Market News - Colony Foodscolonyfoods.com/wp-content/uploads/2013/12/Colony... · 23/12/2013 ·...
Transcript of Market News - Colony Foodscolonyfoods.com/wp-content/uploads/2013/12/Colony... · 23/12/2013 ·...
Global Market report
Market report - eGGs
Flour Facts
produce Market update
cheese & butter
Market update
Market News
Click on the link below to view updates:
oil Market Watch
Western plastic
stretch FilM snap shot
Egg Market Week of December 23, 2013
Retail demand good to very good. Supplies well balanced. Market steady.
The regional egg markets are as follows:
Northeast Midwest Southeast South Central
Lg 1.69 1.69 1.77 1.78
Md 1.30 1.28 1.31 1.32
Source: Esbenshade, Inc.
Weekly Market Highlights
Wheat futures prices continued their steady decline this week.
Basis premiums remain very high but both hard red winter and hard red spring wheat premium prices have
declined this week.
Rail performance has finally improved somewhat, due in part to better weather conditions.
Any further declines in basis premiums, and resulting flour prices, are completely dependent on continuingly
better rail performance.
Facts on Flour Soft Red Winter (SRW)
Soft Red Winter Wheat is grown in the eastern third of the United States. SRW is high yielding wheat, but
relatively low in protein, usually about 10%. SRW is used for cakes, pastries, flat breads, crackers and snack
foods. This fall-seeded wheat comprises about fourteen percent of U.S. wheat exports.
Flour Facts will be taking a break for the Holiday Season. We wish you and your families Happy Holidays and Thank you again for your continued support of our flour business. Watch for Flour Facts again on January 9th.
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Futures & Basis Markets
KC Future
Spring 15% Basis (from MarketFax No.1Northern Spring)
Mpls Future
Winter 13% Basis (from MarketFax No.1hard winter)
Flour pricing consists of a combination of Wheat futures prices and Basis Premium prices per bushel. Information contained on this chart closely resembles Gold Medal All Trumps, Mpls. Future + 15% Basis, and Harvest King, KC Future + 13% Basis. This chart does not reflect changes in millfeed values.
This Chart is meant to indicate Market Direction Only.
DECEMBER 19, 2013
Global Market Report NOVEMBER 14, 2013
Skipjack Tuna Over the past few weeks the Western Pacific region has been reporting good catching. Japanese fishing boats are currently reporting a catch volume of 35-40 MT/boat per day. The meantime, Taiwanese and Korean fishing boats reporting
15-20 MT/boat per day. The operation of the Spanish and French fishing boats in Indian Ocean also recovered to 25-30 MT/day per boat. Raw material price has gone down from $2350/MT at its peak in April to $1900 by July-Sept. Due to improved catching and poor demand, raw material pricing has further dropped to the current level of $1700-1750 for early December deliveries. According to reports, Taiwan/Korean vessel days with PNA nations have been
used up and if they wish to further operate in the seas they have to pay $7000
per boat per day to PNA so operational cost will be very much high and boats are returning to port for rest. Also Eastern pacific fish closure (total fish closure means boats cannot sail out to catch) will start soon from November 18th till January 18th so demand from this region is expected to increase. Raw material prices: Bangkok $1700
Philippines $1750 Ecuador $1900
Outlook: Soft
Yellowfin Tuna The ratio of skipjack vs yellowfin has changed to 85:15 in the western Pacific and 75:25 in Indian Ocean. Raw material price $2450-2500 in Bangkok
Outlook: Stable
Tongol Tuna Vietnam’s local catch finishing up earlier than usual this season. Landing is reportedly much lower than the last season. Thailand season is over now. Price $1600/MT. limited availability
Outlook: Stable
Albacore:
Pacific ocean is in its lowest season now with basically no catch. Next season will
not be until March/April. Japan reports low volumes in cold storages. Landing in
Indian Ocean region is also poor. According to reports some trading companies
who concluded volume for national brand are now facing with difficulty to supply
due to poor catching. Traders/suppliers have not been offering for few weeks
already. Raw material is traded in Bangkok at $2500 levels and people foresee
Mitsui Foods, Inc. 35 Maple Street Norwood, NJ 07648
Phone:
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Fax: 201-750-0150
We’re on the Web! www.mitsuifoods.com Contact:
Johns P. Thampan [email protected]
PRICE TRENDS: Albacore -Stable
Tongol – Stable Skipjack-soft Yellowfin- Stable Pineapple- Firm
Mushroom- Soft Mandarins: Soft Artichokes: Soft
reduction of supply in the coming months and price may start to bounce
back up
Outlook: Stable
Mushrooms: Since 2012, Import from China has drastically reduced due to continued rejection by FDA for pesticide issues. Meanwhile raw material supply in China has reduced drastically since the beginning of 2013 season. According to Chinese agricultural department data, the planting area for mushrooms has reduced more than 1/3. Corp season in the Northern area is winding up now as weather becomes colder.
