Weekly Report -- Jan 21, 2017

 

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

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WEEKLY FEED GRAIN AND PROTEIN REPORT   January 21, 2017

 

 

SECTION 1:  US FEED GRAINS and VEGETABLE AND ANIMAL PROTEIN

 

As the week ended about the only topic of conversation was Donald Trump as the new President of the US. I was in London this week for a GAFTA meeting and both Trump and the possible effect on 2017 European elections were certainly topics of conversation over lunch and in the hallways. Interestingly, these two topics pushed Brexit into the background in conversations – of course, the people at GAFTA meetings are more international and not all UK oriented.

 

Other than Mr. Trump, all eyes were on the rain situation in Argentina and what it could do to the soybean crop. Floods in Argentina may or may not be serious – it depends on what trade report you are reading. The Argentina soybean crop is now expected to be down from earlier estimates of 54.4 million m/t to 52.9 million m/t --- still quite a pile of soybeans.

 

Soybean prices were up by about USD 7 to 10 m/t on the week but could continue higher if the Argentina situation looks to be getting worse.

 

Corn prices were also up on the week and for about the same reasons as soybeans but more Brazil related than Argentina. The rains in Brazil will probably slow down the corn harvest but probably will how little or no effect on the crop size. Although Argentina soybeans have seen lots of rain there seems to be more hot and dry weather in the corn regions which may reduce overall corn yields.

 

For now, all eyes will be on South American weather and how it is affecting both the harvests and the expected yields.

 

 

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

 

US Gulf to Europe: 60/70,000 (10,000 disch)	$14.50/15.00	Down $0.50	X
US Gulf to Spain: 30,000 m/t (5,000 disch)	$24/25.00	Down $1.00	x
US Gulf Israel: 50,000 MT	$22/23.00	Down $1.00	X
US Gulf to Egypt: Panamax(6,000 disch)	$21/22.00	Down $1.00	X
US Gulf Turkey: 50,000	$23/24.00	Down $1.00	X
US Gulf Morocco: 30,000(5,000 disch)	$22/23.00	Steady	X
US Gul Algeria/Tunisia: 30,000 (3,000 disch)	$24/25.00	Down $2.00	X
US Gulf Nigeria: 30,000 m/t	$52/53.00	Steady	X
US Gulf other Med: 30,000 MT(5,000 disch)	$26/27.00	Steady	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	Steady	X
US East Coast Nigeria: Handisize	$53/54.00	Steady	x
France/Germany to Algeria: 30,000 m/t(3,000 disch)	$23/24.00	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	Steady	x
France/Germany to Morocco: 30,000 m/t (3,000 disch)	$22/23.00	Down $1.00	x
France/Germany to Saudi Arabia: 50/60,000	$27/28.00	Down $1.00	x
France/Germany to South Africa: 30,000 m/t	$36/37.00	Down $1.00	X
France/Germany to Yemen: 30,000 m/t	$52/53.00	Down $1.00	x
Argentina to Algeria: 25/30,000 m/t(3,000 disch)	$29/30.00	Up $2.00	x
Argentina to China: 50,000 m/t, with top-off	$29/30.00	Steady	X
Argentina to Japan: 50,000 m/t, with top-off	$30/31.00	Steady	x
Argentina to Egypt: 50,000 m/t	$25/26.00	Up $1.00	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)	$28/29.00	Up $2.00	X
Argentina to Saudi Arabia: 25/30,000 m/t	$45/46.00	Steady	x
Argentina to South Africa 25/30,000 m/t (3,000 disch)	$31/32.00	Steady	X
Argentina to Spain: 30,000 m/t	$24/25.00	Steady	X
Argentina to Tunisia: 25/30,000 m/t (3,000 disch)	$29/30.00	Up $2.00	x
Brazil to Algeria/Tunisia: 25/30,000 m/t	$32/33.00	Steady	x
Brazil to China: 55,000 m/t	$23/24.00	Steady	X
Brazil to Japan: 55,000 m/t	$25/26.00	Steady	X
Brazil to Europe: 30,000 m/t	$31/32.00	Steady	x
Brazil to Morocco: 25/30,000 m/t	$28/29.00	Steady	x
Brazil to Saudi Arabia 30/40,000 m/t	$40/42.00	Steady	x
Brazil to Turkey/Egypt: 50,000 m/t	$24/25.00	Up $1.00	x
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
Ukraine to China:  50,000 m/t	$26/27.00	Steady	x
Black Sea to East Med: 30,000 m/t  (3,000 disch)	$17/18.00	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)	$26/27.00	Down $1.00	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)	$13/14.00	Steady	x
Black Sea to Jordan: 50,000 m/t (4,000 disch)	$21/22.00	Steady	x
Black Sea to Saudi Arabia – Jeddah – 50k	$24/25.00	Down $1.00	x
Black Sea to South Africa – 30,000 m//t	$35/36.00	Steady	x
Black Sea to Tunisia/Algeria: 30,000(5,000 disch)	$19/20.00	Steady	x
Baltic Dry Index	925	Up 15	X
Baltic Capesize Index	1610	Up 227	X
Baltic Panamax Index	970	Down 72	X
Baltic Supramax Index	718	Down 21	X
Baltic Handisize Index	441	Down 18	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 February 2017/April 2017

