Feed ingredient report
Using September 2015 as a base with an outlook to July 2016 - Executive Summary
All forecasts of future feed ingredients and finished feed prices are based on the opinion of an independent feed consultant contracted to SAPA. These forecasts are for guideline purposes only and SAPA does not, in any way, warrant that these predictions will be realised. SAPA therefore cautions any user of this information to treat it in an appropriate manner.
The price of international maize has been very stable for a long time trading well under $4/bu, in December 2015. The USA harvest is nearly finished and the cropsize was even bigger than anticipated. World stock levels are also high so CBOT prices will not move too much going forward, unless we have significant crop damage in South America. South Africa is currently facing projected shortages on especially Yellow Maize and imports are continuosly coming in through the local harbors. Therefore local SAFEX prices will continue trading at import parity and will stay there as long as we have a nett shortage or very tight stocks. Technical buying will therefore be very important.
Soya Meal has also been volatile in the last few months and we have seen highs at $300/shortton for the old season and are currently trading at under$ 300/shortton on CBOT on December 2015 contracts for new season product. New season contracts on CBOT are trading very much on the same levels at $290/st for the 1st half of 2016. Argentine premiums have on the other hand also weakened significantly and are currently trading at $7/shortton for December 2015. The view is still that Soya prices will be trading sideways for some time.
The Rand continues weakening and is currently trading at R14,00 and weaker. The forward prospects of the Rand do not look good and we will see a consistent weakening going into 2016. The weak Rand has had a major impact on Soya Meal and Maize prices. On a Rand basis Soya Meal prices are currently trading at between R5500 and R5700/mt ex local crusher and the same levels ex Durban Harbour. The SAFEX DEC market is currently trading for Yellow Maize at R3200/mt and White Maize at R3250/mt. Currently we are seeing no exports of Yellow Maize from SA, but according to the last SAGIS numbers, more than 450 000mt of Yellow Maize has
been imported until the week of the 20th November 2015. The information in the market is that imports have been fixed until January 2016 and we should see imports continuing.
PLEASE NOTE: The assumptions that were made, major factors influencing the local cost of raw materials and other factors taken into account can be viewed in Appendix A.
The full version of this report can be found on the SAPA website (www.sapoultry. co.za)¡