US FEED GRAINS and VEGETABLE AND ANIMAL PROTEIN 

The lack of up-to-date USDA reports because of the US Government shutdown certainly leads to a great deal of creative thinking and comments in the trade. We have gotten so used to having all this USDA info in our hands that we all have become dependent. The current shutdown is the longest on record.

There wasn't a huge amount of change in grain/oilseed prices at the end of the week most items were a little lower on the week. Had it not been for higher prices on Friday we could have ended up down quite a bit on the week.

The higher Friday prices were due mainly to concern over the weather in South America and the effect that the heat and lack of rainfall could have on corn and soybean yields.  There were also some private sector forecasts of what the USDA might have said – they tended to all be a little lower in production than the last USDA numbers.

At least one forecasting service has reduced expected Brazil corn production by about 5% and soybean production by 6.3%. The same forecasting service also said that USA production will be lower.

Wheat had a quite uninteresting week and did very little ending about unchanged on the week.

DDGS spot prices moved lower this week as did both corn gluten meal and corn gluten feed – perhaps the spot backlog in shipments is being worked down.  There was talk this week about how little margin there is in the ethanol business and the ethanol producers are making more money on DDGS than they are on ethanol. Of course, without the ethanol production we wouldn't see much in the way of DDGS. 

Prices for shipment of all corn by-products in February and March looks quite attractive compared to prices offered back in late December.

Container shipments, minimum 200 m/t

Meat and bone meal prices in Asia are said to be looking to move lower as large, low cost supplies of US origin MBM are still filling the market. Prices put of both Australia and New Zealand were said to be a little higher due to low production during the holidays, but it will be difficult to hold higher prices

It looks like US export prices will stay low for a while as domestic supply is good and much is flowing into the export market. However, if we see more strength in the soybean/soymeal markets then animal proteins will also move higher.

The Jacobsen report this week was saying that animal protein use in feeds is at an all time low as more and more formulations, especially for poultry, are becoming all vegetable formulations.