Weekly Report -- Feb 20, 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

 

Well, this week we end the week with all grains and oilseed being a little higher in USA cash and futures market – everything ended the week up a little. Corn was up by about USD 2 to 3 m/t on the week with soybean up by USD 2 m/t and soymeal by the same USD 2 m/t. Wheat was the strongest with hard red winter (HRW) wheat up by about USD 5 m/t with soft red winter up by USD 2 or so.

 

Except for HRW wheat is was a quiet price week for all. Of course, the Monday holiday in the US probably helped to make the four-day week a quiet week.

 

It was noted in trade reports that trading in the futures market had been quite heavy but that the large volume of trades had little effect on prices – I guess that most of the buyers and sellers were hedgers rather than speculators. The corn futures market shows that major investment funds are very short corn which could mean that any small rally could get them (or their computers) covering their short positions which would push corn prices higher.

 

A couple of the trade reports this week pointed out that US corn is very competitive these days with little to choose in price between the US, Black Sea, Argentina and Brazil – with freight ending up being the major factor to some destinations. Of course, corn also has to fight feed wheat in the export market – at least in some markets – so export sales are not as easy as one might think.

 

Looking at feed wheat, a number of export destinations will not allow feed wheat imports as, in the past, feed wheat has had the bad habit of slipping into the milling wheat supply and lowering the flour quality.

 

On the price side, most experts don't feel that corn prices will be moving higher in the near term – so far there is just no good reason for higher prices.

 

On the soybean side of things, everyone is watching Argentina where the heavy rains of late could cause some problems for finishing the crop and for harvest – the USDA has dropped their estimate of the Argentina soybean harvest by just under 5%.

 

USA soybean exports are about on target and should reach the USDA forecasted exports for 2015/16.

 

One small point on soybean futures is that the size of the short position for Managed Money Funds is dropping as they seem to be looking for the market to be at the bottom.  

 

 

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

 

US Gulf to Europe: 60/70,000 (10,000 disch)	$11/12.00	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)	$26/27.00	Steady	x
US Gulf Nigeria: 30,000 m/t	$43/44.00	Steady	x
US Gulf other Med: 25,000 MT(3,000 disch)	$27/28.00	Steady	x
US Gulf South Africa	$27/28.00	Steady	x
US Gulf Bangladesh	$29/30.00	Steady	x
US Gulf Japan: Panamax	$22/23.00	Steady	x
US Gulf China: Panamax	$20/21.00	Steady	x
US PNW South Africa	$35/36.00	Down $2.00	x
US PNW Japan: Panamax	$13/14.00	Steady	x
US PNW China: Panamax	$12/13.00	Steady	x
US East Coast Egypt: Panamax	$39/40.00	Steady	x
US East Coast Nigeria: Handisize	$46/47.00	Steady	x
France/Germany to Algeria: 30,000 m/t(3,000 disch)	$18/19.00	Steady	x
France/Germany to Egypt: 50,000 m/t (10,000 disch)	$20/21.00	Steady	x
France/Germany to Jordan: 35/45,000 m/t (4,000 disch)	$22/23.00	Steady	x
France/Germany to Morocco: 30,000 m/t (3,000 disch)	$17/18.00	Steady	x
France/Germany to Saudi Arabia: 50/60,000	$26/27.00	Up $1.00	x
France/Germany to South Africa: 30,000 m/t	$24/25.00	Down $2.00	x
France/Germany to Yemen: 30,000 m/t	$39/40.00	Down $2.00	x
Argentina to Algeria: 25/30,000 m/t(3,000 disch)	$17/18.00	Steady	X
Argentina to China: 50,000 m/t, with top-off	$22/23.00	Up $1.00	X
Argentina to Japan: 50,000 m/t, with top-off	$24/25.00	Up $1.00	x
Argentina to Egypt	$18/19.00	Steady	X
Argentina to Europe: 50/60,000 m/t	$16/17.00	Up $1.00	X
Argentina to Morocco: 25,000 m/t(3,000 disch)	$16/17.00	Steady	X
Argentina to Saudi Arabia	$31/32.00	Up $1.00	X
Argentina to South Africa 30,000 m/t (3,000 disch)	$19/20.00	Steady	X
Argentina to Spain: 30,000 m/t	$20/21.00	Up $1.00	X
Argentina to Tunisia: 30,000 m/t	$17/18.00	Steady	X
Brazil to Algeria: 25,000 m/t	$19/20.00	Steady	x
Brazil to China: 55,000 m/t	$15/16.00	Up $1.00	x
Brazil to Japan: 55,000 m/t	$16/17.00	Up $1.00	x
Brazil to Europe	$19/20.00	Up $1.00	x
Brazil to Morocco: 30,000 m/t	$17/18.00	Steady	x
Brazil to Saudi Arabia	$27/28.00	Up $1.00	x
Brazil to Turkey/Egypt: 50,000 m/t	$15/16.00	Up $1.00	x
Australia to China: 40-55,000 m/t	$8.00/8.50	Up $0.50	x
Australia to Japan: 40-55,000 m/t	$8.50/9.00	Up $0.50	x
Australia to Saudi Arabia: 40-55,000 m/t	$10/11.00	Steady	x
Australia to South Africa	$19/20.00	Steady	X
Australia to Iran	$27/28.00	Steady	x
Ukraine to China	$17/18.00	Steady	x
Black Sea to East Med: 30,000 m/t  (3,000 disch)	$17/18.00	Down $2.00	x
Ukraine to East Med: coaster (1,000 disch)	$34/35.00	Steady	x
Black Sea to Egypt: 40/50,000 m/t – (6,000 disch)	$6/8.00	Down $1.00	X
Ukraine to Egypt: coaster 3,000 m/t (1,000 disch)	$34/35.00	Steady	X
Black Sea to Iraq: 50,000 m/t (4,000 disch)	$23/24.00	Down $1.00	x
Black Sea to Morocco: 30,000 m/t (3,000 disch)	$15/16.00	Down $1.00	x
Black Sea to Spain: 40/50,000 m/t (8,000 disch)	$10/11.00	Steady	x
Black Sea to Jordan: 50,000 m/t (4,000 disch)	$13/14.00	Down $1.00	X
Black Sea to Saudi Arabia – Jeddah – 50k	$18/19.00	Down $2.00	x
Black Sea to South Africa – 30,000 m//t	$20/21.00	Steady	x
Black Sea to Tunisia/Algeria: 30,000(5,000 disch)	$13/14.00	Down $2.00	x
Baltic Dry Index	315	Up 24	x
Baltic Capesize Index	207	Up 8	x
Baltic Panamax Index	355	Up 31	x
Baltic Supramax Index	286	Up 43	x
Baltic Handisize Index	198	Up 15	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 March/May 2016

