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Global feed market: U.S. corn stocks are lower than expected and feed prices are rising

 Last Update: 2022-10-12
 Source: Internet
 Author: User

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Foreign media October 3 news: In the week ending September 30, 2022, global feed prices rose moderately, mainly due to lower than expected U.
S.
corn inventories, and the yield of old corn was lowered; The wheat spike also brought a price boost
.
Due to the escalation of the situation between Russia and Ukraine, there is growing doubt about the sustainability
of the Black Sea transport corridor.
At the same time, the U.
S.
corn harvest is advancing, while the supply of inland barges is tight and freight rates are soaring, putting pressure
on corn spot prices.

On Friday, the Chicago Board of Trade (CBOT) closed at around $6.
7750/Pu for December 2022, up 0.
11%
from a week ago.
The spot price of Meiwan 2 yellow corn in the October shipping schedule was $7.
92 per pu, up 0.
7% from a week ago; The November 2022 corn period on the EURONEXT exchange closed at around 341 euros/mt, up 0.
7%
from a week ago.
Argentine corn on the upper river FOB quoted at $296/mt, up 1.
7%
from a week ago.
On Friday, the Dalian Commodity Exchange reported a November 2022 corn period of about 2,753 yuan / ton, down 1.
8%
from a week ago.

International crude oil futures rose slightly this week, ending a four-week losing streak as the OPEC alliance could cut production next week and the dollar retreated
from its 20-year high.
The Nov contract on West Texas Intermediate Crude Oil (WTI) on the New York Mercantile Exchange (NYMEX) closed at $75.
49/bbl, up 0.
95%
from a week ago.
The global benchmark December Brent crude futures were trading at $85.
11/barrel, up 0.
3%
from a week ago.

The dollar index closed at 112.
084 on Friday, down 0.
8 percent
from a week ago.

U.
S.
corn stocks were lower than expected, with old season corn production down 40 million pu

USDA's quarterly inventory report shows that U.
S.
corn stocks as of September 1 totaled 1.
38 billion pu, up 12% year-on-year, but far below the market expectation of 1.
512 billion pu.

Among them, the farm inventory was 510 million pu, an increase of 29% year-on-year; Off-farm inventories were 867 million pu, up 3%
year-on-year.
The amount of potons used from June to August 2022 was 2.
97 billion pu, up from 2.
88 billion pu
in the same period last year.

The U.
S.
Department of Agriculture on Friday cut U.
S.
cereal corn production by 41.
4 million potons and revised the harvest area to 85.
3 million acres
.
Yields in 2021 were lowered to 176.
7 deplecats per acre, 0.
3 deplecats per acre lower than previous estimates
.

Inland barge freight rates soared

As drought dries out the Mississippi River and the load capacity of ships transporting corn and soybeans drops, demand for barges increases accordingly, exacerbating supply tensions and boosting freight rates
.
Barge freight rates on September 27 reached a record high of $49.
88 per tonne, up nearly 50 percent
from the same period last year.
Due to the lack of rainfall, water levels have dropped to extremely low levels
at the point where the Ohio River flows into the Mississippi River via Cario, Illinois.
The U.
S.
government weather agency expects water levels to drop even more
in October.
The Mississippi River accounts for 65 percent
of U.
S.
corn exports.

The U.
S.
corn harvest was 12 percent, lower than expected

The USDA Crop Progress Weekly Report shows that as of Sept.
25, U.
S.
corn harvest progress was 12 percent, 7 percent a week ago, 17 percent year-on-year, and a five-year average of 14 percent
.
Analysts expected the corn harvest to be 13 percent
complete before the report was reported.
The corn excellent rate was 52%, unchanged from a week ago and in line with market expectations
.

U.
S.
corn export sales were in line with expectations

USDA's weekly export sales report shows that net U.
S.
corn sales in 2022/23 were 512,000 tonnes in the week ended September 22, 2022, up from 182,300 tonnes a week earlier, but within market expectations
.

The outlook for the Black Sea export corridor is not promising

Two Russian gas pipelines to Europe were suspected of being deliberately sabotaged almost simultaneously at the beginning of the week, dashing hopes of securing Russian gas supplies this winter and exacerbating tensions in the
Black Sea region.
Russian President Vladimir Putin officially signed a decree on Wednesday (September 28) announcing the accession of Donetsk and four other regions to the Russian Federation
.
This creates great uncertainty about the prospects for a Russian-Ukrainian conflict, because it means that an attack on these areas is tantamount to violating Russian territory, and Putin has said that he will do everything to defend territorial
integrity.
Ukrainian President Zelensky then signed an application to join NATO, creating more uncertainty about
the prospects for a Russian-Ukrainian conflict.
At present, NATO is cautious about Ukraine's application for NATO and still does not seem to want to be directly involved in military confrontation with
Russia.
Regardless of how the Russian-Ukrainian conflict evolves, the prospects for the Black Sea Grain Transport Corridor agreement, which expires in November, are not very promising
.

EU maize production was further lowered to 55.
5 million tonnes in 2022

On Friday, the European Commission released its monthly report, lowering its 2022 corn production forecast to 55.
5 million tons, down from the 59.
3 million tons forecast at the end of August, which will also be the lowest production
in 15 years.
EU maize imports for 2022/23 increased to 21 million tonnes from 20 million tonnes expected last month; Corn export forecasts are down from 4 million tonnes to 3.
5 million tonnes
.
EU maize feed use was reduced by 4.
2 million tonnes to 60.
5 million tonnes.

Argentina's corn production is expected to fall by nearly 4% year-on-year.

The Buenos Aires Grain Exchange released its first production estimate for 2022/23 on September 28, and it is expected that the area of Argentina's maize in 2022/23 will fall from 7.
7 million hectares to 7.
5 million hectares, and corn production is expected to fall to 50 million tons, down 3.
9%
from 52 million tons in the previous year.
At present, the sowing of corn in Argentina has just begun
.

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