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WEEKLY FEED GRAIN AND PROTEIN REPORT January 14, 2017
SECTION 1: US FEED GRAINS and VEGETABLE AND ANIMAL PROTEIN
The biggest news of the week was the USDA WASDE report on Thursday and the surprising numbers for soybeans. The lower numbers for US soybean stocks and production levels pushed soybean prices up by nearly USD 20 m/ while soymeal prices were up even more with spot prices showing a rally of close to USD 25 m/t.
Hard red winter wheat and hard red spring wheat were also up on the week by about USD 7 m/t. corn prices were very quiet on the week with not much exciting for corn in the USDA report.
The USDA did reduce corn production a little and dropped ending stock levels but there seemed to be nothing in the report to get the corn market excited – perhaps everyone was watching soybeans. However, some experts are saying that the corn market will now be trending higher as carrying costs have to factored in and there seems to be little reason for prices to drop --- of course this could all change with the Brazil/Argentina corn crops. The corn harvest in South America is about a month away and, so far, everything looks quite good for the corn crops.
It is quite interesting that a small drop in US soybean crop estimates had such a major effect on soybean prices. Of course, the trade had expected the USDA to raise both production and ending stocks so slightly lower levels were a big surprise to the market. 2016 US soybean crop estimates were lowered by about 1.2% but the soybean futures market rallied by just over 5% -- seems to be overdone a little.
Wheat price rallied on lower plantings with winter wheat at the lowest planting level in more than 100 years. Experts say that farmers switched out of wheat due to very low market prices.
Estimated Bulk Grain Freight in USD per m/t, basis heavy grains
| US Gulf to Europe: 60/70,000 (10,000 disch) | $15/15.50 | Steady | x |
| US Gulf to Spain: 30,000 m/t (5,000 disch) | $25/26.00 | Steady | x |
| US Gulf Israel: 50,000 MT | $23/24.00 | Down $2.00 | x |
| US Gulf to Egypt: Panamax(6,000 disch) | $22/23.00 | Down $2.00 | x |
| US Gulf Turkey: 50,000 | $24/25.00 | Down $2.00 | x |
| US Gulf Morocco: 30,000(5,000 disch) | $22/23.00 | Down $2.00 | x |
| US Gulf Algeria/Tunisia: 30,000 (3,000 disch) | $26/27.00 | New | x |
| US Gulf Nigeria: 30,000 m/t | $52/53.00 | Down $2.00 | x |
| US Gulf other Med: 30,000 MT(5,000 disch) | $26/27.00 | Down $2.00 | x |
| US Gulf Japan: Panamax | $35/36.00 | Steady | 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 | $18/19.00 | Steady | x |
| US PNW China: Panamax | $17/18.00 | Steady | x |
| US East Coast Egypt: Panamax | $45/46.00 | Down $1.00 | x |
| US East Coast Nigeria: Handisize | $53/54.00 | Down $2.00 | x |
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| France/Germany to Algeria: 30,000 m/t(3,000 disch) | $24/25.00 | Down $1.00 | x |
| France/Germany to Egypt: 50,000 m/t (10,000 disch) | $16/17.00 | Steady | x |
| France/Germany to Jordan: 35/45,000 m/t (4,000 disch) | $35/36.00 | Down $1.00 | x |
| France/Germany to Morocco: 30,000 m/t (3,000 disch) | $23/24.00 | Down $1.00 | x |
| France/Germany to Saudi Arabia: 50/60,000 | $28/29.00 | Steady | x |
| France/Germany to South Africa: 30,000 m/t | $37/38.00 | Down $1.00 | x |
| France/Germany to Yemen: 30,000 m/t | $53/54.00 | Down $1.00 | x |
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| Argentina to Algeria: 25/30,000 m/t(3,000 disch) | $27/28.00 | Down $2.00 | x |
| Argentina to China: 50,000 m/t, with top-off | $29/30.00 | Down $1.00 | X |
| Argentina to Japan: 50,000 m/t, with top-off | $30/31.00 | Down $1.00 | x |
| Argentina to Egypt: 50,000 m/t | $24/25.00 | Steady | x |
| Argentina to Europe: 50/60,000 m/t | $23/24.00 | Steady | x |
| Argentina to Morocco: 25/30,000 m/t(3,000 disch) | $26/27.00 | Down $2.00 | x |
| Argentina to Saudi Arabia: 25/30,000 m/t | $45/46.00 | Down $1.00 | x |
| Argentina to South Africa 25/30,000 m/t (3,000 disch) | $31/32.00 | Down $1.00 | x |
| Argentina to Spain: 30,000 m/t | $24/25.00 | Down $2.00 | x |
| Argentina to Tunisia: 25/30,000 m/t (3,000 disch) | $27/28.00 | Down $2.00 | x |
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| Brazil to Algeria/Tunisia: 25/30,000 m/t | $32/33.00 | Down $2.00 | x |
| Brazil to China: 55,000 m/t | $23/24.00 | Down $1.00 | x |
| Brazil to Japan: 55,000 m/t | $25/26.00 | Down $1.00 | x |
| Brazil to Europe: 30,000 m/t | $31/32.00 | Down $1.00 | x |