Fresh market consumption has increased. Very few offers are being made from China to the US market. Small volumes are available from brine pack. Demand in the US has dropped further. The US market has been focusing mainly on product from Holland.
Outlook: Soft
Pineapple:- It has been already 1.5 months since the winter crop began in Thailand but the raw material supply is still much less than of normal season. Now the fruit price
is 6.2-6.5 BHT/kg and packers facing with challenges to fulfill pending orders concluded since early part of 2013. Chins has been actively looking for sliced pineapple from Thailand but unable to find due to the current shortage. Winter peak may not begin until end November/1st week December. For next summer crop, with pineapple cycle, Fruit supply is forecasted to be less than this year (2013) about 10% due to farmers switching to grow other profitable items. Total tonnage Thailand now is around 6000 MT/day compare to
9000-10,000 per day at same period last year.
Outlook: firm
Tropical Fruit Salad Papaya season is Oct-Dec and will slow down from Jan-April. Guava considers
being a very small crop and harvest period is every other two consecutive months. Since papaya and guava supply consider small compare to the demand of domestic consumption. Therefore, the price is extremely volatile which induces mainly by the domestic consumption/market. The growing area of papaya and guava does go up and down as much as pineapple since it is a tree that can yield fruits for quite a long time and that it has enough domestic consumption to support. Therefore, sometimes the factories have to fight
aggressively against the domestic fresh market. raw material price is around 7.50 baht +/- per kg.
Mandarin Oranges: This year production in China began only during 1st week of November which is a late start compare to a normal year. Factories are not very optimistic about this year due to severe labor shortage. Canneries are unable to recruit enough
workers to arrange for production. The quality of the raw material in Hunan and Hubei provinces are very poor and output will be much lower than expected. With regards to pricing, originally suppliers expected pricing to be weak or similar to last crop due to carry over inventory situation and production forecasts.
However, now suppliers are moving up the offer prices due to labor shortage and raw material quality issues. Many suppliers indicate that they will suffer huge
losses if prices are same as last corp. This year, the total production days will be shorter due to late beginning of crop and early beginning of Chinese new year. Production has to be finished before January 15th latest. The average export quantity of mandarin oranges from China for the past 5 years was about 350,000 Mt per year. Due to the good pricing of 2010-2011 seasons and no carry over inventory, packers become so optimistic and produced about
440,000 MT during 2011-2012. The total production of 2012-2013 was reduced to 280,000 MT; however as per reports the industry still holds about 50,000 Mt of carry over (unsold) inventory from the last crop. US is the largest importer of mandarins from China. Last year the export to US was about 170,000 MT. Japan imports about 50-60,000 Mt and Europe about 50-60,000 Mt. The total export
from china last year was about 340,000 MT. A substantial drop in price happened during the past 18 months due to the over production in 2011-2012.
Spain reports some carryover stock of 3 kg and 11 oz mandarins. New crop will begin late November and expected to be good. However, packers are concerned due to low demand and severe competition from China. Forecast: Soft
Artichokes: Spain continues to sell out good volumes packed during this summer crop and anticipates enough to cover before beginning of the new pack season. Plantations areas are in similar size of last corp. winter pack volume will be dependent on
weather condition. Farmers forecast volumes similar to the last crop as long as weather cooperates. Chile and Peru are close to the finish of the season. Production volume is much lower than the last season. However, prices are lower as needed to be competitive with the softer market in Spain. Some packers say that they are completely sold out but some still have unsold stock.
Outlook:Soft
Olives: No major changes from last report. The harvest
volume for 2013 will be about 499,000 MT, about
8,000 MT less than he previous crop.
In some areas fruit has been affected by high temperatures in August
and fruits are too small for canning and may have to be shipped to
pressing plants. Manzanilla variety has been negatively affected by the
phenomenon called “Veceria” (irregular annual yield). Due to the poor
condition of the trees, the yield will be limited and irregular.
