WorldWatch:

[Mustang Sally Farm]

Jamaica in search of alternative feedstock 24 Jan 2011
Government is exploring alternative feedstock as part of a programme aimed at combating volatile food prices, says Agriculture Minister Dr Christopher Tufton.
Tufton made the revelation as Jamaicans brace for higher food prices due to soaring cost of grains on the international market which is expected to impact the cost of feeds used in the production of diary, poultry, meats and eggs.
 
"Where we have to go is, to take a look at alternative feedstock - cassava, for example, that can be pelletised to make poultry feed and pig feed; different types of grass that can be used for beef or production cattle rearing and small remnants rearing," Tufton told the Business Observer.
 
"That's where we have to focus our attention in order to say, instead of requiring 'x' amount of grain, we can cut back and substitute it with other things," he explained.
 
Not enough land
Tufton ruled out directly replacing the imported grains with local produce, noting that Jamaica does not possess the critical mass needed to grow corn and soybean.
 
"The mass acreages that would be required is just not available to grow for commercial use - further processing for feedstock for example," stated Tufton, adding that "We'd have to grow corn on (land) the size of Jamaica to compete with those countries that grow the product...The challenge now becomes therefore whether we need to depend on corn so much for the basis of our feedstock."
 
The agriculture minister said that Government has been doing a lot over the last couple of years in this regards and has seen declines in the food import bill in terms of volumes.
 
He noted that the administration in 2011 will focus on a number of crop areas where the country can have direct replacements both in terms of production and in terms of storage or value-added promotion.
 

[Mustang Sally Farm]

Meat Industry Faces a Squeezed Middle Market
The meat industry faces three separate challenges – increasing and maintaining margins, accommodating greater uncertainty in the business environment and responding to market segmentation, writes Chris Harris,Editor in Chief.

This was the message from Professor Phil Thomas, chairman of the Quality Meat Scotland R&D committee at the Quality Meat Scotland R&D Conference in Perth.

He said the global meat industry will have to face up to the needs of a growing global population – expected to reach nine billion by 2050 – as well as the problems of climate change.

The food industry also has to face up to the challenges of national and international food security, diet and health issues, land use and energy shortages as well as the diminishing mineral reserves and global economic problems.

Professor Thomas said that the future prospects for agriculture look challenging particularly in the red meat sector.

However he said that these challenges are also great opportunities for the meat sector.

"Individual businesses and the industry as a whole will therefore need to grasp the opportunities and address the challenges," he said.

He said the industry could not afford to hold on to the status quo.

The sector will find that it will have to find answers to many different questions using existing and new technologies, improved efficiency, reduction of waste and an ability to innovate.

He said among the challenges will be the cost and availability of energy in "all shapes and sizes".

"Bioenergy has its positives and its negatives," he said.

"You can grow for it but it takes land to grow for it and all along the way governments will intervene."

The main influences on a changing food and agricultural system will be both population growth and climate change and, Professor Thomas said, that while climate change is not going to be felt so dramatically in the northern hemisphere, its impact is going to be felt in regions from the equator outwards.

He also warned that food prices that saw a global peak in 2008 could see another peak this year as cereal and oil prices rise.

However, while cereal and oil prices could reach new high levels, the prices for meat will not peak to such a degree.

"This is because in underdeveloped countries the populations turn from meat to cereals in hard times," he said.

The scenario in the developed nations such as Europe will be different, because there is a small number of buyers in the middle between the large numbers of food producers and the large numbers of consumers.

This dynamic of the market will mean that there will be a growth in the low end products and a growth in the high-end products, but the middle markets will be squeezed.

Professor Thomas told the conference that with a squeezed middle market meat producers will have to find their area of sales either at the top end or the low commodity end as the market polarises.

January 2011

[Mustang Sally Farm]

Thursday, February 03, 2011Print This Page
World Meat Price Steady; Dairy Price Higher
GLOBAL - With a 3.4 per cent surge in January, world food prices have reached a new historic peak. However, the average meat price was steady and dairy prices, though six per cent higher than in December, are still a way off the historic peak.
 

World food prices surged to a new historic peak in January, for the seventh consecutive month, according to the updated FAO Food Price Index, a commodity basket that regularly tracks monthly changes in global food prices.

The Index averaged 231 points in January and was up 3.4 per cent from December 2010. This is the highest level (both in real and nominal terms) since FAO started measuring food prices in 1990. Prices of all monitored commodity groups registered strong gains in January, except for meat, which remained unchanged.

High prices
"The new figures clearly show that the upward pressure on world food prices is not abating," said FAO economist and grains expert, Abdolreza Abbassian. "These high prices are likely to persist in the months to come. High food prices are of major concern especially for low-income food deficit countries that may face problems in financing food imports and for poor households which spend a large share of their income on food."

"The only encouraging factor so far stems from a number of countries, where –,- due to good harvests – domestic prices of some of the food staples remain low compared to world prices," Abbassian added.

FAO emphasised that the Food Price Index has been revised, largely reflecting adjustments to its meat price index. The revision, which is retroactive, has produced new figures for all the indices but the overall trends measured since 1990 remain unchanged.

The FAO Cereal Price Index averaged 245 points in January, up three per cent from December and the highest since July 2008, but still 11 per cent below its peak in April 2008. The increase in January mostly reflected continuing increases in international prices of wheat and maize, amid tightening supplies, while rice prices fell slightly, as the timing coincides with the harvesting of main crops in major exporting countries.

The Oils/Fats Price Index rose by 5.6 per cent to 278 points, nearing the June 2008 record level, reflecting an increasingly tight supply and demand balance across the oilseeds complex.

The Dairy Price Index averaged 221 points in January, up 6.2 per cent from December, but still 17 per cent below its peak in November 2007. A firm global demand for dairy products, against the backdrop of a normal seasonal decline of production in the southern hemisphere, continued to underpin dairy prices.

The Sugar Price Index averaged 420 points in January, up 5.4 per cent from December. International sugar prices remain high, driven by tight global supplies.

By contrast, the FAO Meat Price Index was steady at around 166 points, as declining meat prices in Europe, caused by a fall in consumer confidence following a feed contamination scandal, was compensated for by a slight increase in export prices from Brazil and the United States.

[Mustang Sally Farm]

Meat Industry Faces a Squeezed Middle Market
The meat industry faces three separate challenges – increasing and maintaining margins, accommodating greater uncertainty in the business environment and responding to market segmentation, writes Chris Harris, ThePigSite Editor in Chief.

This was the message from Professor Phil Thomas, chairman of the Quality Meat Scotland R&D committee at the Quality Meat Scotland R&D Conference in Perth.

He said the global meat industry will have to face up to the needs of a growing global population – expected to reach nine billion by 2050 – as well as the problems of climate change.

The food industry also has to face up to the challenges of national and international food security, diet and health issues, land use and energy shortages as well as the diminishing mineral reserves and global economic problems.

Professor Thomas said that the future prospects for agriculture look challenging particularly in the red meat sector.

However he said that these challenges are also great opportunities for the meat sector.

"Individual businesses and the industry as a whole will therefore need to grasp the opportunities and address the challenges," he said.

He said the industry could not afford to hold on to the status quo.

The sector will find that it will have to find answers to many different questions using existing and new technologies, improved efficiency, reduction of waste and an ability to innovate.

He said among the challenges will be the cost and availability of energy in "all shapes and sizes".

"Bioenergy has its positives and its negatives," he said.

"You can grow for it but it takes land to grow for it and all along the way governments will intervene."

The main influences on a changing food and agricultural system will be both population growth and climate change and, Professor Thomas said, that while climate change is not going to be felt so dramatically in the northern hemisphere, its impact is going to be felt in regions from the equator outwards.

He also warned that food prices that saw a global peak in 2008 could see another peak this year as cereal and oil prices rise.

However, while cereal and oil prices could reach new high levels, the prices for meat will not peak to such a degree.

