November 15, 2011

Thai Feed Weekly:  Price of cassava seen to rise in December (week ended Nov 14)
 
An eFeedLink Exclusive
 
 
Price Summary
 
Prices of Thailand's feed ingredients have stabilised after recent increases triggered by supply and logistic problems. But, the government expects a surge in the price of cassava in the next few weeks on strong local and international demand against tight supply.
 
Outside of rice, cassava was the hardest hit in the two month old flooding among the country's key crops, according to Apichart Jongskul, secretary-general of the Thai Office of Agricultural Economics.
 
Raw cassava currently trades at THB2.45-3.00/kg, up from THB2.20-2.30/kg in September. Heavy flooding in 38 provinces across the country damaged about four million hectares of croplands, causing prices of feed raw materials like corn, rice by-products and cassava to soar.
 
 
Market analysis
 
The price of cassava hit rock bottom in September shortly after the government had downgraded its ethanol program.
 
25 of Thailand's 36 ethanol facilities utilise cassava as feedstock. But, local demand for cassava plunged in August after the government stopped collecting levies for the Oil Fund, a subsidy scheme designed to stabilise gas-pump prices when international crude prices are volatile. The move allowed petrol stations to bring down gas prices by as much as 15-20%, causing sales of the cheaper ethanol-mixed fuel to drop by 15%.
 
Deputy Prime Minister Kittiratt Na-Ranong said this week the price of cassava would rebound before the year is over because of "high demand from both the food and energy sectors."
 
He said prices of oil are expected to surge in December because of high demand from cold countries. This would trigger, he added, an increase in demand for ethanol-mixed fuel locally, resulting in increased ethanol production.
 
And with the feed industry resuming normal operation after the floods, demand for cassava chips, a major ingredient in Thai feed formulation, would spike, Kittiratt added. About 30% of Thailand's annual cassava production of around 21 million tonnes is made into feeds. The rest are imported or used in ethanol production.
 
Thailand is the world's leading cassava exporter.
 

 

PRICE as of  November 7
(in Thai baht/kg)

PRICE as of  November 14
(in Thai baht/kg)

Changes
(in Thai baht/kg)

Corn (Delivered to feed factory)

9.50-9.70

9.50-9.70

--

Cassava

2.45-3.00

2.45-3.00

--

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

565.00

565.00

--

White rice bran

10.30-10.80

10.30-10.80

--

Rice bran residue 

8.50-9.20

8.50-9.20

 +(0.10-0.30)

Soy

11.60-14.45

11.60-14.45

--

Soymeal (imported)

15.50

15.50

--

Soymeal (local)

15.30-15.50

15.30-15.50

--

Fishmeal (shrimp grade)

25.00-37.98

25.00-37.98

--

US$1=THB 30.79 (November 15, 2011)

 

 
 
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