About 40% of the Gordal is of too small size not good for commercial
purpose. Hojiblanca variety appears to be of good quality and yield may
benefited from the autumn rains as it harvesting begins later. Cacerena
variety is positively affected by Veceria phenomenon and its output may
be compensated for the low yield of the previous year. Carrasquena
variety is reportedly in good shape and expects good yield and quality
Outlook: firm
Peaches: As reported earlier, the two major producing countries China and Greece had a very difficult year in terms of raw material situation. The extreme cold weather conditions (hail in Greece and Frost in china) caused reduction in crop by 30-50%
The Dangshan area in China finished their crop by end of August and reported a 30 % crop failure. The northern region has completed their crop during 1st half of September and reported 20% shortage. The average price of raw material was 20% higher than the last season. The domestic consumption is increasing drastically in China. The local market consumes about 70% of the crop. The local
market pays much higher price than the export market. Many packers give first priority to the domestic market. During 2012 season china processed about
600,000MT. The total production of this season is about 400-450,000 MT. During 2012 China exported about 132,000 MT of which US imported 44,000 MT, Japan 37,000MT, Russia bout 13,000 MT the remaining to Australia, Chile, Canada etc. There are about 4-5 peach varieties in China. Of which only 2 varieties are of good color and texture properties (#83 and #19). Suppliers are indicating that 2013 season's production has already been sold out and even if some small volumes available, those may not be of the right variety.
Outlook: Firm
Pears:
As reported earlier, this year has marked as a disastrous year for pears due to extreme low temperatures in the growing areas during the blossoming period. Due to frost conditions about 70% fruits withered and the total fruit output had dropped considerably. Generally only 10% the total output in China goes for canning industry. As the harvest continues and it was holiday season in China,
Canneries are currently receiving the secondary fruit for canning and the raw material price is about 1-1.2Rmb. Per kg. Chinese total export during 2012-2013 was about 50,000Mt. USA imported 21,000MT, Europe about 15,000, Thailand 5,300 Mt and Japan 2,600 MT. The industry reports no carryover stock in China from the last season. Currently the finished goods pricing is about 20-25% higher than the last season
Outlook: Firm
Apricots: No major changes from the last report. Spain reported a good production season for pulp but very little for canned due to soft texture issues. In China in the
beginning of the season, packers thought the harvest would be abundant, so they quoted with low prices. But in fact the supply was much less than expectation and price of raw material firmed up drastically. Some suppliers claim
that they suffer huge losses as they made commitments earlier predicating low
raw material prices. The total export from China to the US is not significant. Majority of Chinese production goes to Europe. Chinese canneries were focusing on 14-18 brix for light syrup pack in the past However, next season onwards they plan to increase the brix level to conform to USDA specs of 16-21 brix. This will result in some cost increase
Outlook: firm
Fruit Cocktail:
Major portion of fruit cocktail production is done between September and
March (during the availability of pears). Most packers produce during this
period based on firm commitments. There may be some year round
production but packers use the highest volume of ingredients namely
peaches and pears from frozen raw material. In the past the industry
used to use diced peaches and pears from canned raw material.
However, due to high cost of canning, they have moved to frozen raw
material. The main problem for using frozen raw material is the product
become very soft after further throwing and canning.
Due to the shortage of peaches and pears the present price of fruit
cocktail is 15-20% higher than the last season.
