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DRY FEEDS
Soya: Traders on the Chicago Board of Trade (CBOT) are tentative about the US soybean market, as the crops enter the key pod-filling stage. And, with the 6/10 day weather report looking hot and dry, particularly in the Mississippi region, there’s going to be some further periods of extreme volatility in the markets over the coming weeks. The Argentine Agri Ministry cut its forecast for 2009/10 soybean production to 52.7 million tonnes, from the 54 million tonnes forecasted in their report last month. On the bearish side yesterday fund managers were booking profits and unwinding positions in meal due to a lack of fresh supportive news, causing levels to stumble and slide to a one week low. Soyameal at current levels has created interest for the September to April 11 time frame; as we are seeing some bullish stories in the market place, alongside what looks like a large North American crop that potentially is already built into futures values. Sterling is currently at £1:$1.5318, with some hoping for further improvements to bring levels down. At current values we recommend considering 50% cover for Sept-April 11 soymeal.
Rapemeal: Rapemeal, along with other commodities have continued in volatile fashion over the last week. Although rapemeal levels have dropped slightly overall. The UK has, this week, began its rape harvest, with France 40% complete, Germany 10%, Hungry/Bulgaria/Romania 100% and the Ukraine 60%. Early indications are that the rapeseed harvests around Europe are exactly as expected from the crop forecasts. Cover in the UK for November – April 11 is thought be around the 40% level; and interest from compounders is said to be exclusively for this time period. Yesterday morning rapemeal was €3 firmer on the Lower Rhine and has obviously found support at these levels from the previous day’s decline of approximately £7/8/t (Sterling). Given the limited quantity European crushes have to sell and the projected maintenance shutdown times over the August – October time frame it is worth covering this time period now. It will be interesting to see over the coming few weeks whether the effects of an influx of new crop rapeseed will put much downward pressure on levels. We are also recommending 50% cover now for November-April as it can act as a hedge against further purchases in this highly volatile market that still carries a strong spot premium.
Wheat: Volatility in the wheat market has continued this week, with levels rising and falling shapely; Nov 10 overall has increased since last week to £132.75/t on the futures market. At the centre of the rises were concerns about the condition of crops in several key growing areas. These concerns centred on the Black Sea region and Russia. A sale of 300,000t from France to Algeria added to the strong move higher. Further it has been commented that the number of speculators in this market has risen shapely in the last few weeks, so any move is extremely exaggerated. This activity results in the trade aspect being left well behind in any move, as it results in quick exaggerated rises in levels. Equally this could be the case for a dramatic fall in levels. Yesterdays rises occurred despite better than expected yield reports coming from harvests. These same reports suggest that the French harvest is 30-35% complete. German drought conditions were bought to an abrupt end with heavy rain in recent days (perhaps mirroring that in parts of the UK); however some think this has caused further issues by having strong rain after a hot dry spell potentially damaging crops. To illustrate what has occurred with wheat values recently the Chicago Board of Trade (CBOT) have risen approximately 33% since the start of June.
Fibre / Energies: Many energy feeds have increased in value as wheat levels have moved higher. Sweetstarch is now at July £122 ex, August £116 ex, September £121 and October – April £139/t ex Knowsley (add haul). With fibres soya hulls have moved higher in price and now carry a smaller £10- 15/t discount to imported sugar beet feed.
MOIST FEEDS
C*Traffordgold(DM 50%, CP 21, ME 13.4): Sold out for the summer period at present.
Brewers Grains (DM 24%, CP 24, ME 11.7): : Limited availability at all breweries. Clamps still available.
Pressed Pulp (DM 30%, CP 10, ME 13): Next update August.
Vitagold (DM 35%, CP 36, ME 14.5): Production low and limited availability.
Currency: £/$ 1.5318 £/€ 1.1820
Best buys: Consider Nov-April: HiPro Soya & SoyPass |
