Weekly report -- August 09, 2014

 

 

Hammersmith Marketing Ltd - Grain Trading

 

WEEKLY FEED GRAIN AND PROTEIN REPORT   August 09, 2014

 

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SECTION 1:  FEED GRAINS -- VEGETABLE AND ANIMAL PROTEIN

 

Soybeans/soymeal had another very strong week, especially for the old crop US soybeans where prices were up by as much as USD 15 m/t. Much of the push higher in the old crop seems to be due to China continuing to buy soybeans at record levels. On the US futures market while there is a premium of USD 75 for August soybeans over November soybeans most of this premium is artificial as August futures contracts will close shortly and there are few contracts still open…for futures, November is now the month of choice.

 

The crop weather in the US continues very good and most experts are looking to the WASDE report next week to be bearish for soybeans, so we could see prices slip lower again.

 

There is also question of the Ukraine/Russia/EU/USA sanctions situation and how much this is affecting prices. Certainly there is market concern about the possible effect on grain exports from Russia and to some degree the Ukraine but every news story and press release tends to point out that there will be little or no effect….of course that doesn't stop the market from getting very excited.

 

On the corn side of things it was much quieter with everyone seeming to be waiting for next week's USDA WASDE report. You would have to look far and wide to find anyone who expects that the report will be bullish for corn prices as 99.9% of the experts are calling for higher corn yields and a higher US crop. The weather has been very good, yields should be higher, farmers are all smiling (except about the low prices) and prices should be a tad weaker….unless the USDA has a surprise or two in mind.

 

One thing that the market will wonder about is if the sanctions on Russia will make corn exports more difficult – not that Russia is a major exporter but for North Africa and the Mediterranean they are a significant supplier, just as they are very, very significant for barley exports to the Middle East. Will the sanctions bite into the Russian export grain markets and will we see some business moving from Russia to the Ukraine or Romania or the USA…only time will tell.

 

Just a closing comment on the USDA WASDE report, an analysis of crop estimates by various experts shows that they feel the corn crop projections should increase by about 3% while soybean forecasts are almost the same as last USDA report as are crop estimates for spring wheat. On the ending stocks side of things the average for expert opinions shows corn stocks up by 10 to 12% while soybeans and wheat stocks are unchanged from the last projection ---- this looks to be bearish for corn but neutral for soybeans and wheat.

 

 

USA Crop condition report – Aug 05, 2014 – all in percentages

 

	Very poor	Poor	Fair	Good	Excellent
Wheat - spring	1	4	25	56	14
Corn	2	5	20	51	22
Soybeans	1	5	23	55	16
Sorghum	2	7	32	49	10

 

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

 