"This is because in underdeveloped countries the populations turn from meat to cereals in hard times," he said.

The scenario in the developed nations such as Europe will be different, because there is a small number of buyers in the middle between the large numbers of food producers and the large numbers of consumers.

This dynamic of the market will mean that there will be a growth in the low end products and a growth in the high-end products, but the middle markets will be squeezed.

Professor Thomas told the conference that with a squeezed middle market meat producers will have to find their area of sales either at the top end or the low commodity end as the market polarises.

January 2011

[Mustang Sally Farm]

World Agricultural Supply and Demand Estimates - March 2011
The forecasts for red meat and poultry production and prices in 2011 have been raised from a month ago, according to the latest USDA World Agricultural Supply and Demand Estimates.

Livestock, Poultry and Dairy
The forecast for 2011 red meat and poultry production is raised from last month, reflecting increased production of beef, pork, broilers, and turkeys. Fed cattle slaughter will reflect expected strength in feedlot placements during early 2011 and relatively large dairy cow slaughter in the first part of 2011 will also contribute to higher beef production. However, the effects of increased cattle slaughter will be partly mitigated by lower expected carcass weights. Pork production is increased from last month as carcass weights thus far in the first quarter are well above last year. Broiler and turkey production is forecast higher in the first half of 2011. The broiler production increase largely reflects relatively heavy bird weights but the increase in turkey production forecast reflects higher increases in poult placements as well as increased bird weights. The egg production forecast is raised as the table egg type laying flock has been increasing. Estimates of 2010 poultry and egg production are adjusted to reflect data revisions.

The forecast for beef exports for 2011 is raised from last month on strength in exports to Asia. The beef import forecast is reduced as supplies in several exporting countries are expected to remain tight and a relatively weak US dollar is expected to constrain shipments. The pork and poultry export forecasts for 2011 are unchanged from last month. Trade estimates for 2010 reflect import and export data for December.

Despite the higher production forecasts, prices for livestock and poultry are raised from last month. Robust exports and improving domestic demand in the face of relatively tight meat supplies are expected to support higher price forecasts for cattle, hogs, broilers, and turkeys. Egg prices in the first quarter are forecast lower due to recent price declines.

The milk production forecast for 2011 is reduced from last month. Relatively high milk prices and increased supplies of replacement heifers are expected to encourage further increases in the cow herd through much of the year, but the rate of increase in milk per cow is forecast slower than last month. Exports are forecast higher as global nonfat dry milk and cheese demand remains strong with tight supplies in competitor markets expected through the first half of 2011. Estimates of 2010 milk production are adjusted to reflect data revisions.

Dairy product prices are forecast higher this month on strong early year prices. Strong international demand and improving domestic demand will support prices for most products. Currently tight butter stocks are also helping support butter prices. Class III and Class IV price forecasts are raised to reflect higher product prices. The all milk price is forecast to average $18.10 to $18.70 per cwt for 2011.

Wheat
US wheat ending stocks for 2010/11 are projected higher this month on reduced export prospects. Projected exports are lowered 25 million bushels with increased world supplies of high quality wheat, particularly in Australia, and a slower-than-expected pace of US shipments heading into the final quarter of the wheat marketing year. By-class changes include lower projected exports for Hard Red Spring, White, and durum wheat, partly offset by small increases for Hard Red Winter and Soft Red Winter wheat. The marketing-year average price received by producers is projected at $5.60 to $5.80 per bushel, unchanged from last month.

Global 2010/11 wheat supplies are projected 1.9 million tons higher reflecting higher production. Argentina production is raised 1.0 million tons based on higher reported yields. Australia production is raised 1.0 million tons with higher yields in Western Australia where wheat quality was not hurt by harvest rains as in the east. Other production changes include a 0.5-million-ton reduction for EU-27 with a smaller crop reported for Denmark and a 0.6-million-ton increase for Saudi Arabia on an upward revision to area.

Global 2010/11 wheat supplies are projected 1.9 million tons higher reflecting higher production. Argentina production is raised 1.0 million tons based on higher reported yields. Australia production is raised 1.0 million tons with higher yields in Western Australia where wheat quality was not hurt by harvest rains as in the east. Other production changes include a 0.5-million-ton reduction for EU-27 with a smaller crop reported for Denmark and a 0.6-million-ton increase for Saudi Arabia on an upward revision to area.

Global 2010/11 wheat consumption is projected lower with the biggest change being a 1.5-million-ton reduction in expected wheat feeding for Russia. With increased global production and reduced usage, world ending stocks for 2010/11 are projected 4.1 million tons higher.

Coarse Grains
The US feed grain balance sheet for 2010/11 is nearly unchanged this month. Projections for corn, sorghum, and oats supplies, usage, and ending stocks are all unchanged. Barley exports are lowered 2 million bushels reflecting the slow pace of shipments and sales to date. The projected marketing-year average farm price for corn is narrowed 10 cents on both ends of the range to $5.15 to $5.65 per bushel. Farm price projections for sorghum and barley are lowered slightly and the oats farm price projection is raised slightly, all reflecting reported prices to date.

Global coarse grain supplies for 2010/11 are projected 2.5 million tons lower this month with lower corn beginning stocks and reduced corn, barley, sorghum, and oats production. Global corn beginning stocks are lowered 0.6 million tons with upward revisions to Brazil exports and India feeding in 2009/10.

Global 2010/11 corn production is reduced 0.5 million tons as lower production in Mexico and India is partially offset by higher production in Brazil. Brazil corn production for 2010/11 is raised 2.0 million tons reflecting higher reported area and yields in the summer crop and expectations for increased area for the winter crop with government planting dates extended for crop insurance and loan programmes. Mexico corn production is reduced 2.0 million tons as the unusual early February freeze destroyed standing corn crops across much of the northwest winter corn region, which normally accounts for about one-fourth of the country’s total corn production. Replanting is expected to offset some of the loss, but seasonally high temperatures in the coming months limit the growing season window.

Global 2010/11 sorghum and barley production are each lowered 0.5 million tons and oats production is lowered 0.3 million tons. Lower sorghum output for India more than offsets an increase for Australia. Lower barley and oats output for Australia account for most of the reduction in world production for these coarse grains.

Global 2010/11 coarse grain imports are raised this month as increases for corn and sorghum more than offset a reduction for barley. Corn imports are raised 1.1 million tons for Mexico with the lower production outlook. Corn imports are raised 1.0 million tons for EU-27 on stronger expected feeding. A 0.5-million-ton reduction for Russia corn imports is partly offsetting. Sorghum imports are raised for EU-27 and barley imports are lowered for Russia, Saudi Arabia, and China. Increased corn feeding in EU-27 is more than offset by reductions in feeding in Russia and lower food, seed, and industrial use in India and Mexico. Projected global corn ending stocks are raised slightly.

Oilseeds
US soybean supply and use projections for 2010/11 are mostly unchanged from last month. A higher soybean meal extraction rate is offset by a small increase in soybean meal exports, leaving the projected soybean crush unchanged. Soybean oil production is increased due to a higher soybean oil extraction rate. Soybean oil used for biodiesel for 2010/11 is projected at 2.7 billion pounds, down 200 million from last month due to lower-than-expected production through January. Soybean oil exports are increased 200 million pounds to 3.0 billion reflecting continued strong export shipments and sales. Soybean oil stocks are projected at 2.4 billion pounds, down 165 million from last month. If realized, soybean oil ending stocks would be the lowest in 6 years.

The US season-average soybean price range for 2010/11 is projected at $11.10 to $12.10 per bushel, down 10 cents on both ends of the range. Soybean oil prices are forecast at 51.5 to 55.5 cents per pound, up 0.5 cents on both ends. Soybean meal prices are forecast at $340 to $370 per short ton, down 10 dollars on the high end.

