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PO Box N-3944, Nassau, Bahamas. Email: tradegroup@hammersmith.biz
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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
Back from rainy, rainy, rainy London only to be greeted by heavy rains in France. All this rain in France and the UK is turning quite a bit of the winter wheat crop into feed wheat rather than milling wheat. Feed wheat is now much better priced than corn in most European markets.
On the US side of things we had corn prices up once again on the week and saw bot futures and cash prices move higher by about USD 6 m/t. Soybeans and soymeal actually had a down week and they would have been even further down except for a very strong price rally on Friday – soybean ended the week down by about USD 7 m/t while soymeal was down by around USD 6 m/t.
Soybeans had a big finish to the week due to the hot and dry weather forecast in the US and concerns that some rain is need and that hot may just be too hot. There has also been good soybean demand from China – both for US and Brazil soybeans – and this demand is helping to keep prices firm.
Corn, much like soybeans, rallied on the hot dry weather in parts of the US. The odd expert is even talking about a drought in corn country but this is not a widely held idea. Corn futures are now at their highest level since May 2014. A number of experts pointed out that while the short-term weather looks ok, the 60 to 90 day weather doesn't look so good for crops – this due to longer-term hot and dry weather. But then, we need to expect all these weather related rallies and such every crop season. What is summer without a few good weather related price rallies.
Looking at the futures trends, corn seems to be in a steady trend higher while soybeans and a little harder to read but also look like up is the trend.
Crop planting progress and condition --- USA and France
| Planting USA | June 12 2016 % | June 12 2015 % | Five year Average % |
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| Sorghum | 76 | 67 | 75 |
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| Soybeans | 83 | 85 | 87 |
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| Condition USA June 12, 2016 | Very poor | Poor | Fair | Good | Excellent |
| Winter wheat - % | 2 | 7 | 30 | 49 | 12 |
| Spring wheat | 0 | 2 | 19 | 67 | 12 |
| Barley | 0 | 1 | 21 | 60 | 18 |
| Corn | 1 | 3 | 21 | 60 | 15 |
| Soybeans | 1 | 3 | 24 | 62 | 10 |
| Sorghum | 1 | 3 | 25 | 64 | 7 |
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| Condition France June 13, 2016 | Very poor | Poor | Fair | Good | Excellent |
| Wheat | 1 | 6 | 18 | 53 | 22 |
| Winter barley | 2 | 7 | 18 | 55 | 18 |
| Durum wheat | 3 | 10 | 19 | 55 | 13 |
| Spring barley | 0 | 1 | 13 | 62 | 24 |
| Corn | 3 | 6 | 18 | 69 | 4 |
@USDA and France AgriMer
Estimated Bulk Grain freight in USD per m/t, basis heavy grains
| US Gulf to Europe: 60/70,000 (10,000 disch) | $15/16.00 | Steady | X |
| US Gulf to Spain: 30,000 m/t (5,000 disch) | $21/22.00 | Steady | x |
| US Gulf Israel: 50,000 MT | $23/24.00 | Steady | X |
| US Gulf to Egypt: Panamax(6,000 disch) | $22/23.00 | Steady | X |
| US Gulf Turkey: 50,000 | $24/25.00 | Steady | X |
| US Gulf Morocco: 30,000(5,000 disch) | $31/32.00 | Steady | X |
| US Gulf Nigeria: 30,000 m/t | $46/47.00 | Steady | X |
| US Gulf other Med: 30,000 MT(5,000 disch) | $31/32.00 | Steady | X |
| US Gulf Japan: Panamax | $27/28.00 | Steady | X |
| US Gulf China: Panamax | $26/27.00 | Steady | X |
| US PNW South Africa | $31/32.00 | Steady | X |
| US PNW Japan: Panamax | $15/16.00 | Down $1.00 | X |
| US PNW China: Panamax | $14/15.00 | Down $1.00 | X |