US Gulf to Europe: 60/70,000 (10,000 disch)	$14.00	Steady	x
US Gulf to Spain: 30,000 m/t(5,000 disch)	$26/27.00	Steady	x
US Gulf to Egypt: Panamax(6,000 disch)	$26/27.00	Up $1.00	x
US Gulf other Med: 25,000 MT(3,000 disch)	$33/34.00	Up $1.00	x
US Gulf Israel: 50,000 MT	$27/28.00	Up $1.00	x
US Gulf Morocco: 25,000(3,000 disch)	$31/32.00	Up $1.00	x
US Gulf Nigeria: 30,000 m/t	$44/45.00	Steady	x
US Gulf Turkey: 50,000	$28/29.00	Up $1.00	x
US Gulf Yemen 35/45.000	$42/43.00	Steady	x
US Gulf Japan: Panamax(10,000 disch)	$42/43.00	Up $2.00	x
US Gulf China: Panamax(8,000 disch)	$41/42.00	Steady	x
US PNW Asia: 35/45,000 m/t	$32/34.00	Steady	x
US PNW Japan: 50,000+ m/t(10,000 disch)	$27/28.00	Up $1.00	x
US PNW China: 50,000+ m/t(8,000 d1sch)	$26/27.00	Up $1.00	x
France/Germany to Algeria: 30,000 m/t(3,000 disch)	$21/22.00	Steady	x
France/Germany to Morocco: 30,000 m/t(3,000 disch)	$22/23.00	Steady	x
France/Germany to Yemen: 30,000 m/t	$40/41.00	Up $1.00	x
France/Germany to Egypt: 50,000 m/t(10,000 disch)	$19/20.00	Steady	x
France/Germany to Jordan: 35/45,000 m/t(4,000 disch)	$24/25.00	Steady	x
France/Germany to Saudi Arabia: 50/60,000	$31/32.00	Steady	x
Argentina to Europe: 60,000 m/t	$20/21.00	Up $1.00	x
Argentina to Egypt: 50,000 m/t(10,000 disch)	$29/30.00	Steady	x
Argentina to Algeria: 25/30,000 m/t(3,000 disch)	$31/32.00	Steady	x
Argentina to Morocco: 25,000 m/t(3,000 disch)	$28/29.00	Steady	x
Argentina to Saudi Arabia	$41.00	Steady	x
Argentina to South Africa 30,000 m/t(3,000 disch)	$29/30.00	steady	x
Argentina to Spain: 30,000 m/t	$30/31.00	Steady	x
Argentina to China: 50,000 m/t, with top-off	$38/40.00	Down $2.00	x
Brazil to Algeria: 25,000 m/t	$27/29.00	corrected	x
Brazil to China: 55,000 m/t	$32/33.00	Down $2.00	x
Brazil to Turkey/Egypt: 50,000 m/t	$24/25.00	Steady	x
Brazil to Morocco: 30,000 m/t	$25/27.00	corrected	x
Brazil to Europe	$22/23.00	corrected	x
Black Sea to Spain: 30,000 m/t(5,000 disch)	$16/17.00	Steady	x
Black Sea to Morocco: 30,000 m/t(3,000 disch)	$19/20.00	Steady	x
Black Sea to Tunisia/Algeria: 30,000(5,000 disch)	$17/18.00	Steady	x
Black Sea to East Med: 30,000 m/t(3,000 disch)	$13/14.00	Steady	x
Black Sea to East Med: coaster	$41/44.00	Up $3.00	x
Black Sea to Egypt: coaster 3,000 m/t	$45/47.00	Up $2.00	x
Black Sea to Egypt: 40/50,000 m/t – (6,000 disch)	$11/12.00	Steady	x
Black Sea to Saudi Arabia – Jeddah – 50k	$23/24.00	Steady	x
Baltic Dry Index	777	Up 26	x
Baltic Capesize Index	1166	Down 10	x
Baltic Panamax Index	624	Up 13	x
Baltic Supramax Index	804	Up 76	x
Baltic Handisize Index	363	Up 6	x

*** see sources note

 

 

 

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 251/261 Aug/Oct	x
Wheat, USA Hard Red Winter 12 protein	USD 286/302 Aug/Oct	x
Wheat, Ukraine 11.5 pro, 30,000+ m/t	USD 232/237 Aug/Sep	x
Wheat, Russia 12.5 pro, 30,000+ m/t	USD 240/243 Aug/Sep	x
Wheat, soft milling, France, Rouen port	USD 239/241 Aug/Sep	x
Wheat, milling, Argentina, upriver	USD 265/275 Dec/Jan 2015	x
Wheat, feed, Black Sea	USD 196/200 Aug/Sep	x
Wheat Bran, Black Sea	USD 190/195 Aug/Sep	x
Barley, France, Rouen port	USD 207/210 Aug/Sep	x
Barley, feed, Argentina, upriver	USD 220/228 Dec/Jan 2015	x
Barley, feed, Black Sea, 30,000+	USD 210/215 Aug/Sep	x
Barley, feed, USA Pacific Northwest	USD 280/285 Aug/Oct	x

 

Corn, FOB NOLA USA	USD 193/195 Aug/Oct	x
Corn, FOB USA Pacific northwest	USD 203/207 Aug/Oct	x
Corn, FOB Argentina port, upriver	USD 181/184 Aug/Oct	x
Corn, FOB Brazil port	USD 178/182 Aug/Oct	x
Corn, FOB Black Sea, 30,000+ m/t	USD 188/190 Oct/Nov new crop	x
Corn, FOB France	USD 222/228 Aug/Sep	x
Corn, FOB Romania	USD 193/196 Sep/Oct new crop	x
Sorghum, FOB Texas	USD  220/222 Aug/Oct	x
Sorghum, FOB Argentina port	USD  145/155 Aug/Oct	x

 

 

Soymeal,  48 protein, FOB NOLA	USD 515>>485  Aug>>Oct	x
Soymeal, 48 protein, USA, Rotterdam	USD 560>>535 Aug>>Oct	x
Soymeal, Argentina, Rotterdam	USD 516>>505 Aug>>Oct	x
Soymeal, 47 pro, FOB Argentina	USD 485>>425 Aug>>Oct	x
Soymeal, 48 protein, Brazil, Rotterdam	USD 506>>497 Aug>>Oct	x
Soymeal, FOB Brazil	USD 460>>440 Aug>>Oct	x
Soymeal, 48 protein, India FOB	USD 610/630	x
Soybeans, FOB NOLA	USD 490>>433 Aug>>Oct	X
Soybeans, Argentina, FOB	USD 492>>445 Aug>>Oct	X
Soybeans, Brazil, FOB	USD 545>>475 Aug>>Oct	X
Soybeans, Rotterdam	USD 550>>540 Aug>>Oct	X
Soybeans, Black Sea	USD 440/460 Sep/Oct	x

