a swing in some plantings from corn to soybeans which may help to move corn prices a little higher.

 

As a matter of interest for corn buyers, the Ukraine says that they have corn stocks on hand of just over 11 million m/t, a quite significant quantity.

 

Both soybeans and soymeal ended up a little higher at the end of the week even though the futures markets traded lower on Friday. As noted above, if soybean plantings do increase then this could keep soybean prices from moving higher.

 

Along with possible higher US plantings there was also the good weather situation in South America which helps to keep prices on the back foot. The Brazil soybean harvest is coming along very well and is running ahead of previous years – which probably means we will see shipping from Brazil backed up a little sooner.

 

Other than the weather and the plantings, the biggest factor in soybeans seems to be what China will do in the next few weeks: cancel orders, roll orders, move orders to Brazil, everyone will be watching.

   

 

Estimated Bulk Grain freight in USD per m/t, basis heavy grains 

 

Here is the address for an interesting article on Reuters about grain shipments in containers: http://in.reuters.com/article/2014/02/14/agri-container-idINL5N0LF3MZ20140214

 

 

US Gulf to Europe: 60/70,000	$22.00	Down $2.00
US Gulf to Egypt: Panamax	$34/36.00	Down $2.00
US Gulf other Med: 25,000 MT	$38/40.00	Down $3.00
US Gulf Israel: 50,000 MT	$35/37.00	Down $2.00
US Gulf Morocco: 25,000	$37/39.00	Down $3.00
US Gulf Turkey: 50,000	$36/38.00	Down $2.00
US Gulf Japan: Panamax	$52/54.00	Steady
US PNW Asia: 45,000 m/t	$29/32.00	Up $2/3.00
US PNW Japan: 50,000+ m/t	$28/30.00	Up $2.00
France to Algeria: 25,000 m/t	$25.00	Down $1.00
France to Egypt: 30,000 m/t	$28.00	New
France to Jordan: 50,000 m/t	$33.00	New
France to Saudi Arabia: 60,000 m/t	$40.00	Down $2.00
Argentina to Egypt: 50,000	$37/39.00	Down $3.00
Argentina to Algeria: 25/30,000 m/t	$40/42.00	Down $2.00
Argentina to Morocco: 25,000	$38/40.00	Down $2.00
Argentina to Saudi Arabia	$47.00	Down $3.00
Brazil to Algeria: 25,000 m/t	$36/37.00	Down $1.00
Brazil to Turkey/Egypt: 50,000 m/t	$33/34.00	steady
Brazil to Morocco: 30,000 m/t	$34/35.00	Down $2.00
Brazil to Saudi Arabia	$45.00	steady
Black Sea to Spain: 30,000 m/t	$24/26.00	Down $2.00
Black Sea to East Med: 30,000 m/t	$21/22.00	Down $2.00
Black Sea to East Med: coaster	$30/32.00	Down $1.00
Black Sea to Saudi Arabia – Jeddah – 50k	$29/31.00	Down $2.00
Baltic Dry Index	1106	Up 15
Baltic Capesize Index	1554	Down 34
Baltic Panamax Index	1311	Down 26
Baltic Handisize Index	671	Down 3

 

  

FOB port or location specified. Prices in US$, in metric tons:

All shipments in bulk grain vessels unless stated otherwise

(NOLA is New Orleans, Louisiana, USA.)

 

Wheat, USA Soft Red Winter, NOLA	USD 271>>263 Feb>>Apr
Wheat, USA Hard Red Winter 12 protein	USD 305>>298x Feb>>Apr
Wheat, Black Sea 11.5 pro, 30,000+ m/t	USD 265/270 Feb/Apr
Wheat, soft milling, France, Rouen port	USD 275/277
Wheat, milling, Argentina, upriver	USD 325/300 Feb/Apr
Wheat, feed, Black Sea	USD 235/245
Barley, France, Rouen port	USD 246/248
Barley, feed, Argentina, upriver	USD 218/224 Mar/Apr
Barley, feed, Black Sea, 30,000+	USD 240/245 Feb/Apr
Barley, feed, USA Pacific Northwest	USD 240/245

 

Corn, FOB NOLA USA	USD 215>>212 Feb>>May
Corn, FOB USA Pacific northwest	USD 236>>231 Feb>>May
Corn, FOB Argentina port, upriver	USD 217>>211 March>>May
Corn, FOB Brazil port	USD 199/203 July/Aug new crop
Corn, FOB Black Sea, 30,000+ m/t	USD 216/221 Spot/Apr
Corn, FOB France	USD 241/251 Feb/Apr
Sorghum, FOB Texas, low tannin, GMO free	USD  240/242 Feb/May
Sorghum, FOB Argentina port, high tannin, GMO free	USD  192/197 Feb/Apr

 

 

Soymeal,  48 protein, FOB NOLA	USD 539>>521      Apr>>May
Soymeal, 48 protein, USA, Rotterdam	USD 615>>548 Feb>>May
Soymeal, Argentina, Rotterdam	USD 601>>528 Feb>>May
Soymeal, 47 pro, FOB Argentina	USD 489>>472      May>>Jun
Soymeal, 48 protein, Brazil, Rotterdam	USD 590>>514 Feb>>May
Soymeal, FOB Brazil	USD 505>>468      Mar>>May
Soymeal, 48 protein, India FOB	USD no price
Soybeans, FOB NOLA	USD 560>>535 Feb>>Apr
Soybeans, Argentina, FOB	USD 500/505  May/Jun
Soybeans, Rotterdam	USD 580>>533 Feb>>Apr
Soybeans, Black Sea	USD 515/525 Feb/Apr

