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WEEKLY FEED GRAIN AND PROTEIN REPORT December 10, 2016 --- week 49
SECTION 1: US FEED GRAINS and VEGETABLE AND ANIMAL PROTEIN
The big news this week was the latest USDA WASDE report – a report that changed little or nothing from the November report, at least as far as US supply and demand. Even for world numbers there were no real surprises – Australia wheat is forecasted higher as is Brazil corn – most numbers were u changed. The next USDA WASDE report will be out on January 12, 2017 and it is expected that this report will more exciting.
So where did we end up on prices after the USDA report. Interestingly enough the no-change report resulted in most grains and oilseed prices moving higher. Corn prices were up by about USD 4 to 5 m/t on the week while soybeans were up by USD 4 m/t and soymeal up even more at USD 6 to 7 m/t higher. Winter wheat prices in the US were also a little higher on the week.
Corn prices were said to be higher on expected strong export demand along with more demand from the ethanol industry due to the increased blending target for ethanol in the USA. The increase by the USDA in the Brazil corn estimate didn't have much effect on market prices and, on the futures side, experts say that corn futures were just following soybean prices higher with no good reason for a rally in corn.
USA corn continues to be the lowest priced in export market but prices from South America are inching closer but US corn should continue to hold a big chunk of the corn export business until Brazil is able to ship their new crop corn. In North Africa and the Middle East, Black Sea corn – Ukraine and Romania – is now very competitive to US and it is reported that corn shipments from the Ukraine are so heavy that some wheat shipments are being delayed.
Soybeans were stronger on a nothing USDA report and most expert seem to feel that this was strictly export business related. USA soybean export sales just keep rolling along and the USA will not have to face much in the way of export competition from South America for another couple of months.
There was also some concern for Argentina soybeans as some areas are seeing a shortage of rainfall and, if this continues, soybean prices could move higher.
Crop condition --- USA and France
Crop condition reporting is over for the year. Nothing happening as winter progresses. More updates next spring.
Estimated Bulk Grain Freight in USD per m/t, basis heavy grains
There was a comment by World Perspectives this week that one result of the low freight rates is that owners are not completing maintenance on some vessels due to the low income and are laying up the vessels rather than doing needed repair work and even some regular maintenance.
It is also seen this week that the rates for Capesize vessels continue to drop but that the rates for vessels that are consider grain size are steady to higher --- while the Baltic Dry Index may be lower overall this is due entirely to the weakness in rates for non-grain vessels.
US Gulf to Europe: 60/70,000 (10,000 disch) | $16/16.50 | Steady | X |
US Gulf to Spain: 30,000 m/t (5,000 disch) | $25/26.00 | Up $1.00 | X |
US Gulf Israel: 50,000 MT | $25/26.00 | Up $1.00 | X |
US Gulf to Egypt: Panamax(6,000 disch) | $24/25.00 | Up $1.00 | X |
US Gulf Turkey: 50,000 | $26/27.00 | Up $1.00 | X |
US Gulf Morocco: 30,000(5,000 disch) | $34/35.00 | Up $1.00 | X |
US Gulf Nigeria: 30,000 m/t | $56/57.00 | Up $1.00 | X |
US Gulf other Med: 30,000 MT(5,000 disch) | $36/37.00 | Up $1.00 | X |
US Gulf Japan: Panamax | $35/36.00 | Up $1.00 | X |
US Gulf China: Panamax | $33/34.00 | Steady | X |
US PNW South Africa – 40,000 m/t | $37/38.00 | Steady | x |
