Weekly Report - Jan 09, 2016

 

HAMMERSMITH Marketing Ltd
-------------------------

Corporate Head Office: 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  

 

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

1 Traverse Du Cheval Blanc, St Remy de Provence, 13210 France

 

 

SECTION 1:  US FEED GRAINS and VEGETABLE AND ANIMAL PROTEIN

 

Looking at the futures market at the end of the week there certainly was very little change over the end of the previous week. Getting past all the Christmas and New Year holidays didn't seem to get any excitement back into the grain markets.

 

The Argentina situation and all the analysis about Argentina and how their changes will effect world markets seemed to be the major item in trade comments this week. Overall, everything about Argentina seems to be bearish as most experts feel that all the moves made by the country will just add supply to an already full world supply of grain. Everyone in the trade is waiting to see what the January USDA WASDE report says when it comes out next week but it is probably a little too soon to expect the USDA to be able to incorporate much of an Argentina factor in to the January report.

 

The feeling in the USA and probably the world, is that there is little reason at present to expect grain and oilseed prices to move higher. Except for the crop/drought problems in Southern Africa, almost every producing country has had a good 2015 and the late 2015 plantings for 2016 look good for almost everyone. Even Russia and the Ukraine had some heavy snow which was needed to protect winter wheat and barley. So, one is quite hard pressed to find any news in the market that will give prices a nudge higher.

 

Of course, there is still the chance of changing weather affecting crops in Argentina and Brazil and a change in the winter weather in the USA and Europe that could affect winter wheat and barley but for today things look quite good and prices don't seem to be able to show any strength at all.

 

So, until we have some kind of serious problem: weather, economic or even political, then we should see prices trending steady to lower – with lower more likely for now.

 

One other point for export buyers is that, with the continued drop in both vessel costs and ship costs, freight has not been this low in years and CNF prices for buyers are at very, very attractive levels.

 

  

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

 