| US East Coast Egypt: Panamax | $41/42.00 | Steady | X |
| US East Coast Nigeria: Handisize | $48/49.00 | Steady | X |
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| France/Germany to Algeria: 30,000 m/t(3,000 disch) | $24/25.00 | Steady | X |
| France/Germany to Egypt: 50,000 m/t (10,000 disch) | $22/23.00 | Steady | X |
| France/Germany to Jordan: 35/45,000 m/t (4,000 disch) | $28/29.00 | Steady | X |
| France/Germany to Morocco: 30,000 m/t (3,000 disch) | $23/24.00 | Steady | X |
| France/Germany to Saudi Arabia: 50/60,000 | $30/31.00 | Steady | X |
| France/Germany to South Africa: 30,000 m/t | $30/31.00 | Steady | X |
| France/Germany to Yemen: 30,000 m/t | $47/48.00 | Steady | X |
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| Argentina to Algeria: 25/30,000 m/t(3,000 disch) | $25/26.00 | Up $1.00 | X |
| Argentina to China: 50,000 m/t, with top-off | $27/28.00 | Steady | X |
| Argentina to Japan: 50,000 m/t, with top-off | $28/29.00 | Steady | x |
| Argentina to Egypt: 50,000 m/t | $24/25.00 | Up $1.00 | X |
| Argentina to Europe: 50/60,000 m/t | $24/25.00 | Up $1.00 | X |
| Argentina to Morocco: 25/30,000 m/t(3,000 disch) | $23/24.00 | Up $1.00 | X |
| Argentina to Saudi Arabia: 25/30,000 m/t | $41/42.00 | Up $1.00 | X |
| Argentina to South Africa 25/30,000 m/t (3,000 disch) | $25/26.00 | Up $1.00 | X |
| Argentina to Spain: 30,000 m/t | $27/28.00 | Up $1.00 | X |
| Argentina to Tunisia: 25/30,000 m/t(3,000 disch) | $25/26.00 | Up $1.00 | X |
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| Brazil to Algeria: 25/30,000 m/t | $26/27.00 | Steady | X |
| Brazil to China: 55,000 m/t | $18/19.00 | Steady | X |
| Brazil to Japan: 55,000 m/t | $20/21.00 | Steady | X |
| Brazil to Europe: 30,000 m/t | $24/25.00 | Steady | X |
| Brazil to Morocco: 25/30,000 m/t | $23/24.00 | Steady | X |
| Brazil to Saudi Arabia 30/40,000 m/t | $37/38.00 | Steady | X |
| Brazil to Turkey/Egypt: 50,000 m/t | $21/22.00 | Steady | X |
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| Australia to China: 40-55,000 m/t – round trip | $17.50/18.00 | Steady | X |
| Australia to Japan: 40-55,000 m/t – round trip | $18/18.50 | Steady | X |
| Australia to Saudi Arabia: 40-55,000 m/t | $21/22.00 | Down $1.00 | X |
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| Ukraine to China | $21/22.00 | Steady | X |
| Black Sea to East Med: 30,000 m/t (3,000 disch) | $23/24.00 | Steady | X |
| Ukraine to East Med: coaster (1,000 disch) | $24/25.00 | Steady | X |
| Black Sea to Egypt: 40/50,000 m/t – (6,000 disch) | $9/10.00 | Steady | X |
| Ukraine to Egypt: coaster 3,000 m/t (1,000 disch) | $24/25.00 | Steady | X |
| Black Sea to Iraq: 50,000 m/t (4,000 disch) | $25/26.00 | Steady | X |
| Black Sea to Morocco: 30,000 m/t (3,000 disch) | $21/22.00 | Steady | X |
| Black Sea to Spain: 40/50,000 m/t (8,000 disch) | $11/12.00 | Down $1.00 | X |
| Black Sea to Jordan: 50,000 m/t (4,000 disch) | $17/18.00 | Steady | X |
| Black Sea to Saudi Arabia – Jeddah – 50k | $20/21.00 | Steady | X |
| Black Sea to South Africa – 30,000 m//t | $27/28.00 | Steady | X |
| Black Sea to Tunisia/Algeria: 30,000(5,000 disch) | $17/18.00 | steady | X |
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| Baltic Dry Index | 587 | Down 23 | X |
| Baltic Capesize Index | 927 | Down 79 | X |
| Baltic Panamax Index | 546 | Up 3 | x |
| Baltic Supramax Index | 555 | Down 2 | x |
| Baltic Handisize Index | 311 | Down 16 | x |
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FOB port or location specified. Prices in US$, in metric tons:
All shipments in bulk grain vessels unless stated otherwise
(NOLA is New Orleans, Louisiana, USA.)
