Weekly report -- Sep 13, 2014

 

Hammersmith Trade Services

A division of Hammersmith Marketing Ltd.

 

WEEKLY FEED GRAIN AND PROTEIN REPORT   September 13, 2014

 

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SECTION 1:  US FEED GRAINS -- VEGETABLE AND ANIMAL PROTEIN

 

Well, it seems that the USDA WASDE report was even more bearish than most experts had been forecasting and although the market sold off on both Thursday and Friday experts are now saying that corn prices are near the bottom although soybeans may have room to tumble further.

 

Corn prices were down by about USD 7 m/t on the week but some experts are saying that there was still very good buying interest as the corn price moved lower. Perhaps corn ay USD 180 m/t at the export port looks like quite a bargain to export buyers. However, USA export prices are still not quite low enough to compete in markets covered by Black Sea shippers. The FOB prices are good but the freight is just too high.

 

There were some reports that US farmers are going to hold on to their corn crop as it is harvested in the hopes of seeing higher prices later in the year. It seems that at current price levels there is little or no income for farmers in a ton of corn. However, some experts feel that the estimated corn yields may go even higher in the next USDA report in October which will make the situation even more difficult for farmers…..but certainly better for buyers.

 

One thing to consider for 2015 is that if farmers loose on corn this year they will be more inclined to switch to a more profitable crop, like soybeans, in 2015.

 

Soybean prices were down by about USD 13 m/t with soymeal off by close to USD 20 m/t and there looks to be no reason at all for soybean/soymeal prices to move any higher….much lower seems to be the way prices will go. Some experts feel that soybean prices could quite easily move another USD 15 m/t lower over the next weeks and even lower as we get further into Oct/Nov.

 

About the only chance for prices to move higher at present would be bad weather that delays the corn and soybean harvest

 

USA crop condition report – September 07 26, 2014 – all in percentages

France crop condition as of September 04, 2014

 

	Very poor	Poor	Fair	Good to excellent	Harvested %
USA crop:
Wheat - spring	1	7	29	63	78
Corn	2	5	19	74
Soybeans	1	5	22	72
Sorghum	3	9	31	57
French crop:	Very poor	Poor	Fair	Good to excellent
Corn	0	2	11	87	22
Barley, spring	2	10	26	62	100

 

 

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

 

