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October 17, 2011

Thai Feed Weekly: Feed ingredient prices dragged down by floods (week ended Oct 10)
 
An eFeedLink Exclusive
 
 
Price Summary
 
The local price of imported soymeal weakened slightly this week, reflecting the easing of the price of soy overseas.
 
At Chicago, the price of soy for November delivery dropped to US$11.5825 per bushel on Oct 7, compared with US$11.79 per bushel on Sep 30. In Thailand, the price of imported soymeal dropped by THB0.50/kg to THB13.80/kg. 
 
 
Market analysis
 
Locally produced soymeal, which receives government protection, remains unchanged at THB14.20-14.50/kg. Thai feed makers are free to import soymeal, subject to 2% in-quota tariff or 119% for out-of-quota tariff, as long as they also buy from local producers.  
 
The Chicago Board of Trade (CBOT) price of corn for December contract closed at US$6/bushel on Oct 7, from US$5.925/bushel a week earlier. Unlike soy, however, Thailand is not dependent on imported corn. As such, local corn prices are not very sensitive to corn-price movements overseas.
 
In fact, local corn prices dipped slightly this week on lower demand. Massive flooding in Central Thailand has caused feed production to slow down, causing corn orders to fall slightly.
 
Also, despite the start of the government's mortgage programme, that had been expected to drive the price of rice and other rice byproducts up, the price of broken rice slid during the week after almost two months of escalation.
 
Local feed producers use up to a million tonnes of broken rice a year as an energy source in feed formulation. Despite anticipation that prices of rice byproducts would shoot up once the rice mortgage scheme went into effect, the price of broken rice fell by THB4/tonne on the first week the government started buying paddy rice at higher prices.
 
Feed mill operators attributed the price fall to the massive flooding in the country, which has slowed down feed production and thus dampened demand for some ingredients.
 
In addition, the new rice subsidy scheme was off to a slow start because of the floods, leaving only a few farmers to take their produce to the government's buying stations.
 
With this slow start, the anticipated surge in the price of rice and its byproducts has not taken place so far.
 

 

PRICE as of  October 3
(in Thai baht/kg)

PRICE as of  October 10
(in Thai baht/kg)

Changes
(in Thai baht/kg)

Corn (Delivered to feed factory)

9.05-9.20

9.00-9.15

-(0.05)

Cassava

2.15 - 2.25

2.15 - 2.25

--

White Broken Rice A.1 Super (US$/tonne)

505.00

501.00

-4.00

White rice bran

8.90-9.00

8.90-9.00

--

Rice bran residue 

7.70-7.80

7.70-7.80

 --

Soy

20.00-21.00

20.00-21.00

--

Soymeal (imported)

14.30

13.80

-0.50

Soymeal (local)

14.20-14.50

14.20-14.50

--

Fishmeal (shrimp grade)

29.00

29.50

+0.50

US$1=THB 30.68 (October 17, 2011)

 

 
 
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