The total fruit cocktail export from China during 2012 was about
59,000MT. (US 17,000MT, Europe 15,000MT and Canada 7,000MT)
Outlook: Firm
Coconut Products–
Thailand is having major shortage situation on coconut due to hot weather and damages caused by bugs. Thai packers are now collecting raw material from Indonesia. But the availability from Indonesia is also limited as their plantations
were also affected by weather and bug issues. Philippines, India and Srilanka are also reporting the same. The market price has already move up by 20-25% Thai canneries are now struggling to fulfill their pending commitments. Next season will start in April 2014 Outlook: Firm
Baby Corn- It is off season in Thailand now. Also as reported earlier, there weren’t much recovery in supply even during the last harvest season either. The standard 150-
180 count corn is still very limited. Most of the packers are fully occupied with pending orders and may not be in a position to offer till beginning of 2014. Outlook: firm/severe shortage
Peppers and Pimientos
Production in Spain has over now. Price of raw material was higher than the last
season due to high demand from fresh market. New crop price is about 10-15%
higher than last crop. Peru is now producing some small volumes. Their season begins in January/February. They anticipate normal production volume this year. Chile produces small volumes but price is higher than last crop season. Outlook: firm
Water chestnuts:
According to reports due to high labor cost and low profits, many farmers have
reduced their plantation area for water chestnuts and changed to other profitable agricultural products. The recent reports from the Farmers Association in the growing areas, the reduction in growing acreage is about 20-30% compare to the last season. Usually by early No Sowing for 2013-2014 started in July. However, according to reports due to high labor cost and low profits, many farmers have reduced their plantation area for water chestnuts and changed to other profitable agricultural products. The recent reports from the Farmers Association in the
growing areas, the reduction in growing acreage is about 20-30% compare to the last season. Usually by early November, canneries will start offering. This year due to severe labor shortage and increase in cost of production, many canneries are reluctant to make offers. The starting of the season is expected to be delayed.
During 2011-2012 seasons, china exported approx. 40,000 Mt of water
chestnuts. However, the export volume has dropped by 20% during 2012-2013 seasons. The main reasons for such reduction was due to farmers’ efforts to concentrate more on domestic market by leaving water chestnuts to grow into larger size and get more yield for domestic fresh/frozen market. Production of canned water chestnut (especially a10 size) was reduced due to labor shortage. Canneries could not find skilled workers for peeling at the right time also wages
were increased considerably. Price of finished products increased by 30% over the past 6 months and currently there are no stocks available in China until new season begins. Outlook: Firm
For the week of December 22nd, 2013
Orange-Roasted Baby Carrots with Honey INGREDIENTS
1 1/2 pounds slender baby carrots, trimmed, scrubbed
2 tablespoons extra-virgin olive oil plus additional for drizzling 1 teaspoon (packed) finely grated orange peel 1/3 cup fresh orange juice 1 1/2 tablespoons honey Fleur de sel or Maldon sea salt
PREPARATION Preheat oven to 400°F. Arrange carrots in single lay-er on rimmed baking sheet. Add 2 tablespoons olive oil and orange peel; sprinkle with salt and pepper and toss. Pour orange juice over; cover tightly with foil. Roast until crisp-tender, about 10 minutes. Remove foil. Increase oven to 450°F. Drizzle honey over carrots. Roast uncovered until car-rots are tender and browned in spots, about 10 minutes longer. Transfer carrots and any juices to platter. Drizzle lightly with additional olive oil. Sprinkle with fleur de sel or Maldon sea salt. Recipe from their newsletter of 16-December-2013
Weather & Crop Update
The hottest topic, rather the “coldest topic” of conversation in the produce world is about the recent freezing temperatures effecting most of the country. Cold temperatures have impacted our fields here in Santa Maria, leaving us with limited availability on many of our baby lettuces, frisée, specialty greens and root vegetables.
Jeff Lundberg, Babé Farms VP of Operations sent these dramatic photos of our baby head lettuce fields out on Tuesday morning. The good news is that we have warm/mild temperatures in the forecast. At this time, it looks dry through the end of the year, with 2013 most likely ending up as the driest year on record since the 1870's. Hoping for good rainfall in 2014!
ASPARAGUS Sara Hoxie, [reporter for “And Know You Know], wrote an interesting article on the planting increases of asparagus, and concluded her comments, with a challenging thought for those of us in food service produce sales: “As the asparagus category gains in popularity so do the opportunities to take advantage of the increasing demand”. - See more at: http://www.andnowuknow.com/bloom/mexican-asparagus-production-expected-increase/sarah-hoxie?
AVOCADOES Good supplies of Mexican Hass with good quality and flavor. Fruit remains green and is firmer to the touch. Some lenticel damage appears (cosmetic only and does not affect quality). Short supplies on 40ct and larger fruit, as crops are peaking on 48/60/70. California Harvesting is complete. There will be very few Hass if any arriving to the packing house this month. By January 2014, Chilean Avocados supplies will likely increase in preparation for the Super Bowl pull which will start in early January.