US Gulf to Europe: 60/70,000 (10,000 disch)	$16.00	Steady	x
US Gulf to Spain: 30,000 m/t(5,000 disch)	$27/28.00	Steady	X
US Gulf to Egypt: Panamax(6,000 disch)	$27/28.00	Up $1.00	X
US Gulf other Med: 25,000 MT(3,000 disch)	$33/34.00	Steady	X
US Gulf Israel: 50,000 MT	$28/29.00	Up $1.00	X
US Gulf Morocco: 25,000(3,000 disch)	$32/33.00	Up $1.00	x
US Gulf Turkey: 50,000	$29/30.00	Up $1.00	x
US Gulf Nigeria: 30,000 m/t	$45/46.00	Steady	x
US Gulf Yemen 35/45.000	$46/47.00	Up $2.00	x
US Gulf South Africa: 30,000 m/t	$38/39.00	Up $1.00	x
US Gulf Japan: Panamax(10,000 disch)	$45/46.00	Up $2.00	X
US Gulf China: Panamax(8,000 disch)	$46/47.00	Up $1.00	X
US PNW Asia: 35/45,000 m/t	$33/35.00	Steady	x
US PNW Japan: 50,000+ m/t(10,000 disch)	$28/29.00	Steady	x
US PNW China: 50,000+ m/t(8,000 d1sch)	$27/28.00	Steady	x
France/Germany to Algeria: 30,000 m/t(3,000 disch)	$22/23.00	Steady	X
France/Germany to Morocco: 30,000 m/t(3,000 disch)	$23/24.00	Steady	X
France/Germany to Jordan: 35/45,000 m/t(4,000 disch)	$28/29.00	Steady	x
France/Germany to Saudi Arabia: 50/60,000	$34/35.00	Steady	X
France/Germany to Egypt: 50,000 m/t(10,000 disch)	$23/24.00	Steady	X
France/Germany to Yemen: 30,000 m/t	$43/44.00	Steady	x
France/Germany to South Africa: 30,000 m/t	$34/35.00	Steady	x
Argentina to Europe: 50/60,000 m/t	$21/22.00	Steady	x
Argentina to Egypt: 50,000 m/t(10,000 disch)	$31/32.00	Steady	x
Argentina to Algeria: 25/30,000 m/t(3,000 disch)	$32/33.00	Steady	x
Argentina to Morocco: 25,000 m/t(3,000 disch)	$29/30.00	Steady	x
Argentina to Tunisia: 30,000 m/t	$33/34.00	Steady	x
Argentina to Saudi Arabia	$41.00	Steady	x
Argentina to South Africa 30,000 m/t(3,000 disch)	$30/31.00	Steady	x
Argentina to Spain: 30,000 m/t	$31/32.00	Steady	x
Argentina to China: 50,000 m/t, with top-off	$39/40.00	Steady	X
Brazil to Algeria: 25,000 m/t	$28/29.00	Steady	X
Brazil to China: 55,000 m/t	$32/33.00	Steady	X
Brazil to Turkey/Egypt: 50,000 m/t	$24/25.00	Steady	X
Brazil to Morocco: 30,000 m/t	$26/27.00	Steady	X
Brazil to Saudi Arabia	$41/42.00	Steady	x
Brazil to Europe	$22/23.00	up $1.00	x
Black Sea to Spain: 30,000 m/t(5,000 disch)	$17/18.00	Steady	x
Black Sea to Morocco: 30,000 m/t(3,000 disch)	$21/22.00	Steady	x
Black Sea to Tunisia/Algeria: 30,000(5,000 disch)	$19/20.00	Steady	x
Black Sea to East Med: 30,000 m/t(3,000 disch)	$14/15.00	Steady	x
Black Sea to East Med: coaster	$40/43.00	Steady	x
Black Sea to Egypt: coaster 3,000 m/t	$43/45.00	Steady	x
Black Sea to Egypt: 40/50,000 m/t – (6,000 disch)	$13/14.00	Steady	x
Black Sea to Saudi Arabia – Jeddah – 50k	$22/23.00	Down $1.00	x
Baltic Dry Index	1181	Up 26	X
Baltic Capesize Index	2546	up 63	x
Baltic Panamax Index	875	Down 56	X
Baltic Supramax Index	1006	Up 9	x
Baltic Handisize Index	477	Up 8	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 231/240 Sep/Nov	x
Wheat, USA Hard Red Winter 12 protein	USD 265/280 Sep/Nov	x
Wheat, Ukraine 11.5 pro, 30,000+ m/t	USD 235/238 Sep/Nov	x
Wheat, Russia 12.5 pro, 30,000+ m/t	USD 246/253 Sep/Nov	x
Wheat, soft milling, France, Rouen port	USD 207/212 Sep/Nov	x
Wheat, milling, Argentina, upriver	USD 240/250 Dec/Jan 2015	x
Wheat, feed, Black Sea	USD 190/194 Sep/Nov	x
Wheat Bran, Black Sea	USD 160/170 Sep/Nov
Barley, France, Rouen port	USD 187/191 Sep/Nov	x
Barley, feed, Argentina, upriver	USD 208/215 Sep/Nov	x
Barley, feed, Black Sea, 30,000+	USD 210/216 Sep/Nov	x
Barley, feed, USA Pacific Northwest	USD 250/255 Sep/Nov	x
Corn, FOB NOLA USA	USD 182/185 Sep/Nov	x
Corn, FOB USA Pacific northwest	USD 191/194 Sep/Nov	x
Corn, FOB Argentina port, upriver	USD 168/173 Sep/Nov	x
Corn, FOB Brazil port	USD 163/169 Sep/Nov	x
Corn, FOB Black Sea, 30,000+ m/t	USD 170/178 Oct/Nov new crop	x
Corn, FOB France	USD 176/181 Sep/Nov	x
Corn, FOB Romania	USD 178/185 Oct/Nov	x
Sorghum, FOB Texas	USD  210/213 Sep/Nov	x
Sorghum, FOB Argentina port	USD  140/150 Sep/Nov	x
Soymeal,  48 protein, FOB NOLA	USD 510>>420  Sep>>Nov	x
Soymeal, 48 protein, USA, Rotterdam	USD 595>>500 Sep>>Nov	X
Soymeal, Argentina, Rotterdam	USD 484>>470 Sep>>Nov	X
Soymeal, 47 pro, FOB Argentina	USD 435>>380 Sep>>Nov	X
Soymeal, 48 protein, Brazil, Rotterdam	USD 470>>455 Sep>>Nov	X
Soymeal, FOB Brazil	USD 440>>400 Sep>>Nov	X
Soymeal, 48 protein, India FOB	USD 620/630	x
Soybeans, FOB NOLA	USD 430>>410 Sep>>Nov	X
Soybeans, Argentina, FOB	USD 455>>415 Sep>>Nov	X
Soybeans, Brazil, FOB	USD 485>>440 Sep>>Nov	X
Soybeans, Rotterdam	USD 500>>440 Sep>>Nov	x
Soybeans, Black Sea	USD 395/405 Oct/Nov	x
Corn Gluten Meal, USA FOB NOLA	USD   690/700 m/t Sep/Nov	x
Corn Gluten Feed, USA FOB NOLA	USD   185/190 m/t Sep/Nov	x
DDGS corn, 35 profat, USA FOB NOLA	USD   198/203 m/t Sep/Nov	x
DDGS corn, 35 profat, USA CNF Asia	USD   236/241 m/t Sep/Nov	x

*** see sources note

 

 

 

As with almost everything else, the USDA WASDE report, at least in anticipation, had a big effect on the market. In advance of the report prices were up and down USD 5 to 10 m/t, more for corn gluten meal, but with the report being late in the week there was little in the way of definite market price direction on Friday. According to the US Grains Council report at weeks end, some prices for DDGS were down as much as USD 20 m/t….which seems a tad overdone.

