Prime Molasses, the UK molasses arm of Peter Cremer Gmbh, has underlined its commitment to the organic feed market by setting up a subsidiary company, Prime Organic Ltd. The business has simultaneously acquired the assets of an organic soyabean crushing facility in North Killingholme, North Lincolnshire.
The business will be headed up by Greg Dunn, who has been appointed General Manager.
Prime Molasses managing director John Hughes believes the start up gives the company an ideal opportunity to grow and diversify within the animal feed sector, without competing with its core customer base. "This development allows us to grow in a sector that we already have experience in, following the start up of our organic molasses operation last year," says Mr Hughes.
"Prime Organic is uniquely positioned to supply quality organic products that have been processed in the UK to the highest possible standards. This should give organic producers some welcome assurance at a time when certain imported raw materials have given buyers some genuine causes for concern," he added.
"The expeller crush facility in North Killingholme processes whole organic soyabeans, producing 42% protein/8% oil organic soyabean cake and organic soyabean oil, and both products are available in both bulk and tote bags/IBCs," said Mr Dunn.
"The recent melamine issue has obviously heightened organic home-mixers' concerns about food safety and organic provenance, and as Prime Organic is the only producer of organic expeller soya meal in the UK (please note that organic full fat soya is a totally different product), we are well placed to meet increased demand," he concluded.
Mention my name when you buy some and they might buy me an organic beer!
eCBOT grains traded higher for most of the session, but slipped back late to end around unchanged levels. March wheat finished 1/2c higher at $5.39 1/4; March corn closed down 1 1/4c at $3.65 and March beans finished 1 1/2c lower at $9.57.
Corn and soybean sales were strong in yesterday's USDA weekly export sales report. Korea bought US/South American corn and South American soymeal overnight.
The USDA also reported reasonable sales for wheat on the export front, and talk of severe congestion at Australian ports may push a bit of extra business the way of the US over the next couple of months.
Conflicting reports continue to come out of China, with the government saying that wheat losses to drought are only likely to be 2-2.5%, but other estimates saying that 10-15% of the crop could be lost.
Argentine farmers have said that they will not be striking next week, and are prepared for further discussions with the president in an effort to resolve their dispute. Should talks fail, as they almost inevitably will, then a strike could be back on in March. Still, March is a much nicer month to have a strike don't you think?
There's been a change in the weather forecasts for South America - rain will reach southern growing regions of Argentina Monday with limited moisture but enough to produce some one-half to one-inch amounts, says QT Weather's Allen Motew.
By Tuesday these rains weaken over eastern growing regions but the threat of clouds and some light showers continues. Along with this new rain chance, temperatures average one to four degrees C above normal for the next seven days, he says. Before, by late next week (Friday Feb 20), a cold front cools Argentina bringing some more rain possibilities.
Crude oil is lower again at around $34/barrel as supply just keeps outstripping demand.
The dollar is lower ahead of a Congress vote on the $789 billion economic stimulus bill later today.
Early calls for this afternoon's CBOT session: Corn steady to 1 lower; soybeans 1 to 3 lower; wheat steady.
Bad weather, violent conflict and volatile market prices could force a drop off in the global production of cereal crops this year, the United Nations Food and Agricultural Organization (FAO) predicted today after already warning that some 1billion people worldwide are going hungry.
Drought and high food prices in much of the developing world coupled with a diversion to bio-fuels and the disincentive of high planting costs in the West look likely to reduce grain production in most of the world’s major producers.
The latest issue of FAO’s Crop Prospects and Food Situation Report warned that acute food shortages persist in 32 countries worldwide and pointed to the situation in the Gaza Strip as cause for particular concern.
In Eastern Africa more than 18 million people face serious food insecurity due either to conflict, unrest, adverse weather or a combination of the factors, while in Southern Africa the total number of food insecure is estimated at some 8.7 million.
The report stressed that in Kenya, Somalia and Zimbabwe, the situation is very serious citing drought, civil unrest and economic crises as causes.
The outlook for cereal crop production in low-income countries with food shortages is gloomy, with a likely reduction in maize crops in Southern Africa, and prolonged dry spells affecting wheat farmers in Asia. Almost half of China's winter wheat harvest is already suffering from severe drought and India is experiencing a lack of rainfall.
In South America, 2008 wheat production was halved by drought in Argentina, and persistent dry weather is damaging prospects for the region’s 2009 coarse grains.
The report noted that despite the decline in international food prices in the second half of 2008, domestic prices remain very high in several developing countries, making food unaffordable for low-income groups.
In Southern Africa and Central America, prices of their main food commodities have continued to rise or have not decreased in recent months, and in Western and Eastern Africa January prices were significantly higher than at the same time last year.
Imported rice and wheat prices, staples in these sub-regions, are also on the increase, and remain high in several poor Asian countries, including Afghanistan, Pakistan and Sri Lanka.
The FAO report pointed out that while conditions are generally favourable for winter wheat throughout Europe and the United States, the amount of planted area in these countries has declined, reflecting the prospect of sharply reduced profits compared to last year and persistently high input costs.
FAO also forecasted further increases in the use of cereals for bio-fuel production with a total of 104 million tons, up 22 per cent from the 2007/08 estimated level, representing almost 5 per cent of world cereal production. The United States alone is expected to increase production of bio-fuels to roughly 93 million tons, which is up 19 percent from the 2007/08 level.
The pound soared over 250 bps to as high as 1.4600 on the back of the increasing risk appetite as it erased the majority of the losses it suffered following the BoE’s quarterly inflation report.
Indeed, the central bank signaling further rate cuts and the possibility of quantitative easing had sunk Sterling to as low as 1.4150.
The potential of more coordinated efforts to revive the global economy coming from the G-7 meeting has fueled the bullish sterling sentiment. However, if the current every man for themselves mentality continues post summit then we could see recent gains reversed.