BELL PEPPERS/CUCUMBERS/SQUASH Green & Red Bells: Availability is improving for red bells in Coachella and Nogales; prices have eased slightly. Prices are firm for green bells in Nogales and Florida; this market will be supported going forward due to issues caused by excessive rainfall during September and October in the Sinaloa district in Mexico. Yields continue to be below-average. Cucumber: Market is creeping up. Crossings through Nogales are increasing but movement is still brisk. Quality is good and anyone with older inventories is cleaning up. Weather for the weekend may press markets higher as rain and cold weather are expected this weekend. The anticipated rain is expected to be enough to interrupted harvesting. Squash Yellow & Zucchini -- Steady availability for zucchini, tightening supply for yellow squash. Acorn, Butternut, Spaghetti: Plentiful availability for all varieties. BROCCOLI -- Due to the colder weather, plant growth has slowed. However, there are no quality defects on broccoli, and sizing is good. Supplies are fairly good with crown material available. CAULIFLOWER -- Fairy good supplies with increased holiday demand. Quality will remain steady featuring good sized white curds, strong jacket leaves and good carton weights. CELERY -- Supplies are expected to be moderate throughout the week on all sizing. The quality is reported to be good, with only slight bowing being reported. In spite of the retail ads, Harold advises the market is steady. CILANTRO -- Good supplies this week despite the freezing temps in the Mexican growing region. Appearance and quality continues to be nice. Bunches are averaging 8-10 inches in length with good, green color. LETTUCE Good supplies are available although production will be limited due to cold morning temperatures and lettuce ice. Quality is fair with frost damage. Most heads will be pale in color, medium to medium-small size, and firm. Leaf Lettuce -- Our green leaf supply is healthy this week. The overall quality remains great with this cold weather with no blisters and freeze damage. We are seeing some slight yellowing on from the cold weather but shelf-life is performing well with no pinking or decay. Overall, we believe supplies will be good for the next several weeks.
TOMATOES Holiday parties and gatherings are full of traditional finger-foods and appetizers. Tomato options like salsa with fresh chopped cilantro or a caprese with rich green basil leaves nestled on lush, beautiful, red tomato slices are already dressed in festive colors. A fresh made tomato jam is a unique treat for the party host or an easy appetizer paired with cheese, fruit and toast. Rounds: The round tomato market saw more relief this week as warmer weather continues to bring on more fruit in Florida. This comes during a time when slower holiday pulls create lesser demand, yielded lower pricing on all sizes. Though Mexico has officially begun to ship out gas greens and increasing amounts of 2-layer product, the quieter demand offsets this new volume, keeping markets low. Romas: Florida Roma production is still strong this week, as the eyes of buyers shift from the American southeast to great fields of Mexico. Warm weather in Florida last week brought on heavy supplies that were quickly bought by both American and Mexican buyers. The high price, though, dropped the demand for these items as buyers shifted to small rounds as a suitable replacement. Now that Mexico in coming into more volume of romas, this market dropped even more this week and will continue to slide as we head into the week of Christmas. Cherry: Cherry tomatoes have also found themselves in a sloppy market as most shippers are consigning volume to buyers in order to keep inventory clean. Grape: While grape tomatoes continue to flourish in Florida, shippers are not realizing the full value of their product after the cost of harvest and production. That being the case, some shippers are beginning to skip over fields that simply will not yield enough profitable returns due to such low market pricing. Christmas ads have not been enough to overcome these hearty supplies and leave many shippers looking to still move product at below market pricing to keep inventory as clean as possible. Expect this market to remain saturated with product through the end of the year. POTATOES The biggest challenge has been temperatures at or below zero making it almost impossible to move product to the sheds for packing. Combine that with Christmas Tree movement out of that area and there has been a shortage of trucks. To add just a little more fuel to the fire, additionally trucks unloading in the east and mid-west, have run into extreme winter conditions and have simply not been able to make their way back to Idaho. After a bump in the smaller sizes I think the market has leveled off a bit, so we will wait to see how the retail Christmas ads play out to determine the blend of consumer to carton pack.