 

There wasn't actually much in the way of buying interest last week as most export buyers chose to wait to see what the report would bring, although we all knew that it would be bearish. Waiting until after the report certainly looks like the best decision because we should now see some lower prices for all corn by-products going into next week.

 

However, lower prices will certainly attract export buyers and this could keep prices from moving too much lower – especially for DDGS where export volumes are much larger than for CGM and CGF.

 

So, lower prices are expected but perhaps not too much lower if corn prices prove to be at or near the bottom of their price slide.     

 

 

Container shipments, minimum 200 m/t

 

Argentina Meat & Bone meal, 45 protein    Argentina poultry meal, 57/60 protein	USD 450/470 m/t CNF Asia  USD 630/640 m/t CNF Asia
Paraguay Meat &Bone meal, 45 protein	USD 410/420 m/t CNF Asia
European MBM 48/50/52 protein    European Feathermeal, 75 protein    European poultry meal	USD 405/430 m/t CNF Asia  USD 740/750 m/t CNF Asia  USD 900/920 m/t CNF Asia
Australian MBM 45 protein    Australian MBM 50 protein    Australian Feathermeal, 80 protein    Australian Poultry Meal, pet food	USD 550/560 m/t CNF Asia  USD 600/620 m/t CNF Asia  USD 800/820 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 600/620 m/t CNF Asia  USD 880/890 m/t CNF Asia  USD 780/790 m/t CNF Asia  USD 950/1000 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 470/500 m/t
Feathermeal  80 protein USA	USD 720/740 m/t
Poultry meal  57 protein, Eastern USA	USD 660/680 m/t

*** see sources note

 

Animal protein export prices followed soymeal lower at the end of the week with most prices being lower by USD 10 to 20 m/t. However, domestic USA prices did not seem to be quite so weak. There did not seem to be much new export sales business being booked as most buyers were waiting to see what the USDA WASDE report had to say and the effect that this could have on protein prices. As we have all seen the effect was to push soymeal prices lower. If soymeal stays low into next week then we should see some weakness in animal protein prices since buyers are certainly going to be bidding lower for any new purchases.

 

Trade reports in the USA are all saying that animal protein prices in the USA must move lower in order to compete but so far any slide lower has been quite minimal…perhaps we will see increased price weakness next week or perhaps not.

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

Fishmeal prices in Peru seem to have slipped a little lower this week with the trade expecting that the lower prices should attract more buyers and get the market a little more excited…it has not been excited in a few weeks now.

 

A couple of trade reports were speculating that the quota for the next fishing period will not exceed 1 million m/t of catch (about 240,000 m/t of fishmeal) but there are some who expect the quota to be up at 1.5 million. Of course, this is all just guess work for now.

 

With new sales being so slow, the stock levels in Peru have dropped very little and look to still be between 120-130,000 m/t but with the lower prices perhaps we will see stock levels decrease.

 

According to export statistics for 2014 to the end of August, Peru has exported just slightly over 700,000 m/t of fishmeal with 55% for China, 15% for Germany, 8.5% for Japan, 6% to Chile and 5% to Vietnam – these five destinations represent almost 90% of Peru fishmeal exports.  

 

 

European fishmeal prices – FOB North German port.

 

Type	Protein %	Price per m/t USD
Herring fishmeal	72 protein	1,875
Danish fishmeal	64 protein	1,685
Peru fishmeal	64 protein	1,745
Chile fishmeal	65 protein	1,785
Iceland fishmeal	70 protein	1,900

@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	1700/1720 m/t
65/66 protein	1710/1730 m/t
67 protein standard steam	1720/1740 m/t
67 protein SD 150  TVN	1740/1760 m/t
67 protein SD 120 TVN	1760/1780 m/t
67 protein SD 1000 hist, 120 TVN	1780/1800 m/t
68 protein SD 500 hist, 120 TVN	1810/1830 m/t
Fish oil, crude bulk	1850/1950
Fish oil, crude drums	2050/2150
Fish oil, flexi tank	2000/2100
Fish oil, Omega 3: 28%EPA/DHA	2500/2700

*** 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