Food Business News - November 8, 2011 - 46

Ingredient Markets
Market commentary for one-week period ended November 4, 2011

Sweeteners
Corn sweetener negotiations continued last week with additional pricing from speciﬁc reﬁners. Sugar trading was slow. New crop supply increased as the sugar beet harvest was completed in some areas. At least one major corn reﬁner pushed to complete 2012 contracting for dry corn sweetener products by Nov. 4 and liquid product contracting by Nov. 11. There were indications dextrose and other dry product negotiations were progressing more rapidly than those of liquid products, but bookings last week appeared to be far from completed in both cases. While prices of both liquid and dry products varied by reﬁner, reﬁners appeared to hold ﬁrm as talks advanced. While ofﬁcial offers were below some initial pricing indications, more recent offers seemed to be rising as negotiations progressed, which one analyst suggested may encourage earlier contracting this year. Last year, pricing eased the longer negotiations went on for liquid products. Most 2012 offers for dextrose were $4-a-cwt above 2011 contracted levels. Pricing for high-fructose corn syrup and other liquid products saw much variation. Offers on 42% HFCS appeared to be up 7% to 22% from 2011 levels, ranging from $21@23.50 a cwt with pricing varying by region in some cases. Offers on 55% HFCS appeared to be up about 15% to 25%, at $25.50@27 a cwt, with some regional variations.

Domestic bulk reﬁned sugar for spot through Dec. 31, 2011, was offered at 62c a lb f.o.b. and at 59@62c a lb f.o.b. for Jan. 1, 2012, through Sept. 30, 2012, unchanged for the past several weeks. There still appeared to be sugar available closer to the 55c-a-lb area despite the ﬁrm offers. Activity was quiet, but some beet processors who had been out of the market for 2012 due to lack of supply appeared to be returning as new crop supply became more available. The sugar beet harvest was completed in the Red River Valley as of Oct. 30, ahead of the 2006-10 average for the date of 93% lifted in Minnesota and 95% in North Dakota, according to the U.S. Department of Agriculture. Harvesting was 72% completed in Idaho and 42% in Michigan with both harvests delayed by recent wet conditions. Sugar beet harvesting was ahead of average pace in Wyoming at 80% completed and in Montana at 94% but was behind in Colorado at 70% completed. Sugar cane harvesting was active in Florida, Louisiana and Texas. Union members rejected the latest contract offer from the American Crystal Sugar Co., where union workers had been locked out since Aug. 1. Factories have been run with replacement workers. FBN

Edible Oils
Bookings of edible oil were limited last week. Price changes were mixed. Soybean oil prices advanced. Soybean oil

futures prices moved up narrowly during another week when supply-and-demand fundamentals took a backseat to macroeconomic concerns. The cash basis on soybean oil ﬁrmed slightly. Most major users of soybean oil earlier covered most of their needs through the end of the year but hesitated on extending contract balances into 2012. The trade will watch Congress for indications over whether the $1-per-gallon blenders’ credit for biodiesel will be allowed to expire at the end of 2011. Buyers and sellers eagerly awaited the U.S. Department of Agriculture’s November Crop Production report and World Agricultural Supply and Demand Estimates due to be released on Nov. 9. Lard and edible tallow prices tumbled as demand for the holiday baking season peaked and began to wane. Recent increased cattle liquidation in drought areas pressured the tallow market. Hog slaughter was up seasonally, which contributed to the weaker tone for lard. Peanut oil prices were strong with demand related to use of fryers for Thanksgiving turkey preparation a factor. Reﬁned canola prices advanced with soybean oil and on increased usage of crude canola oil in the United States as a raw stock for the biodiesel industry. Palm oil prices moved up with soybean oil and in anticipation of a seasonal decline in production. Vegetable oil shipments were seasonally heavy. FBN

Beet and cane sugar
f.o.b. plant, cents per lb

Sweeteners
Delivered basis, cents per lb HFCS spot price1

HFCS list price2 Regular — Change from — Year corn Nov. 4 Oct. 28 Oct. 21 ago syrup3 Dextrose 42% HFCS wet 55% HFCS wet Nov. 4 Year ago Midwest beet 59.00 @ 62.00 — — 55.00 21.375 24.875 net 153/8@ 193/8 153/8@ 193/8 29.85@33.85 24.625 East Paciﬁc beet 59.00 @ 62.00 — — 55.00 Midwest 22.925 26.425 net 28.85@32.85 26.175 Midwest Cane* 59.00 @ 62.00 — — 55.00 Northeast 16¾@ 20¾ 16¾@ 20¾ 23.125 26.625 net *Spot raw plus 7% plus 16.6c with 2% cash discount. Southeast 167/8@ 207/8 167/8@ 207/8 31.85@35.85 26.375 West 22.625 26.125 net Southwest 16½@ 20½ 16½@ 20½ 25.875 Raw cane 23.325 26.825 net West 173/8@ 213/8 173/8@ 213/8 26.575 Delivered reﬁner, cents per lb 1-Variations in prices often tied to tank car versus truck deliveries. 2-Prices are the lowest available to the publication. 3-Regular 42 DE/43 Baume, f.o.b. tank cars, trucks — Change from — Contract Nov. 4 Oct. 28 Oct. 21 Nearby 38.50 -1.25 -.05 November-December 38.50 -1.25 -.05 January-March 39.00 -.85 +.10 April-June 39.00 -1.00 -.25 July-September 39.00 -.05 — October-December 37.50 -.10 +.35 Year ago 41.15 41.15 40.95 40.25 39.75 35.25

Chicago soybean oil futures
Bulk in tank cars, cents per lb Nov. 4 — Change from — Delivery close Oct. 28 Oct. 21 December 51.87 +.10 +.62 January 52.10 +.07 +.58 March 52.46 +.05 +.60 May 52.81 +.04 +.65 July 53.08 +.02 +.73 August 53.18 +.03 +.74 Year ago 52.22 52.58 52.96 53.19 53.38 53.41

Edible oils
Bulk, cents per lb — Change from — Year Nov. 4 Oct. 28 Oct. 21 ago Soybean oil, Decatur 52.75 Loose lard, Chicago 55.25 Edible tallow, Chicago 46.75 Cottonseed oil, Miss. PBSY 51.75 Palm oil, ports 50.00 Palm kernel oil, ports 57.25 Coconut oil 57.00 Peanut oil, Southeast 100.00 Corn oil, Decatur 55.25 Sunﬂowerseed oil, Midwest 91.00 Canola oil, Midwest 57.50 +.25 -5.75 -5.75 — +.25 +2.50 — +5.00 +.25 — +.75 +.50 -9.25 49.00 46.00

Spot soybean oil
Decatur, Ill., bulk cents per lb
63.00 53.00 43.00 33.00 23.00 N F M Previous Year A Current Year

-12.25 39.00 +.50 52.25 +1.25 53.00 +2.50 59.25 +1.00 69.00 +3.50 75.00 -1.25 51.00 -2.00 63.00 +1.25 54.75

Crude soybean oil
Bulk in tank cars, cents per lb Delivery Decatur, Ill. November 52.37 @52.87 December 52.37 @52.87 January 52.35 @52.85 February 52.53 @53.03 March 52.71 @53.21 April 52.89 @53.39 May 53.06 @53.56 Western points 51.62 @52.12 51.62 @52.12 51.85 @52.10 52.03 @52.28 52.21 @52.46 52.39 @52.64 52.56 @52.81

FOODBUSINESS NEWS

November 8, 2011

Food Business News - November 8, 2011

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