*** see sources note

 

Corn Gluten Meal, USA FOB NOLA	USD   695/705 m/t  Aug/Oct	x
Corn Gluten Feed, USA FOB NOLA	USD   175/180 m/t  Aug/Oct	x
DDGS corn, 35 profat, USA FOB NOLA	USD   186/189 m/t Aug/Oct	x
DDGS corn, 35 profat, USA CNF Asia	USD   230/234 m/t Aug/Oct	x
DDGS corn, France, at producer	USD   312/315 m/t Sep/Oct	x
DDGS corn, Rotterdam	USD   312/315 m/t Sep/Oct	x
DDGS wheat, France, at producer	USD   310/313 m/t Sep/Oct	x

*** see sources note

 

 

There was an uptick in DDGS prices this week after a couple of weeks of lower and lower and lower prices. DDGS prices were up by USD 10 or so depending on the shipment month. Sales for the last week have been quite strong as buyers seemed to want to cover some of their needs in advance of next week's USDA WASDE report….strange as most experts feel that corn production will increase which should push DDGS lower.

 

Corn gluten meal and corn gluten feed prices were steady this week since there were no major changes in corn pricing.

 

It is interesting to note how much higher the EU prices are for EU produced DDGS and corn gluten feed – if it wasn't for GM difficulties in the EU both these products would be very competitive in the EU. Not so for corn gluten meal where a very high tariff rate would limit competitiveness.

 

 

USA export shipments – Jan to June 2014 – in m/t major destinations

 

	Corn Gluten Feed	Corn Gluten Meal	Distillers Dried Grains -- DDGS	Soymeal
Canada			143,900	459,700
Chile		71,800
China			3,018,500
Columbia		34,000	50,000	220,100
Costa Rica			31,500
Cuba				106,900
Dominican Rep				175,000
Ecuador				240,600
Egypt	15,800	102,000	95,200	96,900
El Salvador			30,800	75,000
France				90,900
Germany	30,300			106,900
Guatemala		5,500	29,500	156,700
Honduras				110,400
Indonesia	5,100	84,200	143,800
Ireland	219,700	15,900	113,800
Italy				87,600
Israel	131,300	14,500	94,600	18,700
Japan		39,400	248,900	122,100
Malaysia		28,000	20,000
Mexico	10,600	25,700	776,000	832,600
Morocco	11,200		36,700	110,200
Panama				81,300
Philippines			44,400	700,200
Saudi Arabia				77,500
South Korea	25,300	3,200	315,800	165,100
Spain				113,000
Taiwan		7,600	125,600
Thailand		12,600	114,300	323,300
Turkey			61,600	103,300
UK	23,000		70,200
Vietnam		6,600	308,400	174,500
Venezuela				468,000
Denmark				118,800
Italy				87,600

@USDA GATS July

 

 

Container shipments, minimum 200 m/t

 

Argentina Meat & Bone meal, 45 protein    Argentina poultry meal, 57/60 protein	USD 480/490 m/t CNF Asia  USD 630/640 m/t CNF Asia
Paraguay Meat &Bone meal, 45 protein	USD 410/430 m/t CNF Asia
European MBM 50 protein    European Feathermeal, 75 protein    European poultry meal	USD 435/440 m/t CNF Asia  USD 725/730 m/t CNF Asia  No offers
Australian MBM 45 protein    Australian MBM 50 protein    Australian Feathermeal, 80 protein    Australian Poultry Meal, pet food	USD 595/610 m/t CNF Asia  USD 655/675 m/t CNF Asia  USD 840/850 m/t CNF Asia  USD 1030/1050 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 660/680 m/t CNF Asia  USD 890/910 m/t CNF Asia  USD 775/790 m/t CNF Asia  USD 1000/1030 m/t CNF Asia

*** see sources note

 

 

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

 

Meat and bone meal, USA, 50 protein	USD 530/550 m/t
Feathermeal  80 protein USA	USD 720/740 m/t
Poultry meal  57 protein, Eastern USA	USD 680/700 m/t

*** see sources note

 

 

There were stories out of Asia this week that animal protein prices are softening a little probably due to increased competition from vegetable proteins. The Chinese halt to DDGS business has made DDGS very attractive to other destinations and due to DDGS reasonable protein content there could be some buyer switching from MBM (meat and bone meal) to DDGS --- after all, DDGS is currently selling at only 30% of the MBM price.

