Weekly report - March 01, 2014

 

 

Hammersmith Marketing Ltd - Grain Trading

WEEKLY FEED GRAIN AND PROTEIN REPORT   March 01, 2014

 

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

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Corporate Office: Trident Corporate Services (Bahamas) Limited, Suite 200B, Centre of Commerce,

One Bay Street, PO Box N-3944, Nassau, Bahamas. Tel 1.242.322.6154

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

 

 

SECTION 1:  FEED GRAINS -- VEGETABLE AND ANIMAL PROTEIN

 

It was a relatively quiet week for corn this week, certainly calmer that soybeans/meal markets, with a decent spread of good and bad news that didn't seem to get the market too excited. The political situation in the Ukraine has tended to push corn prices up a little in world markets but more in the Middle East, North Africa and Europe regions as these areas buy a great deal of Ukraine corn. We are currently between the seasons for Black Sea corn so shipments are at the low for the year but even so there are still supplies coming from the Ukraine but buyers are having to pay as much as USD 15 m/t higher than a few weeks ago. Buyers of smaller quantities of corn are still active in the Ukraine market but major buyers, like Egyptian importers, are looking more at Panamax shipments from the US or South America.

 

There are concerns in Brazil about the rain and the effect on the corn crop and estimates are moving lower for the size of the corn crop. Brazil is in the midst of their rainy season so things won't be too dry for the next month or so. Interestingly, Brazil has reduced their corn crop estimate by about 6% due to earlier drought conditions and here it is now raining like mad.

 

Reports in the news had China rejecting another 300,000 m/t or so of US corn this week – this certainly is an expensive disaster for the international grain trade.

 

Experts seem to be saying that corn prices will be steady to higher in coming days as there does not seem to be any good reason for prices to move much lower.

 

Both soybeans and soymeal were up on the week – getting to be quite a pattern. Actually both had very volatile days this week with wide variations in prices depending on what time of day you happened to be wanting to buy.

 

Much like corn, the Brazil crop estimates for soybeans have also dropped, by just over 6%, which helped to keep soybean prices up. The soybean harvest in Brazil is coming along very well with only a few rain related delays.

 

The soybean market had been expecting to see some additional old crop soybean cancellations from China but nothing this week. Without some cancellations or switches to next year or to Brazil, the prices for old crop US soybeans are expected to stay strong as stocks are limited but demand is very good.

 

With soybean/meal prices being quite firm and little bearish news it is hard to see any good reason for a major drop in soybean/meal prices. Perhaps there will be a wide weekly price range but still tending steady to higher overall.

   

 

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

 

US Gulf to Europe: 60/70,000	$22.00	Steady
US Gulf to Egypt: Panamax	$34/36.00	Steady
US Gulf other Med: 25,000 MT	$37/38.00	Steady
US Gulf Israel: 50,000 MT	$35/37.00	Steady
US Gulf Morocco: 25,000	$35/37.00	Steady
US Gulf Turkey: 50,000	$36/38.00	Steady
US Gulf Japan: Panamax	$50/52.00	Steady
US Gulf China: Panamax	$52/54.00	New
US PNW Asia: 45,000 m/t	$29/32.00	Steady
US PNW Japan: 50,000+ m/t	$26/28.00	Steady
US PNW China: 50,000+ ,t	$24/26.00	New
France to Algeria: 30,000 m/t	$25.00	Steady
France to Morocco: 30,000 m/t	$26.00	Steady
France to Egypt: 30,000 m/t	$28.00	Steady
France to Jordan: 50,000 m/t	$33.00	Steady
France to Saudi Arabia: 60,000 m/t	$40.00	Steady
Argentina to Egypt: 50,000	$36/38.00	Steady
Argentina to Algeria: 25/30,000 m/t	$35/36.00	Down $3.00
Argentina to Morocco: 25,000	$34/35.00	Down $3.00
Argentina to Saudi Arabia	$45.00	Steady
Argentina to Spain: 30,000	$34/35.00	Steady
Argentina to Europe	$27.00	New
Brazil to Algeria: 25,000 m/t	$32/33.00	Down $2.00
Brazil to Turkey/Egypt: 50,000 m/t	$29/30.00	Down $2.00
Brazil to Morocco: 30,000 m/t	$30/31.00	Down $2.00
Brazil to Saudi Arabia	$45.00	steady
Brazil to Europe	$32.00	New
Black Sea to Spain: 30,000 m/t	$21/22.00	Down $1.00
Black Sea to East Med: 30,000 m/t	$17/18.00	Steady
Black Sea to East Med: coaster	$24/25.00	Down $1.00
Black Sea to Saudi Arabia – Jeddah – 50k	$29/31.00	Steady
Baltic Dry Index	1258	Up 83
Baltic Capesize Index	1701	Up 383 – up 22%
Baltic Panamax Index	1099	Down 145 – down 12%
Baltic Handisize Index	669	Down 8

 

  

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 270>>264 Mar>>May	x
Wheat, USA Hard Red Winter 12 protein	USD 309>>300 Mar>>May	x
Wheat, Black Sea 11.5 pro, 30,000+ m/t	USD 275/280 Mar/May	x
Wheat, soft milling, France, Rouen port	USD 278/280 Mar/May	x
Wheat, milling, Argentina, upriver	USD 323/328 Mar/May	x
Wheat, feed, Black Sea	USD 240/250 Mar/May	x
Barley, France, Rouen port	USD 245/247 Mar/May	x
Barley, feed, Argentina, upriver	USD 215/227 Mar/Apr	x
Barley, feed, Black Sea, 30,000+	USD 240/245 Mar/May	x
Barley, feed, USA Pacific Northwest	USD 260/265	x

 