US Gulf to Europe: 60/70,000 (10,000 disch)	$12/13.00	Steady	x
US Gulf to Spain: 30,000 m/t(5,000 disch)	$20/21.00	Steady	x
US Gulf Israel: 50,000 MT	$19/20.00	Steady	X
US Gulf to Egypt: Panamax(6,000 disch)	$18/19.00	Steady	x
US Gulf Turkey: 50,000	$20/21.00	Steady	x
US Gulf Morocco: 25,000(3,000 disch)	$27/28.00	Steady	x
US Gulf Nigeria: 30,000 m/t	$44/45.00	Down $1.00	x
US Gulf other Med: 25,000 MT(3,000 disch)	$28/29.00	Steady	x
US Gulf South Africa	$30/31.00	Steady	x
US Gulf Japan: Panamax	$24/25.00	steady	X
US Gulf China: Panamax	$23/24.00	Steady	x
US PNW Japan: Panamax	$16/17.00	Steady	X
US PNW China: Panamax	$15/16.00	Steady	x
US East Coast Egypt: Panamax	$41/42.00	Steady	X
US East Coast Nigeria: Handisize	$47/48.00	Steady	x
France/Germany to Algeria: 30,000 m/t(3,000 disch)	$21/22.00	Steady	x
France/Germany to Egypt: 50,000 m/t(10,000 disch)	$21/22.00	Steady	x
France/Germany to Jordan: 35/45,000 m/t(4,000 disch)	$23/24.00	Steady	x
France/Germany to Morocco: 30,000 m/t(3,000 disch)	$20/21.00	Steady	x
France/Germany to Saudi Arabia: 50/60,000	$27/28.00	Steady	x
France/Germany to South Africa: 30,000 m/t	$30/31.00	Steady	x
France/Germany to Yemen: 30,000 m/t	$43/44.00	Down $1.00	X
Argentina to Algeria: 25/30,000 m/t(3,000 disch)	$20/21.00	Up $1.00	x
Argentina to China: 50,000 m/t, with top-off	$24/25.00	Steady	X
Argentina to Japan: 50,000 m/t, with top-off	$26/27.00	Steady	X
Argentina to Egypt	$20/21.00	Up $1.00	x
Argentina to Europe: 50/60,000 m/t	$19/20.00	Up $1.00	X
Argentina to Morocco: 25,000 m/t(3,000 disch)	$19/20.00	Up $1.00	X
Argentina to Saudi Arabia	$31/32.00	Up $1.00	X
Argentina to South Africa 30,000 m/t(3,000 disch)	$23/24.00	Up $1.00	X
Argentina to Spain: 30,000 m/t	$20/21.00	Up $1.00	x
Argentina to Tunisia: 30,000 m/t	$20/21.00	Up $1.00	x
Brazil to Algeria: 25,000 m/t	$19/20.00	Up $1.00	x
Brazil to China: 55,000 m/t	$17/18.00	Steady	X
Brazil to Japan: 55,000 m/t	$18/19.00	Steady	x
Brazil to Europe	$20/21.00	Steady	x
Brazil to Morocco: 30,000 m/t	$19/20.00	Up $1.00	x
Brazil to Saudi Arabia	$28/29.00	Steady	x
Brazil to Turkey/Egypt: 50,000 m/t	$17/18.00	Up $1.00	x
Australia to China: 40-55,000 m/t	$6.00/6.50	Down $0.50	X
Australia to Japan: 40-55,000 m/t	$6.50/7.00	Down $0.50	X
Australia to Saudi Arabia: 40-55,000 m/t	$9.00/9.50	Steady	x
Ukraine to China	$20/21.00	Steady	x
Black Sea to East Med: 30,000 m/t(3,000 disch)	$19/20.00	Up $1.00	X
Ukraine to East Med: coaster (1,000 disch)	$35/36.00	Steady	X
Black Sea to Egypt: 40/50,000 m/t – (6,000 disch)	$8/10.00	Steady	X
Ukraine to Egypt: coaster 3,000 m/t (1,000 disch)	$35/36.00	Steady	X
Black Sea to Iraq: 50,000 m/t (4,000 disch)	$26/28.00	Steady	X
Black Sea to Morocco: 30,000 m/t(3,000 disch)	$20/21.00	Steady	X
Black Sea to Spain: 40/50,000 m/t (8,000 disch)	$7/8.00	Down $1.00	X
Black Sea to Jordan: 50,000 m/t (4,000 disch)	$15/17.00	Steady	X
Black Sea to Saudi Arabia – Jeddah – 50k	$20/21.00	Steady	X
Black Sea to South Africa – 30,000 m//t	$21/22.00	Steady	x
Black Sea to Tunisia/Algeria: 30,000(5,000 disch)	$18/20.00	Steady	x
Baltic Dry Index	429	Down 49	x
Baltic Capesize Index	343	Down 127	x
Baltic Panamax Index	434	Down 28	x
Baltic Supramax Index	420	Down 20	X
Baltic Handisize Index	256	Down 14	x
Bunkerworld fuel index	418	Down 29	x

 

 

 

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.)

 

ALL PRICES ARE FOR January 2016/March 2016

 

