Market Intel
Beyond the Mideast:
A Look at Palm Prospects
Ongoing tariff uncertainties also affect pricing of imported palm, calcium salt, and bypass fat products used in U.S. dairy rations. Major exporting countries — Indonesia, Malaysia, India — jockey for the global food and feed trade in products processed from the palm kernel.
Palm & bypass fat products: Spot inventories of palm products are tight with less imported as buyers await tariff decisions. However, some are paying a premium for spot loads. Although palm products currently have zero tariff, calcium salts carry a 10% tariff. Also, the two major suppliers have countervailing or anti-dumping fees (Indonesia 16.75%, Malaysia 5%) covering palm only. India sourcing is an option, but higher freight costs make it not so attractive. Meanwhile, bypass fat product prices, which jumped in May-June-July are likely to steady in August, although there are longer purchase lead times, according to sources.
Soybean meal: Board prices are stronger with basis up a little. Market Intel sources say soy processors are “more secure” and now considering offers on the new crop. Canada’s potentially large canola crop carries attractive meal prices at home but faces high rail, loading-unloading costs getting to U.S. markets, making it roughly equivalent to SBM “when all is said and done.” Soy protein products prices are up with the board and the basis is widening.
Amino acids: Lysine supplies have tightened in recent weeks due to delayed shipments, which is likely to persist in Q3 into Q4, despite resolution of anti-dumping charges. Threonine supplies are adequate with steady prices, while both tryptophan and valine are plentiful with softer prices. The huge DL methionine price rise is in the rear view with current firm but steady pricing. Likewise more stable prices for liquid met and hydroxy analog.
Vitamins: There is softer pricing overall following higher prices in Q2. Supplies of vitamin A, vitamin D3 and vitamin E are good with prices trending down.
Trace minerals: Generally, supplies of copper and zinc sulfates and manganese compounds are available but prices remain elevated and not likely to decline.
Blood products: The Independence Day holiday with processors offline surged prices. Supply is still tight but the outlook is steady to lower prices through the summer
P-K-Mg: There’s more phosphate supply but prices are up and “steadying out” higher than last month. Potassium chloride (KCl), priced higher in Q2, is steady now. Likewise for magnesium oxide (MgO), sources report. Â
Urea: Shipments through the Hormuz Strait remain problematic and prices are moving higher. A large tender from India is also having effects. But prices remain lower than mid-Q2. Potential Red Sea shipping problems may affect supplies and pricing, too.
Distillers: DDGS prices are up with the value of corn. There is minor concern about VOM (deoxynivalenol mycotoxin) in some old crop distillers.
Wheat midds: Prices are up again and previous concern about VOM is dissipating as overall crop quality appears very good.
Soy hulls: Shutdown season is in full swing, so supply is tighter and prices higher, probably continuing high until September, which applies to both loose hulls and premium-priced pellets.
Over the horizon… Widening conflict in the Mideast — ranging from the Persian Gulf to the Red Sea and now to the eastern Mediterranean — continues to roil commodity markets.