ONIONS In the Northwest, prices may be rising slightly. Yellows and reds are getting higher demand with prices tending to sneak up a little at a time. Growers are being cautious not to get overzealous to early after all, Mexico onions are just around the corner. The word on the street is prices may go up a bit but remain fairly steady for the near future. Export markets continue to pull regularly. APPLES / PEARS Last season Washington apple growers had a record setting crop, with record setting exports! Add to the unusual year with the East coast issues, Northwest growers could pick everything and sell everything they harvested. This year, growers have been a little more selective with harvest. With that said, there are some great opportunities to promote lesser grade apples (full color product) with peak sizing in the 88-100 size range! Smaller sizing still tight and will continue to get tighter as we go through the season. BLUEBERRIES http://foodservice.blueberrycouncil.org/ The above is the link to some great information. CITRUS Lemons: The freeze in the Central Valley has now started to affect this districts lemon crop. This is not a larger crop, but will have an impact on overall supplies as we move in to the late winter through summer months. We already see the market beginning to firm up. Demand still remains very good on all sizes from all shippers. Limes: We are expecting some rain over the weekend but nothing to cause any major issues. Day time temperatures are in the low 80's with overnight temps reaching the low 60's, beautiful weather for growing limes. Quality has been very good and is expected to continue into January. No major heat or storms have caused any real issues. Any decay, scarring, brown/sugar spots that we are seeing are being addressed on the grading lines and in the sheds as well. We are seeing nice dark green limes crossing which should make a lot of people happy. Pricing on the other hand is all over the board. Pricing on the Mexico side has been escalating more rapidly than on the US side. Customers are just not willing to pay what they are asking for. We have seen pricing jump anywhere from 2 to 8 dollars this week. Remember, you get what you pay for. With both Christmas and New Year’s falling on a Wednesday we are expecting limes to be tight till the first week of the New Year. Harvesting will slow down over this weekend and will be limited for the remainder of the year. We will keep an eye on the market and keep you informed of any major adjustments.
Oranges: All citrus areas have had Freezing temperatures, as we reported last week.. Actual damage numbers could take 4 – 6 weeks to access. All Market will be on a day by day basis but will be increasing-- Navels, lemons, clementine’s, and Minneola’s will be affected as a result of the freeze. USDA has instituted a 48 hour hold and inspection on all picked citrus prior to packing. GRAPES Red and green seedless varieties will continue to be available through late-December; prices have firmed on green and red seedless. Quality is on the decline for late-season storage crop fruit from California. No gap in supply is anticipated, with the first arrivals from Chile expected December 26th. MELONS Cantaloupe: The offshore melon season is now in full swing with good availability on cantaloupes and honeydews from Guatemala. Sizing is skewed toward large sizes. Honeydew: Honeydews from Mexico continue with plentiful supplies going forward, as the harvest moves southward to Guerrero and Guaymas districts. STRAWBERRIES Product remains very tight, freezes in a few growing regions have taken some fruit out of production. Production in California is declining as we move into the Winter months. Should see the numbers start to increase sometime in mid-late January. We will have fruit and if the rains leave us alone the quality will be very nice--winter berries tend to be bigger and sweeter but limited in numbers. Bush berries are transitioning; Blacks are coming in from Mexico-blues from Chilie and Argentina. Overall quality is good, says Harold who just got back from vacation, however just not a lot of volume. Thank you, For your on going support of the Pro Mark group and please feel free to contact me at anytime I can ever be of assistance to you.
Ron Orr Produce Peddler [email protected] [573] 680-1066
Thursday, December 19, 2013 10:31:59 AM MT
Page 1 of 3
Subject: FW: Stretch Film Pricing and the Santa Claus Rally
Date: Thursday, December 19, 2013 10:31:01 AM MT
From: Cindy Hulett
Please forward to your sales team
What the Trade is Saying
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WrapNet Pallet Stretch NettingEvolution Wrapper and Logo Film
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Get updates as they happen - follow @westernplastics on Twitter
NEWSWIRE SNIPPETS
Polyethylene trading was above average. The overall market was mostly steady, availability for certain grades like LLDPE film were tight and led to higher prices. Domestic demand is being offset by better exports leading to what some analysts are calling a Santa Claus rally for year end.
PVC prices set to rise in 2014 on higher ethylene prices, export demand.U.S. prices for polyvinyl chloride (PVC) are set to rise by five cents per pound in the first two months of 2014. This is a significant price increase in a market that will see producers end the year with a net five-cent increase in their 2013 margins, according to Reports.
FOODSERVICE DISTRIBUTION CONSOLIDATIONSysco and US Foods announced an agreement to merge. The total enterprise value of the transaction is approximately $8.2 billion and the combination has been approved by the Board of Directors of each company. At closing, Sysco will have estimated annual sales of approximately $65 billion.Trade News December 2013
Polyethylene business better
Page 2 of 3
December - The Polyethylene business is Improving steadily ; buyers are coming back to the market to replenish depleted inventories.