 

Wheat, USA Soft Red Winter, NOLA	USD 196/199	x
Wheat, USA Hard Red Winter 12 protein	USD 208/212	x
Wheat, Ukraine 11.5 pro, 30,000+ m/t	USD 171/173	x
Wheat, Russia 12.5 pro, 30,000+ m/t	USD 181/183	x
Wheat, Romania 12.5 pro	USD 182/184	x
Wheat, Superior, France, Rouen	USD 169/171	x
Wheat, Medium, France, Rouen	USD 166/168	x
Wheat, milling, 12.0%, Argentina, upriver	USD 197/202	x
Wheat, feed, Black Sea	USD 170/172	x
Barley, France, Rouen port	USD 164/166	x
Barley, feed, Argentina	USD 161/165	x
Barley, feed, Black Sea, 30,000+	USD 171/175	x
Barley, feed, USA Pacific Northwest	USD 145/150	x
Corn, FOB NOLA USA	USD 170>>165	x
Corn, FOB USA Pacific northwest	USD 173/176	x
Corn, CNF Asia, USA #2	USD 207/211	x
Corn, FOB Argentina port, upriver	USD 167/170	X
Corn, FOB Brazil port	USD 161/165	x
Corn, FOB Black Sea, 30,000+ m/t	USD 165/170	x
Corn, FOB France	USD 168/171	x
Corn, FOB Romania	USD 167/170	x
Sorghum, FOB Texas	USD 177/181	X
Sorghum, FOB Argentina port	USD 150/155	x
Soymeal, 48% protein, FOB NOLA	USD 321>>315	X
Soymeal, 48% protein, USA, Rotterdam	USD 347>>340	x
Soymeal, USA CNF Asia	USD 372/377	x
Soymeal, Argentina, Rotterdam	USD 322/325	x
Soymeal, 47% pro, FOB Argentina	USD 302/306	x
Soymeal, 48% protein, Brazil, Rotterdam	USD 314/317	x
Soymeal, FOB Brazil	USD 285/290	x
Soymeal, 48% protein, India FAQ	USD 545/555	x
Soybeans, FOB NOLA	USD 350/353	x
Soybeans USA #2, CNF Asia	USD 387/392	x
Soybeans, Argentina, FOB	USD 329/332	x
Soybeans, Brazil, FOB	USD 339/343	x
Soybeans, Black Sea	USD 370/375	x
Corn Gluten Meal, USA FOB NOLA	USD  550/560 m/t	x
Corn Gluten Meal, USA CNF Asia, cont.	USD  610/615 m/t	x
Corn Gluten Meal, USA CNF Egypt, cont.	USD  635/640 m/t	x
Corn Gluten Feed, USA FOB NOLA	USD  170/175 m/t	x
DDGS corn, 35 profat, USA FOB NOLA	USD  191>>181 m/t	x
DDGS corn, 35 profat, USA CNF Asia, cont	USD  214/220 m/t	x

