Local feed millers facing soymeal supply squeeze<\/p>\n
SINGAPORE (Reuters): Indonesian feed millers are facing a
\nsoymeal supply squeeze as many U.S. cargoes, contracted after a
\nban on South American supplies, are unlikely to arrive before
\nJuly, regional traders said on Wednesday.<\/p>\n
Feed ingredient importers, left with little option after
\nJakarta banned South American supplies on foot-and-mouth fears,
\nare scouting to finalize some U.S. soymeal deals for prompt
\nshipments despite relatively high prices.<\/p>\n
Regional traders said Indonesia would need to buy much more
\nthan the normal monthly requirement for July shipments to offset
\na sharp fall in domestic stocks during June.<\/p>\n
\"Indonesia is short of soymeal now. There is a scarcity in the
\nlocal feed market. The ban has created a situation where local
\navailability has fallen sharply,\" said a leading Jakarta-based
\nsoymeal trader.<\/p>\n
Indonesia normally imports about 80,000 to 100,000 tons of
\nsoymeal every month.<\/p>\n
\"Smaller feed ingredient buyers are actively looking for
\nprompt U.S shipments. Nobody is interested in paying the kind of
\nprice they are paying for U.S. meal but then do we have an
\noption?\" asked another Jakarta-based oilseeds trader.<\/p>\n
But some regional traders added that rising Chicago meal
\nprices this week would keep trading volumes low. \"Interest will
\nbe there but to a limited extent,\" said one trader.<\/p>\n
On Tuesday, Chicago Board of Trade soy product futures closed
\nslightly higher, following a late rally in soybean futures and
\nafter a higher overnight close in Malaysian palm oil futures.
\nCBOT soymeal ended up 10 cents to $1.40 per ton.<\/p>\n
The Indonesian ban meant that many South American soy and corn
\ncargoes, originally bound for Indonesia, were diverted to other
\nAsian destinations such as Malaysia and Thailand.<\/p>\n
After the ban, the only other possible supplier was India but
\nhardly any trade took place recently due to the end of the season
\nthere and relatively high prices, traders added.<\/p>\n
Regional traders said Indonesian importers were paying about
\n$240 a ton C&F for high-pro U.S. soymeal, while Argentine low-pro
\nsoymeal was available at about $30 a ton lower.<\/p>\n
There was market talk Indonesia had finalized a few deals for
\nU.S. soymeal in the past few days at about $241 a ton C&F. \"What
\nI have heard is mainly for July shipments,\" said one Singapore-
\nbased grains and oilseeds trader.<\/p>\n
One trader said more than 25,000 tons of soymeal and about
\n25,000 tons of corn -- of U.S. origin contracted after the ban
\nimposed in April -- were awaiting shipment to Indonesia. But most
\nof these cargoes won't arrive until mid-July.<\/p>\n
\"It is unfortunate that we are facing a supply crunch for
\ningredients when the demand for commercial feed is showing a
\nhealthy trend,\" said one Indonesian feed miller.<\/p>\n
Grain trade officials expected Indonesia's feed production to
\nrise to about six million tons in 2001 from close to five million
\ntons in 2000.<\/p>\n
Feed millers said local availability had so far prevented
\ndomestic feed prices from rising.<\/p>\n
\"The local demand in June could be met from surplus stocks but
\nI am not sure what is going to happen to domestic feed prices in
\nJuly. We should remember that feed millers would be buying high-
\npriced U.S. meal,\" said one feed miller.<\/p>\n
Indonesia was declared free from foot-and-mouth in 1990 and
\nsince then has imposed bans on meat and animal products from
\nnations hit by the disease, and only recently on grain imports.<\/p>",
"url": "https:\/\/jawawa.id\/newsitem\/local-feed-millers-facing-soymeal-supply-squeeze-1447893297",
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"sponsor": "Okusi Associates",
"sponsor_url": "https:\/\/okusiassociates.com"
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