Market Intel
Soy Sea Change:
South America to China
China has the world’s largest swine industry, which contributes to its ranking as the largest soybean customer. In its ongoing trade disputes with the U.S., China-based soy processors are largely replacing U.S. beans with those from South America, mainly from Brazil, Uruguay, and Argentina.
This “soy sea change” keeps a lot more beans and meal at home, at relatively lower prices. Meanwhile, the current soy tide is still coming in for China as international trade reports indicate nearly a third of Argentina’s 2024-25 soy harvest remains unsold. One report suggests Argentine exporters are going to be close to doubling last season’s sales.
Given the huge proportion of micro ingredients sourced from China, Market Intel keeps an eye on Pacific Ocean container traffic. Current drought conditions are causing lower water levels in the Panama Canal. Expect slower delivery on micros from China.
Amino acids: The European Union’s July anti-dumping ruling against China for its lysine exports remains in limbo following a recent postponement. Overall, the primary swine AA markets are trending down going into Q4, including lower prices for tryptophan and threonine. A big supply of soybean meal continues to suppress these prices. Meanwhile, DL methionine prices are firming up.
Vitamins: Prices are lower for most vitamins, too, according to Market Intel sources, with vitamin A “probably close to the bottom” and vitamin E still coming down. Vitamin D3 prices are an exception and holding their own.
Trace minerals: Prices for copper sulfate are firm while tribasic copper chloride (TBCC) prices are steady to higher. Suppliers are trying to push up zinc sulfate prices in advance of the fertilizer season, sources report.
Fat products: Veg-animal blend prices had steadied, but recently moved lower, given ongoing large supplies of soy oil.
Soybean meal: Basis prices for old crop SBM remain steady to slightly lower with new crop SBM steady. However, the board remains weak. Other soy protein products prices are following suit although there is more strength in the new crop basis.
Canola meal: Prices for old crop product have dropped significantly in the shadow of plentiful veg protein.
Blood products: Prices steadied then rose slightly with the Labor Day holiday. The Thanksgiving holiday represents the next price rise while near-term prices may soften. Immigration enforcement questions continue to affect labor available for meat processing.
P & K: Prices for phosphates are higher with suppliers matching fertilizer pricing. Potassium chloride (KCl) prices are up slightly on good demand while magnesium oxide (MgO) prices are steady.
Distillers: DDGS prices continue to weaken amid large supplies of cheap soy and corn.
Wheat midds: Prices are up slightly with somewhat less supply attributed to processing slowdowns. Mycotoxins do not appear to be problematic in the current crop.
Soy hulls: Prices are weaker still, even though processing is “slow to get up and running” following summer shutdowns, sources report.
Over the horizon… Many of the expected unilateral trade “deals” still require the fine print. U.S.-China “talks” continue to rattle feedstuffs markets. Â