THE WESTERN PLASTICS MESSAGE TO DISTRIBUTIONBuy only as needed expect prompt shipping[customer orders already secured}For immediate shipping and billingUse a reliable partner for freight paid drop ships"
Free copies visit www.wplastics.com
LLDPE sells at a clip "resin trading continued to hum along at a rapid clip; volumes were good and prices were steady to higher."
PE demand picks up "Recent trading activity has been driven by buyers looking to secure ample material through mid-Jan"
Fundamentals Drive "Natural Gas futures continued its upward tear and Ethane jumped"
Tight Resin "Polyethylene trading was above average and the overall market was mostly steady, availability for certain grades like LLDPE film were tight and led to higher prices"
LLDPE No slack offshore "slack demand was offset by better exports"
PE price relief sought "There was renewed talk about a 2-cent decrease potentially coming through for December, but most producers seem to still be holding firm."
Ask for better prices advice "PE prices have yet to settle in December, processors have expressed renewed hopes for a $.02/lb decrease. PE export demand is continuing to improve"
Build inventory and orders will come "If you will need material don¹t wait until the last minute."
Packaging Sources December 2013
Ask about HYBRiD80 plus engineered stretch film, lower minimums, shorter leadtimes click here.
To stay tuned - click here
No Strings - No Contract
Page 3 of 3
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41995 Remington Ave, Temecula, CA 92590
Market Watch . . . . . . .
Market Watch
December 20, 2013
Market Watch . . . . . . .
• With only a few more trading days this year, we could see profit taking, light volume and higher volatility.
Soybean Oil
• The Argentine crop is approximately 80% planted. • Planting in Brazil is complete. 91% of Brazil’s beans are GMO
this year. • Dryness in southern Brazil and northern Argentina could
eventually damage crops. Temperatures are moderate. • This season’s rains have caused a 37% increase in Asian rust
in Mato Grosso.
Crop Updates
Expected Value Range $36.00 - $38.00 cash
Soybean Oil Market Pricing Trend
Value Ranges *
The information above reflects the current opinion of Stratas Foods but does not represent a guarantee of future market conditions. All final oil booking decisions should be made by the end customer and not Stratas Foods.
* Value ranges represent good booking levels if the market dips into this range
Ideas that demand will slow and supplies are rising drove some speculative longs out of the market.
If Argentina remains dry after Christmas, a weather premium could be added to prices.
US soyoil is competitive in the world market.
Misc. Influences Impact
Key Factors Recent Trend
December 20, 2013
Bearish Bullish Neutral
• NOPA crush for November was 160.145 million vs. expectations for 161.983. October was revised to 1.377 million. Stocks were 1.486 billion pounds, up 124 billion from last month and higher than the expected 1.448 billion.
• Informa left their 2013/14 US carryout unchanged at 146 million bushels but moved 25 million bushels from crush to exports.
• USDA estimated World soybean use for 2013/14 at 271 MMT vs. 258 last year and 200 10 years ago.
• Weekly US export inspections were topped guesses at 62.5 million bushels. Export sales were below expectations and also a marketing year low at 15.3 million bushels of old crop and 2.9 million of new crop. Soyoil sales were 27,000 tonnes.
• Logistics issues due to the railcar shortage could push basis levels higher.
• We could see some cancellations of soybean sales from China as demand moves to South America.
Flash Summary
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Market Watch . . . . . . .
• Oversold technicals and fund rebalancing are feeding the bulls while the bears are focused on the large supply.
Corn Oil
• CNGOIC raised their forecast of Chinese production 6.7 million tonnes to 217.7 million.
• 71% of the corn planted in Brazil this year is GMO.
Crop Updates
Expected Value Range $37.00 - $39.00 cash
Corn Oil Market Pricing Trend
Value Ranges *
The information above reflects the current opinion of Stratas Foods but does not represent a guarantee of future market conditions. All final oil booking decisions should be made by the end customer and not Stratas Foods.
* Value ranges represent good booking levels if the market dips into this range
Misc. Influences Impact
Key Factors Recent Trend
• A group of senators introduced a bill to eliminate the corn ethanol mandate late last week.
• There is talk that China will also test DDGs for GMO issues. This could slow the record pace of Chinese DDG imports.