Global oilseed production for 2010/11 is projected at 444.2 million tons, up 2.4 million tons from last month. Foreign production, projected at 343.7 million tons, accounts for all of the change. Brazil soybean production is forecast at a record 70.0 million tons, up 1.5 million tons from last month due to higher projected yields. Soybean production is also raised for China. Global sunflowerseed production is raised 0.3 million tons due to higher estimates for China and EU-27. Global cottonseed production is reduced with lower production in China, India, and Uzbekistan only partly offset by increases for Australia and Brazil.

Global oilseed supplies, crush, and ending stocks are projected higher this month. Soybean crush is projected higher for Brazil and India, and sunflowerseed crush is raised for China and EU-27. Higher soybean stocks for Brazil and Argentina are only partly offset by reductions for China, Canada, and India. Higher rapeseed stocks are projected for EU-27, Australia, and Turkey. Global protein meal production, consumption, and stocks are all projected higher this month.

[Mustang Sally Farm]

Feed Outlook - March 2011
World coarse grain production and beginning stocks forecast for 2010/11 are reduced this month, lowering supply 2.5 million tons, according to the latest report from the USDA Economic Research Service.
 

However, projected global use is 3.3 million tons lower this month, allowing for a 0.8-million-ton increase in ending stocks to 154.9 million tons. The global stocks-to-use ratio is projected at 13.8 per cent, slightly lower than in 2006/07 when stocks were 9 per cent lower but use was smaller. US 2010/11 supply and use forecasts for feed grains are unchanged this month except for a small reduction in barley exports and an offsetting increase in ending stocks. Price projections are adjusted, but the midpoint of the forecast corn farm price range is unchanged.


DOMESTIC OUTLOOK

2010/11 Feed Grain Supplies and Use Essentially Unchanged This Month
US feed grain supplies for 2010/11 remain at 380.3 million metric tons this month, unchanged from last month’s projection but down 4.4 per cent from last year. Total use of the four feed grains is nearly unchanged this month at 359.5 million metric tons. With demand exceeding supply, ending stocks are expected to be drawn down to 20.8 million metric tons, the lowest level since the end of the 1995/96 marketing year.The midpoint of the projected range for the 2010/11 corn price received by farmers remains at $5.40 a bushel this month, but both the lower and upper end of the range are reduced by 10 cents, to $5.15-$5.65 a bushel. With the exception of last month, corn prices at the farm gate have been below $5.00 a bushel so far this year. If the preliminary February price of $5.66 a bushel is confirmed, this will be the first time since September 2008 that prices at the farm gate have exceeded $5.00.

Feed and residual use for the four feed grains plus wheat on a September-August marketing year basis is unchanged this month, remaining at 142.7 million metric tons. Grain-consuming animal units (GCAU’s) are projected at 93.3 million this month, up slightly from last month's 93.1 million due to an increase in broiler production. The broiler production increase largely reflects relatively heavy bird weights, but the increase in forecast turkey production reflects higher poult placements as well as increased bird weights. Feed and residual use per animal unit is unchanged this month at 1.53 tons, which is down from 1.54 tons in 2009/10.

Minor Changes Made to Feed Grain Price Projections
The midpoint of the projected range for the 2010/11 corn price received by farmers remains at $5.40 a bushel this month, but both the lower and upper end of the range are reduced by 10 cents, to $5.15-$5.65 a bushel. With the exception of last month, corn prices at the farm gate have been below $5.00 a bushel so far this year. If the preliminary February price of $5.66 a bushel is confirmed, this will be the first time since September 2008 that prices at the farm gate have exceeded $5.00.

 

 

 


The farm price has been below prevailing cash market bids due to farmers forward contracting when prices were lower. Farm gate prices are expected to well exceed $6.00 per bushel in the coming months to reach the $5.40 midpoint of the projected season average price range.

The projected sorghum price received by farmers is lowered by 20 cents at the top end of the range, to $5.15-$5.65 a bushel. This lowered the midpoint by 10 cents to $5.40 per bushel, reflecting year-to-date price data. The barley and oat price estimates were also changed slightly this month, reflecting year-to-date data. The barley farm price projection is reduced by 10 cents and now stands at $3.70-$3.90 per bushel. The oat farm price projection is increased by 5 cents, to $2.35-$2.55 per bushel.

US barley exports for the 2010/11 crop year are lowered from 10 million bushels to 8 million bushels, reflecting shipments to date and minimal outstanding sales.

 

 

 


Ethanol Projection Unchanged
Corn used for fuel is unchanged. Recent lower weekly ethanol production and higher stock levels, according to Energy Information Administration data, are consistent with last month’s projection. Current ethanol production has returned to levels close to those prier to last December's increase. High petroleum and gasoline prices have reduced gasoline demand, lowering gasoline production. As ethanol blending nears practical limits, demand has deepened.

March Planting Intentions and Stocks Report are Keys to Price Prospects
Grain Stocks and Prospective Plantings are the key reports that will be released by the USDA’s National Agricultural Statistics Service on March 31, 2011. The stocks report will show grain stocks as of 1 March 2011. Stocks that are lower-thanexpected will imply greater feeding in the quarter ending 1 March and would be bullish for prices. A higher-than-expected stock level may moderate price increases somewhat.

At the 25 February 2011, USDA Outlook Conference, corn plantings this spring were projected at 92 million acres. Prices will likely respond if planted acreage is much different than this projection. In the past 20 years, the March projection was below the final acreage number 8 times and above it 12 times.

INTERNATIONAL OUTLOOK

World Coarse Grain Production Prospects for 2010/11 Reduced
Global coarse grain production for 2010/11 is projected down 1.8 million tons this month to 1,079.7 million. Reductions for Mexico, India, and Australia more than offset improved expectations for Brazil. World corn, barley, and sorghum production are each reduced 0.5 million tons, while global oats production is trimmed 0.3 million.

Mexico’s corn production for 2010/11 is cut 2.0 million tons to 22.0 million as an early February freeze devastated the crop in Sinaloa. The corn marketing year for Mexico is October-September, with about 75 per cent of the crop being produced in the main season (harvested in the fall). However, most of the winter-crop corn is grown in Sinaloa with irrigation. An exceptional freeze hit in the first week of February, with about 80 per cent of the corn planted. Satellite imagery verifies that much of the corn crop was killed. Some replanting will limit losses, but high temperatures later in the season will limit the window for replanting. Most of the Sinaloa corn is white corn destined for products for human consumption, such as tortillas.

India’s coarse grain production is cut 1.3 million tons to 40.4 million based on more complete harvest reports covering the last monsoon season. Sorghum area harvested came in 4 per cent below previous expectations, with average yields trimmed slightly more, cutting production 0.7 million tons to 6.8 million. Corn area was reported higher than expected, but yields were lower leaving production reduced 0.5 million tons to 20.5 million. Millet production is trimmed 0.1 million tons, but barley is increased 0.05 million.


Australia’s coarse grain production is reduced 0.5 million tons this month to 13.4 million. More complete harvest reports indicate lower barley yields, cutting production 0.5 million tons to 9.3 million. Oats area and yields are reduced, cutting production 0.25 million tons to 1.5 million, but excellent sorghum yield prospects boost projected production 0.25 million tons to 2.2 million. Ukraine oats production is trimmed as lower area more than offset good reported yields. Also, Moldova’s 2010/11 coarse grain production is reduced slightly with a decline in barley more than offsetting a small increase in corn.

Brazil’s corn production prospects are increased 2.0 million tons this month to 53.0 million. Brazil’s Ministry of Agriculture reported excellent yields for the mainseason corn crop now being harvested. While the second-crop corn planted following short-season soybeans has been delayed by slow soybean harvesting, especially in Mato Grosso, the Government has extended the permitted planting window, supporting area prospects. However, late planted second-crop corn in Mato Grosso is more susceptible to an early end of the wet season, potentially limiting production prospects.