ALL PRICES ARE FOR July/September 2016
| Wheat, USA Soft Red Winter, NOLA | USD 203/208 | x |
| Wheat, USA Hard Red Winter 12 protein | USD 202/207 | x |
| Wheat, Ukraine 11.5 pro, 30,000+ m/t | USD 178/181 | x |
| Wheat, Russia 12.5 pro, 30,000+ m/t | USD 182/185 | x |
| Wheat, Romania 12.5 pro | USD 184/187 | x |
| Wheat, Superior, France, Rouen | USD 180/183 | x |
| Wheat, Medium, France, Rouen | USD 178/180 | x |
| Wheat, milling, 12.0%, Argentina, upriver | USD 207/210 | x |
| Wheat, feed, Black Sea | USD 168/173 | x |
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| Barley, France, Rouen port | USD 167/169 | x |
| Barley, feed, Argentina | USD 158/163 | x |
| Barley, feed, Black Sea, 30,000+ | USD 157/162 | x |
| Barley, feed, USA Pacific Northwest | USD 195/200 | x |
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| Corn, FOB NOLA USA | USD 201/208 | x |
| Corn, FOB USA Pacific northwest | USD 205/208 | x |
| Corn, CNF Asia, USA #2 | USD 221/224 | x |
| Corn, FOB Argentina port, upriver | USD 197/202 | x |
| Corn, FOB Brazil port | USD 202/205 | x |
| Corn, FOB Black Sea, 30,000+ m/t | USD 198/202 | x |
| Corn, FOB France | USD 205/208 | x |
| Corn, FOB Romania | USD 201/206 | x |
| Sorghum, FOB Texas | USD 195/198 | x |
| Sorghum, FOB Argentina port | USD 183/186 | x |
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| Soymeal, 48% protein, FOB NOLA | USD 467/475 | x |
| Soymeal, 48% protein, USA, Rotterdam | USD 497/505 | X |
| Soymeal, 46.5 pro, USA CNF Asia | USD 502/507 | x |
| Soymeal, Argentina, Rotterdam | USD 471>>465 | X |
| Soymeal, 47% pro, FOB Argentina | USD 438/445 | x |
| Soymeal, 48% protein, Brazil, Rotterdam | USD 471/474 | x |
| Soymeal, FOB Brazil | USD 436/443 | x |
| Soymeal, 48% protein, India FAQ | No offers | x |
| Soybeans, FOB NOLA | USD 437/442 | x |
| Soybeans USA #2, CNF Asia | USD 496/507 | x |
| Soybeans, Argentina, FOB | USD 438/443 | x |
| Soybeans, Brazil, FOB | USD 463/468 | x |
| Soybeans, Black Sea | USD 440/445 | x |
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| Corn Gluten Meal, USA FOB NOLA | USD 675/680 m/t | x |
| Corn Gluten Meal, USA CNF Asia, cont. | USD 750/760 m/t | X |
| Corn Gluten Meal, CNF Egypt | USD 775/780 m/t | x |
| Corn Gluten Feed, USA FOB NOLA | USD 148/154 m/t | x |
| DDGS corn, 35 profat, USA FOB NOLA | USD 249>>237 m/t | x |
| DDGS corn, 35 profat, USA CNF Asia, cont | USD 267>>255 m/t | X |
Corn prices continued higher again this week and DDGS followed right along. With there being little or no DDGS available for export loading until late July export buyers are chasing whatever positions that they can find. There is also concern that the US weather may turn bad for the corn crop and that this will push DDGS price higher. US DDGS monthly shipments to China are also up – much to everyone's surprise. For now, it doesn't look like we will be seeing DDGS prices moving lower. The trend seems to be steady to higher. The US domestic market for DDGS was also up on the week – some report as much as USD 15 ton.
USA corn gluten meal prices in the domestic market was reported to be as much as USD 50 m/t higher but this has not as yet been seen in the export market – so we could be in for a further rally. A major CGM exporter was saying this week that CGM prices had been artificially low and are now just getting back to a more normal level.