The French agriculture ministry (Agreste) has released its second forecast for the French soft winter wheat acreage for the 2009/10 crop.
It reduced it's acreage estimate to 4.96 mln ha from it's December forecast of 5.03 mln ha, and the 5.06 mln ha planted last season.
That's a decrease of 2%, allowing for an anticipated small reduction in yield this will probably see this season's soft wheat crop in Europe's biggest producer at around 36mmt.
The first admissions that the worst drought in fifty years may lead to a significant drop in Chinese wheat production have come from analysts from the Research and Development Center of Jinshi Futures in Shanghai.
They have said that "summer wheat production might drop only 10 percent to 15 percent compared with last year, while wheat consumption would grow no more than one percent."
The problem that the Chinese government is facing is that they need to raise the price they are willing to pay farmers for the wheat. Unless this more than covers the extra cost of irrigation and fertilising the crop, then they simply won't do it.
"Farmers will be unwilling to fight against the drought if the grain can not be sold at a high price," said Ding Shengjun, a researcher with the State Grain Administration.
China's wheat crop is the largest in the world, coming in at around 110-112mmt in 2008. With planting this year expected to be down around 5% that gives us an anticipated pre-drought output of 105mmt. Knock off say 12.5% and that leaves us a final production figure closer to 90mmt, some 20mmt below 2008.
And that's if they are telling the truth.
Soft wheat export licences in the EU have been granted for 13.49mmt in the 33rd week of the marketing year. That's an increase of more than 230% from the same time last year, when licences to export only 4.07mmt had been granted.
Total grain imports into the EU meanwhile are running at 8.2mmt, less than half of the 18.36mmt imported in the previous marketing year.
Pork producers in Russia are getting three times as much money for their animals as producers in North America, according to Jim Long, the president and CEO of Genesus Genetics.
Long explains there’s a shortage of meat which was caused by the loss of infrastructure for livestock production that followed the collapse of the Soviet Union.
Russian producers are reaping the benefits of the shortage.
He says producers in Russia are getting roughly $3.00 per kilogram while North American hog farmers get closer to $1.00 per kilo.
He says a 1500 sow barn in Russia will usually have its own feed mill and slaughtering facility due to the lack of trust between farm owners.
Security guards will often make up at least 10 percent of a farm’s workforce, says Long - not just to prevent outsiders from stealing from the farm but to prevent employees from taking property home with them.
In a surprisingly restrained move Argentine farmers have said that they will postpone their proposed strike in favour of talks with Argy president and hot babe Cristina Fernandez.
"We've decided to postpone any kind of protest and reiterate to the president that we want to talk," farm workers union leader Eduardo Buzzi is quoted as saying.
Now, I'm not one for gossip as you know, but I wouldn't mind betting that Eduardo has got the hots for Cristina.
And why wouldn't he want to "talk" with her? We've all been there. You meet up for a critical meeting with the president of your country. You have a few drinks just to settle the nerves. Mmmm you smell nice, next thing she's digging her nails into your back screaming "punish me for those punative export tariffs big boy." No wonder her hair looks touselled.
The next day the strike's back on & he's not returning her calls and ignoring her texts. How could she have been so stupid? She's not just let herself down, she's let the entire country down.
She reminds me very much of Mrs Nogger#1 actually. Except Fernandez is attractive and doesn't live in my old house, with all my furniture. But I did get the Dyson (she had no need for it the slovenly cow). So that was 50:50 really.
Everybody's favourite chum Cargill have launched a swanky new website designed to encapsulate the company's sophisticated environmentally friendly corporate image.
For some reason they have chosed to convey this image via the medium of a large bag of chips, a huge cruise liner and some bloke in rude health wearing a Cargill t-shirt pretending to be a Thai farmer. I kid you not...
Do you want salt & vinegar on those love?
The overnight grains markets are a little steadier this morning on strong US export sales, a weaker dollar and book-squaring ahead of a three day weekend.
Weekly corn sales came in above expectations yesterday at over 1.5mmt, with soybeans also strong at more than 1mmt, whilst wheat came in in-line with trade guesses at 411,700mt.
In addition to that, the Korea Feed Association bought 165,000mt of US/South American corn and 110,000mt South American soymeal overnight. Also another branch of the same association bought 110,000mt of corn from Cargill overnight. This last deal was of unspecified origin, but is thought likely to be US material.
In South America it really is a game of two halves, as they say in football. For the rest of February there is virtually no rain in the forecast for Argentina at all. In Brazil, the opposite is true, you could even make out a case for their being too much rain. Up to fourteen inches may fall in Mato Grosso in the next fortnight. And as Mrs Nogger will testify, that's a lot of inches.
There is no drought in China, so stop going on about it will you? And if there was a drought, which there isn't, it would only be a small drought. And if that drought was to do any damage, which it won't, it would only be minimal damage. Got it?
March corn futures finished lower this session. Updated weather forecasts this afternoon in Argentina called for a return to hot and dry conditions in corn crop areas for the next 7 days or so, but rain late next week. This continuing weather news item brought some pressure to US corn futures late on the day. Better than expected US corn net exports sales at 1.54 million metric tons for the week ending February 5 provided some support to corn futures. This amount was a new market year high and above analysts’ estimated range of 95,000 to 1.15 million metric tones. A higher US dollar index and lower crude oil futures this session gave additional pressure. Cash corn bids were higher so far on the day with slow farmer selling. March corn finished at $3.66 1/4, down 2 1/4 cents.
