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November 1, 2011

Thai Feed Weekly: Thai feed ingredient prices rally on supply, logistics problems (week ended Oct 24)
 
An eFeedLink Exclusive
 
 
Price Summary
 
Feed ingredient prices have surged on dwindling supplies aggravated by delivery problems, as Thailand's worst flood in 50 years threatened to overrun parts of Bangkok this week after having submerged some provinces nearby.
 
Corn increased again by THB0.10/kg, on top of last week's THB0.20-0.50/kg increase. Prices of cassava and rice byproducts have also jumped, raising concerns that feed prices could rise by as much as 10% in the next few weeks.
 
 
Market analysis
 
With more croplands coming under water, tighter supplies of corn, cassava and rice byproducts have been causing feed production problems. Industry leaders expect domestic corn output to drop 20-30% this year as a result of the widespread flooding.
 
Logistics, however, is the more urgent problem at the moment. With floodwaters closing some major routes in Bangkok and in the provinces, raw material deliveries have been disrupted, causing feed plants to slow down or even cease operation.
 
Dr Chaisak Boonprasopshot, chief executive officer of Thai Foods Group, an integrated feed and livestock operation, says he expects prices of corn, soymeal, cassava and rice byproducts to go up 10% in the aftermath of the flooding.
 
Due to a lack of supplies, he adds, some feed mills have started buying corn at THB9.60/kg, THB0.20-0.40/kg higher than the current price in the market. The CP Group, the country's number one feed producer, was even buying it at THB9.75/kg last week before scaling it back to THB9.60 this week.
 
The price of broken rice has soared to THB15/kg locally amid concerns of tighter supplies, with about 2,000 hectares of rice lands now underwater. Thailand's rice production this year is expected to be down by 6-7 million tonnes. 
 
With farmers rushing to sell their animals before their farms are overrun by floodwaters, live-weight prices for both hogs and chicken are down. He says live broilers are now being sold for as low as THB37-38/kg, from THB44/kg before the floods. The price range for live hogs, on the other hand, has widened to THB55/kg and THB59/kg with more farms disposing of their inventories, according to him.
 

 

PRICE as of  October 17
(in Thai baht/kg)

PRICE as of  October 24
(in Thai baht/kg)

Changes
(in Thai baht/kg)

Corn (Delivered to feed factory)

9.20-9.30

9.20-9.40

+0.10

Cassava

2.10 - 2.25

2.25 - 2.50

+(0.15-0.25)

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

504.00

509.00

+5.00

White rice bran

8.90-9.00

9.40-9.50

+0.50

Rice bran residue 

7.70-7.80

8.10-8.20

 +0.40

Soy

20.00-21.00

20.00-21.00

--

Soymeal (imported)

13.80

13.80

--

Soymeal (local)

13.90-14.10

13.90-14.10

--

Fishmeal (shrimp grade)

29.00

29.00

--

US$1=THB 30.49 (November 1, 2011)


 
 
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