Weekly report February 01, 2014

 

Hammersmith Marketing Ltd - Grain Trading

WEEKLY FEED GRAIN AND PROTEIN REPORT   February 01, 2014

                                                                       

 

Representative Office: +33.9.7044.4881   Mobile: +33.6.8068.4564    Fax: +33.4.5774.7575

13+220 Quartier La Galine, D-99, Mas Martin, St Remy de Provence, 13210 France

 

Corporate Office: Trident Services, Kings Court, Bay Street, PO Box N-3944, Nassau, Bahamas.

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

 

 

I was asked this week why this report does not cover wheat and there is an easy answer, or two. Firstly the report has always been aimed at the animal feed side of the grain/protein business and second is because my area of interest has always been mainly the Middle East, North Africa and the Mediterranean where the wheat markets tend to be controlled by the government there was little or no reason to mention wheat. Few of the people that I dealt with had any interest in wheat, except a few in Egypt, so wheat has never been much of a part of the report. Not even feed wheat since that is not allowed in most countries in the region. Feed wheat has not been allowed due to the possibility of it sneaking into the flour milling sector.

 

 

SECTION 1:  FEED GRAINS -- VEGETABLE AND ANIMAL PROTEIN

 

If you look at how the corn and soybean prices finished off the week then the overall changes look pretty small and actually it was not all that exciting a week. What has been very good for corn business is seeing how USA export corn, much like SRW wheat, is able to compete with Black Sea corn into markets in Spain and North Africa. New corn sales to both Egypt and Spain have been very good over the past couple of weeks and it would not be at all surprising to see this continue for the next few weeks, perhaps a little longer. It is very good to see US corn being competitive in markets that in the past were 100% for US corn.

 

The South American crop situation seems to be quite good with Argentina corn progressing very well and the Brazil crop (second crop) just going into the ground. However, Brazil does need some rain and their area planted in corn is down from last year. Argentina weather looks good for the next couple of weeks.

 

Experts don't see much reason for corn prices to move higher at present, so all may be quiet until the next big news event.    

 

Soybean prices were down just a little on the week and had been up a little and down a little during the week. US export sales are still moving along at very high levels as demand just does not stop contrary to all kinds of rumours about China cancelling orders.

 

Experts feel that soybean prices will remain firm for the old crop US beans but that new crop beans may have quite a bit of room to move lower but new crop is a long way away and we are all concerned about prices much closer than late 2014. For now, we will probably see soybean and soymeal prices continue to be in an up/down price range, unless there is a major change in China or a crop disaster in South America.  

 

 

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

 

While Capesize freight has dropped considerably and pulled Panamax rates lower, the drop is more for shipments of coal and ore rather than for grain shipments. Grain shippers are finding that they are not able to get the same reduced rates as seen in the other bulk markets and with grain shipments being a somewhat specialized sector in the bulk trade it is easier for ship owners to keep prices firm.

 

US Gulf to Europe: 60/70,000	$24.00	Steady
US Gulf to Egypt: Panamax	$38/39.00	Up $1.00
US Gulf other Med: 25,000 MT	$43/45.00	Steady
US Gulf Israel: 50,000 MT	$39/40.00	Up $1.00
US Gulf Morocco: 25,000	$45/47.00	Steady
US Gulf Turkey: 50,000	$40/41.00	Up $1.00
US Gulf Japan: Panamax	$55/57.00	Steady
US PNW Asia: 45,000 m/t	$26/28.00	Down $2.00
US PNW Japan: 50,000+ m/t	$28/30.00	steady
France to Algeria: 25,000 m/t	$27.00	Steady
France to Saudi Arabia: 60,000 m/t	$35.00	Steady
Argentina to Egypt: 50,000	$40.00	Steady
Argentina to Algeria: 25/30,000 m/t	$44/45.00	Steady
Argentina to Morocco: 25,000	$42/40.00	Steady
Argentina to Saudi Arabia	$50.00	Steady
Brazil to Algeria: 25,000 m/t	$38/39.00	Steady
Brazil to Turkey/Egypt: 50,000 m/t	$33/34.00	Steady
Brazil to Morocco: 30,000 m/t	$36/37.00	Steady
Brazil to Saudi Arabia	$45.00	Steady
Black Sea to Spain: 30,000 m/t	$28/30.00	Steady
Black Sea to East Med: 30,000 m/t	$25/26.00	Steady
Black Sea to East Med: coaster	$35/38.00	Steady
Baltic Dry Index	1110	Down 136 – 10.9%
Baltic Capesize Index	1524	Down 356 – 18.9%
Baltic Panamax Index	1337	Down 159 – 10.6%
Baltic Handisize Index	684	Down  31 –  4.3%

 

  

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 256>>247 Feb/Apr
Wheat, USA Hard Red Winter 12 protein	USD 285>>281 Feb/Apr
Wheat, Black Sea 11.5 pro, 30,000+ m/t	USD 265/270 Feb/Apr
Wheat, soft milling, France, Rouen port	USD 265/267
Wheat, milling, Argentina, upriver	USD 330>>320 Feb>>Apr
Wheat, feed, Black Sea	USD 235/245
Wheat bran, Black Sea	USD no prices
Barley, France, Rouen port	USD 233/235
Barley, feed, Argentina, upriver	USD 222/230 Feb/Apr
Barley, feed, Black Sea, 30,000+	USD 240/245 Feb/Apr
Barley, feed, USA Pacific Northwest	USD 245/250

 