March soy complex closed lower in today’s session. November soybeans contracts also closed lower. Updated weather forecasts this afternoon in Argentina called for a return to hot and dry conditions in soy crop areas for the next 7 days or so, but rains late next week. This continuing weather news item brought some pressure to US soy futures late on the day. Better than expected US soybean net export sales at 1.07 million metric tons for the week ending February 5 provided some support to soy futures. This amount was above the analysts’ estimated range of 550,000 to 750,000 metric tons. During that same week soy meal and cake net export sales were near 197,000 metric tons, an increase of 6% from the previous week at 184,000; soy oil net export sales were near 46,000 metric tons, an increase of 354% from the previous week at 10,100, a market year high. A higher US dollar index and lower crude oil futures gave bearish pressure to the soy complex, especially soy oil, limiting gains. Cash soybean bids are steady to higher so far on the day with light farmer selling. March soybeans closed at $9.68 1/2, down 9 1/2 cents.
March wheat futures at all three grain exchanges settled lower on the day. This morning the USDA released its weekly export sales for the week ending February 5. US wheat net sales were near 412,000 metric tons, an increase of 26% from the previous week at 327,000. This amount which fell within analysts’ estimated range of 300,000 to 500,000 provides some bullish support to US wheat futures this session. US wheat export outlook indicates growing competition from Northern Europe, Russian and Black Sea wheat exports. Spillover from corn and soy gave some pressure. A higher US dollar index and continued sentiment over the decreased demand for US wheat resulting from the global economic slowdown provided additional bearish pressure.
March CBOT Wheat settled at $5.38 3/4, down 4 1/2 cents.
Argentina has had precious little rain again in the last 24 hours. Here's the latest precipitation map for the period 9am 11/02 to 9am 12/02, with thanks to Jose in Uruguay:
On top of that, there is very little in the forecast either, with the entire soy & corn areas set to receive 25% of normal or less for the period through to 19th Feb.
By contrast, heavy to excessive rains are set to hit Brazil over the next couple of weeks, according to QT Weather meteorologist Allen Motew.
He says that Brazil will be extremely wet with between six and fourteen inches of rain falling from Mato Grosso through to Sao Paulo/Minas Gerais, with heavy rains disrupting the harvest in Mato Grosso and Goias as it approaches 10% complete.
Check out the QT weather maps here: South American Precip For Rest Of Feb
Strategie Grains have cut their 2009/10 EU-27 wheat output estimate slightly to 132.2mmt, down 5.6% on last season's 140.1mmt, saying that the cold snap in January may have caused some crop losses.
Yields are predicted at 5.8mt/ha, down 4% on last season's 6.1mt/ha.
EU-27 barley output is seen 3% lower at 63.5mmt and corn production 7% down at 57.8mmt.
The French Farm Ministry has indicated 2009/10 soft wheat acreage of 4.96 million hectares. That is down from their December estimate of 5.03 million, and represents a 2.1% decline from last year.
eCBOT grains closed flat, barely unchanged in a very lacklustre session.
The financial bailout in the US has met with a lukewarm reception. Whilst it may stimulate some demand for grains, the cost to the US taxpayer is very significant.
On a supportive note, Argentine farmers may announce a series of strikes, demonstrations and/or a suspension of cattle and grain movements as early as today in protest to crippling losses faced by farmers who are being taxed to the hilt.
Whilst the drought situation in the country has improved somewhat, crop losses are still expected to be very significant in 2009.
The USDA lowered it's wheat production estimate for the crop just harvested to 8.4mmt on Tuesday. That has almost halved from output of 16mmt last season.
Japan bought 132,000mt of mostly US wheat overnight. Egypt may buy US or Russian wheat today, whilst South Korea is shopping for corn and soymeal.
Pakistan, the Philippines and Morocco are also in the market for wheat.
Congestion and delays at Australian ports may put them out of the export arena until April, according to some reports.
Early calls for this afternoon's session: Wheat down 1-2c, corn flat to down 1c and soybeans steady to 2c firmer.
New data from the Council of Mortgage Lenders makes grim reading and reflects just how tight getting a mortgage has become. The figures reveal total net lending for 2008 was just £39.7bn, down 63% from £108bn in 2007.
The number of purchased home loans dipped from 1,017,000 in 2007 to 516,000 in 2008, that was the lowest level since 1974.
Loans for first-time buyers also plummeted by 163,600, with 357,800 in 2007 to 194,200 in 2008. First-time buyers had to put down an average deposit of 22% in 2008, and that is simply beyond many. It is also the highest level of average deposit put down by first-time buyers since the CML's records started back in 1974. Until the end of 2007 a 10% deposit was the norm.
Early estimates for the 2009 Russian grain harvest peg the crop in the region of 91mmt, some 16mmt below production in 2008.
SovEcon, an analytical centre that studies the grain market, released its first preliminary forecast on February 6, predicting a harvest of 87-96mmt.
Meanwhile the Agrarian Market Conjuncture Institute (IKAR) said that their harvest forecast for the 2009 agricultural year is 85-95mmt.
Unlike ministries in other countries, the Russian Agriculture Ministry does not issue any official forecasts for the current year's harvest.
If we take the middle ground and go for a crop of 91mmt, that is 16mmt (or 15%) down on 2008. The harvest is expected to be split roughly 50:50 between winter and spring sown grains.
India's leading Hindu cultural group, the Rashtriya Swayamsevak Sangh, has developed a drink called Gau Jal, or Cow Water, which is says is a healthy alternative to Pepsi. The only problem is what it's made from.
And there's more, they don't just drink the urine either....
I've bhuna round the world and I've never heard anything so jalfreizi in all my life.
There isn't a lot of change in the overnight eCBOT markets this morning. As freight rates continue to rise, the Baltic Dry Index was up for the 17th day in a row yesterday, importers are coming in for cover before things get worse.
Japan bought 132,000mt of US, Canadian and Australian wheat overnight, the majority of which was US origin. South Korea are in the market to buy 165,000mmt of corn and 55,000mmt of soybean meal. Egypt are in for at least 55,000 tons of wheat.
