August 10, 2012
 
Thai Feed Weekly:  US drought further drives Thai corn and soybean prices up (week ended Aug 6)
 
An eFeedLink Exclusive
 
 
Price Summary
 
The drought in the US Midwest, which has caused American corn output to drop to its lowest level in three years, has been driving Thai corn and soymeal prices to soar.
 
Thai feed millers are now buying corn at THB11/kg (US$0.35/kg), up from last week's price of THB10.88/kg. Charoen Pokphand Foods (CPF), Thailand's number feed maker, says its buying price for corn has gone up to THB11.30/kg (US$0.36/kg), from only THB11/kg (US$0.35/kg), last week.
 
Soymeal, on the other, hand now sells in Thailand at an all-time high of THB19.70/kg (US$0.62/kg).
 
 
Market analysis
 
Amid soaring feed raw material prices, the Thai Feed Meal Association pressed anew this week for the scrapping of the 2% import tax on soymeal.  Pornsilp Patcharintanakul, president of the association, says the severe drought in the US has upset supply of soybeans and other feed ingredients resulting in rising prices.
 
Tight supply, according to him, has driven up the price of soybean in Thailand by around 50%.
 
Mr. Pornsilp calls on the government anew to lift the import tax of feed ingredients to ease the burden of feed and livestock producers.
 
CPF says the price of soybean jumped to US$15.96/bushel on July 18, up by 11% since last month and 32% since last year. Corn price, on the other hand, rose to US$7.73 /bushel on July 18, up by 18% from last month and 20% compared to the same period last year.
 
Although Thailand produces corn, it still imports tonnes of the commodity to feed its expanding broiler and shrimp productions.
 
During the last few months, Thai corn prices have been escalating mainly due to external factors, such as the decline in supply from Argentina.
 
CPF says the recent drop in corn output to its lowest level in three years has aggravated the situation. While the 2011/12 US corn stocks-to-use ratio dived to near a record low, global corn inventories are also short, it adds.
 
The 2011/12 US soybean stocks-to-use ratio is also near record low, according to CPF, due to diminished South American production in the face of greater US demand.
 

 

PRICE as of  Jul 30
(in Thai baht/kg)

PRICE as of  Aug 6
(in Thai baht/kg)

Changes
(in Thai baht/kg)

Corn (Moisture not more than 14.5%)
Delivered to feed factory

10.88

11.00

+0.12

Corn Picked up at silo

(no report)

9.24

--

Cassava

2.40

2.35

-0.05

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

531.00

531.00

--

White rice bran

9.20

9.80

+0.60

Rice bran residue 

7.40

7.30

 -0.10

Soy

(no report)

17.28

 --

Soymeal

19.70

19.70

--

Fishmeal (protein less than 60%)

24.21

24.21

--

US$1=THB 31.50 (Aug 10, 2012)

 
 


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