| Brazil to Morocco: 25/30,000 m/t | $28/29.00 | Down $2.00 | x |
| Brazil to Saudi Arabia 30/40,000 m/t | $40/42.00 | Steady | x |
| Brazil to Turkey/Egypt: 50,000 m/t | $23/24.00 | Steady | x |
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| Australia to China: 40-55,000 m/t – round trip | $18.00/18.50 | Steady | X |
| Australia to Japan: 40-55,000 m/t – round trip | $18.50/19.00 | Steady | X |
| Australia to Saudi Arabia: 40-55,000 m/t | $26/27.00 | Steady | x |
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| Ukraine to China: 50,000 m/t | $26/27.00 | Down $1.00 | x |
| Black Sea to East Med: 30,000 m/t (3,000 disch) | $18/19.00 | Down $1.00 | x |
| Ukraine to East Med: coaster (1,000 disch) | $27/28.00 | Steady | x |
| Black Sea to Egypt: 40/50,000 m/t – (6,000 disch) | $16/17.00 | Steady | x |
| Black Sea to Egypt: 30,000 m/t – (4,000 dich) | $17/18.00 | Steady | x |
| Ukraine to Egypt: coaster 3,000 m/t (1,000 disch) | $27/28.00 | 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) | $21/22.00 | Down $2.00 | x |
| Black Sea to Spain: 40/50,000 m/t (8,000 disch) | $13/14.00 | Down $2.00 | x |
| Black Sea to Jordan: 50,000 m/t (4,000 disch) | $21/22.00 | Down $1.00 | x |
| Black Sea to Saudi Arabia – Jeddah – 50k | $25/26.00 | Down $1.00 | x |
| Black Sea to South Africa – 30,000 m//t | $35/36.00 | Down $1.00 | x |
| Black Sea to Tunisia/Algeria: 30,000(5,000 disch) | $19/20.00 | Down $1.00 | x |
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| Baltic Dry Index | 910 | Down 53 | x |
| Baltic Capesize Index | 1383 | Down 275 | x |
| Baltic Panamax Index | 1042 | Up 150 | x |
| Baltic Supramax Index | 739 | Down 44 | x |
| Baltic Handisize Index | 459 | Down 49 | X |
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FOB port or location specified. Prices in US$, in metric tons:
All shipments in bulk grain vessels unless stated otherwise
(NOLA is New Orleans, Louisiana, USA.)
ALL PRICES ARE FOR February 2017/April 2017
| Wheat, USA Soft Red Winter, NOLA | USD 182/186 | x |
| Wheat, USA Hard Red Winter 12 protein | USD 206/211 | x |
| Wheat, Ukraine 11.5 pro, 30,000+ m/t | USD 177/180 | x |
| Wheat, Russia 12.5 pro, 30,000+ m/t | USD 182/184 | x |
| Wheat, Romania 12.5 pro | USD 183/186 | x |
| Wheat, Superior, France, Rouen | USD 190/193 | x |
| Wheat, milling, 12.0%, Argentina, upriver | USD 173/177 | x |
| Wheat, feed, Black Sea | USD 169/172 | x |
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| Barley, France, Rouen port | USD 162/164 | x |
| Barley, feed, Argentina | USD 156/161 | x |
| Barley, feed, Black Sea, 30,000+ | USD 162/165 | x |
| Barley, feed, USA Pacific Northwest | USD 185/195 | x |
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| Corn, FOB NOLA USA | USD 167>>163 | X |
| Corn, FOB USA Pacific northwest | USD 176/179 | x |
| Corn, FOB Argentina port, upriver | USD 181/186 | X |
| Corn, FOB Brazil port | USD 182/185 | x |
| Corn, FOB Black Sea, 30,000+ m/t | USD 165/168 | x |
| Corn, FOB France | USD 184/187 | x |
| Corn, FOB Romania | USD 168/171 | x |
| Sorghum, FOB Texas | USD 166/169 | x |
| Sorghum, FOB Argentina port | USD 159/163 | x |
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| Soymeal, 48% protein, FOB NOLA | USD 372/375 | x |
| Soymeal, 48% protein, USA, Rotterdam | USD 397/400 | X |
| Soymeal, Argentina, Rotterdam | USD 382/385 | x |
| Soymeal, 47% pro, FOB Argentina | USD 349/352 | x |
| Soymeal, 48% protein, Brazil, Rotterdam | USD 370/374 | x |
| Soymeal, 48% protein, FOB Brazil | USD 333/337 | X |
| Soybeans, FOB NOLA | USD 397/400 | x |
| Soybeans, Argentina, FOB | USD 408/411 | x |
| Soybeans, Brazil, FOB | USD 405/408 | x |
| Soybeans, Black Sea | USD 405/410 | X |
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| Corn Gluten Meal, USA FOB NOLA | USD 600/610 m/t | x |
| Corn Gluten Meal, CNF Egypt | USD 700/710 m/t | x |
| Corn Gluten Feed, USA FOB NOLA | USD 145/150 m/t | x |
| DDGS corn, 35 profat, USA FOB NOLA | USD 148/152 m/t | x |
The big news in the market this week was the action taken by China against US DDGS imports. Some experts feel that the new duties imposed will drop DDGS shipments to China to only about 1 million m/t in 2017, down from 2.3 million m/t so far in 2016 and 6.2 million m/t in 2015. In 2916, the lower DDGS prices attracted enough other buyers so that YTD exports were only down about 9% but the question is: will there be enough new business to offset a drop of another 1.2 million m/t in China's DDGS imports.