China's Vice Agriculture Minister Wei Chaoan says that the government is confident of a good harvest in 2009 despite the drought, and that he doesn't anticipate a problem as the government has adequate supplies to counter any shortfall.
Ar you familiar with the expression "methinks thou doth protesteth too much" Wei? Is that burning smell your trousers or the wheat fields behind you?
Congestion at Australian ports may well redirect some shipping interest away from that region so the US and EU may pick up a bit of extra wheat business on that back of that.
A stronger dollar looks like capping any rally attempts in Chicago, not that this will help UK prices too much today with the pound about as popular as piles.
London wheat should find enough impetus from an ailing sterling to move a little higher.
The pound is sharply lower for a second day after BoE governor Mervyn King was splashed across the nation's TV screens last night looking like a man who hasn't got a clue what he's doing.
He is of course a big mate of Gordon McBroon (is it just me or does he always look like he's got a sly bit of chewy on the go? Or a caramel that he hasn't quite finished and is saving for later).
So too of course is former HBOS chief Sir James (I was only obeying orders) Crosby.
Having pretty much run out of bullets as far as rate cuts are concerned, Mr King says that the BoE is now ready to take "unconventional" monetary easing measures to revive the ailing economy. The widely quoted "quantitative easing" - which it seems to me is otherwise known as printing more money.
We'll be queuing up with a wheelbarrow full of "Aytron Senna's" just to buy the paper on a Sunday morning before long.
The pound is $1.4150 and 1.1035 against the euro.
Crude oil is below $36/barrel after the US Energy Department pegged US stocks at 350.8 million barrels.
Supplies at Cushing, Oklahoma, where crude oil traded on Nymex is stored, rose 1.7 percent to 34.9 million barrels, the highest on record.
All this despite US refineries operating at 81.6 percent of capacity, the lowest since the period ended Oct. 3 when the Gulf Coast was recovering from hurricanes Gustav and Ike, and OPEC pumping 950,000 barrels a day less than in December.
Supply is still very clearly outstripping demand.
Read this interesting article in the China Daily "No rain in the country, no jobs in the cities"
With more than 20 million migrant workers out of work, it maybe isn't surprising that the Chinese government might just be tempted to deliberately play down the true impact of the drought in northern China.
Imagine the unrest that 20 million STARVING and jobless migrant workers could cause.
Suppose YOU were the Chinese government, what would you do? I don't think I'd be wanting to suggest that crop losses would be anything other than minimal, would you?
The Baltic Dry Index - the benchmark guide to drybulk shipping rates on 40 routes across the world - rose 81 points, or 4.1 percent, yesterday to close at 2,055 - the index's 17th consecutive daily gain.
Demand to ship commodities such as coal, iron ore and wheat have boosted capesize vessel rates to a four-month high.
That demand is coupled with a lack of ships, as chartered vessels queue to at various ports around the world, and some lie fully laden, but idle, being used as giant floating storage containers.
There are at least 19 vessels waiting to load grain from ports in Western Australia, by far the country's biggest exporting state, according to Bloomberg. CBH Group, the state’s biggest grain handler, told customers it can’t take orders for February or March and temporarily halted April bookings, they added.
Steel production underpins demand for about half of the world’s bulk carrier fleet. What we are now seeing is improved demand from China as steel mills reopen after December shutdowns, and increased steel production in emerging markets India and Russia, experts say.
Steel makers were replenishing stock, while the results of government stimulus plans to kick start economies in China were now beginning to be felt, they added.
There could certainly be some more room on the upside for freight yet, as we are still a very long way from the index's all-time high of 11,793 set in May 2008.
March corn finished at $3.68 1/2, down 8 1/4 cents despite Taiwan buying 116,000mt overnight. Since Tuesday to early Wednesday, heavier than expected showers fell in drought-stricken corn crop areas of Argentina. A return to above normal, hot and dry weather conditions for the remainder of the week to next week are forecast. Some reports suggest that this is too little too late for corn, but for now it is a little early to say for sure. Tomorrow's weekly export sales report estimates are 850,000-1.2 million metric tonnes.
March soybeans closed at $9.78, down 16 cents. More rain in Argentina, concern over the global recession and the US stimulus package weighed on the market from the start. Taiwan purchased 56,000 tonnes of US soybeans, apart from that there was little bullish impetus for beans. Weekly export sales estimates for tomorrow range from 400,000-800,000mmt.
March CBOT Wheat settled at $5.43 1/4, down 12 3/4 cents. A return of market sentiment over the global economic downturn will decrease wheat demand gave bearish pressure to US wheat futures. Showers and snow fell over HRW wheat crop areas in the US plains, benefiting crops there.
EU wheat futures closed with very little change Wednesday on a dearth of fresh market news.
March Paris milling wheat finished down EUR0.25 at EUR150.25/tonne. London March feed wheat closed down GBP0.60 at GBP116.50/tonne.
In the UK crop conditions lurch from bad to worse. Planting was done late, or not at all, in wet and claggy soil and things have gone largely downhill since then.
Snow, rain and sub-zero temperatures have subsequently combined to make crop development even further behind.
Still, many educated pundits suggest that the UK, EU and much of the rest of the world will produce wheat yields comparable, or only slightly down, on 2008.
They could, of course, be talking absolute rubbish. And indeed they almost certainly are. But these are the things that Dow Jones, Reuters, Bloomberg and the rest aren't allowed to say.
World wheat production in 2009 WILL be well down, you really don't have to be Einstein to work that out. Just like you didn't have to be overly blessed in the brains department to figure out that the opposite would be true in 2008.
Yet in 2008 it seemed like very few could see past the end of their noses. Now many "experts" are saying that wheat production in 2009 will only be 2-3% down on last year.