US PNW Japan: Panamax | $19/20.00 | Up $1.00 | X |
US PNW China: Panamax | $18/19.00 | Up $1.00 | X |
US East Coast Egypt: Panamax | $46/47.00 | Steady | X |
US East Coast Nigeria: Handisize | $54/55.00 | Up $1.00 | x |
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France/Germany to Algeria: 30,000 m/t(3,000 disch) | $30/31.00 | Steady | x |
France/Germany to Egypt: 50,000 m/t (10,000 disch) | $22/23.00 | Down $1.00 | x |
France/Germany to Jordan: 35/45,000 m/t (4,000 disch) | $38/39.00 | Up $1.00 | x |
France/Germany to Morocco: 30,000 m/t (3,000 disch) | $29/30.00 | Steady | x |
France/Germany to Saudi Arabia: 50/60,000 | $28/29.00 | Corrected | x |
France/Germany to South Africa: 30,000 m/t | $40/41.00 | Up $1.00 | x |
France/Germany to Yemen: 30,000 m/t | $56/57.00 | Up $1.00 | x |
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Argentina to Algeria: 25/30,000 m/t(3,000 disch) | $31/32.00 | Steady | X |
Argentina to China: 50,000 m/t, with top-off | $31/32.00 | Up $1.00 | X |
Argentina to Japan: 50,000 m/t, with top-off | $33/34.00 | Up $1.00 | X |
Argentina to Egypt: 50,000 m/t | $26/27.00 | Steady | X |
Argentina to Europe: 50/60,000 m/t | $29/30.00 | Steady | X |
Argentina to Morocco: 25/30,000 m/t(3,000 disch) | $30/31.00 | Steady | X |
Argentina to Saudi Arabia: 25/30,000 m/t | $47/48.00 | Up $1.00 | X |
Argentina to South Africa 25/30,000 m/t (3,000 disch) | $32/33.00 | Up $1.00 | X |
Argentina to Spain: 30,000 m/t | $30/31.00 | Steady | X |
Argentina to Tunisia: 25/30,000 m/t (3,000 disch) | $31/32.00 | Steady | X |
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Brazil to Algeria: 25/30,000 m/t | $33/34.00 | Up $1.00 | X |
Brazil to China: 55,000 m/t | $26/27.00 | Up $1.00 | X |
Brazil to Japan: 55,000 m/t | $28/29.00 | Up $1.00 | X |
Brazil to Europe: 30,000 m/t | $31/32.00 | Up $1.00 | X |
Brazil to Morocco: 25/30,000 m/t | $29/30.00 | Up $1.00 | X |
Brazil to Saudi Arabia 30/40,000 m/t | $46/47.00 | Up $1.00 | X |
Brazil to Turkey/Egypt: 50,000 m/t | $27/28.00 | Up $1.00 | X |
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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 | $28/29.00 | Up $1.00 | X |
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Ukraine to China: 50,000 m/t | $29/30.00 | Up $1.00 | X |
Black Sea to East Med: 30,000 m/t (3,000 disch) | $30/31.00 | Up $1.00 | X |
Ukraine to East Med: coaster (1,000 disch) | $27/28.00 | Up $1.00 | x |
Black Sea to Egypt: 40/50,000 m/t – (6,000 disch) | $15/16.00 | Up $1.00 | X |
Black Sea to Egypt: 30,000 m/t – (4,000 dich) | $16/17.00 | Up $1.00 | X |
Ukraine to Egypt: coaster 3,000 m/t (1,000 disch) | $27/28.00 | Up $1.00 | x |
Black Sea to Iraq: 50,000 m/t (4,000 disch) | $29/30.00 | Steady | X |
Black Sea to Morocco: 30,000 m/t (3,000 disch) | $27/28.00 | Up $1.00 | X |
Black Sea to Spain: 40/50,000 m/t (8,000 disch) | $15/16.00 | Steady | X |
Black Sea to Jordan: 50,000 m/t (4,000 disch) | $23/24.00 | Up $2.00 | X |
Black Sea to Saudi Arabia – Jeddah – 50k | $28/29.00 | Steady | X |
Black Sea to South Africa – 30,000 m//t | $38/39.00 | Up $1.00 | X |
Black Sea to Tunisia/Algeria: 30,000(5,000 disch) | $22/23.00 | Up $1.00 | X |
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Baltic Dry Index | 1090 | Down 108 | x |
Baltic Capesize Index | 1575 | Down 618 | x |
Baltic Panamax Index | 1508 | No change | x |
Baltic Supramax Index | 966 | Up 45 | x |
Baltic Handisize Index | 567 | Up 24 | x |
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FOB port or location specified. Prices in US$, in metric tons:
All shipments in bulk grain vessels unless stated otherwise
(NOLA is New Orleans, Louisiana, USA.)
