Despite a slight drop in recent weeks, the overall high price of soyabean meal is continuing to keep most users buying on the spot market only, writes Colin Shepherd of KW Alternative Feeds.
Prices remain in the £280-300/t range delivered onto farm at the time of writing, even though the latest USDA report confirms excellent US soyabean yields this year and a total planted crop for the 2010 harvest of 77.7m acres (up from 76.0m acres in 2009).
The soya crops will soon be planted in South America, with Brazil and Argentina together predicted to be up by some 4-5m acres on the back of this year’s high prices. There is some confidence of prices easing now being reflected in forward contracts, however, with the best opportunities for November-April deliveries in recent weeks at £285/t, and some forward thinking farmers securing deals in the £225-235/t range for May-October 2010.
For rapemeal, a record European oilseed rape crop of over 20m tonnes has brought rape oil prices down, stimulating demand within the marketplace. As a result, crushing volumes are likely to remain high, keeping the supply of rapemeal ahead of demand.
The result has been that rapemeal prices remain at around £130-140/t for the winter, and livestock farmers should probably be booking at least 50% of winter requirements right through to spring at this level. The rest can then be bought during any further dips in the market, but with the confidence that some good protection has been taken against the market lifting.
Combined with strategic use of heat treated rapemeal (such as ProtoTec) and small quantities of rumen-protected soyabean meal (SoyPass), the opportunity now exists to get winter protein costs locked in at levels that are certainly below those experienced by many last winter. EU wheat distillers’ pellets are another option worth considering.
On the energy front, an anticipated Australian wheat harvest of 22-23m tonnes is giving confidence to an ongoing position of general world oversupply, with UK exports currently at very low levels. The result is that energy feed prices remain relatively static.
Soya hulls in the mid £90s/t are excellent value on the spot market, although are less attractive when it comes to forward contracts for the winter. More competitive at the moment is sugar beet feed, which is probably the current “best buy” for winter digestible fibre requirements.