It WILL be down, much, much more than that.
eCBOT grains closed lower with March soybeans down 11 /34c, March wheat down 6 3/4c and March corn 3 1/4c easier.
Disappointment over the US bank rescue plan seems to be the main reason for the decline. Sometimes, it seems, throwing $2 trillion at a problem just isn't enough. The rescue package seems to carry a surprising lack of detail and that is disconcerting.
Some forecasts for rain later in the week for Argentina also contributed to the general mood of doom & gloom. Meanwhile here is what has fallen in the 24 hours to 9am local time this morning:
Chinese trade data released today showed exports dropped 17.5% year-on-year, after a 2.8% slump in the previous month; while imports nosedived 43.1%, more than two-fold the December's 21.3% year-on-year drop.
The conclusion being if China isn't exporting, then it isn't going to be importing that's for sure. And that of course is potentially bad news for grains as a whole.
Yesterday's USDA numbers have already been consigned to today's chip wrappings. If you can afford a bag of chips that is.
Early calls for this afternoon's CBOT session: March corn called 3 to 5 cents lower, March soybeans called 6 to 12 cents lower, March CBOT wheat called 4 to 8 cents lower.
The pound has put in a bad 24 hours at the office, falling from a high of $1.4893 yesterday to a low $1.4338 today.
Sterling had a nervy start to the day ahead of UK unemployment data, which was expected to show 88,000 job losses in January, pushing unemployment up from 1.92 million last month, above 2 million.
As it was the numbers weren't quite as bad as expected, coming in at 73,800 - keeping unemployment below the magical 2 million mark, albeit ever so slightly.
The pound rallied around a cent on the news.
However, the BoE quarterly inflation report then came out, saying that the BoE sees CPI at just 0.5% in two years time, based on current market rate expectations. This would appear to give some further downwards room for manoeuvre on UK interest rates.
“Given its (the BoE's) remit to keep inflation on track to meet the 2 percent target in the medium term, the projections published by the committee today imply that further easing in monetary policy may well be required,” said King.
Many feel that a zero interest rate policy is warranted and if prices continue to plunge the risk of deflation may drive the MPC to oblige.
Sterling subsequently fell back below $1.44 and to around 1.11 against the euro.
An advertisement by the British Pork Executive (BPEX) has been banned by the British Advertising Standards Authority (ASA) as an investigation found the ad’s claim of ‘very high welfare’ to be misleading.
The watchdog received a complaint made by Compassion in World Farming, which expressed concern that the ‘Pigs are worth it’ adverts were unacceptable. Objections to the campaign were raised as animal rights activists said it implied all UK pigs were well cared for.
The ads by the British Pig Executive was featured in national press, bill board posters and magazines. They stated that “British pig farms have very high welfare standards assured by the Quality Standard Mark (QSM). And well cared-for animals mean better quality meat…Help the pig farmers. Sign our petition for fairer prices at pigsareworthit.com and always look for the Pork Quality Standard Mark.”
The ASA ruling states that “some indicators of UK pig welfare, such as the percentage of piglets tail-docked, the percentage of finishing pigs that had access to straw bedding, and the use of farrowing crates for sows might be seen by some as indicating that the general level of pig welfare in the UK in certain areas should not be described as very high.”
From an official Chinese News Agency release:
According to the State Flood Control and Drought Relief Headquarters, extremely low rainfall since late October has created an extremely unusual drought in north China, traditionally the country's breadbasket.
As of Monday, about 136 million mu (9.1 million hectares) of winter wheat in eight major producing provinces was affected, of which 36 percent, or 49 million mu, was seriously affected. In addition, 3.5 million people and 1.66 million livestock had no access to drinking water.
Henan, which produces a quarter of China's wheat, is worst hit. Since October, it has seen about 10 mm of rain, 80 percent less than average, making it the worst drought since 1951. The provincial government says about 43.5 million mu of wheat is affected, 8.7 million seriously. In neighbouring Anhui Province, drought has hit 25.9 million mu of wheat crops.
Agriculture Minister Sun Zhengcai said Friday in Anhui that more than 2.3 million mu of seedlings in Anhui, Henan and Shandong had already died. He warned the dry spell was forecast to continue and cause more losses.
The Agriculture Ministry has no estimates of wheat yield losses this year, but a senior weather official said on Feb. 3 that production was likely to be down 2 to 2.5 percent from last year, when China produced around 110 million tons of winter wheat.
Xiao Ziniu, director of the National Climate Center of the China Meteorological Administration, has warned the "once-in-a-half-century" drought will continue until next month.
The Anhui provincial government says the drought has caused losses of 1.6 billion yuan (234 million U.S. dollars). Henan has published no estimated losses, but Party chief Xu Guangchun said the drought had affected people's livelihoods and could undermine social stability.
"The drought is adding difficulties to an already grim economic situation owing to the impact of the global financial crisis," he said.
It is interesting, is it not, that there are no official estimates as to how much production will be lost, yet they can tell us exactly how much the drought has cost in financial terms?
Why would they want to keep the true extent of any crop damage quiet? There is a clue methinks in "the drought had affected people's livelihoods and could undermine social stability."
And there's no point telling the world how bad things are now, that'll only make the price go up. We've got some buying to do first.
Make no official announcement on losses but get some "senior official" to say it's only going to be 2-2.5% or so.
The plot thickens.
Vivergo Fuels - the illegitimate love-child of an incestuous relationship between BP, British Sugar and DuPont - say that it's new plant at Saltend is expected to be in production in the summer of 2010, taking in 1.1mmt of UK wheat and spitting out 420 million litres of bioethanol and up to 500,000mt of by-products (including some wet).