World coarse grain beginning stocks for 2010/11 are reduced this month by 0.7 million tons to 195.1 million. The largest reduction is for Brazil, with corn beginning stocks cut 0.4 million tons to 10.1 million due to stronger-than-expected exports during the March-February 2009/10 local marketing year (just ending). India’s coarse grain beginning stocks are down 0.1 million tons, mostly because of strong corn feed use and exports in 2009/10, partly offset by increased millet stocks. Saudi Arabia’s beginning stocks for 2010/11 are down 0.1 million this month as 2009/10 trade data show barley imports fell short of previous expectations. There are also small reductions in corn beginning stocks this month for Kenya and Taiwan.


Global Use of Coarse Grains Reduced for 2010/11
Total world coarse grain use in 2010/11 is projected down 3.3 million tons this month to 1,119.9 million. Feed use is forecast up 0.3 million tons, but food, seed, and industrial use is down. Trade changes contribute heavily to the projected decline in global use.

Projected EU coarse grain total use is up 1.2 million tons this month with increases of 1.0 million tons for corn and 0.2 million for sorghum. Import licenses are up as prices in the EU encourage imports. Ukraine’s total coarse grain use is up 0.5 million tons, with feed use up 0.4 million as the slow pace of barley exports and uncertainty about export licenses is expected to encourage domestic use. Corn feed use prospects are increased slightly for Moldova.

Coarse grain feed use prospects are cut 0.9 million tons for Russia as the grain export ban has kept internal prices low, especially for low-quality wheat, discouraging imports and feeding of corn (down 0.5 million tons) and barley (down 0.4 million). Australia’s feed use is trimmed 0.4 million tons, with lower barley and oats production more than offsetting increased sorghum. There is also a small reduction in corn feed use prospects this month for Taiwan.

India’s coarse grain total use is down 1.3 million tons this month to 37.6 million. Lower production of sorghum, corn, and millet is expected to cut human consumption, with a reduction in projected sorghum feed use of 0.2 million tons. Food use is also cut this month for Mexican corn (down 0.3 million tons), Kenyan corn (down 0.1 million), and Chinese barley (trimmed 0.1 million).

Local marketing year trade changes can alter global use (see last month’s write up). With the sum of local marketing year coarse grain exports reduced 1.1 million tons this month, while the sum of imports are increased 0.9 million tons, the trade changes combine to reduce global coarse grain use by 2.0 million tons.

World Ending Stocks Projected Higher
Projected 2010/11 coarse grain use is cut more this month than supply, boosting forecast global ending stocks 0.8 million tons to 154.9 million. World corn ending stocks are up 0.6 million tons to 123.1 million. Global barley and millet stocks are up slightly while sorghum and oats prospects are trimmed.

The largest increase in projected 2010/11 ending stocks is a 1.6-million ton-increase for corn in Brazil to 8.8 million tons. Increased production is only partly offset by reduced beginning stocks, and forecast use (on a local marketing year) is unchanged. Brazil’s 2010/11 ending stocks are still projected lower than beginning stocks, but the tightening of stocks is not as great as projected a month ago. Other increases in projected ending stocks include a 0.3-million-ton increase in barley for both the EU and Ukraine, as well as small increases for US barley and Taiwan corn.

Partly offsetting the 2010/11 increased ending stocks expected for Brazil and others this month are several countries with reduced expected ending stocks. Mexico’s corn stocks are reduced 0.4 million tons to 1.5 million due to the cut in production. Australia’s coarse grain ending stocks are reduced 0.4 million tons this month, with reductions for barley and sorghum. Saudi Arabia’s coarse grain ending stock prospects are down 0.3 million tons with a decline for barley more than offsetting a small increase for corn. Ending stocks for corn in Kenya are down 0.2 million tons due to reduced imports. There are also small reductions this month for barley in China, corn in Moldova, and coarse grains in India, where a reduction for corn is almost offset by increases for millet, sorghum, and barley.

World Corn Trade Boosted Slightly, US Export Prospects Unchanged
Global corn trade for 2010/11 is forecast up 0.8 million tons this month to 92.1 million. Imports for Mexico are up 1.1 million tons to 9.0 million due to the production shortfall. EU imports are boosted 1.0 million tons to 6.5 million as import licenses are large and domestic prices encourage imports. Saudi Arabia’s corn import prospects are increased 0.1 million tons to 1.9 million, reflecting higher imports and feed use revealed by the latest estimates for 2009/10. However, corn imports for Russia are cut 0.5 million tons to 0.5 million as grain prices in Russia have not been high enough to encourage imports and no significant corn imports have occurred yet. Kenya’s corn imports are trimmed 0.25 million tons due to sufficient domestic supplies and lower estimated 2009/10 corn imports than previously forecast.

Brazil’s 2010/11 October-September corn exports are increased 1.0 million tons to a record 10.0 million. The shipment pace from October 2010 to February 2011 has been very rapid, at about 7.5 million tons, but is expected to slow dramatically as port capacity is switched to exporting soybeans, a more valuable crop. The availability or lack of government transport subsidies to move corn from the interior to the coast tends to accentuate the “lumpiness” of Brazilian corn exports.

Mexico, with reduced corn production, is expected to export 0.2 million tons less corn, leaving projected 2010/11 exports at only 0.1 million. Kenya’s corn exports are also reduced slightly.

US corn exports for 2010/11 are unchanged this month at 50.0 million tons (1.95 billion bushels for the September-August local marketing year). The forecast is nearly the same as the 49.9 million tons shipped the previous year. Census data for October-January indicate shipments of 14.0 million tons, virtually the same as a year earlier. However, grain inspections for February were 0.5 million tons less than those reported a year ago. The recent slow shipment pace is expected to increase as outstanding sales as of March 3, 2011, reached 12.8 million tons, up 2.3 million from a year earlier and the third highest for early March in the last 20 years.

World barley trade projected for 2010/11 is reduced 1.1 million tons this month to 16.0 million. Saudi Arabia’s barley imports are cut 0.6 million tons to 6.7 million on the slow pace of purchases and the Government’s goal of reducing subsidies.


Imports by Russia and China are also reduced due to the slower-than-expected pace of purchases. The slow pace of sales and shipments supports a reduction in barley exports of 0.8 million tons for Ukraine, and 0.3 million for the EU. US barley exports are reduced for the local June-May marketing year but unchanged for the October-September trade year.

Global sorghum trade for 2010/11 is increased slightly with 0.2-million-ton increases for Australia’s exports and EU imports. US sorghum export prospects are unchanged this month at 3.8 million tons. The pace of exports for the first 5 months of the trade year has been sluggish, but at the beginning of March 2011, outstanding export sales are up 21 per cent from a year ago.

[Mustang Sally Farm]

S Korea Says FMD Costs Near $2.7 Bln
SOUTH KOREA - South Korea, battling against its worst ever outbreak of foot-and-mouth disease said on Thursday that the crisis has cost nearly 3 trillion won (S$3.42 billion) so far.


Prime Minister Kim Hwang-sik also said in a statement that the government would lower its disease alert to "watch" from "seriousness", noting the cases were waning, while stepping up quarantines at borders including airports to block the potential entry of any virus.

In the past four months, Asia's fourth-largest economy has culled a third of its hog population and five per cent of cattle in a bid to stop the disease. It has also vaccinated animals.

"The government will make a routine to vaccinate cows and pigs to prevent foot-and-mouth disease outbreak," Prime Minister Kim said.

[Mustang Sally Farm]

Report Re-Examines Link between Meat Intake and Human Cancers
A major analysis of the sometimes contradictory scientific evidence by the World Cancer Research Fund (WCRF) concludes that high red meat consumption increases the risk of bowel cancer, while high white meat consumption does not, the Soil Association states in the appendix to a briefing on The Role of Livestock in Sustainable Food Systems.
A few individual studies have also found a link with prostate and pancreatic cancer.

The Soil Association says that widely-accepted concerns that the saturated fats found in red meat increase the risk of heart disease have found their way into the Government’s healthy eating guidelines.