 

Wheat, USA Soft Red Winter, NOLA	USD 187>>181	x
Wheat, USA Hard Red Winter 12 protein	USD 210>>204	x
Wheat, Ukraine 11.5 pro, 30,000+ m/t	USD 181/184	x
Wheat, Russia 12.5 pro, 30,000+ m/t	USD 186/189	x
Wheat, Romania 12.5 pro	USD 187/190	X
Wheat, Superior, France, Rouen	USD 188/190	x
Wheat, milling, 12.0%, Argentina, upriver	USD 174/178	x
Wheat, feed, Black Sea	USD 175/178	x
Barley, France, Rouen port	USD 161/163	x
Barley, feed, Argentina	USD 148/155	x
Barley, feed, Black Sea, 30,000+	USD 162/165	x
Barley, feed, USA Pacific Northwest	USD 185/195	x
Corn, FOB NOLA USA	USD 171>>166	x
Corn, FOB USA Pacific northwest	USD 183>>180	x
Corn, FOB Argentina port, upriver	USD 181/186	X
Corn, FOB Brazil port	USD 183/186	X
Corn, FOB Black Sea, 30,000+ m/t	USD 165/168
Corn, FOB France	USD 185/187	x
Corn, FOB Romania	USD 174/177	X
Sorghum, FOB Texas	USD 169/172	X
Sorghum, FOB Argentina port	USD 160/165	x
Soymeal, 48% protein, FOB NOLA	USD 400/405	X
Soymeal, 48% protein, USA, Rotterdam	USD 425/430	X
Soymeal, Argentina, Rotterdam	USD 395/398	X
Soymeal, 47% pro, FOB Argentina	USD 370/373	X
Soymeal, 48% protein, Brazil, Rotterdam	USD 385/388	X
Soymeal, 48% protein, FOB Brazil	USD 355/358	X
Soybeans, FOB NOLA	USD 405/410	X
Soybeans, Argentina, FOB	USD 410/416	X
Soybeans, Brazil, FOB	USD 410/415	X
Soybeans, Black Sea	USD 405/410	x
Corn Gluten Meal, USA FOB NOLA	USD  610/620 m/t	x
Corn Gluten Meal, CNF Egypt	USD  700/710 m/t	x
Corn Gluten Feed, USA FOB NOLA	USD  150/155 m/t	x
DDGS corn, 35 profat, USA FOB NOLA	USD  145/150 m/t	x

 

DDGS prices were steady on the week and it is reported that the very competitive DDGS export price is attracting quite a bit of attention from export buyers. According to the US Grains Council report this week, DDGS supply could tighten a little as ethanol production is expected to dip. Tighter supply could tend to push export prices up a little.