Vivergo have signed exclusive contracts with grain marketing business Frontier to procure all of the wheat for its feedstock. Under a similar agreement, animal feeds supplier KW Trident will market all the resulting co-products.
That's what we call a nice level playing field there then. Anyone for a game of Monopoly?
For more info dial Saltend 666.
The number of UK jobless rose by 73,800 in January figures just released reveal, pegging the ranks of the great unemployed now at just a tad under 2 million.
Astonishingly, the figures were actually better than anticipated. An increase of 88,000 had been expected, taking unemployment over 2 million.
The pound rose around a cent on the news from $1.44 to $1.45, but still around 4 cents below the weeks highs.
The USDA yesterday forecast EU-27 rapeseed production at 18.79mmt, down from the 19.32mmt produced in 2008/09.
Production in Germany, the top EU-27 producer, is seen at 5.13mmt they say, slightly below Strategie Grains' latest estimate of 5.5mmt and marginally down on 2008/09 output of 5.16mmt.
In France production is estimated at 4.77mmt, below Strategie Grains' estimate of 4.95mmt, and again marginally down on last season's 4.78mmt.
Here in the UK they predict output at 2mmt, considerably more than Strategie Grains' estimate of 1.79mmt, and an increase on last season's production of 1.98mmt.
Now that figure of roughly unchanged production is interesting, as my broking chum Robert Kerr is adamant that UK production will be down substantially in 2009. So adamant in fact that he is willing to bet on it.
I, for one, agree with him calling UK production this year around 15% lower at 1.7mmt.
Poland incidentally are the third largest producer in the EU-27, knocking the UK into fourth slot. They are seen producing 2.12mmt in 2009/10 according to the USDA.
Poland: the new Aston Villa.
The Baltic Dry Index, the benchmark guide to drybulk shipping rates on 40 routes across the world, rose 8.8 percent yesterday to close at 1,974 - the index's 16th consecutive daily gain.
After rising 53.5 percent last week alone, the index has already added to those gains with a further 20 percent gain already Monday/Tuesday this week.
A London broker said fewer ships were available in Europe to meet charterers' needs for promptly available tonnage, which was why "better numbers" were being seen.
A large number of Black Sea and Mediterranean cargoes have come onto the market, with iron ore cargoes dominating the list, brokers said.
March soybeans at $9.94, down 8 cents, disappointing but well off session lows. The USDA report cut US ending stocks in line with expectations. It also dropped Argy production quite sharply to 43.8mmt, and Braz production by 2mmt. These were towards the upper end of expectations (in terms of around the largest losses expected). US equities posted sharp declines as US Treasury Secretary Timothy Geithner fudged details of the economic rescue plan. Crude oil also fell closing $1.40 lower at $38.16/barrel.
March corn at $3.76 3/4, down 3/4 cents, well off session lows as updated forecasts in Argentina called for showers today followed by a return to drier and warmer weather for the rest of the week. This return to drought conditions will likely to continue increase stress to corn crops there. Also supportive was the USDA's surprising decision to leave US ending stocks unchanged at 1.79 billion bushels. Mexico today purchased 206,000 tonnes of US corn which also added some support.
March CBOT Wheat closed at $5.56, down 9 cents. The USDA report wasn't really expected to throw up too many pearls of wisdom & true to type it didn't. the dollar moved higher throughout the afternoon and that dragged all the grains down with it. Nobody is sure what the implications are for wheat from drought in northern China. What we do know is that this morning, beneficial rains fell in the HRW wheat crop areas in the southern US Plains and showers fell in wheat crop areas of China’s northern plains. That seems to be sufficient to keep the market calm and allay any fears for now.
EU wheat closed narrowly mixed with March Paris milling wheat down EUR1.00 at EUR150.50/tonne, and London May feed wheat unchanged at GBP119.25/tonne.
The USDA numbers didn't throw up too many surprises. The Argy wheat crop was dropped to 8.4mmt, but that was ,ore like the USDA playing catch-up as a figure around 8.5mmt was already in the market from thes like of the Buenos Aires Cereals Exchange.
US wheat ending stocks were left unchanged, which was also in line with expectations.
For the EU crop more export business is needed before attention starts to focus on the 2009 crop.
At first glance the USDA report looks bullish for soybeans and corn and neutral wheat.
They cut Argy soybean output by 5.7mmt to 43.8mmt, whilst not off the radar as far as other estimates go, the trade was probably anticipating a more cautious approach from the USDA coming in around 45-46mmt.
They also lopped 2mmt off Brazilian production, which again was towards the higher end of what they were expected to do.
US soybean carryout was cut pretty much as expected.
Argy corn production was also slashed by 3mmt, again probably by more than anticipated. Brazilian corn output was left unchanged, a slight surprise as a modest cut had been anticipated.
US corn carryout was left unchanged, that was a big surprise as just about everybody was predicting an increase in stocks, so that is seen as mildly bullish too.
Argy wheat production was cut by 1.1mmt, now falling in line with estimates from the local exchanges.
Overall reaction is bullish beans, modestly bullish corn and neutral wheat.
Early calls for this afternoon's CBOT session: beans up 12-15c, corn up 3-5c, wheat 2-3c higher.
The USDA's WASDE report was out at 13.30GMT today. Here is a quick summary of the main changes from last month:
Aussie Wheat 20.15mmt 20.00mmt
Argy Wheat 8.40mmt 9.50mmt
Argy Corn 13.50mmt 16.50mmt
Argy Soybeans 43.80mmt 49.50mmt
Braz Soybeans 57.00mmt 59.00mmt
No huge surprises really. They maybe dropped Argy soy & corn a tad more than it was anticipated they would. A bit of a surprise that they didn't drop Braz corn at all. Argy wheat dropped in line with local exchange estimates.