There has also been research in Spain linking high red meat consumption to low male fertility.

However, it says that none of these negative effects has been established for chicken and other intensively produced white meat, so far.

One rather bizarre aspect of this issue, which has received little consideration, the Soil Association says, is that weekly consumption of beef in the UK fell from 244g per person in the early 1950s to 126g in the 1990s. In contrast, chicken consumption during the same period increased from 19 to 237 grams and has risen further since. Yet this is the very period during which cancer and heart disease has increased dramatically, the briefing note says.

This period equates to the major phase of agricultural intensification, when virtually all chickens and a significant proportion of cattle, even in the UK, were brought indoors and fed on a predominately cereal-based diet to increase productivity.

The organic food group points to research by scientists at the Institute of Brain Chemistry and Human Nutrition in London that has recently highlighted the fact that more than half the energy in a modern broiler chicken (as well as some organic chickens) comes from fat, whereas 60 years ago, the vast majority of the energy came from protein.

Even more significantly though, the Soil Association says, the proportion of the omega-3 fatty acid, DHA, found at significant levels in grass, has fallen dramatically in chicken meat, which today contains only one-fifth of the level found in wild birds.

In contrast, levels of the omega-6 fatty acids derived from grain have not fallen, giving a highly unhealthy balance of almost 10 times as much omega-6 as omega-3.

The scientists study associates this with the rise of brain dementia.

Professor Michael Crawford, one of the authors, says: "Essential fats for the brain are the priority. In biochemical terms, the limiting factor for the brain is the omega-3 [docosahexaenoic acid; DHA] to get the same amount of DHA from a modern broiler chicken you need to eat about three to five chickens at a cost of over £12 and with 5,000 calories of thrombogenic and atherogenic fats included." (Crawford, 2009, personal communication).

While a similar trend has occurred with intensively produced beef and pork, grass-fed beef has an omega-6 to omega-3 ration of just 1.65:1.

A very high proportion of beef in recent decades, however, has been produced intensively, in feedlots in the US and many other countries, and in the barley-beef systems pushed by MAFF for so many years.

The Soil Association asks if could this be an explanation for the studies that have found harmful trends associated with high red meat consumption.

"We have to remember too that the WCRF included pork in their definition of red meat and worldwide a high proportion of pork is produced in the most appallingly intensive conditions," the Soil Association says.

The beneficial effects of omega-3 fatty acids are, as yet, widely accepted only in relation to cardiovascular disease and it is for this reason that we are advised to eat two portions of oily fish a week, but recent research has shown that Western diets are typically as high as 16:1, omega-6 to omega-3, but that reducing this to:

2.5:1 reduced colo-rectal cancer cells and the risk of breast cancer in women, and
5:1 suppressed inflammation in patients with rheumatoid arthritis. (Simopoulos, 2008).
Even the WCRF, which has been at the forefront of the global campaign to reduce the consumption of red meat, has acknowledged that the meat of wild animals has a very different fat profile to that of most farmed animals and may therefore not be linked to increased cancer risk, the association's briefing says.

"However, it has failed to acknowledge that production systems much closer to the wild are likely to produce meat with similar characteristics to wild animals.

"This is a serious omission, because in the absence of such a recognition economics are driving extensive producers out of business at a much faster rate than intensive ones.

"Meat and milk from predominantly grass-fed animals have other advantages too: higher levels of beneficial conjugated linoleic acid and many other important micro-nutrients associated with increased well-being," the Soil Association concludes.

March 2011

[Mustang Sally Farm]

Foot and Mouth Disease – Asia's Fastest Growing Challenge?
"FMD control has been an enduring priority globally and today presents the fastest growing challenge facing Asia," stated Dr Sacha Seneque of Merial Australia, at the 5th Asian Pig Veterinary Society Congress, held last month in Pattaya, Thailand, writes Stuart Lumb.

Efforts in pursuit of FMD control have had enormous political, financial and emotional impact. Dr Seneque cited the recent outbreaks in Korea and Japan as examples, in terms of the impact these two outbreaks have had on the respective countries. The current type O outbreak in South Korea is the worst in the country's history and and the most significant in the world since the the UK outbreak in 2001.

Many will remember the unprecedented media coverage and the concerns about how that outbreak was handled. When animal suffering and destruction are measured in millions of head and where the financial impact is measured in millions of UK pounds and where the social and emotional costs are inordinately high the quest to improve control efforts and minimise FMD's destructive impacts are worthy priorities.

FMD's impact is growing in Asia due to several factors:

The disease has greater negative effects on growing populations of improved and more efficient production animals
There is greater virus risk of virus spread due to increased movement of humans and livestock products
There is an increasing gap between the developed and developing countries in Asia.
The result is that we are faced with a situation where increased populations of concentrated and highly susceptible animals are having greater risks of being exposed to FMD virus (FMDV).

FMDV has a discrete range of serotypes (seven are known to exist) and several sub-types each with an ability continually to evolve and mutate, contributing to wide genetic and antigenic variation, plus the disease can be spread in widely ranging ways.

The epidemiology of FMD in Asia is influenced by a combination of factors, said Dr Seneque. This includes: variation in the virus strain; the consistency of effective control measures and new strain introductions (originating from distant outbreaks that are transmitted via animal movement or other mechanisms) to susceptible populations. Seasonal and cyclical periods of increased disease prevalence are observed, suggesting that there are factors that favour periods of increased transmission or host susceptibility that predispose epizootic risk.

The current state of play in Asia is as follows, regarding the distribution of FMD viruses, Dr Seneque continued. Today, serotypes O, A and Asia 1 are considered endemic in one or more of the FMD-affected countries in Asia, with type C having last been reported in the Philippines in 1995. Type O strains have been responsible for the most severe epidemics experienced in Asia, e.g. Taiwan in 1997 and Korea in 2009/10.

Virus Spread
It is accepted that the most important endemic mechanism of virus spread in Asia is by live animal movement, both within disease-affected countries and and across borders. This is largely driven by the economics of trade, explained Dr Seneque. Cattle, buffalo or pig movements are the source (or implicated) in most cases, and well documented trading patterns that reflect local demand have a high correlation to outbreak risk factors and disease 'hotspots' in the Indochina region.

In the absence of other possible sources, the many biosecurity failures observed over recent years suggest that people have been responsible for transferring FMD between farms. This may prove to be an important and underestimated transmission risk within this region.

Country/Zone FMD status
Classification with Zone 1 is given to those countries or regions that are FMD-free, where routine vaccination is not practised.

In Zone 2 are countries or zones where FMD is endemic. This group is subdivided into Zone 2a, i.e. areas where commercial livestock enterprises are not well developed, veterinary services may be weak and FMD cases are not uncommon, and Zone 2b, i.e. those that have well developed commercial sectors with interests in securing and developing the considerable premium trade opportunities that present with increased market access. These countries generally have well developed veterinary services.

Vaccination
In FMD-endemic countries, vaccines are often regulated to aid vaccination compliance aims and to ensure appropriate quality vaccines are used. In Asia, available FMD vaccines are routinely used in the vast majority of commercial herds (usually at the producer's motivation and expense) and today, more than 95 per cent of pigs in commercial units are vaccinated.

In FMD-free countries, routine use of FMD vaccination is banned (in compliance with OIE disease-free status requirements).

FMD vaccination limitations exist: vaccination with one FMD serotype does not confer cross-protection against other serotypes, plus vaccine efficacy may vary between isolates of the same FMD serotype if antigenic diversity is great.

Experiences and Challenges
Recent years have seen several regional countries secure 'Disease-Free' recognition that have required validation of disease freedom after disease, e.g. South Korea and Japan, eradication from an established endemic or outbreak situations, e.g. Philippines and Indonesia). Others, although not disease-free, have reduced outbreak prevalence to sporadic outbreaks, e.g. Taiwan, Viet Nam and Thailand, after successful implementation of comprehensive disease control initiatives.