 

DDGS supplies for Feb/March shipment are tight with the nearby periods offered at as much as USD 10 m/t over April/May shipment. There were comments in the trade that DDGS export demand will be strong in the next few months, assuming China is still buying, due to the possible increased demand for DDGS by the aquaculture feed producers. DDGS prices are still quite competitive with corn/soymeal – both in domestic and export markets – but increasing prices for corn and soymeal may pull DDGS prices higher.

 

Corn Gluten Meal prices seem to have decided not to go any lower and for now are stuck in a range of about USD 10 m/t. Export demand is steady and February/March export positions are tough to find and if found are at a premium to April/May. Lower fishmeal prices could put some pressure on CGM prices but will probably not have a major effect overall.

 

Corn gluten feed prices are steady and just follow whatever is happening to corn prices.

 

 

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 400/410 m/t CNF Asia  USD 425/435 m/t CNF Asia  USD 440/450 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 360/380 m/t CNF Asia  USD 390/400 m/t CNF Asia  USD 460/470 m/t CNF Asia  USD 640/660 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 370/380 m/t CNF Asia  USD 380/400 m/t CNF Asia  USD 390/410 m/t CNF Asia  USD 680/700 m/t CNF Asia

 

It was a very quiet week on the export side of things for animal proteins due to the Chinese New Year holidays and people slowly returning to work. Business should be a tad more exciting this coming week. Indonesia is the major animal protein market for US exports and all seems to have been very quiet in Indonesia.

 

There was no change in export prices from Australia and New Zealand and South American exports are still saying that they can't find any buyers – so, markets are very quiet.

 

With fishmeal prices continuing lower there could be some downward pressure on animal protein items but with soymeal moving higher a little there is also some upward pressure.

 

In the USA, meat and bone meal is still very, very competitive to soymeal and this is keeping domestic prices steady as buyers lean toward lower cost animal proteins in their feed formulations. One trade report this week noted that US feed producers of vegetable only animal feeds are finding themselves too expensive.

 

It should also be noted that US trade reports are now turning bullish with the feeling that US demand will continue to increase and animal protein prices should move higher in coming months – at least on the domestic side of things.

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

South American fishmeal prices continue to move lower and, as can be seen by the table below, Peru and Chile now look to be quite competitive with European fishmeal prices – this is something that has not been seen in many months.

 

According to reports from Peru, there is a good lineup of fishmeal for shipment to China, so Chinese buyers may not be all that enthusiastic to book new lots. However, the lower prices could certainly get a few buyers interested. As noted by MSI Ceres this week, possible fishing quota reductions in the EU may make South America even more competitive.

 

Business has been very slow as major buyers have not seen any reason to rush into the market. Also, with a possible delay to the Chinese aqua season there does not look to be much reason for China to rush out and stock up.

 

Currently, producers in Peru have good stocks of fishmeal, about 130,000 m/t, and are looking very seriously at all buyer's bids. As can be seen by the USD 30 m/t drop in price this week, there is certainly little price strength in the market. However, as can be seen in the prices below, there is a big premium to be paid for Super Prime fishmeal as supplies of low FFA product is quite limited.

 

Trade reports in Peru mentioned this week that as much as 60 percent of the stock of fishmeal is held by only two large companies – this could limit the weakness in market prices.

 

 

European fishmeal prices – FOB North German port.

 

Type	Protein %	Price per m/t USD
Herring fishmeal	72% protein	1,730
Danish fishmeal	64% protein	1,500
Peru fishmeal	64% protein	1,500
Chile fishmeal	67% protein	1,600
Iceland fishmeal	70% protein	1,740

 

 

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	1300/1320 m/t
65/66 protein	1330/1350 m/t
67% protein standard steam	1350/1370 m/t	No offers
67% protein 150 TVN	1420/1450 m/t	1450/1480
67% protein 120 TVN	1500/1520 m/t	1500/1520
67% protein 1000 hist, 120 TVN	1550/1570 m/t	1550/1570
68% protein 500 hist, 120 TVN	1650/1670 m/t	1650/1670
Fish oil, crude bulk	2300/2350	2000/2100
Fish oil, crude drums	2450/2500
Fish oil, flexi tank	2550/2600
Fish oil, Omega 3: 28%EPA/DHA	2800/2850

 

 

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

           

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