Headlines:

  • EU livestock recovery set to slow over next six months
    European animal feed manufacturer ForFarmers, announcing results for the first six months of 2017, says a recovery in livestock markets is driving growth in its European markets. But factors such as the Brexit uncertainty holding back its UK operations mean that growth is set to slow over the rest of the year. The co-operative has a 6% share of the EU feed market, and operates across Holland, Belgium, Northern Germany and the UK. “Our customers are currently in better financial shape than a year ago, when milk and pig prices were under pressure,” notes ForFarmers Group chief executive Yoram Knoop. “Farmers, especially in the Netherlands and Germany/Belgium, are buying more high-quality feeds again to increase their production. “There is large uncertainty in the United Kingdom about the consequences of Brexit for the agricultural sector. Farmers are therefore more hesitant in, among others, growing the size of their herds, which were reduced last year. In spite of this, the market in the United Kingdom appears to be recovering slowly.”.
  • Brazil’s chicken exports set for 5% rise in 2018
    Brazil’s chicken meat production is set to increase further, with rising global demand for the product and disease disrupting output in some countries, said a USDA report. Broiler production in Brazil is forecast to grow by 2.6% to 13.8m tonnes in 2018 from the 13.44m tonnes in 2017, and to be 6.45% up on 2016’s 12.91m tonnes. USDA analysts point to continued firm world demand for Brazilian product, due to the effect of Avian Influenza in several countries. Domestically, demand is set to improve by up to 1.5% in line with economic recovery in Brazil, with lower inflation and some growth – albeit weak, following several years of negative GDP. At the same time, reduced feed costs as a result of record corn and soybean crops will cut production costs. With these two feed ingredients accounting for some 70% of the cost of producing broilers, producers and packers in Brazil are “cautiously optimistic” that profit margins will continue to improve, despite currency effects.

Summary:

Corn, Soybean, and Spring Wheat were once again mixed in trading. This time Beans was up almost double digits ranging from 7.75 to 9.25 in price improvement. Both Corn and Wheat were down again. Corn was down ranging from 2.0 to 2.50 cents and Chicago Spring Wheat ranged from 4.50 to 5.25 down on the day. The small overnight bounce in Corn did not last as sellers came returned in full force. The weather and projected crop size continues to weigh down on it. Export sales for old crop fell well below analyst estimates but new crop was at the high end of expectations. Old crop Soybean sales were at 453,200 tons and new crop were at 899,400 tons. Overseas, Paris wheat futures fell to new contract lows today with the huge crop in the Black Sea region weighing on international markets.