Milling & Baking News - March 27, 2007 - 50

Ingredient Week

Sweeteners

Dominating developments in sweeteners last week, some sugar markets rebounded. Earlier signs of ongoing local
pressure appeared to evaporate, although
pricing was mainly unchanged. Raw cane
was a shade lower. Corn sweeteners again
were unchanged and inactive, with ongoing attention on volatile corn futures.
Midwest beet sugar was at 25@26c a lb
f.o.b. While some processors continued
to push material, sellers had more success obtaining offered quotes. Most of
these sellers already had booked at least
80% to 90% of their prospective trade and
showed indifference about additional
coverage except at levels above the current market. Some Midwest processors
have begun 2007-08 bookings. At least
one operator claimed it had already covered 15% of prospective new crop bookings in a range of 26@26½c f.o.b. Early
interest in forward coverage reflected
much lower prices than a year ago.
The Southeast and south central markets
again were around 27@27½c f.o.b., Northeast at 27@27½c f.o.b. and Pacific 27½@28c.
Much of the reemerging bullishness
in the market reflected rumors concerning Mexico. According to a story widely
circulated in the trade, Mexican officials
were pushing for a reduction in their
nation's sugar tariff. That would allow a
significant inflow of U.S. sugar into Mexico, relieving local shortages. Estimates

Beet and cane sugar

of the Mexican shortfall were around
325,000 tons, offsetting to an extent burdensome U.S. sugar overhanging the
domestic market. Most agreed free access to Mexico for surplus U.S. material,
mainly beet, would go far in offsetting
pressure on the U.S. market.
Recent statements by U.S. government
officials, including the secretary of agriculture, suggested the administration will
support the basic structure of the existing
sugar program in the new farm bill with the
important exception being that domestic
production allocations would not be lifted
in the event sugar imports exceed 1.532 million tons. U.S. officials seemingly believe
the next farm bill would be the last with
such a sugar program, but this prediction
has drawn some skepticism in the trade.
Corn sweeteners activity was routine. MBN

Bakery Shortening

Bookings of bakery shortening were
light last week. Shortening buyers and
sellers gathered in Phoenix March 21-24
to attend the annual meeting of the National Institute of Oilseeds Products. The
meeting didn't interrupt business, as
bookings of most ingredients have been
virtually hand-to-mouth for the past several weeks. Prices of most items rose.
Standing out was a spike in lard pricing. Merchandisers pointed out the advance could be short-lived as it resulted
from two large purchases the likes and

timing of which might not be seen again
for awhile. The first was a large export
sale to Mexico. That in itself was not
unusual. But it was followed by a large
purchase by a buyer determined to lock
in supply even at the higher price.
Other fats and oils also showed
strength last week, particularly soybean
oil, which tends to lead several other
products higher in its wake. Soybean oil
futures prices advanced with the rest of
the soy complex, pushing above 32c a lb
basis the July contract. Soybeans were
competing with corn for planted acres.
At the same time, the cash basis on soybean oil continued to firm despite burdensome nearby stocks.
Most large soybean oil buyers owned
basis-only coverage into the summer and
even fall and continued to wait for futures prices to break before pushing contract balances forward aggressively. They
hoped the harvest of a record large South
American soybean crop would exert desired pressure. In the meantime, contracts
were extended month-by-month.
The U.S. Census Bureau estimated
February soybean crush at 138,316,542
bus, down from 155,316,580 bus in January and compared with 136,047,637 bus
in February 2006. Soybean oil stocks at
the end of February were estimated at
3,318 million lbs, up from 3,202 million
lbs in January and compared with 2,676
million lbs in February 2006. MBN

Sweeteners
Delivered basis, cents per lb
42% H.F.C.S. spot price1

f.o.b. plant, cents per lb

H.F.C.S. list price2
Regular
- Change from - Year
corn
March 23 March 16 March 9 ago
syrup3
Dextrose
42% H.F.C.S. wet 55% H.F.C.S. wet
March 23 Year ago
Midwest beet 25.00 @ 26.00 +.50
-
37.50
16.875 East
15.88
18.88 net
143/8@ 145/8 11½@ 12
28.35@30.35
Pacific beet
27.50 @ 28.00
-
-.50 39.50 Midwest
7
3
18.425 Midwest
17.43
20.43 net
27.35@29.35
Cane*
27.20 @ 27.25 -.05
-.80 40.05 Northeast 15¾@ 16 12 /8@ 13 /8
18.625 West
17.63
20.63 net
Southeast 157/8@ 161/8 13@ 13½
30.35@32.35
*Spot raw plus 7% plus 4.50c with 2% cash discount.
18.125
17.13
20.13 net
Southwest 15½@ 15¾ 125/8@ 131/8
Raw cane
3
5
18.825
17.82
20.83 net
West
16 /8@ 16 /8 13½@ 14
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
March 23 March 16 March 9
Nearby
20.70
-.05
-.15
April-June
20.70
-.05
-.15
July-September
20.75
-.05
-.15
October-December 20.95
-.25
-.30
January-March
21.00
-.15
-.50
April-June
21.25
-.15
-.25

Spot soybean oil
Decatur, Ill., bulk, cents per lb

Year
ago
23.60
23.60
23.35
22.25
22.20
22.30

Chicago soybean oil futures
Bulk in tank cars, cents per lb
March 23 - Change from -
Delivery
close March 16 March 9
May
31.96
+1.19
+1.37
July
32.36
+1.12
+1.27
August
32.55
+1.08
+1.19
September 32.80
+1.10
+1.19
October
32.97
+1.10
+1.22
December 33.43
+1.23
+1.23

Edible oils
Bulk, cents per lb
Year
ago
22.74
23.12
23.30
23.48
23.68
24.00

Crude soybean oil
Bulk in tank cars, cents per lb
Delivery
Decatur, Ill.
March
29.71 @29.96
April
29.71 @29.96
May
29.71 @29.96
June
29.91 @30.16
July
30.11 @30.36
August
30.30 @30.55
September
30.55 @30.80
52 / March 27, 2007

Milling & Baking News

Western points
29.21 @29.46
29.21 @29.46
29.21 @29.46
29.41 @29.66
29.61 @29.86
29.80 @30.05
30.05 @30.30

- Change from - Year
March 23 March 16 March 9 ago
Soybean oil,
Decatur
Loose lard, Chicago
Edible tallow,
Chicago
Cottonseed oil,
Miss. PBSY
Palm oil, ports
Palm kernel oil,
ports
Coconut oil
Peanut oil,
Southeast
Corn oil, Decatur
Sunflowerseed oil,
Midwest
Canola oil, Midwest

30.00
35.00

+1.25 +2.25 21.50
+10.00 +10.00 17.00

24.75

+1.00

+.75

17.50

33.50
31.50

+1.00
+.75

+.75
+.50

26.75
21.75

43.00
35.50

+.25
-.50

+.50
-.50

33.50
28.25

49.00
30.00

-
-

+2.00 45.00
-
23.50

54.75
39.50

+1.00
+1.50

+1.50 31.25
+1.25 29.25

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Milling & Baking News - March 27, 2007

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