ALL PRICES ARE FOR January 2017/March 2017
Wheat, USA Soft Red Winter, NOLA | USD 179/182 | x |
Wheat, USA Hard Red Winter 12 protein | USD 191/194 | x |
Wheat, Ukraine 11.5 pro, 30,000+ m/t | USD 179/182 | X |
Wheat, Russia 12.5 pro, 30,000+ m/t | USD 180/183 | X |
Wheat, Romania 12.5 pro | USD 180/184 | X |
Wheat, Superior, France, Rouen | USD 181/183 | x |
Wheat, Medium, France, Rouen | No prices | X |
Wheat, milling, 12.0%, Argentina, upriver | USD 170/173 | X |
Wheat, feed, Black Sea | USD 171/173 | X |
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Barley, France, Rouen port | USD 153/156 | x |
Barley, feed, Argentina | USD 155/159 | x |
Barley, feed, Black Sea, 30,000+ | USD 158/162 | x |
Barley, feed, USA Pacific Northwest | USD 188/192 | x |
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Corn, FOB NOLA USA | USD 161/163 | x |
Corn, FOB USA Pacific northwest | USD 174/176 | x |
Corn, FOB Argentina port, upriver | USD 184/187 | x |
Corn, FOB Brazil port | USD 184/187 | x |
Corn, FOB Black Sea, 30,000+ m/t | USD 166/170 | x |
Corn, FOB France | USD 179/181 | x |
Corn, FOB Romania | USD 170/173 | x |
Sorghum, FOB Texas | USD 166/170 | x |
Sorghum, FOB Argentina port | USD 162/167 | X |
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Soymeal, 48% protein, FOB NOLA | USD 358/362 | x |
Soymeal, 48% protein, USA, Rotterdam | USD 383/387 | X |
Soymeal, Argentina, Rotterdam | USD 358/364 | x |
Soymeal, 47% pro, FOB Argentina | USD 323/328 | X |
Soymeal, 48% protein, Brazil, Rotterdam | USD 352/356 | X |
Soymeal, 48% protein, FOB Brazil | USD 325/329 | x |
Soybeans, FOB NOLA | USD 391/395 | x |
Soybeans, Argentina, FOB | USD 406/411 | x |
Soybeans, Brazil, FOB | USD 411/416 | x |
Soybeans, Black Sea | USD 410/420 | x |
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Corn Gluten Meal, USA FOB NOLA | USD 575/585 m/t | X |
Corn Gluten Meal, CNF Egypt | USD 670/680 m/t | X |
Corn Gluten Feed, USA FOB NOLA | USD 150/155 m/t | X |
DDGS corn, 35 profat, USA FOB NOLA | USD 165/168 m/t | x |
According to the USDA national prices, corn gluten feed prices are up by about USD 5 m/t on the week with corn gluten meal prices up by as much as USD 20 m/t while DDGS prices seemed to remain steady. Trade reports say that much of the change in prices is logistics driven as winter weather slows things down. There is also an increase in demand for corn by-products from the animal feed industry in the US as the winter weather leads to more feed requirements for grass-fed livestock – not much grass left in December.
According to the latest US Grains Council weekly report, DDGS are at an extremely competitive level against both corn and soymeal which could quite easily lead to increased export demand. There were also some news reports this week suggesting that as long as the grain situation in China is unclear there will be considerable weakness in DDGS export prices. However, as has been pointed out in this report in the past, when prices are low other export destinations seem very willing to pick up most of the export volume that has been lost to China.
USA Exports of corn by-products – January to October 2016 – in m/t - major destinations only
| Corn Gluten Feed | Corn Gluten Meal | Distillers Dried Grains DDGS |
Canada | 25,200 | 57,600 | 422,600 |
Chile |
| 40,600 |
|
China | 1,000 |
| 2,252,300 Down 62% |
Colombia | 54,300 | 78,600 | 153,600 |
Costa Rica | 1,500 |
| 71,500 |
Egypt |
| 115,100 | 141,400 |
El Salvador |
| 11,600 | 48,900 |
Germany | 29,400 |
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Holland | 19,100 |
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Indonesia | 2,100 | 174,900 | 293,200 |
Ireland | 257,600 |
| 204,200 |
Israel | 169,500 |
| 158,400 |
Japan |
| 15,900 | 259,800 |
Malaysia |
| 15,500 | 40,500 |
Mexico | 12,300 | 22,300 | 1,551,700 |
Morocco | 68,500 | 1,500 | 133,700 |
New Zealand |
|
| 71,400 |
Pakistan |
|
| 59,300 |
Philippines |
|
| 132,500 |
Portugal | 57,900 |
| 14,300 |
South Korea |
|
| 751,200 |
Spain |
|
| 160,200 |
Taiwan |
| 25,600 | 188,300 |
Thailand |
| 27,300 | 603,600 |
Turkey | 223,000 |
| 626,600 |
UK | 51,100 |
| 121,100 |
Vietnam |
| 13,700 | 932,800 |
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Total | 978,600 | 644,900 | 9,611,100 |
% change | Up 54% | Down 7% | Down 11% |
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 410/430 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 440/450 m/t CNF Asia USD 490/500 m/t CNF Asia USD 510/520 m/t CNF Asia USD 770/790 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 480/490 m/t CNF Asia USD 500/510 m/t CNF Asia USD 560/580 m/t CNF Asia USD 780/800 m/t CNF Asia |
Reports in the trade say that export prices for meat and bone meal have weakened by USD 20 m/t or so as buyers seem to be able to find deal from suppliers with too much supply. Sellers in Asia say that US exporters have been accepting lower customer bids and that that has brought the entire MBM market lower. USA export prices published don't show any weakness but the very low domestic prices in the USA could certainly convince exporters to be more aggressive in their export pricing.