Dr Seneque concluded that Asia has unique diversity that is relevant to trans-boundary disease movement risks, e.g. animal movement pathways. Add to this the dynamic socio-economic and urbanisation changes that can influence disease epidemiology and it could be viewed as inevitable that there will be FMD movement from endemic hot-spots or outbreak areas to neighbouring geographies.

FMD in South Korea: an Update
Dr Seneque gave an update on the current situation in South Korea. The outbreak started on 23 November 2010 and, within six weeks, it had spread over 60 per cent of the country. By the end of December, it was realised that slaughtering was ineffective and so ring vaccination was implemented, followed by blanket vaccination. By early March 2011, huge numbers of animals had been slaughtered, including 2.2 million pigs. The army is now involved with movement controls, disinfection and vaccination now implemented.

Water and soil contamination has occurred and meat consumption has dropped due to consumers' food safety concerns. It is estimated that 40,000 jobs have been lost in the countryside as a consequence of FMD, the animal population has dropped by 30 per cent and the outbreak has had serious ramifications as far as the tourism industry is concerned.

[Mustang Sally Farm]

World Agricultural Supply and Demand Estimates - April 2011
The forecast for 2011 red meat and poultry production is virtually unchanged from last month, according to the latest USDA World Agricultural Supply and Demand Estimates.

Wheat
US wheat ending stocks for 2010/11 are projected slightly lower this month reflecting a small increase in seed use. Higher planted area as reported in the 31 March Prospective Plantings raises projected seed use four million bushels. Small by-class changes are made for imports with Soft Red Winter (SRW) wheat raised five million bushels and Hard Red Spring and durum wheat together lowered an offsetting amount. The marketing-year average price received by producers is projected 10 US cents lower on each end of the range at $5.50 to $5.70 per bushel. Farm prices continue to be reported well below prevailing cash market bids indicating that farmers priced a substantial portion of this year’s crop well ahead of delivery.

Global 2010/11 wheat supplies are nearly unchanged as higher beginning stocks are mostly offset by lower world production. Production is lowered 1.3 million tons for Egypt as the latest reports indicate a sharp year-to-year drop in yields as unusual, early season heat affected pollination and reduced grain size. Production is raised 1.1 million tons for Iran on higher area.

Global wheat trade is projected higher with imports raised for Turkey, Indonesia, Morocco, Yemen, Egypt and Peru. Lower expected imports for Syria and Afghanistan are partly offsetting. Global exports are raised 1.1 million tons with 1.0-million-ton increases for both Australia and EU-27, and a 0.6-million-ton increase for Brazil. Exports are lowered 0.5 million tons each for Canada and Ukraine, 0.4 million tons for Pakistan and 0.3 million tons for Mexico.

Global 2010/11 wheat consumption is lowered 0.8 million tons reflecting small reductions in food, seed, and industrial use in a number of countries. Changes in wheat feeding are mostly offsetting with China raised 1.0 million tons and Pakistan and Egypt lowered 0.6 million and 0.4 million tons, respectively. Global ending stocks are projected 0.9 million tons higher.

Coarse Grains
US corn ending stocks are unchanged this month as a projected increase in corn use for ethanol is offset by a reduction in expected feed and residual use. Corn used to produce ethanol is raised 50 million bushels as strong blender incentives and positive ethanol producer margins continue to encourage expansion in ethanol production and use. Rising gasoline prices have pulled ethanol prices higher helping to offset increases in corn feedstock costs for ethanol producers.

US corn feed and residual use is lowered 50 million bushels as increased prospects for 2011 SRW wheat production and higher year-to-year corn plantings in the South reduce expected corn feed and residual disappearance during the second half of the 2010/11 corn marketing year. SRW wheat plantings are up sharply year-to-year with the 31 March Prospective Plantings report further increasing acreage in the SRW wheat states. A weighted average of early April crop conditions in the SRW states shows the highest percent of the crop in good-to-excellent condition in five years. Winter wheat conditions are especially favourable in Arkansas and North Carolina where wheat feeding is an alternative for poultry and hog producers. Cash and futures prices for SRW wheat have recently dropped below those for corn on a pound-for-pound basis creating opportunities for wheat to replace higher priced corn in feeding rations. Prospects for early new-crop corn usage ahead of September 1 are also increased with the largest intended southern corn plantings since 2007 and high expected summer corn prices.

Other 2010/11 US feed grain changes this month include higher feed and residual use and higher food, seed and industrial use for sorghum which boost expected domestic usage 15 million bushels. Sorghum exports, however, are projected 10 million bushels lower. Oats imports are raised slightly and feed and residual use is projected lowered leaving ending stocks up 18 million bushels. Price ranges for all the feed grains are narrowed five cents per bushel on each end. The season-average corn price is projected at $5.20 to $5.60 per bushel.

Global coarse grain supplies for 2010/11 are projected 6.3 million tons higher this month with a 1.8-million-ton increase in beginning stocks and a 4.5-million-ton increase in production. Higher corn and barley beginning stocks in Iran account for most of the increase in carry-in. Nearly half of the increase in coarse grain production reflects upward revisions to sorghum production in a number of Sub-Saharan African countries. Increases in millet production for countries in this same region add 1.4 million tons to global coarse grain output.

Global corn production is raised 1.2 million tons with the biggest increases for Brazil, Uganda and Paraguay. Production for Brazil is raised two million tons with higher reported area and yields for their primary summer crop and an increase in reported plantings for their winter crop. A 0.5-million-ton increase for Uganda corn is part of a number of revisions for African countries this month. Production for Paraguay is raised 0.4 million tons as favourable growing season weather boosted yields. Production is lowered 1.3 million tons for Indonesia and 0.5 million tons each for Egypt and South Africa.

Global 2010/11 corn trade is up slightly this month with imports raised 0.9 million tons for Indonesia and 0.5 million tons for China. The increase in expected China imports reflects the short-term decline in world corn prices in mid-March that created a buying opportunity for Chinese importers. No official confirmation of such purchases has yet been made. Corn imports are lowered 0.4 million tons for Canada based on the slow pace of US shipments to date. Corn exports are raised 1.5 million tons for Brazil and 0.3 million tons for Paraguay with increased production and supplies in both countries. Exports are lowered 0.5 million tons each for South Africa and Thailand. Global corn consumption is increased 3.1 million tons with increases in feeding for China, Brazil, and Thailand, and increased food, seed, and industrial use for China and for several African countries where corn is a food staple. Projected global corn ending stocks are lowered 0.7 million tons.

Rice
No changes are made on the supply side of the US 2010/11 rice supply and use balance sheets. On the use side, all rice domestic use and residual is estimated at 127.0 million cwt, still a record, but down 2.0 million from last month, but 4.4 million above 2009/10. All of the reduction is in long-grain rice now estimated at a near-record 99.0 million cwt.

Combined medium- and short-grain domestic use is unchanged at 28.0 million cwt. The changes in the 2010/11 domestic use and residual estimates are based largely on the March 1 Rice Stocks report released by the National Agricultural Statistics Service (NASS) on 31 March. NASS reported all rice stocks on a rough-equivalent basis at nearly 130.0 million cwt, up 17 per cent from a year earlier, and above trade expectations.

The all-rice 2010/11 export projection is unchanged at 116.0 million cwt; however, the rough-rice export projection is lowered 3.0 million to 39.0 million because of slower-than-expected sales and shipments to markets primarily in Central America. Conversely, the combined milled and brown rice export projection is raised 3.0 million cwt to 77.0 million (on rough-rice basis) due mostly to recent, large food-aid announcements. The 2010/11 long-grain export projection is raised 1.0 million cwt to 79.0 million, while the combined medium- and short-grain export projection is lowered the same amount to 37.0 million. The increase in the long-grain export projection is due mostly to an increase in the non-commercial portion of exports (virtually all long-grain rice) and the reduction in the combined medium- and short-grain export forecast is due to lower-than-expected exports to Taiwan. All rice ending stocks are projected at 54.8 million cwt, 2.0 million above last month, 18.1 million above the previous year, and the largest stocks since 1985/86. Long-grain and combined medium- and short-grain rice stocks are each raised 1.0 million cwt to 43.9 million and 9.4 million, respectively.