Speaking of corn gluten meal, one wonders if the new fishmeal season will have an effect on CGM prices. Will a sudden serious drop in fishmeal prices also tend to move CGM lower. It would seem likely as experts had been saying that high fishmeal prices had been part of the cause for the recent CGM price rally.
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 430/440 m/t CNF Asia USD 460/470 m/t CNF Asia USD 470/480 m/t CNF Asia |
| Paraguay Meat &Bone meal, 45% protein | USD 430/440 m/t CNF Asia |
| Australian MBM 45 protein Australian MBM 50 protein Australian Feathermeal, 80 protein Australian Poultry Meal, pet food | USD 470/480 m/t CNF Asia USD 520/530 m/t CNF Asia USD 470/490 m/t CNF Asia USD 790/810 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 510/530 m/t CNF Asia USD 470/480 m/t CNF Asia USD 620/640 m/t CNF Asia USD 750/770 m/t CNF Asia |
Export markets for animal proteins are reported to have been very quiet this week but there has been little weakness in export prices even with the lack of customer inquiries. Ramadan has slowed buying in Indonesia and this should stay quiet for another couple of weeks.
It will be interesting to see if the new Peru fishing season has any effect on animal protein demand as with expected lower fishmeal prices we may see that interest in poultry meal falls off a little.
USA domestic prices for MBM were a little higher on the week as the prices try to catch up to the soymeal rally of the past few weeks. The Jacobsen Report this week says that MBM is still selling at too low a ratio versus soymeal and that there should be room for MBM to move higher. USA feathermeal prices were a little higher on the week while poultry meal prices are reported to be steady.
SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN
So now we have the new Peru fishing quota and the season dates: 1.8 million m/t of catch to begin on July 1st and extend until finished or "sometime in August" as based on IMARPE information. The latest IMARPE report showed that the biomass at 7.3 million m/t was up by 65% over the earlier report which certainly helped make the decision for the higher than expected quota. The biomass level is higher than the 20-year average level of about 6.4 million m/t.
The big question now is what will happen to prices. Will the larger than expected quota cause a dramatic and immediate drop in prices or will there suddenly be a rush of buyers and sellers in the market trying to do scads of business before the fishing starts.
One would expect that sellers will now be much more willing to book some forward business but also that buyers will be low-balling offers in the hopes of saving some money.
It is not too hard to imagine that new catch fishmeal prices could slide lower by as much as USD 300 m/t, back to levels that we were seeing not all that long ago.
On other matters, China represents 70% of Peru's export fishmeal business so far in 2016 with Germany being 14% of the export business and other Asian destinations at about 9.0% of exports – that adds up to 93% of all Peru fishmeal exports, so we all know where the markets are.
I was looking at some IFFO numbers for Turkey in 2016 and see that Turkey has imported about 53,000 m/t of fishmeal up to end April with 60% coming from Morocco and another 30% from Georgia, which is Black Sea fishmeal. Turkey's fishmeal imports this year are up by about 67% over last year.
European fishmeal prices – FOB North German port.
| Type | Protein % | Price per m/t USD |
| Herring fishmeal | 72% protein | 1,880 |
| Danish fishmeal | 64% protein | 1,510 |
| Peru fishmeal | 64% protein | 1,690 |
| Chile fishmeal | 67% protein | 1,740 |
| Iceland fishmeal | 70% protein | 1,920 |
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 |
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| 65% protein | 1650/1700 m/t |
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| 65/66 protein | 1700/1750 m/t |
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| 67% protein standard steam | 1750/1800 m/t | No offers |
| 67% protein 150 TVN | 1800/1820 m/t | No offers |
| 67% protein 120 TVN | 1850/1870 m/t | No offers |
| 67% protein 1000 hist, 120 TVN | 1900/1950 m/t | 1950/2000 |
| 68% protein 500 hist, 120 TVN | 1950/2000 m/t | 2000/2050 |
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| Fish oil, crude bulk | 2200/2250 | 1700/1800 |
| Fish oil, crude drums | 2350/2400 |
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| Fish oil, flexi tank | 2450/2500 |
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| Fish oil, Omega 3: 28%EPA/DHA | 2700/2800 |
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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
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