Todays US 2008/09 closing stocks data from the USDA:
USDA Feb Avg Guess USDA Jan
Corn 1.790 1.838 1.790
Soybeans 0.210 0.203 0.225
Wheat 0.655 0.649 0.655
The only significant difference to what was expected there is that they left corn ending stocks unchanged from last month, whereas a sizable increase was anticipated.
It certainly seems so looking at the chart above, which shows crude losing more than 28% in the last three months whilst beans have risen 12%. Seemingly inextricably linked for most of 2008, this trend has been going on since October. Let's see if breaking free of the shackles of crude is a sign that grains and oilseeds will be the commodities to lead us out of this recession.
The main thing that concerns me about this is that there seem to be too many other people thinking, or is it hoping, along the same lines. I'd feel much more comfortable being a lone voice in the wilderness somehow.
Still, freight rates are moving up, export business is being done. The way I see it is that right now any export business is good export business, no matter who gets the order.
If anything god has come out of this whole mess, it might just be that some of the hot-shot whizz-kids in the city that have only just started shaving have now actually witnessed their first real bear market. Maybe they will be a bit more cautious next time, or is that just wishful thinking?
Blimey, I'm starting to sound like my Dad now. Of course I remember when all this was fields. A hoop & a stick that's all we had in my day, we had to make out own amusement etc.
Schools Secretary, Ed Balls has embarrassed the government with his off-the-cuff remark that the current economic downturn is so severe that it would surpass even the Great Depression of the 1930s.
"This is a very worrying admission from a Cabinet minister. We are being told not only that we are facing the worst recession in 100 years, but that it will last for over a decade," said Shadow Chancellor George Osborne, not one to miss an opportunity.
Balls has made himself look all the more stupid as his Government has been busy telling us all that the economy will recover by the second half of the year!
eCBOT grains are mixed in quiet trade ahead of the USDA's stocks & world production numbers due at 13.30GMT.
Soybeans are around 5c higher, and wheat and corn 1-2c lower in light positioning ahead of the data.
South American production numbers are expected to be lowered for corn & soybeans.
For soybeans expect the Argy crop to be reduced from 49.5mmt to around 45mmt, in Brazil from 59mmt to 57-58mmt.
In corn we can also expect to see the Argy crop cut from 16.5mmt to 13-14mmt, and in Brazil from 53.5mmt to around 51-52mmt.
For US ending stocks it is expected that corn will be increased, soybeans decreased and wheat left roughly unchanged. For corn that means going from 1.79 billion bushels to around 1.9 billion; for beans from 225 million to 200 million; and for wheat staying around last month's 655 million.
In other news Iraq bought 350,000mt Canadian, Australian, German and Russian wheat yesterday, whilst Tunisia bought 50,000mt of any origin milling wheat.
Japan are in the market for their usual combo of US, Canadian and Australian wheat in a tender due to be concluded Thursday. Of this 86,000mt is expected to be US wheat.
Pakistan may retender this week for 250,000mt wheat ahead of their own harvest in March/April
Taiwan are on the prowl for 60,000mt US corn.
Nobody seems to know what is really going on in China, one minute they are having the worst drought for 100 years, the next minute there isn't a problem.
The Baltic Dry Index, which measures drybulk shipping rates on 40 routes across the world, jumped more than 10 percent yesterday to close at 1,815. That was an increase of 173 points from Friday, the index's biggest one day leap since rates bottomed at 663 in December, and it's 15th consecutive daily gain.
The index rose more than 50% last week on talk of renewed demand for vessels as credit lines begining to open again. Chinese demand for Brazilian iron ore is being cited as the trigger for the recent surge, along with Australia finally getting a decent wheat crop after two years of drought.
There are fewer vessels available on the market as shipping companies have drawn in their horns, sending vessels into dry dock for much-needed repairs rather than plying the seas at heavily discounted rates.
The recent phenomena of storing cheap commodities at sea, has also led to a reduction in available freight.
Eastern Australia is not normally a big wheat exporter, shipping just 800,000mt last year, but that figure could leap to more like 3mmt in 2009, according to some shippers. It is now virtually impossible to get a vessel any earlier than the end of April to ship grain out of Australia's eastern seaboard, and shipping to the Middle East now costs $25/tonne, up sharply from $15/tonne two months ago, brokers say.
Meanwhile rates on the fronthaul route, shipping cargoes from Europe to Asia via east coast South America or the US Gulf, have risen nearly $3,500/day in the last week.
EU wheat futures closed modestly higher in a relatively low volume day with Paris March milling wheat ended up EUR1.25 at EUR151.25/tonne. London May feed wheat closed up GBP0.85 at GBP119.25/tonne.
On the export front Iraq bought 350,000mt Canadian, Australian, German and Russian wheat, whilst Tunisia bought 50,000mt of any origin milling wheat from Bunge.
The trade is garnering some encouragement from any export business at the moment, no matter where it comes from.
There are concerns over weather in China and the US which may adversely affect production there.
Whilst global stocks are rather burdensome for now, the jury is still out on the eventual size of the world 2009 crop, with estimates I've seen recently ranging from 625-662mmt, compared to 682mmt in 2008.
Current estimates include: USA 61.9mmt (from 68.0); Russia 53.6mmt (63); EU-27 140.50mmt (150.50); China 100mmt (112.5); Ukraine 20mmt (25.5); Canada 25.2mmt (28.6) - that lot alone takes almost 50mmt of production off the table coming to 401.2mmt from 448.1mmt a year ago.
The USDA will issue revised world production estimates tomorrow at 13.30GMT.
March soybeans finished at $10.02, up 1 cent, well off session highs of 18 cents higher. Soy futures traded higher most of the day in anticipation of Tuesday’s USDA WASDE report. The average trade estimate for US soy ending stocks is a 20 million cut to 205 million bushels. Chinese buying resurfaced with them booking another 120,000mt beans today. Argentine weather outlook seems dry for the rest of the week.