Corn, FOB NOLA USA	USD 217>>206 Feb>>May
Corn, FOB USA Pacific northwest	USD 230>>224 Feb>>May
Corn, FOB Argentina port, upriver	USD 206/210 March/May new crop
Corn, FOB Brazil port	USD 186/194 July/Aug new crop
Corn, FOB Black Sea, 30,000+ m/t	USD 217/220 Spot/Apr
Corn, FOB France	USD 237/247 Feb/Apr
Sorghum, FOB Texas, low tannin, GMO free	USD  235/236 Feb/May
Sorghum, FOB Argentina port, high tannin, GMO free	USD  188/190 Feb/Apr

 

 

Soymeal,  48 protein, FOB NOLA	USD 542>>529 Feb>>Apr
Soymeal, 48 protein, USA, Rotterdam	USD 567>>554 Feb>>Apr
Soymeal, Argentina, Rotterdam	USD 569>>510 Feb>>Apr
Soymeal, 47 pro, FOB Argentina	USD 508>>475 Feb>>Apr
Soymeal, 48 protein, Brazil, Rotterdam	USD 551>>501 Feb>>Apr
Soymeal, FOB Brazil	USD 503>>468 Feb>>Apr
Soymeal, 48 protein, India FOB	USD 570/580
Soybeans, FOB NOLA	USD 558>>532 Feb>>Apr
Soybeans, Argentina, FOB	USD 481/485 new crop May
Soybeans, Rotterdam	USD 563>>515 Feb>>Apr
Soybeans, Black Sea	USD 495/510 Feb/Apr

 

 

Bulk vessel shipments, minimum 5000 m/t

 

Corn Gluten Meal, USA FOB NOLA	USD   770/775 m/t
Corn Gluten Feed, USA FOB NOLA	USD   225/230 m/t
DDGS, 35 profat, USA FOB NOLA	USD   300>>282 m/t Feb>>Apr
DDGS, 35 profat, CNF Asia	USD   345>>338 m/t Feb>>Apr

 

DDGS prices are still very high for nearby positions but then it is almost impossible find any supply nearby. US exporters are looking at March and April rather than February and buyers from Asia seem to have moved all their interest into April and later when the prices looked quite a bit better.

 

The EU has been quite a good buyer of corn by products in January, except corn gluten meal which has a very high EU import tariff. Shipments of DDGS and corn gluten feed were just shy of 100,000 m/t with the UK, Ireland and Italy being the major buyers. The GMO problems in the EU have not slowed shipments as volume is well above double the 2012/13 level.

 

Prices for all corn by-products should follow the direction of corn but for now short term supply shortages have tended to push Feb/Mar prices up a little higher than would be expected with more normal supply levels and fewer winter logistics problems.

 

Buyers who can wait for April/May shipment from the US should find sellers are willing to discount those positions at present.

 

 

Container shipments, minimum 200 m/t

 

Argentina Meat & Bone meal, 45 protein	USD 440/450 m/t CNF Asia
Paraguay Meat &Bone meal, 45 protein	USD 430/440 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 grade	USD 580/600 m/t CNF Asia USD 630/660 m/t CNF Asia USD 770/790 m/t CNF Asia USD 890/910 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 590/620 m/t CNF Asia USD 780/800 m/t CNF Asia USD 620/640 m/t CNF Asia USD 880/900 m/t CNF Asia

 

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

 

Meat and bone meal, USA, 50 protein	USD 490/510 m/t
Feathermeal  80 protein USA	USD 640/660 m/t
Poultry meal  57 protein, Eastern USA	USD 550/570 m/t

 

 

With China being closed for New Year and many buyers in other Asian countries off for the same reason, the business has been very quiet and will stay the same for another few days. Prices out of both Australia and New Zealand have changed little in the last week and little new activity is expected for a few days. Things were also quiet in the USA with both bad winter weather and trade shows keeping both buyers and sellers out of the market. The very bad weather in the US has made the supply side of things quite difficult and getting supplies to export ports has seen some delays, but then it is winter in the US and there is nothing like some ice and snow along with freezing weather to complicate business.

 

Not much change is expected in prices for the near term and we will have to see what happens when the Chinese buyers get back to work and the weather changes in the US.

 

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

PERU "INDICATION" FISHMEAL PRICES:

 

There is little or nothing in the way of fishing going on in Peru as the current quota winds down for the end of the month/ Difficult to say exactly what is left on the quota but probably something around 25,000 m/t which probably means there is nothing left at all. However that is still just over 400,000 m/t of catch available on the southern Peru quota which runs until March 31^st, so it is expected that we will see more activity in the south over the next few weeks.

 

With almost not stock left unsold in Peru, one can say that business is very slow and prices for anything that can be found are quite firm. This week the prices probably moved up by about USD 30 m/t but with little to sell then prices are bound to increase.

 

With China closed up tight for the New Year holiday, there is certainly nothing new and interesting from there…this will change after about Feb 06.

 

Just as a matter of interest, the fishmeal exports from Peru are down by over 30 percent in 2013 but don't be fooled as this is a result of limited supply rather than shrinking demand. Every year, every ton of fishmeal is sold with nothing ever left over.

 

The MSI Ceres weekly report this week quoted some interesting numbers: fishing in the north of Peru has dropped from a high of 8.7 million m/t in 2005 to 4.6 million m/t in 2013 and in the south from a high of 1.0 million m/t in 2005 to 250,000 m/t in 2013. The drop in catch was due 100 percent to the control of fishing by Peru not due to a lack of fish -- although, had Peru not controlled the fishing there may have been no fish at all in 2013. As anyone can see a drop of 50% in the catch reduced the supply of fishmeal by 50% --- so no wonder prices have increased over the years.       

 

 

 

 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	1850/1900
Fish oil, crude drums	2050/2100
Fish oil, flexi tank	2000/2050
Fish oil, Omega 3: 28%EPA/DHA	2300/2350

 

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