 

It is also reported in the trade that there is still some interest in US DDGS from Chinese buyers, even with the greatly increased duty levels but so far now serious levels of new DDGS business to China.

 

Corn gluten meal prices were a little higher this week pushed up by soymeal price increases but corn gluten feed prices were mainly unchanged on the week.

 

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 420/430 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 420/430 m/t CNF Asia
Australian MBM 45 protein    Australian MBM 50 protein    Australian Feathermeal, 80 protein    Australian Poultry Meal, pet food	USD 460/470 m/t CNF Asia  USD 510/520 m/t CNF Asia  USD 530/540 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 450/470 m/t CNF Asia  USD 520/530 m/t CNF Asia  USD 580/600 m/t CNF Asia  USD 820/840 m/t CNF Asia

 

Animal protein export prices moved higher this week following the rally in soymeal prices and, according to trade reports, buyers seem to be quite happy to pay the higher prices as there seems to be the feeling that prices may be continuing higher.

 

Australian MBM exporters said that there was strong demand from China for MBM -- this is China begins their New Year celebrations – this year is the year of the rooster.

 

The USA saw higher domestic prices as soymeal price increases allowed MBM and such to move higher and still stay price competitive. Poultry meal and feathermeal prices were also higher on the week but the trade said that this a rally with very little support and that higher prices may not last.

 

The next few days will see prices continue to by influenced by what is happening with soybeans and soymeal and if the rally in those items continue than animal proteins too will move higher.

 

SECTION 2 --- FISHMEAL COMMENTS AND PRICES: PERUVIAN

 

The fishmeal industry is getting closer and closer to the 2 million m/t quota level – we are at about 1.825 million m/t landed with 10 days or so left to go. With the recent average catch levels are about 20,000 m/t per day there is a very good chance that the quota could all be caught……certainly better than most experts thought only a few weeks ago.

 

No catch reported as yet in the South but then everyone wants to finalize the North first.

 

Trade reports say that trade has been quite brisk in advance of the Chinese New Year…much of the volume being done by Chinese traders. The trade also reports that the fishmeal levels available for sale are dropping lower every week and that premium quality fishmeal is getting harder and harder to find.

 

Speaking of premium grades of fishmeal, the president of TASA Peru has said that the fishmeal industry needs to improve the overall quality of Peruvian fishmeal and improve the product consistency. Peru's fishmeal production has remained at a somewhat constant level, on average over the past few years while the world production of animal feed has more than doubled since 2003 and now exceeds 100 million m/t. Peru's share of world fishmeal production has dropped from 29% in 2011 to just 18% in 2015 – some of this is due to reduced fishing quotas in Peru but much is also due to increased fishmeal production in many new fishmeal producing nations.

 

There was a report this week that as much as 80% of the fishmeal in the feed formulations for tilapia can be replaced with vegetable-based protein. Studies in the US and Kenya have shown that protein derived from amaranth leaf. Amaranth has been used due to its nutritional content. However, the study did show that lower fishmeal feed was consumed in higher levels by tilapia. It also points out that more research needs to be done on the processing of amaranth leaves in order to obtain a consistent protein product.  Of good news to the fishmeal industry is the result that, according to the results of this study, fishmeal cannot be total eliminated from the tilapia feed ration.    

 

 

European fishmeal prices – FOB North German port.

 

Type	Protein %	Price per m/t USD
Herring fishmeal	72% protein	1,540
Danish fishmeal	64% protein	1,405
Peru fishmeal	64% protein	1,480
Chile fishmeal	67% protein	1,550
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
65% protein	1240/1250 m/t
65/66 protein	1270/1280 m/t
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
Fish oil, crude bulk	1700/1750	1600/1650
Fish oil, crude drums	1800/1850
Fish oil, flexi tank	1950/2000
Fish oil, Omega 3: 28%EPA/DHA	2400/2500

 

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