Weekly report - Oct 01, 2016

 

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

Corporate Head Office: Suite 200B, Centre of Commerce, One Bay Street,

PO Box N-3944, Nassau, Bahamas.   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

 

Friday was the day for the quarterly USDA stocks report and there were a few surprises. Wheat stocks are at the highest summer stocks level in thirty years and are about five percent higher than the trade had been expecting. Corn stocks were the highest seen in ten years but were still a little lower than the trade had forecasted and the same with soybeans, where stocks were just a little less than pre-report forecasts.

 

Reading all the week ending trade reports it seems that the only numbers that could push prices would be the soybean stocks as old crop supplies are now seen to be even tighter than the experts has expected. This should keep soybean prices from dropping. With soybeans, the lower current stocks have to be offset against the expected amazing soybean crop yields – so the mountains of soybeans may be a little lower. In the cash market soybeans were unchanged while in the futures beans were off a dollar or so for the week. With harvest just starting to chug along there seems to be no reason to expect soybean or soymeal prices to be moving higher.

 

Corn prices were up a little on Friday after the report but were really unchanged on the week from last week. The USDA report seemed to push prices up a little on the futures side of things but certainly not a major rally or even a minor one – just an up day.  The big question on corn will be what the yields work out to – it seems that some early US harvest yields are lower than had been expected and while this may not be an overall trend it can be a little worrying to anyone who is short corn. Even with a very good crop expected, a little drop in yields could certainly push corn prices higher. We will all be watching as the harvest progresses to see if average yields get closer to the USDA forecasts.

          

 

 

 

Crop condition --- USA and France

 

Condition USA Sep 19, 2016	Very poor	Poor	Fair	Good	Excellent
Corn	2	5	19	54	20
Soybeans	2	5	20	54	19
Sorghum	1	5	28	52	14
Harvested	Sep 25 2016	Five year average
Corn	15%	19%
Soybeans	10%	13%
Sorghum	34%	32%
Spring Wheat	100%	100%
Barley	100%	100%
Winter wheat planted	30%	30%
Condition France Sep 26, 2016	Very poor	Poor	Fair	Good	Excellent
Corn	7	14	26	46	8
Winter crops planted	2016	2015
Wheat – soft	1%	2%
Barley	1%	2%