 

 

Bulk vessel shipments, minimum 5000 m/t

 

Corn Gluten Meal, USA FOB NOLA	USD   805/820 m/t
Corn Gluten Feed, USA FOB NOLA	USD   225/230 m/t
DDGS, 35 profat, USA FOB NOLA	USD   320>>293 m/t Feb>>Apr
DDGS, 35 profat, CNF Asia	USD   359>>354 m/t Feb>>Apr

 

Tough times in the USA with the recent very bad winter weather making shipping logistics next to impossible. With DDGS we had a severe shortage of Feb/Mar unsold supply and now producers can't even ship the good that they have sold – shipping logistics are a nightmare.

 

According to the US Grains Council report this week, nearby DDGS prices are up by close to USD 25 m/t with Feb/Mar/Apr at a very significant premium over May/June. While producers margins have increased it is reported that some ethanol facilities have had to shut down due to either a lack of corn for production or a lack of available shipping to move DDGS and ethanol to market.

 

So, with DDGS, as soon as logistics improve and some supply is available then buyer will see better process but this may not reflect in export prices before April/May shipment positions.

 

Corn gluten feed prices did little or nothing this week while corn gluten meal moved higher. Export CGM is staying strong due to demand caused by strength in fishmeal and animal proteins and very large export demand for USA soymeal. Price may ease a little once there is some reasonable amounts of soymeal coming out of South America.  

 

 

Container shipments, minimum 200 m/t

 

Argentina Meat & Bone meal, 45 protein	USD 420/430 m/t CNF Asia
Paraguay Meat &Bone meal, 45 protein	USD 410/420 m/t CNF Asia
Europe MBM, 50 protein    Europe Poultry meal, 65 protein    Europe Feathermeal, 80 protein	USD  no prices USD  no prices USD  no prices
Australian MBM 45 protein    Australian MBM 50 protein    Australian Feathermeal, 80 protein    Australian Poultry Meal, pet food    Australian Poultry Meal, feed grade	USD 580/600 m/t CNF Asia USD 630/660 m/t CNF Asia USD 810/830 m/t CNF Asia USD 960/980 m/t CNF Asia USD 647/690 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 610/630 m/t CNF Asia USD 830/850 m/t CNF Asia USD 640/660 m/t CNF Asia USD 930/950 m/t CNF Asia

 

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

 

Meat and bone meal, USA, 50 protein	USD 500/520 m/t
Feathermeal  80 protein USA	USD 670/690 m/t
Poultry meal  57 protein, Eastern USA	USD 560/580 m/t

 

The export business for animal proteins seems to have taken a jump higher this week as buyers in Asia are looking for supplies and comparing prices from all origins. The increased demand has pushed up prices for export from the USA, Australia and New Zealand. Market experts say that it looks like prices could go higher as demand seems to be running ahead of the current supply.

 

Domestic prices in the USA are not moving much, up a little then down a little as they follow other protein items in the local market but for export the prices are moving higher as Asian demand has cleaned out the nearby export stocks. The biggest problem in the US is the severe winter weather and the transportation problems that have hit all feed items. It is tough to ship MBM when you are up to your neck in snow. The continuing USA shipping problems are expected to push export prices a little higher, at least in the short term.

 

I was told by a couple of European suppliers this week that there are still quite serious problems with getting letters of credit from some buyers in Vietnam. It is difficult to know whether this is a bank related problem or a buyer problem, probably a bit of both.    

 

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

PERU "INDICATION" FISHMEAL PRICES:

 

 

Not too much to say on Peruvian fishmeal this week. There has been nothing new on the quota for the next fishing season but everyone is certainly speculating or perhaps just hoping. According to trade reports the available supply of fishmeal in Peru may actually be less than most traders had been reporting. Of course, it is not too easy to know exactly what stocks are available when you get down to the bottom end of the supply.

 

Prices are probably a little higher this week, strictly as a result of limited supply rather than any sudden increase in demand.

 

MSI Ceres published 2013 versus 2012 export numbers in their trade report this week and it is not at all surprising to see export shipments down by 32% to Asia and 55% to Europe. All of this is a result of the much lower quota in 2013 and the much higher prices. The industry expects that 2014 will be back much closer to 2012 in fishmeal exports and 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	1380/1390 m/t
65/66 protein	1410/1420 m/t
67 protein standard steam	1440/1450 m/t
67 protein SD 150  TVN	1460/1470 m/t
67 protein SD 120 TVN	1480/1490 m/t
67 protein SD 1000 hist, 120 TVN	1500/1510 m/t
68 protein SD 500 hist, 120 TVN	1520/1530 m/t
Fish oil, crude bulk	1900/1950
Fish oil, crude drums	2100/2150
Fish oil, flexi tank	2050/2100
Fish oil, Omega 3: 28%EPA/DHA	2350/2400

 

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 © 2014 Wayne S. Bacon