• USDA estimated World corn use for 2013/14 at 937 MMT vs. 650 MMT 10 years ago.
• Weekly US export inspections were 25.1 million bushels, lower than the expected 34-38 million.
• US trade officials are in China meeting on several agricultural issues, the most pressing being the GMO issue.
• Weekly US ethanol production was lower than last week but up 13% from last year. Stocks were higher than last week but 25% lower than last year. Margins are lower but are still positive.
• Xinhua news reported that domestic Chinese corn prices will likely be supported by government reserve purchases, strong margins, increased demand ahead of their holidays, a lack of quality corn due to mildew, and lower imports.
Flash Summary
Bearish Bullish Neutral
Fears that China will reject more cargoes due to GMO issues pressured prices.
Strong export sales and strong ethanol use helped support prices.
Speculative short covering and index fund rebalancing could push prices higher.
December 20, 2013
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Market Watch . . . . . . .
• The large crop and expectations for a larger carryout to lower demand and logistics issues pressured prices.
Canola/Rapeseed Oil
• Oil World pegged 2013/14 global rapeseed production at a record 25.4 million, a 2% rise from last year.
• Australia’s crop may end up being larger than traders initially anticipated.
Crop Updates
Expected Value Range $42.00 - $44.00 cash
Canola Oil Market Pricing Trend
Value Ranges *
The information above reflects the current opinion of Stratas Foods but does not represent a guarantee of future market conditions. All final oil booking decisions should be made by the end customer and not Stratas Foods.
* Value ranges represent good booking levels if the market dips into this range
Misc. Influences Impact
Key Factors Recent Trend
• Canadian crush margins are excellent which encouraged some buying and helped limit the losses seen in this week’s trading.
• There is talk that China may release some canola oil from their reserves.
• Oversold sentiment and ideas that canola is undervalued limited losses.
• Nearby canola futures contracts have lost more than 30 dollars per tonne so far this month.
• If futures prices continue to drop, basis levels will likely increase to stabilize cash bids.
• StatsCanada reported that sales of canola seed to China increased 62% in October.
• Short covering and commercial buying kept prices from falling more than they did.
• Increased farmer selling has been seen at daily higs.
Flash Summary
Bearish Bullish Neutral
A decline in the value of the Canadian dollar limited losses on Wednesday.
Expectations for a large South American crop weighed on values.
Spillover support from higher CBOT soyoil supported prices early yesterday.
December 20, 2013
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Market Watch . . . . . . .
• Slowing exports and high world vegoil supplies are weighing on prices despite lower production.
Tropical Oils
• A Bloomberg poll suggested that 2013 palm oil production in Indonesia could fall 1.9% to 26.5 MMT due to a mixture of drought and heavy rain. This would be the first decline since 1998. December output is seen higher at 2.2 MMT.
• Indonesian copra production could slow as soon as next month.
• Oil World pegged 2013/14 global palm oil production at 58.5 million tonnes, a 4.8% increase.
Crop Updates Palm and Coconut Oil Market Pricing Trends
The information above reflects the current opinion of Stratas Foods but does not represent a guarantee of future market conditions. All final oil booking decisions should be made by the end customer and not Stratas Foods.
Misc. Influences Impact
Key Factors Recent Trend
Bearish Bullish Neutral
Palm oil’s narrow discount to soyoil continues to limit demand for palm.
Chinese palm oil imports are expected to increase ahead of the Lunar New Year festival that starts January 31.
Coconut oil prices should not decline much unless we see lower palm/palm kernel prices.
December 20, 2013
Flash Summary
• CNO shipments from the PI are expected to be around 83,000 MT in December. YTD shipments are 24.1% higher than last year.
• December 1-15 exports of palm oil from Malaysia were reported 14.06% lower by ITS and 12% lower by SGS.
• Indonesia’s palm oil exports for November will total 1.9 MMT, up 2% from October and the highest in 9 months.
• The 5% export tax in Malaysia makes Indonesia uncompetitive.
• Coconut oil in the domestic PI market is at a $40 premium to export. Imported olein is a 12 peso per kg discount, making it more attractive than domestic CNO.
• Oil World expects 2013/14 global palm oil exports to decline for the first time in 16 years as food and fuel makers substitute more sun and soy oils. Exports should total 43.75 million tonnes, a decline of 1.1%.
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Palm Olein Coconut