@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)	$16.00/16.50	Steady	x
US Gulf to Spain: 30,000 m/t (5,000 disch)	$22/23.00	Steady	x
US Gulf Israel: 50,000 MT	$21/22.00	Steady	X
US Gulf to Egypt: Panamax(6,000 disch)	$20/21.00	Steady	X
US Gulf Turkey: 50,000	$22/23.00	Steady	X
US Gulf Morocco: 30,000(5,000 disch)	$27/28.00	Steady	X
US Gulf Nigeria: 30,000 m/t	$50/51.00	Steady	X
US Gulf other Med: 30,000 MT(5,000 disch)	$32/33.00	Steady	X
US Gulf Japan: Panamax	$29/30.00	Steady	x
US Gulf China: Panamax	$28/29.00	Steady	x
US PNW South Africa – 40,000 m/t	$37/38.00	Up $1.00	x
US PNW Japan: Panamax	$16/17.00	Steady	X
US PNW China: Panamax	$15/16.00	Steady	x
US East Coast Egypt: Panamax	$43/44.00	Steady	x
US East Coast Nigeria: Handisize	$48/49.00	Steady	x
France/Germany to Algeria: 30,000 m/t(3,000 disch)	$27/28.00	Up $1.00	X
France/Germany to Egypt: 50,000 m/t (10,000 disch)	$25/26.00	Steady	X
France/Germany to Jordan: 35/45,000 m/t (4,000 disch)	$33/34.00	Up $1.00	X
France/Germany to Morocco: 30,000 m/t (3,000 disch)	$26/27.00	Up $1.00	X
France/Germany to Saudi Arabia: 50/60,000	$36/37.00	Up $1.00	X
France/Germany to South Africa: 30,000 m/t	$35/36.00	Steady	X
France/Germany to Yemen: 30,000 m/t	$52/53.00	Steady	x
Argentina to Algeria: 25/30,000 m/t(3,000 disch)	$28/29.00	Up $1.00	x
Argentina to China: 50,000 m/t, with top-off	$28/29.00	Steady	x
Argentina to Japan: 50,000 m/t, with top-off	$30/31.00	Steady	x
Argentina to Egypt: 50,000 m/t	$24/25.00	Up $1.00	x
Argentina to Europe: 50/60,000 m/t	$26/27.00	Steady	x
Argentina to Morocco: 25/30,000 m/t(3,000 disch)	$27/28.00	Up $1.00	x
Argentina to Saudi Arabia: 25/30,000 m/t	$44/45.00	Up $1.00	x
Argentina to South Africa 25/30,000 m/t (3,000 disch)	$27/28.00	Up $1.00	x
Argentina to Spain: 30,000 m/t	$28/29.00	Up $1.00	x
Argentina to Tunisia: 25/30,000 m/t (3,000 disch)	$28/29.00	Up $1.00	x
Brazil to Algeria: 25/30,000 m/t	$28/29.00	Steady	X
Brazil to China: 55,000 m/t	$22/23.00	Steady	X
Brazil to Japan: 55,000 m/t	$24/25.00	Steady	X
Brazil to Europe: 30,000 m/t	$25/26.00	Steady	X
Brazil to Morocco: 25/30,000 m/t	$24/25.00	Steady	X
Brazil to Saudi Arabia 30/40,000 m/t	$37/38.00	Steady	X
Brazil to Turkey/Egypt: 50,000 m/t	$23/24.00	Steady	X
Australia to China: 40-55,000 m/t – round trip	$19.00/19.50	Steady	X
Australia to Japan: 40-55,000 m/t – round trip	$19.50/20.00	Steady	X
Australia to Saudi Arabia: 40-55,000 m/t	$23/24.00	Steady	x
Ukraine to China	$26/27.00	Steady	x
Black Sea to East Med: 30,000 m/t  (3,000 disch)	$27/28.00	Up $1.00	X
Ukraine to East Med: coaster (1,000 disch)	$25/26.00	Steady	X
Black Sea to Egypt: 40/50,000 m/t – (6,000 disch)	$11/12.00	Up $1.00	X
Black Sea to Egypt: 30,000 m/t	$12/13.00	Up $1.00	X
Ukraine to Egypt: coaster 3,000 m/t (1,000 disch)	$25/26.00	Steady	X
Black Sea to Iraq: 50,000 m/t (4,000 disch)	$27/28.00	Steady	X
Black Sea to Morocco: 30,000 m/t (3,000 disch)	$23/24.00	Up $1.00	X
Black Sea to Spain: 40/50,000 m/t (8,000 disch)	$14/15.00	Down $1.00	X
Black Sea to Jordan: 50,000 m/t (4,000 disch)	$19/20.00	Up $1.00	X
Black Sea to Saudi Arabia – Jeddah – 50k	$24/25.00	Up $1.00	X
Black Sea to South Africa – 30,000 m//t	$31/32.00	Up $1.00	x
Black Sea to Tunisia/Algeria: 30,000(5,000 disch)	$18/19.00	Up $1.00	X
Baltic Dry Index	875	Down 66	x
Baltic Capesize Index	2008	Down 375	X
Baltic Panamax Index	726	Up 4	X
Baltic Supramax Index	679	Up 8	X
Baltic Handisize Index	421	No change	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 October/December 2016

 

Wheat, USA Soft Red Winter, NOLA	USD 186/190	x
Wheat, USA Hard Red Winter 12 protein	USD 197/199	x
Wheat, Ukraine 11.5 pro, 30,000+ m/t	USD 162/164	X
Wheat, Russia 12.5 pro, 30,000+ m/t	USD 168/172	X
Wheat, Romania 12.5 pro	USD 170/173	X
Wheat, Superior, France, Rouen	USD 185/187	X
Wheat, Medium, France, Rouen	No prices	x
Wheat, milling, 12.0%, Argentina, upriver	USD 184/187	X
Wheat, feed, Black Sea	USD 155/158	X
Barley, France, Rouen port	USD 154/156	X
Barley, feed, Argentina	USD 159/162	X
Barley, feed, Black Sea, 30,000+	USD 150/153	X
Barley, feed, USA Pacific Northwest	USD 178/182	X
Corn, FOB NOLA USA	USD 162/166	X
Corn, FOB USA Pacific northwest	USD 174/177	X
Corn, FOB Argentina port, upriver	USD 172/174	X
Corn, FOB Brazil port	USD 192/194	X
Corn, FOB Black Sea, 30,000+ m/t	USD 158/162	X
Corn, FOB France	USD 174/182	x
Corn, FOB Romania	USD 163/167	x
Sorghum, FOB Texas	USD 173>>165	x
Sorghum, FOB Argentina port	USD 162/166	x
Soymeal, 48% protein, FOB NOLA	USD 360/364	x
Soymeal, 48% protein, USA, Rotterdam	USD 385/389	X
Soymeal, Argentina, Rotterdam	USD 361/364	x
Soymeal, 47% pro, FOB Argentina	USD 335/338	X
Soymeal, 48% protein, Brazil, Rotterdam	USD 358/362	X
Soymeal, FOB Brazil	USD 328/332	X
Soymeal, 48% protein, India FAQ	USD 520/525	X
Soybeans, FOB NOLA	USD 383/387	x
Soybeans, Argentina, FOB	USD 395/398	X
Soybeans, Brazil, FOB	USD 406/409	X
Soybeans, Black Sea	USD 378/382	X
Corn Gluten Meal, USA FOB NOLA	USD  550/560 m/t	x
Corn Gluten Meal, CNF Egypt	USD  610/630 m/t	x
Corn Gluten Feed, USA FOB NOLA	USD  142/145 m/t	x
DDGS corn, 35 profat, USA FOB NOLA	USD  164/168 m/t	x

