Milling & Baking News - September 21, 2004 - 34

I N G R E D I E N T

Concern emerged over the possible
damage Hurricane Ivan might have
caused to Alabama's cotton and peanut
crops. But these concerns had yet to be
reflected in the markets for peanut oil
and cottonseed oil.
Cash premiums on soybean oil for September-October remained very strong,
reflecting dwindling supplies before new
crop soybeans flow in significant volume. Forward cash quotes were at fairly
wide discounts to the nearby.
Meat fat prices were unchanged, with
lard holding at 20-year highs.
Bucking the general downtrend were
tropical oils, which saw modest gains.
Palm kernel oil quotes ranged from
34½@35½c a lb.
Export demand for U.S. soybean oil
expanded in the week ended Sept. 9, with
Cuba, Mexico, Kenya, Canada and Morocco as destinations.
Domestic shipments were seasonal. MBN

Soy Flour
Bookings of soy flour were light last
week. Prices declined.
Most of the trade was covered through
October, or the first month of the new
marketing year. And many buyers held
ownership through December. A few had
contracts extending into 2005. The issue
now before soy flour users was when to
engage in negotiations for longer-term
contracting. Typically, this takes place
once the soybean harvest is in full swing
and the crop's size and quality can be better gauged and reflected in the market.
October and November were expected to
be key months for long-term contracting.
Until then, booking likely would remain
hand-to-mouth. MBN

$2.25 in the December contract. The combination of a projected 2004 corn crop
near 11 billion bus and good late-season
weather weighed on prices throughout
the week. Even though export news
turned positive Thursday when the
U.S.D.A. reported net sales of 1,207,700
tonnes for the week ended Sept. 9, almost
double trade expectations, corn futures
still ended the day lower.
The U.S.D.A. rated corn crop condition
at 69% good to excellent on Sept. 12, unchanged from a week earlier but 25 percentage points ahead of last year. Twentyseven per cent of the crop was mature
versus the 41% average for the date.
While the news was a bit more friendly
for soybean futures, continued warm
weather allowing late-maturing crops to
finish was the dominant factor pushing
prices lower last week. The soybean crop
was rated 63% good to excellent as of
Sept. 12, up one point from a week earlier
and 22 points ahead of last year. Thirty
per cent of the crop was dropping leaves,
about even with last year and the most
recent five-year average. Export sales of
634,900 tonnes for the week ended Sept. 9
were well above trade forecasts. The
U.S.D.A. reported sales by private exporters of 225,000 tonnes of soybeans for
2004-05 last week, of which 115,000
tonnes went to China. MBN

Oats
Bookings of food grade oat flakes were
limited last week. Prices advanced on
stronger oats futures and an extremely

Spot Soybean Oil

Corn & Soy Futures
Corn futures struggled from the onset
last week, setting new lows daily and easily erasing a previous support price of
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strong cash basis. The Minneapolis Grain
Exchange posted no spot basis and held
the to-arrive basis at 18c a bu. But mills
indicated the spot basis more realistically
was at 35@40c a bu, Minneapolis.
Strength in both the futures and cash
oats markets was derived from the crippling delays in the Canadian oats harvest.
Oat mills on both sides of the U.S.-Canada
border rely on Canadian growers to produce the key supply of milling oats. Some
U.S. mills grind up to 80% Canadian oats,
with the remainder provided by U.S. producers. While the Manitoba harvest in a
typical year would be about 50% done by
now, estimates were that harvest was only
5% to 10% done in that province. The
Saskatchewan harvest at last week's outset was pegged at only 2% completed.
Canadian oat mills have only just begun
to receive initial new crop deliveries. The
oats delivered were very high in moisture
content and required mechanical drying.
With the harvest progressing so slowly,
oat mill inventories were being drawn
down quickly. Inventory issues were
critical with production for the hot cereal
season well under way. MBN

Sweeteners
Sugar business remained fairly active
last week. Prices held mostly steady. Spot
raws were unchanged but saw midweek
movement. Deferreds were steady to off
30 points. Hurricane Ivan missed major
sugar cane growing areas, although some
yield loss was expected.
Industry sources estimated that

Oats

Decatur, Ill., bulk cents per lb
Sept. 17

Week's
change

Oat flakes, food grade, f.o.b.
Minneapolis, bagged, $ per cwt 20.75@21 1.00@1.00
Milling quality oats, No. 2 heavy,
delivered Minneapolis, $ per bu
1.891/2
+10 c
Oat screening, clean out,
oats unground, $ per bu
.80@1.10
-
Oat hull, ground hulls only, $ per ton 10@15
-

Corn Meal
Sales of corn meal were steady last
week. Prices declined.
Demand for flaking grits from breakfast cereal manufacturers was irregular.
Some mills indicated a decrease in demand for the coarse grits in the last couple
of weeks but identifying a reason proved
difficult. Other mills reported no change
in seasonally heavy demand from the cereal makers both for the flaking grits and
for the more finely granulated grits used
to produce extruded cereals. Snack meal
sales remained brisk. Volume of brewer's
grits has held up well even as the seasonal
peak has passed. Corn flour sales were
not as heavy as in recent weeks, though
the approach of the baking season soon
should generate demand. MBN

W E E K

Spot Shortening
Bulk, cents per lb

Chicago Soybean Oil Futures
Bulk in tank cars, cents per lb
Sept. 17
Week's
Delivery
close
change
October
22.08
-1.70
December
21.89
-1.47
January
21.85
-1.45
March
21.85
-1.40
May
21.78
-1.32
July
21.77
-1.23

Year
ago
23.47
23.41
23.35
23.26
22.81
22.67

Sept. 17
Soybean oil, Decatur
25.00
Loose lard, Chicago
34.00
Edible tallow, Chicago
18.50
Cottonseed oil, Miss. PBSY 24.75
Palm oil, ports
23.25
Palm kernel oil, ports
35.00
Coconut oil, West coast
33.00
Peanut oil, Southeast
56.00
Corn oil, Decatur
27.00
Sunflowerseed oil, Midwest
33.50
Canola oil, Midwest
30.00

Week's
change
-3.00
-
-
-2.50
+.25
+.50
+1.25
-
-
-2.00
-2.50

Milling & Baking News, September 21, 2004 / 35

Year
ago
24.50
24.00
20.50
32.00
21.50
22.00
20.25
63.00
29.50
34.50
29.75

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Milling & Baking News - September 21, 2004

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