Domestic supplies of MBM are quite large in the US due mainly to higher cattle kill level while the price pressure from low cost vegetable protein is limiting any possible increase in prices.
The Jacobsen report this week was saying that with, Christmas and New Year coming up shortly, there could easily be a holiday driven rally in prices as buyers try to cover short term needs before the holidays.
They also point out that sellers in Australia and New Zealand are holding out for higher prices but aren't having too much success so far.
USA Exports of animal proteins – January to October 2016 – in m/t - major destinations only
| Meat and Bone Meal Includes poultry and pork meal | Feathermeal |
Canada | 55,000 | 14,300 |
Chile |
| 8,400 |
China | 46,000 | 6,900 |
Ecuador | 7,800 |
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Germany | 14,000 |
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Holland | 10,100 |
|
Honduras | 9,700 |
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Indonesia | 106,500 | 23,900 |
Mexico | 62,500 |
|
Philippines | 8,700 |
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Thailand | 3,200 |
|
Vietnam | 23,800 | 1,000 |
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Total | 358,900 | 54,000 |
% change | Up 49% | Down 29% |
USDA GATS
SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN
Fishing in Peru is still at about 20,000 m/t of catch per day with the odd day getting up to the high 20's. The total catch, up to Friday, is at about 625,000 m/t which leaves 1.4 million m/t to go to reach full quota – at 20,000 m/t per day this means 70 more days of fishing and we don't have that much time. It is reported that some experts feel the total catch may only reach 1.5 million m/t.
If the catch comes up short, say 1.5 million m/t, then fishmeal production could be around 350,000 m/t and, with a reported 200,000 m/t of the fishmeal presold, this does not leave much left to cover a few month's needs.
The trade in Peru reports that there is more buying interest in the past couple of weeks – probably as buyers see that fishing is coming up a little short. But, the prices expected by the buyers are well below current market levels and sellers are showing no interest.
Rabobank published a report of world fishmeal this week and their conclusion is that 2016/17 fishmeal production will be higher which should mean prices will be lower. Most of the increase in supply is due to Peru fishing again. Rabobank says that prices could be between a high of USD 1600 m/t and a low of USD 1200 m/t. Rabobank points out that much of the demand for fishmeal depends on the recovery of the China and Thailand shrimp industries and they don't expect any increase in demand from the China pig industry. However, Rabobank does say that world fishmeal production in 2017 will show the first increase in total world production in five years but production will still be below levels seen prior to 2011.
There was a report in the press this week about a new fishmeal replacement developed in the US that is produced by enzyme treating soymeal. This new item – EnzoMeal – has been test fed in Australia ( to perch), Norway (to salmon) and the USA (to bass) with results that seem to show that it can replace between 50 and 100 percent of the fishmeal in the diet with no adverse effects.
It seems that almost every week there is a new fishmeal replacement but, as they are all very low production products, it will be sometime until much effect is felt in the fishmeal industry.
European fishmeal prices – FOB North German port.
Type | Protein % | Price per m/t USD |
Herring fishmeal | 72% protein | 1,575 |
Danish fishmeal | 64% protein | 1,420 |
Peru fishmeal | 64% protein | 1,515 |
Chile fishmeal | 67% protein | 1,615 |
Iceland fishmeal | 70% protein | 1,610 |
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 | 1300/1310 m/t |
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65/66 protein | 1350/1360 m/t |
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67% protein standard steam | 1400/1420 m/t | 1430/1450 |
67% protein 150 TVN | 1450/1470 m/t | 1450/1470 |
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 | 1600/1620 m/t | 1580/1600 |
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Fish oil, crude bulk | 1900/1950 | 1600/1650 |
Fish oil, crude drums | 2000/2050 |
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Fish oil, flexi tank | 2150/2200 |
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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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