Wheat, USA Soft Red Winter, NOLA	USD 202/205	x
Wheat, USA Hard Red Winter 12 protein	USD 214/218	x
Wheat, Ukraine 11.5 pro, 30,000+ m/t	USD 182/185	x
Wheat, Russia 12.5 pro, 30,000+ m/t	USD 185/190	x
Wheat, Romania 12.5 pro	USD 184/189	x
Wheat, Superior, France, Rouen	USD 178/181	x
Wheat, Medium, France, Rouen	USD 176/179	x
Wheat, milling, 12.0%, Argentina, upriver	USD 191/194	x
Wheat, feed, Black Sea	USD 172/176	x
Barley, France, Rouen port	USD 169/172	x
Barley, feed, Argentina	USD 172/178	x
Barley, feed, Black Sea, 30,000+	USD 173/178	x
Barley, feed, USA Pacific Northwest	USD no prices	x
Corn, FOB NOLA USA	USD 163/166	x
Corn, FOB USA Pacific northwest	USD 170/173	x
Corn, CNF Asia, USA #2	USD 210/216	x
Corn, FOB Argentina port, upriver	USD 154/158	x
Corn, FOB Brazil port	USD 156/159	x
Corn, FOB Black Sea, 30,000+ m/t	USD 164/168	X
Corn, FOB France	USD 170/173	x
Corn, FOB Romania	USD 163/167	X
Sorghum, FOB Texas	USD 174/177	x
Sorghum, FOB Argentina port	USD 135/140	x
Soymeal, 48% protein, FOB NOLA	USD 320/324	x
Soymeal, 48% protein, USA, Rotterdam	USD 347/351	X
Soymeal, USA CNF Asia	USD 370/380	x
Soymeal, Argentina, Rotterdam	USD 334/338	x
Soymeal, 47% pro, FOB Argentina	USD 293/297	x
Soymeal, 48% protein, Brazil, Rotterdam	USD 337/341	x
Soymeal, FOB Brazil	USD 294/299	x
Soymeal, 48% protein, India FAQ	USD 550/560	x
Soybeans, FOB NOLA	USD 360/365	x
Soybeans USA #2, CNF Asia	USD 376/382	x
Soybeans, Argentina, FOB	USD 324/327	x
Soybeans, Brazil, FOB	USD 328/333	x
Soybeans, Black Sea	USD 350/360	x
Corn Gluten Meal, USA FOB NOLA	USD   570/580 m/t	x
Corn Gluten Meal, USA CNF Asia, cont.	USD   614/619 m/t	x
Corn Gluten Meal, USA CNF Egypt, cont.	USD   640/645 m/t	x
Corn Gluten Feed, USA FOB NOLA	USD   155/160 m/t	x
DDGS corn, 35 profat, USA FOB NOLA	USD   178/181 m/t	x
DDGS corn, 35 profat, USA CNF Asia, cont	USD   218/222 m/t	x

 

There is quite a bit of expectation in the market that DDGS prices will drop in coming weeks as a result of the situation in China – this has resulted in export buyers holding back on orders for March/April shipment. There had been lots of Jan/Feb export business booked back in December so most buyers are covered for now so can wait a little to see what does happen with prices. China's DDGS purchases represent about 52% of total US DDGS exports, so any change in buying will have a major effect on export prices.

 

USA domestic prices for DDGS were down about USD 5 m/t on the week. Both corn gluten meal and corn gluten feed were also lower in the US and this helped to move export prices a little lower for both.

 

The USDA Co-Products report showed that DDGS production was down a little but is still at just over 1.9 million m/t production for November. Corn gluten feed production was down just a little at 323,000 m/t while corn gluten meal production was up a little at 83,500 m/t.

 

It is interesting to note that with DDGS production at 1.9 million m/t per month this is about 22.8 million m/t of yearly production with YTD exports, for 11 months, standing at 11.6 million m/t then DDGS is certainly highly dependent on exports, so what happens in China is very important.

 

 

USA Corn Co-products exports – Jan to Nov 2015 – major destinations only – in m/t

 

	Corn Gluten Feed	Corn Gluten Meal	Distillers Dried Grains – DDGS
Canada	24,100	58,800	445,800
Chile		133,700
China			6,071,100
Colombia	51,800	76,300	111,200
Costa Rica			80,000
Egypt		184,100	88,600
Germany	63,500
Indonesia		131,600	205,700
Ireland	178,100		197,000
Israel	164,000		118,300
Japan			209,300
Korea, South			532,700
Malaysia		19,400
Mexico	17,400	32,000	1,487,800
Morocco	38,600		93,500
Peru		17,000
Philippines			06,000
Portugal	17,400
Spain	44,700		100,700
Taiwan		17,700	186,000
Thailand		24,100	354,700
Turkey	39,000		184,600
UK	55,300		122,200
Vietnam			594,300

@USDA GATS

 

 

Container shipments, minimum 200 m/t

 

