Market Intel
Pricing and Repricing:
Fuel Surcharges Recharged
Used to be that companies updated their pricing once a month. That was then, this is now.
Now the higher cost of diesel fuel is bringing twice-a-month product price updates.
Soybean meal: Board prices are slipping but basis is not giving up ground. Most soy processing capacity is back online but Market Intel sources see Indiana beans moving west for processing. Meanwhile, traders are watching SBM in Brazil and Argentina as new crop planting proceeds more normally than last year. For canola meal, although the basis is strong, board prices are lower. Sources report good yields on new crop in Canada but remind us that the 25% import tariff initiated last year remains in effect. Soy protein product prices are trending lower, similar to a year ago.
Palm & bypass fat products: Preliminary countervailing duties (CVD) up to nearly 16.5% on palm fatty acids from Indonesia and Malaysia are exacerbating a very tight supply situation. However, the CVD do not apply to the imported calcium salts. Even so, existing tariffs and higher ocean freight charges are keeping Q4 prices high but with some relief possible in Q1. Overall, bypass fat product prices continue high with long purchase lead times.
Amino acids: Despite resolution of the E.U.-China trade dispute over lysine, inventories remain tight and may remain so into Q1 with prices elevated due to higher ocean freight and trucking costs. Likewise for inventories of threonine with one major supplier “on allocation”. Tryptophan and valine supplies are more available and prices steady with additional freight charges. The good news — decreasing prices across the board for DL methionine along with liquid met and hydroxy analog.
Vitamins: For Q4, vitamin pricing is quiet overall with good supplies of vitamins A, D3 and E going into Q1.
Trace minerals: Data center construction, electric vehicles, and other industrial uses continue to move prices higher for copper sulfate and TBCC (tribasic copper chloride) and to a lesser extent zinc sulfate and others.
Blood products: Supplies remain tight with still higher prices and longer purchase lead times in Q4. Sources suggest no relief likely until Q1. Â
P-K-Mg & Salt: Phosphate prices are retreating somewhat while potassium chloride (KCl) prices are strengthening again. Magnesium oxide (MgO) prices are steady to firm. The macro mineral surprise is salt (sodium chloride) — a major Lake Erie mine quit supplying this critical feed grade product, which is causing “a bit of a scramble” for other sources. Higher shipping costs — both trucking and rail — complicate pricing.
Urea: Prices continue to rise due to conflict constrictions on supply and higher ocean freight costs.
Distillers:Â DDGS prices are up slightly as export demand persists. There’s good supply although there’s also renewed concern about VOM (deoxynivalenol mycotoxin) as farmers clean out their corn bins.
Wheat midds: Quality remains good, helping to keep prices up. Adding to the strength in prices are Europe’s dry summer and autumn and stoppage of exports out of Ukraine and Russia.
Soy hulls: Prices are up going into Q4 even with soy processing in full swing. With beans moving west, so are hulls.
Over the horizon… This year’s harvest in the U.S. is likely to benefit from El Niño with extended autumn dry periods, while the effects elsewhere in the world may help keep crop prices higher than usual.Â