DDGS prices are extremely cost-effective at present and it is not too hard to imagine corn and soymeal importers looking very closely at DDGS as a very low cost feed alternative.
Corn gluten meal and corn gluten feed prices didn't do too much this week with CGM export prices up a little while CGM domestic USA prices were said to be lower. Corn gluten feed export prices were steady but domestic US prices were down by about USD 2 m/t on average. US domestic DDGS prices tended to be steady to USD 5 m/t lower.
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 530/540 m/t CNF Asia USD 460/470 m/t CNF Asia |
| Paraguay Meat &Bone meal, 45% protein | USD 400/410 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 440/460 m/t CNF Asia USD 520/530 m/t CNF Asia USD 560/580 m/t CNF Asia USD 780/800 m/t CNF Asia |
The Asian animal protein market was very quiet this week as we get closer to the Chinese New Year holiday which begins on January 28th.
Supplies from both Australia and New Zealand are limited with low cost meat and bone meal from the USA filling most of the demand. Exporters in OZ/NZ will have to get a bit more aggressive with their pricing if they want to get some business back from the US shippers.
USA domestic MBM prices were steady on the week while feathermeal prices moved a little higher. The rally this week in soymeal will probably give a little strength to animal protein prices in the next week.
There was a report from Turkey that poultry producers will no longer be able to use poultry by-product meal in their feed formulations. Local experts say that this change could result in Turkey becoming an exporter of poultry meal.
SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN
The new fishing quota for the south of Peru has been announced: 515,000 m/t of anchovy beginning on January 17 – the quota will expire on June 30, 2017 or when total quota landed.
Fishing in the north of Peru has averaged about 25,000 m/t per day with the total now at about 1.66 million m/t – leaving 334,000 m/t of catch remaining. If the fishing stays at an average of 25,000 m/t per day then the total quota is going to be very close to being landed --- something that very few people expected could happen.
Quoting MSI Ceres again this week, they report that export sales since the start of the season in September are up at 355/365,000 m/t. Also, it seems that I misquoted MSI Ceres export numbers last week, so, hopefully I have done it correctly this week (inshallah). MSI Ceres points out that there will be about 100,000 m/t of fishmeal to trade, assuming that the catch continues, but this is certainly not a huge amount of fishmeal to cover the period until the next fishing season.
Prices in Peru are reported to be a little lower this week but no one expects this to be a new price trend – just a market adjustment.
European fishmeal prices – FOB North German port.
| Type | Protein % | Price per m/t USD |
| Herring fishmeal | 72% protein | 1,530 |
| Danish fishmeal | 64% protein | 1,400 |
| Peru fishmeal | 64% protein | 1,550 |
| Chile fishmeal | 67% protein | 1,650 |
| Iceland fishmeal | 70% protein | 1,520 |
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 | 1240/1250 m/t |
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| 65/66 protein | 1270/1280 m/t |
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| 67% protein standard steam | 1300/1310 m/t | 1350/1370 |
| 67% protein 150 TVN | 1380/1400 m/t | 1400/1440 |
| 67% protein 120 TVN | 1430/1450 m/t | 1450/1470 |
| 67% protein 1000 hist, 120 TVN | 1480/1500 m/t | 1500/1520 |
| 68% protein 500 hist, 120 TVN | 1530/1550 m/t | 1580/1600 |
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| Fish oil, crude bulk | 1700/1750 | 1600/1650 |
| Fish oil, crude drums | 1800/1850 |
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| Fish oil, flexi tank | 1950/2000 |
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| Fish oil, Omega 3: 28%EPA/DHA | 2400/2500 |
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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 © 2017 Wayne S. Bacon
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