Argentina Meat & Bone meal, 45/50 protein    Argentina poultry meal, 57/60 protein    Argentina feathermeal, 78/80 protein	USD 380/400 m/t CNF Asia  USD 500/510 m/t CNF Asia  USD 480/490 m/t CNF Asia
Paraguay Meat &Bone meal, 45% protein	USD 380/400 m/t CNF Asia
Australian MBM 45 protein    Australian MBM 50 protein    Australian Feathermeal, 80 protein    Australian Poultry Meal, pet food	USD 370/390 m/t CNF Asia  USD 400/420 m/t CNF Asia  USD 450/460 m/t CNF Asia  USD 680/700 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 380/390 m/t CNF Asia  USD 430/450 m/t CNF Asia  USD 450/470 m/t CNF Asia  USD 680/700 m/t CNF Asia

 

 

Asian animal protein prices are reported to be lower again this week as the never ending rush to lower prices continues. Meat and bone meal into Asia seems to all be prices below USD 400 m/t for Jan/Feb with Feb/Mar prices said to be even lower. Asian reports say that stocks on hand are very good while a drop in demand has meant that it has become a serious buyer's market with sellers seeming to be happy to take a very good look at almost every buying offer, no matter how low.

 

USA domestic prices were also quite weak and this spread into the export market. For now, there just doesn't seem to be any buying interest in the main importing markets. It is expected that the Asian demand will pick up but not for a few weeks so looks like low prices will be with us for a while.

 

 

USA Animal protein exports – Jan to Nov 2015 – major destinations – in m/t

 

	Feathermeal	Meat and Bone Meal: Includes poultry meal and pork meal exports
Canada	15,000	54,400
Chile	22,300
China		32,600
Indonesia	39,500	103,000
Mexico		23,100
Netherlands		8,800
Vietnam	2,600	7,300

 

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

The total catch in Peru is now up to just over 900,000 m/t which leaves less than 200,000 m/t to go to reach the quota. There are still about three weeks to go to the end of the quota period so, even with the fishing bans, it looks quite good for getting the full quota or at least very close to full quota. Even with the bans the total daily fishing has been able to reach 10,000 m/t, so 10,000 m/t per day for the remaining days would certainly do the job.

 

The big concern in Peru these days is the situation in China and the financial upset seen in recent days. No one knows how this all could affect the fishmeal business but it should have some effect. Especially if the Chinese economy continues to weaken and animal feed demand drops. Overall the Chinese feed industry showed production increases in 2015 and the forecasts are for 10% percent growth going forward – so business should not be all that bad. However, there may still be a short term drop in Chinese demand until the economy sorts itself out a little.

 

There has been little or no report of new sales from Peru and trade reports are saying that business may not pick up until China gets back to buying fishmeal and this is not expected to happen until February.

 

With the stocks on hand and the lack of new business, exporters are said to be quite flexible in their pricing – so, if anything, prices are expected to move lower in coming weeks. There is just no reason to expect that prices will increase.    

 

European fishmeal prices – FOB North German port.

 

Type	Protein %	Price per m/t USD
Herring fishmeal	72 protein	1,705
Danish fishmeal	64 protein	1,500
Peru fishmeal	64 protein	1,675
Chile fishmeal	67 protein	1,700
Iceland fishmeal	70 protein	1,715

 

 

 

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	Price per m/t Chile port
65 protein	1550/1570 m/t
65/66 protein	1600/1620 m/t
67 protein standard steam	1700/1720 m/t	No offers
67 protein SD 150  TVN	1800/1820 m/t	1680/1700
67 protein SD 120 TVN	1850/1870 m/t	1700/1750
67 protein SD 1000 hist, 120 TVN	1900/1920 m/t	1750/1770
68 protein SD 500 hist, 120 TVN	1950/2000 m/t	1800/1820
Fish oil, crude bulk	2000/2050	1800/1900
Fish oil, crude drums	2100/2150
Fish oil, flexi tank	2150/2200
Fish oil, Omega 3: 28%EPA/DHA	2450/2500

 

 

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

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

           

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 © 2016 Wayne S. Bacon