 

Export business to Asia, which is the main animal protein market outside of North America, has been very quiet for the past few weeks, especially in Asian Muslim countries but everyone should be back to work come Monday and business will be back closer to normal.

 

The USA domestic market, much like Asia, has not been too exciting with very little happening to prices but the feeling in the market is that animal protein prices are going to have to move lower just to stay closer to soymeal and to keep demand steady. It is reported that US buyers are only buying as they need because they expect lower prices in the near future… this makes sense when you see where soymeal prices are for Sep/Oct.

 

 

 

 

 

 

   USA export shipments – Jan to June 2014 – in m/t major destinations

 

	Meat and bone meal Incl pork and poultry	Feathermeal
Indonesia	36,300	53,000
Chile		23,800
Canada	21,500	4,700
Philippines	3,800
Mexico	10,900
China	20,900
Thailand	3,300
Guatemala	6,600
Ecuador	3,700
Holland	3,800
Malaysia	3,500

@USDA GATS July

 

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

Here we are just about at the end of the 10 day fishing extension in Peru and not too much has changed on the supply side – the quota is still going to come up about 30% short on the catch for this season and that is going to limit fishmeal supply and should certainly keep prices from weakening. On the other hand the sales side of things has been very quiet with only 2 or 3,000 m/t being sold each week and stocks on hand said to be around about 150,000 m/t.

 

The extra ten days of fishing in Peru did not add much to the catch but it did give people something to talk about and made the Government officials look like heroes.

 

According to trade reports, China has about two months stock on hand (usage about 70,000 m/t per month) but is reported to have another month's supply already booked from Peru – all this means is that China will have to be back in the fishmeal market again in the next few weeks in order to maintain supply levels for later in 2014. Of course, this is assuming that they don't have other hidden purchases in the Peru market.

 

And on the El Nino, everyone scientific seems to agree that we are out of the woods on that and if, just if, there is an event later in 2014 it will probably be very minor – perhaps the fish wont even notice.

 

There doesn't seem to be any good reason to expect lower prices for the next weeks but we will probably see a reasonably broad price range, depending on the producer, of plus/minus USD 20 m/t.

 

In the USA, a study released this week concludes that specially produced rapeseed concentrate produced from rapeseed meal could replace fishmeal in up to 100% of the fishmeal in the feed rations for some types of fish. One interesting point in the study is that fish tend to hate the taste of rapeseed meal which is why it has to be specially processed…perhaps it tastes like broccoli or Brussels sprouts to the fish.

 

 

 

 

Peru Fishing Season Weekly update – August 07, 2014

 

Season	Zone		Quota	Caught	%	Remaining	%
1st	North/Central		2,530,000	1,667,900	65.9	862,100	34.1
1st	South		234,300	11,400	4.9	222,900	95.1

@Andes Connections

 

 

European fishmeal prices – FOB North German port.

 

Type	Protein %	Price per m/t USD
Herring fishmeal	72 protein	1,945
Danish fishmeal	64 protein	1,740
Peru fishmeal	64 protein	1,800
Chile fishmeal	65 protein	1,817
Iceland fishmeal	70 protein	1,920

@Commodity3

 

 

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	1720/1730 m/t
65/66 protein	1750/1760 m/t
67 protein standard steam	1800/1820 m/t
67 protein SD 150  TVN	1820/1840 m/t
67 protein SD 120 TVN	1840/1860 m/t
67 protein SD 1000 hist, 120 TVN	1860/1880 m/t
68 protein SD 500 hist, 120 TVN	1880/1900 m/t
Fish oil, crude bulk	1900/2000
Fish oil, crude drums	2100/2200
Fish oil, flexi tank	2050/2150
Fish oil, Omega 3: 28%EPA/DHA	2600/2800

*** see sources note

 

INFORMATION:  gtee = guarantee, TVN = total volatile nitrogen, hist = histamine,

FAQ = fair average quality (normally flame or hot air dried), SD = steam dried

           

*** sources for information for the Weekly Report:

US Grains Council  --- www.grains.org, International Grains Council – www.igc.int

US Wheat -- www.uswheat.org , France Agrimer – www.franceagrimer.fr

EU DG Agri -- ec.europa.eu/agriculture/index_fr.htm,  Commodity 3 -- http://www.commodity3.com/

Newedge Group -- www.newedge.com, The Jacobsen Report -- https://www.thejacobsen.com

MSI Ceres Peru -- http://www.msiceres.com, International Brokers Group S.A.C, Peru.

 

And many, many, many more

 

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