International Feedgrain Update

[charliep]

Canadian barley exports to date (end December) - 700,000 tonnes or 30 % ahead of last year. Current international feed barley prices $305 to $310/tonne FOB west coast. That is about $230/tonne central Alberta (delivered elevator). Canada west coast capacity fully booked to March. Black Sea sold out of barley.

Limited to no feed wheat being offered out of Canada. Limited availability/better domestic markets. Recent Korean South Korean business $330 ish CIF (delivered) or $305 west coast assuming $25/tonne ocean freight. Argentine feed wheat in the $305 to $310 range (availability because of harvest challenges. FSU countries sold out.

[charliep]

Got Argentine feed wheat prices wrong. Should have been $290 to $295. Prices above in US dollars.

[crusher]

Thanks for the update Charlie. Either your basis is pretty wide on the barley or there won't be any more barley exported. Guess I'll keep waiting patiently. Losing patiece on the canola, I think I'm going to reward the market tomorrow around $13.75

[charliep]

Barley supply demand will be tight. The bigger than expected US corn domestic use is also coming into play.

Not a bull or a bear these days. Just an observation that things are going to be interesting. Selling some (not all) into rallies or minimum price strategies (puts, calls after selling cash, minimum price contracts, etc) are the strategies to be followed. Just have a marketing plan based on your business needs and follow it.

[charliep]

Not to prod the bulls (often turn to gore someone like me) but some here have a strategy to sell into March. I will be curious to see how these plans have modified themselves as the target period approaches. Will also note that farmers have delivered 7 MMT of canola - just over half the crop - by week 23. Higher crush/less canola in the commercial system over the same period. South American soybean crop looking pretty darn good to date (still growing).

[Burbert]

Colombia's gag business in the u.s.a. is
huge. Columbian product moved/ smuggled
inta the u.s. commands a premium price.
In return, columbians buy all kindsa
u.s. firearms to keep varmits outta
their cocoa crops. Win, win, situration
fer both nations. Most columbian
product is injested on weekends in the
u.s. Yup truly a gag angribusiness that
rivals anything produced in Nort
America. Wheat/barely, what the fk,
never ever, ever, ever, ever compete wit
Columibian product.......

[charliep]

crusher,

Any thoughts about the markets/charts?

Wheat seems to be showing some bottoming action. Exports will start to pick in North America. US HRW crop will become more of a focus.

Corn seems to be showing some strenghth based on extremely tight supplies at the end of the crop. More exports would be nice but US domestic demand is not being curtailed as much as expected.

Oilseeds remain a tale of two products. Soybean oil chart is starting to look more interesting likely based on mid $90 per barrel crude oil prices. Soybeans and soybean meal remain weak with upcoming S. American harvest a damper. Canola signs around strong basis, tight crush crush margins and strong futures are showing respect for the tight S&D this summer. Does more need to be done? An interesting question.

[charliep]

Will add in inverses in the futures market.

[errolanderson]

Charlie . . . feeders are already gearing
up to substitute barley for lower protein
wheat and corn for the spring market.

Feed barley premiums are seasonally
available for Mar/Apr/May movement into
feedlot alley. But overall domestic barley
demand may start to weaken by late winter
(IMO).

[charliep]

Had an interesting conference call with Informa with the theme volatility. On corn, the end result this next fall will be $4 to $5/bu corn (not their number but mine - 75 % probability) or $7/bu plus (25 % probability. Old crop has yet to deal with the tight corn carryover on the domestic (pace of use high on both livestock feed and ethanol) but still lagging on the export side (off shore customers are buying from elsewhere). US corn carryover will be extremely tight with the trying to right size what is available to what is needed.

New crop is a crap shoot with record US corn acres likely to go. Get the yield side up and supplies will exceed demand/prices will come down.

Not negative on feed barley but don't see a really big rally either in the making based on today. The new world of an open means market opportunities/prices increases across the border will be reflected directly to farmers both in price and delivery.