March corn futures settled slightly higher at $3.77 1/2, up 1/4 cent. Midday weather forecasts for Argentina took a bit of heat out & added a bit of rain. Many analysts however are saying that for corn the damage has already been done. The USDA will likely lower Argy & Braz production estimates tomorrow, but also raise US carryout. South Korea bought 100,000 MT of US corn overnight.
March CBOT Wheat closed at $5.65, up 8 cents ahead of tomorrows USDA WASDE report. No major changes are expected for US wheat carryout or production elsewhere in the world. Iraq bought 350,000mt Canadian, Australian, German and Russian wheat today, whilst Tunisia bought 50,000mt milling wheat from Bunge Ltd. Drought in China and crop concerns in the US added some support as did a weak US dollar.
eCBOT grains closed with corn flat and wheat and soybeans firmer. March corn closed down 1/4 cents, March soybeans ended up 8 3/4 cents and March wheat up 9 3/4 cents.
Largely hot & dry weather seems to be returning to Argentina which will stress crops further there.
Despite some decent rains last week, undoubtedly damage has already been done, particularly to corn.
All eyes will be on the USDA tomorrow when it releases revised crop production estimates and stocks data, with soy and corn output likely to be reduced in Brazil as well as Argentina.
US ending stocks for soybeans are expected lower, corn higher and wheat around unchanged from last month.
Tunisia has bought 50,000mt wheat from Bunge in a tender at $203.87 C&F. Pakistan passed on a tender for 250,000mt white US wheat as it only attracted one bid for just 50,000mt. A revised tender may be issued tomorrow.
Conflicting stories abound as to the extent of damage to winter wheat crops in China. Exactly what the true magnitude of drought losses are to the world's largest wheat crop remains unclear.
The USDA has today reported the sale of 100,000mt US corn to South Korea and 120,000mt soybeans to China. South Korea have bought a lot of kit in the last few weeks, over one million tonnes worth, and it is also nice to see China back again after a lethargic first week back after their New Year celebrations.
Letters of credit seem to be finally lubricating the wheels of industry again if the freight market is anything to go by, with the Baltic Dry Index up by more than half in the past week alone.
Early calls for this afternoon's CBOT session: Corn flat, wheat up 6-8 cents, soy up 7-9 cents.
Lack of rainfall, the collapse of commodity prices and the misguided policies of the Argentine government will cost farmers a fall in income of 43 billion pesos (equivalent to 12.5 billion US dollars) in 2009, according to the Argentine Rural Confederations, CRA.
And Argentine farmers are not happy bunnies. They're planning are planning to return to the streets in an orchestrated wave of protests to complain about their plight and to demand changes in government policies.
CRA vice-president Nestor Roulet said that besides the drought, the Kirchner administration's intervention with misguided policies caused farm prices to fall, discouraged farmers to make use of improved technology, and that the country was now going to harvest 22.4 million tons less grain because if their actions.
CRA together with the three other farmers organizations (FAA, Coninagro and the Argentine Rural Society) will be deciding soon about the next steps to follow.
Two of the organizations favour taking to the road, suspending grain and oilseed sales for two three day periods plus tractor marches in towns and cities.
Argentine Rural Society (SRA) president Hugo Biolcati on Sunday, said the conflict between the government and the farmers is unstoppable and added that the farmers liaison group which includes the four main farming groups, would support week long protests against the government. The liaison committee is set to meet on Thursday, and may finalise demonstration plans then.
Tentative dates are February 19 to 21 and March 5, 6, 7 with a huge concentration in Cordoba on March 14th.
After a decent soaking last week, warm and dry weather is set to return to Argentina this next fortnight.
Forecast highs this week are in the range 88-100 degrees, with temperatures set to hit 108 by Tuesday/Wednesday of the following week.
Anticipated rainfall meanwhile during this timeframe is pretty non-existent.
Here's a map from my chum Jose Lavista of what fell in Argentina over the 24 hour period 9am 07/02 to 9am 08/02:
Scruffy celebrity chef and severely henpecked husband Anthony Worrall Thompson has put his holding company, AWT Restaurants Ltd, into administration and closed four of his six restaurants. Wozzer lays the blame fairly and squarely at the feet of Lloyds for refusing to extend his business overdraft by £200k.
Nissan becomes the latest car maker to announce job losses - 20,000 will go worldwide in 2009.
GM and Chrysler could be forced into bankruptcy by the US government according to some media reports, after it was revealed that the US taxpayer takes a backseat when it comes to payback time. Prior creditors such as Citi and Golden Sacks take precedent over the government under the terms of the hastily arranged bailout. And we know who rubber stamped that one don't we children.
Barclays says it has managed to buck the trend and turn in a respectable £6.08 billion profit in 2008. That's 14% down from 2007, but not a bad performance at all in the current climate. Unless the board are considering to pay themselves £6.07 billion in bonuses of course! Barclays shares are up 12% to 117.10p in early trade, the biggest FTSE gainer of the day so far.
eCBOT grains are showing little different from Friday night's close overnight with wheat around 3c firmer, corn 3c lower and soybeans around unchanged.
Corn is under a bit of pressure on ideas that the USDA will increase ending stocks in tomorrows report as demand from the US ethanol sector wanes.
Crude oil is lower this morning, sub-$40 once again, so that will provide little in the way of support for corn.
Tomorrow's WASDE report is expected to show a reduction in world soybean supply with sharp cuts in Argentina and also a lower Brazilian crop.
Corn output in both South American countries is also likely to be reduced.
Uncertainty over the impact of drought in China on it's winter wheat crop and also some crop concerns on the US Plains are supportive to wheat.
The dollar is already around a cent off the days lows at $1.4775 against the pound.