The combined medium- and short-grain 2010/11 price range is projected at $16.75 to $17.25 per cwt, up 50 cents on each end of the range from a month ago. The NASS February full-month combined medium- and short-grain rice price is up 60 cents from the February preliminary price. In addition, an unexpectedly large jump in the preliminary March farm price reported by NASS in Agricultural Prices at $20.30 per cwt is up 15 percent from the February full-month price. These two factors are largely responsible for the upward revision. The long-grain price range is projected at $11.05 to $11.55 per cwt, unchanged from last month. The rice by-class prices indicate an all rice season-average farm price for 2010/11 at $12.35 to $12.85 per cwt, up 10 cents per cwt on both ends of the range from a month ago.

Global 2010/11 rice production, imports and ending stocks are lowered from last month, while consumption is raised slightly. World rice production is reduced 0.8 million tons to 450.7 million based mostly on decreases for Indonesia, Iran, Laos, North Korea and Sri Lanka, which is partially offset by increases for Brazil and Colombia. Global imports for 2010/11 are lowered 0.8 million tons to 29.2 million due mostly to reductions for Malaysia, Madagascar, the Philippines and Thailand, which is partially offset by increases for some Sub-Saharan Africa markets. Additionally, global exports are lowered from last month owing to expected declines in shipments from mostly South American markets including Argentina, Peru and Uruguay. Global consumption is increased slightly based mostly on increases to a number of Sub-Saharan Africa markets. Global ending stocks are projected at 97.1 million tons, down 1.7 million from last month, but an increase of 3.3 million from 2009/10, and the largest stocks since 2002/03. The largest reductions in ending stocks occurred in Indonesia, the Philippines, and Thailand, which are partially offset by an increase for Brazil.

Oilseeds
US soybean exports for 2010/11 are projected down 10 million bushels from last month. The slower-than-expected shipment pace through March combined with increased export competition resulting from larger crops for Brazil and Paraguay leave US exports projected at 1.58 billion bushels. Although there are no changes in the US soybean meal supply and demand projections, the soybean crush is reduced 5.0 million bushels to 1.65 billion due to an increase in the meal extraction rate. Seed use is reduced to reflect plantings for 2011 reported in the 31 March Prospective Plantings report. Residual use is raised based on indications from the 31 March Grain Stocks report. US soybean ending stocks remain unchanged at 140 million bushels.

The US season-average soybean price range is projected at $11.25 to $11.75 per bushel, up 15 cents on the bottom and down 35 cents on the top of the range. Soybean meal prices are forecast at $340 to $360 per short ton, down $10 on the top of the range. The soybean oil price is projected at 53 to 55 cents per pound, up 1.5 cents on the bottom and down 0.5 cents on the top of the range.

Global oilseed production for 2010/11 is projected at 447 million tons, up 2.8 million tons from last month. Higher soybean, sunflowerseed and rapeseed production more than offsets lower cottonseed production. Global soybean production is increased 2.6 million tons to 261 million. Soybean production for Brazil is projected at a record 72.0 million tons, up two million from last month as ample moisture and favourable late-season weather in the southern states improved yield prospects. Soybean production for Paraguay is projected at 8.1 million tons, up 0.6 million, also based on higher yields. Global rapeseed production is raised 0.2 million tons to 58.6 million due to increased output in Russia. Global sunflowerseed production is projected higher as increased production in Argentina and Turkey more than offset reductions for India and Russia. Other changes include reduced cottonseed production for Pakistan and Turkey, and higher cottonseed production for Brazil. Malaysia palm oil production is reduced 0.5 million tons to 17.5 million due to lower-than-expected yields.

Global oilseed supplies and ending stocks for 2010/11 are projected higher this month while crush is reduced. Lower soybean crush, led by Argentina and China, is only partly offset by increased rapeseed crush, with the largest gains in Mexico, Pakistan, and United Arab Emirates. Global oilseed stocks are raised 2.5 million tons, with the largest gains for soybeans in Brazil and Argentina.

Livestock, Poultry and Dairy
The forecast for 2011 red meat and poultry production is virtually unchanged from last month as small increases in beef and pork production are largely offset by a slightly reduced forecast of broiler and turkey production. Beef production is forecast higher as higher cow and bull slaughter more than offsets slightly lower steer and heifer slaughter. Pork is forecast higher on slightly larger slaughter and higher-than-expected first quarter weights. Broiler and turkey production forecasts are reduced on moderating weight gains. The egg production forecast is reduced slightly as higher feed costs squeeze returns.

The forecast for beef exports for 2011 is raised from last month as the relatively weak dollar and economic growth in a number of countries support export growth. Conversely, the weakness in the US dollar and economic growth in other major importing countries will limit US beef imports. Thus, the forecast for beef imports is reduced from last month. The pork export forecast is unchanged from last month but imports are forecast slightly lower. Broiler exports are forecast lower on weaker expected demand.

Prices for livestock and poultry are raised from last month. Meat supplies remain tight and improving domestic demand and strength in red meat exports are supporting prices for livestock and poultry. Egg prices are forecast higher on the anticipated smaller production increase.

The milk production forecast for 2011 is reduced slightly from last month. Relatively high milk prices are being offset by high feed costs and only slight growth is expected in the herd for the remainder of the year. Fat-basis imports are lowered from last month but skim-solids imports are forecast higher. Both skim and fat-basis exports are raised largely on the strength of first-quarter butter, cheese and non-fat dry milk (NDM) sales.

Butter and cheese prices are forecast lower this month, reflecting recent price declines but NDM and whey price forecasts are raised. The Class III price forecast is lowered as the weaker cheese price more than offsets higher whey prices. The Class IV price forecast is raised as higher NDM prices more than offset the lower forecast butter price. The all-milk price is forecast to average $18.15 to $18.65 per cwt for 2011.

[Mustang Sally Farm]

Wednesday, April 13, 2011
New Agreement Eases China–Brazil Beef, Poultry Trade
CHINA & BRAZIL - The Presidents of the two countries have hailed a new strategic partnership as key deals and agreements have been signed on products including chicken, beef and bovine embryos and semen.

 


China pledged to diversify its trade with Brazil and boost imports from South America's biggest economy, as Brazilian President Dilma Rousseff began her debut presidential trip outside Latin America yesterday (12 April), according to official sources.

President Hu Jintao and Rousseff signed a joint communique, which included China's pledge to diversify trade, after talks at the Great Hall of the People. Both President Hu and President Rousseff praised the strategic partnership of the two countries.

Both countries agreed to promote the registration of Brazil's poultry and beef companies and vowed to quicken procedures to add new products onto their import and export lists.

The products include gelatin, corn, tobacco leaf, bovine embryos and semen and fruit from Brazil as well as fruit from China.

The two countries also called for the Doha trade talks to produce comprehensive and balanced results that address the concerns of the world's least developed countries, Xinhua said.

The Doha talks have stalled repeatedly since their start. Some countries earlier identified 2011 as a 'window of opportunity' and a chance to secure an agreement.

China and Brazil agreed to work more closely on reforming international financial and monetary systems under the G20 framework, the communique said.

Under the communique, both countries called for increased supervision to avoid new crises while working toward global economic recovery.

[Mustang Sally Farm]

Monday, April 18, 2011
Japan’s Compound Feed and Livestock Production
JAPAN - Since the earthquake and subsequent tsunami struck Japan on 11 March, surrounding Japanese feed millers have stepped up to fulfill the demand in the affected area, the US Grains Council’s Tokyo office reports.