 

The China duty situation with US origin DDGS has hit the prices quite hard this week and, at least for now, DDGS seems to be a tremendous bargain. The US Grains Council made the comment in their weekly report that, even with the added duties and taxes, US DDGS should be able to compete with local product from a price point of view but will have a greater advantage in DDGS quality. It is too soon to know if this "US advantage" will allow DDGS shipment to China to remain strong or if the China business will continue to dwindle, as has been seen so far in 2016.

 

Both corn gluten meal and corn gluten meal are also at very attractively prices for export markets, as we are now reaching export price levels that we have not seen since some low price levels in late 2015. Looking at corn gluten meal in particular, it is difficult to see the FOB or CNF prices going much lower than the current levels – although, if meat and bone meal continues weak and fishmeal prices stay where they are perhaps there could be a further drop in 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 420/440 m/t CNF Asia  USD 530/540 m/t CNF Asia  USD 460/470 m/t CNF Asia
Paraguay Meat &Bone meal, 45% protein	USD 410/420 m/t CNF Asia
Australian MBM 45 protein    Australian MBM 50 protein    Australian Feathermeal, 80 protein    Australian Poultry Meal, pet food	USD 425/435 m/t CNF Asia  USD 470/480 m/t CNF Asia  USD 520/530 m/t CNF Asia  USD 760/780 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 450/470 m/t CNF Asia  USD 500/520 m/t CNF Asia  USD 580/600 m/t CNF Asia  USD 740/760 m/t CNF Asia

 

With vegetable protein prices continuing to move lower this week there was steady pressure on animal protein prices and price did slide a little lower. The Jacobsen Report has made the comment for the past couple of weeks that significant quantities of meat and bone meal from Europe is being smuggled into some countries and that this is pushing prices lower. Some in the trade are saying that it is not so much smuggling as origin changing – much like all the embargoed food products going into Russia as Belarus production that are still in original EU packaging.  

 

However, it is also reported that the total demand for animal proteins is falling in parts of Asia, as feed producers are seeing a slip in feed use – but this is more seasonal than any trend to lower feed production.

 

The US domestic prices for most animal proteins continues weaker and this will help to keep export prices trending lower. No one in the protein trade seems to be forecasting any increase in prices in coming weeks, at least not for feed use items.

 

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

Very, very little to report from Peru this week. Fishing in the South has been zero for the past few weeks now with a balance of 350,000 m/t of catch left on the 382,000 m/t quota and only until December 31, 2016 to use up the balance.

 

There is nothing in the way of buying interest in the Peru market at present and, as mentioned last week, the sellers don't mind waiting to book more business --- they can't sell what they don't have and most are loath to sell too much on an unknown quota level. On some occasions in the past, producers had oversold their expected stocks and ended up with unhappy buyers.

 

The best guess on the next Peru fishing quota seems to be at about 2 million m/t total catch but there is some concern that even that level may not be able to be landed, depending on when the fishing season actually begins. Some trade folks feel that we may just see a maximum of 1.5 million m/t catch, no matter what the quota is set at.

 

 

European fishmeal prices – FOB North German port.

 

Type	Protein %	Price per m/t USD	Cost per protein unit
Herring fishmeal	72% protein	1,830	25.41
Danish fishmeal	64% protein	1,520	23.75
Peru fishmeal	64% protein	1,580	24.69
Chile fishmeal	67% protein	1,680	25.07
Iceland fishmeal	70% protein	1,885	26.93

 

 

 

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
	New crop prices for the Peru November fishing quota
65% protein	1330/1340 m/t
65/66 protein	1350/1360 m/t
67% protein standard steam	1380/1400 m/t
67% protein 150 TVN	1420/1440 m/t
67% protein 120 TVN	1450/1470 m/t
67% protein 1000 hist, 120 TVN	1510/1530 m/t	1500/1520
68% protein 500 hist, 120 TVN	1540/1560 m/t	1550/1570
Fish oil, crude bulk	2150/2200	1700/1750
Fish oil, crude drums	2250/2300
Fish oil, flexi tank	2400/2450
Fish oil, Omega 3: 28%EPA/DHA	2800/3000

 

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