Corn, FOB NOLA USA	USD 221>>215 Mar>>May	x
Corn, FOB USA Pacific northwest	USD 247>>239 Mar>>May	x
Corn, FOB Argentina port, upriver	USD 219>>209 March>>May	x
Corn, FOB Brazil port	USD 202/207 July/Aug new crop	x
Corn, FOB Black Sea, 30,000+ m/t	USD 228/232 Mar/May	x
Corn, FOB France	USD 243/255 Mar/May	x
Sorghum, FOB Texas, low tannin, GMO free	USD  245/247 Mar/May	x
Sorghum, FOB Argentina port, high tannin, GMO free	USD  194/199 Mar/May	x

 

 

Soymeal,  48 protein, FOB NOLA	USD 575>>553 Apr>>May	x
Soymeal, 48 protein, USA, Rotterdam	USD 639>>604 Mar>>May	x
Soymeal, Argentina, Rotterdam	USD 626>>545 Mar>>May	x
Soymeal, 47 pro, FOB Argentina	USD 512>>497 May>>Jun	x
Soymeal, 48 protein, Brazil, Rotterdam	USD 621>>533 Mar>>May	x
Soymeal, FOB Brazil	USD 508>>476 Mar>>May	x
Soymeal, 48 protein, India FOB	USD 565/575
Soybeans, FOB NOLA	USD 556>>547 Mar>>May	x
Soybeans, Argentina, FOB	USD 520/526  May/Jun	x
Soybeans, Brazil, FOB	USD 549/553 March	x
Soybeans, Rotterdam	USD 580>>564 Mar>>May	x
Soybeans, Black Sea	USD 540/550 Mar/May	x

 

 

Bulk vessel shipments, minimum 5000 m/t

 

Corn Gluten Meal, USA FOB NOLA	USD   890/900 m/t  March	x
Corn Gluten Feed, USA FOB NOLA	USD   225/230 m/t  March	x
DDGS, 35 profat, USA FOB NOLA	USD   335>>315 m/t Mar>>May	x
DDGS, 35 profat, CNF Asia	USD   375>>365 m/t Mar>>May	x

 

Nearby prices for all corn byproducts continued higher this week as there is just nothing much available for export until we get out a few weeks. Both logistics problems and high demand have pushed up the prices since early in 2014 and there looks to be little chance of a drop in prices until we get into late April/May.

 

DDGS producers are saying that the logistics problems that they currently have may push shipments even further out and that the expected drop in prices may not happen as quickly as the market had been expecting. According to this week's US Grains Council report, a number of ethanol producers have cut back on production due to a lack of rail cars both to obtain needed corn supplies and to ship production of DDGS. There is also a very tight supply of export containers and difficulties in getting them to the production facilities.

 

Corn gluten meal prices are very high at present and much of the problem is related to logistics and lack of both product and containers. Of course, with soymeal prices moving higher and fishmeal sold out everywhere, the market is looking at corn gluten meal as the best high protein alternative which is resulting in higher prices every week.   

 

Container shipments, minimum 200 m/t

 

Argentina Meat & Bone meal, 45 protein	USD 470/480 m/t CNF Asia
Paraguay Meat &Bone meal, 45 protein	USD 440/450 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	USD 590/610 m/t CNF Asia USD 640/650 m/t CNF Asia USD 840/860 m/t CNF Asia USD 1000/1020 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 630/650 m/t CNF Asia USD 840/860 m/t CNF Asia USD 700/7200 m/t CNF Asia USD 970/990 m/t CNF Asia

 

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

 

Meat and bone meal, USA, 50 protein	USD 515/540 m/t
Feathermeal  80 protein USA	USD 680/700 m/t
Poultry meal  57 protein, Eastern USA	USD 560/580 m/t

 

There should have been a jump in prices for animal proteins in the US domestic market this week due to the increase in soymeal prices but so far this has not happened as the animal protein market in the US has been very quiet.

 

The situation was much the same in international markets as prices remained steady although market experts are saying that prices will have to move higher if other protein alternatives, like soymeal, corn gluten meal and fishmeal continue to increase in price. There has been quite a bit of buying interest from Asia for animal proteins this week but as is normal the buyers are bidding well below the market. However, it is reported that there have been some low priced sales done from both Argentina and Paraguay to Vietnam.

 

It is reported in the trade that Egypt is once again allowing the import of poultry meal but so far this is unconfirmed. It is also reported that Turkey has changed their very restrictive requirements on poultry meal, that specified only food grade poultry for the meal, but this too has you to be confirmed.

 

Animal protein prices for export should be moving higher in the near term in order to catch up to the increases in vegetable proteins but this may not last for too long as vegetable protein prices are much weaker for the South American soybean/meal production period    

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

PERU "INDICATION" FISHMEAL PRICES:

 

The rumor in Peru is that at least one producer is holding back some stock from the market in order to benefit from higher prices in the next few weeks. However, with the estimated inventories being so low there would not be a great deal of extra profit in holding back some stock, but then I guess a little more profit is always better than a little less.

 

While the trade estimated that there is probably about 40,000 m/t of unsold fishmeal in various places in Peru, it is next to impossible to find anything to buy and sellers are certainly not making any offers. Looking at the South American fishmeal situation, there is little or nothing available from anywhere in South America and supply really isn't any better in the North Atlantic.

 

There have been some changes in the government in Peru and a new man is in charge of the Ministry of Production and the entire trade hopes that he will be a little more industry biased than the lady that he is replacing. The trade is looking forward to much less of an adversarial relationship with the new minister.

 

So, as to prices, for now they can only be higher but with nothing available prices don't mean very much. We won't see any decent price indications until there is more business done for the next fishing season.

 

 

 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	2400/2500

 

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