“With the flow of compound feed from outside areas, combined with feed produced in some of the mills in the Tohoku area which were capable of working, livestock farms in the Tohoku area could get roughly half of its normal demand during the month since the earthquake,” said Hiroko Sakashita, USGC associate director in Japan.

While livestock in the Tohoku area are on a significantly reduced feed ration, a livestock expert informed the Council that animals will survive but will experience some growth reductions. Once feed supplies recommence, producers will resume normal feed rations for production and shipment and animals will mature.

“We have not heard devastating reports in regards to animal losses at large cattle, swine and chicken farms,” reported Ms Sakashita. “The livestock population in the whole country was not significantly impacted. Therefore there will be no significant reductions in feed demand.”

This takes into consideration the livestock operations that were forced to evacuate due to their proximity of the Fukushima nuclear power plant.

“The animal population within a 20 kilometer (13 mile) radius of the power plant was not significant to the total Tohoku area,” she said.

Transportation costs and power outages remain a concern for feed millers in the mid to long term. Ports are recovering but it is not clear when a Panamax-size vessel will be accepted into the affected area.

Japanese feed manufacturers submitted a letter of request to the Ministry of Land, Infrastructure, Transport and Tourism, which administers the ports, in an effort to secure a stable supply of compound feed and feed ingredients. The appeal included radioactivity declaration of safety of those ports and early accessibility recovery for Panamax-size vessels.

For mills in Kashima, which account for 15 per cent of Japan’s total compound feed production, some have recovered in volume of production and shipment to the level of before the earthquake, with reduced variety of compound. As a whole, all feed mills in Kashima expect to resume full production in the latter part of April or beginning of May.

[Mustang Sally Farm]

Thursday, April 21, 2011
NDRC Expects Food Prices to Stabilise
CHINA - China's consumer prices are likely to remain high in the second quarter of this year, but food prices, the main driver of the country's inflation, are predicted to stabilize, a senior official from the National Development and Reform Commission (NDRC) said on Wednesday.


Soaring prices for commodities in the international markets, including crude oil, iron ore, and grains, may continue to fuel the nation's inflation in the second quarter, said Zhou Wangjun, deputy head of the pricing department of the NDRC, the country's top economic planner.

"Food prices tended to be stable and some even declined in March, signaling the government's measures to rein in prices have taken effect," Mr Zhou said.

The nation's consumer price index (CPI), the main gauge of inflation, climbed to a 32-month high of 5.4 per cent in March, according to data from the National Bureau of Statistics (NBS).

Food prices, which account for about 30 per cent of the CPI basket, increased by 11 per cent in March from a year earlier, the same amount as the year-on-year rise in the first two months of this year, indicating a stabilizing trend, the NBS said.

The Chinese government has made stabilizing prices a key task in the first year of the 12th Five-Year Plan (2011-2015). The authorities have stepped up efforts to postpone price rises of utilities, increased support for grain producers and took administrative measures to control prices.

In March, vegetable prices fell by 6.2 per cent, egg prices by 7 per cent, and the price of aquatic products by 2.3 per cent, compared with a year ago, according to Zhou.

He said that industrial products in China are oversupplied, and food supply can "completely" satisfy consumers' demand. "The Chinese government has the ability to curb inflation," Mr Zhou said.

Zhu Hongren, chief engineer of the Ministry of Industry and Information Technology (MIIT), said on Wednesday that other than food prices, surging international raw-material prices are adding to the pressure of imported inflation in China, and this has been boosted by the quantitative easing policy in some major developed economies.

A report from the Chinese Academy of Social Sciences (CASS) said on Monday that the country's total grain output may increase to 550 million tons this year, from 546.41 million tons in 2010.

The output of oil seeds may increase by 2 per cent to more than 33 million tons in 2011 from a year earlier, and the output of meat is likely to grow by 3.5 per cent to at least 82 million tons, helping to counter food price increases this year, the CASS report said.

According to an NBS survey of more than 70,000 rural households, the planting area for grain was predicted to be 110.28 million hectares, 400,000 hectares more than that in 2010, the bureau said.

In the first three months of this year, the total output of pork, beef, mutton and poultry increased by 1.8 per cent year-on-year to 21.42 million tons, according to the data from the NBS released on 15 April.

[Mustang Sally Farm]

Friday, May 06, 2011Print This Page
Feed Additive Market Estimated at $19 Billion in 2016
GLOBAL - The worldwide animal feed additives market is estimated to reach US$18.7 billion in 2016, according to a new market report.


The report, Global Animal Feed Additives by Type, Livestock, Geography, Regulations Trends & Forecasts (2009-2016) from MarketsandMarkets (M&M) defines and segments the global animal feed additives market with analysis and forecasting of the global revenues for feed additives. It also identifies driving and restraining factors for the global feed additives market with analysis of trends, opportunities, and challenges.

The market is segmented and revenues are forecasted on the basis of major geographies such as North America, Europe, Asia, and Rest of the World (ROW).

Further market is segmented and revenues are forecasted on the basis of products such as antibiotics, amino acids, feed acidifiers, antioxidants.

The global feed additives industry has been in a higher growth trajectory from the last four years, according to the report. This growth is largely fuelled by the increasing meat consumption and rising concerns over meat quality and safety. Some of the major drivers of the global feed additives industry identified in this report are rise in global meat consumption, increasing awareness towards meat quality and safety, increasing mass production of meat, and recent livestock disease outbreaks. Major restraints identified in this report are regulatory structure and intervention, and rising raw material cost. Growth is particularly high in emerging countries such as China, India and Brazil due to increasing income levels and rising per capita meat consumption.

The report estimates the global feed additives market will reach $18.7 billion in 2016 with an expected CAGR of 3.8 per cent from 2011 to 2016. The Asian market is driving the sales and is expected to hold 28.5 per cent of the global market share in 2016. The Asian market is expected to have a high CAGR of 4.74 per cent due to increasing demand for meat products in the region, and rising domestic meat production. Europe is the leading market for feed additives, with 35 per cent share in 2011 resulting from higher regulatory concerns over meat quality and safety, and increasing per capita meat consumption. North America is the second largest market, with a share of 28.5 per cent in 2011; the US is the largest market with a share of more than 80 per cent.

Antibiotics is the leading demand generating product with a share of more than 27 per cent in 2011, followed by amino acid – 26.5 per cent share in the global feed additives market. The consumption of antibiotics is high due to increasing demand in Asian and Latin American regions to meet the high domestic and export demand for meat.

Scope of the report
This research report categorizes the global market for animal feed additives on the basis of product types, livestock, and geography; forecasting revenues, and analyzing trends in each of the following sub-markets:

on the basis of product types: antibiotics, feed acidifiers, amino acids, enzymes and vitamins
on the basis of materials: pork, sea food, cattle and poultry
on the basis of geography: North America (US and Canada), Europe (German, UK, France and Russia), Asia (China, India and Japan), and ROW (Brazil and Argentina)

[Mustang Sally Farm]

Wednesday, May 11, 2011
Agricultural Trade Reaches An All-Time High
GENERAL - Over the past year, agricultural trade has reached an all-time high, at least 12 per cent above the previous record set in 2008. The impact of the economic crisis led to a contraction of six per cent in 2009 but global agricultural exports rebounded by over 19 per cent last year.


The EU as well as the other top exporters all benefited from buoyant markets. Following the slump in 2009, the EU, the US and Brazil bounced back with over 20 per cent growth in exports, to reach record levels in 2010.

For the past three years, the EU and the US have been roughly neck and neck as the world's leading agri-food exporters.

In 2010 US exports reached an all-time high of €92 billion, just ahead of the EU's record €91 billion exports.

The EU remains by far the world's biggest importer with imports worth €83 billion in 2008-10, well ahead of the US. EU imports grew by nine per cent in 2010 though they remain five per cent below the peak of 2008.

US imports grew strongly by 17 per cent in 2010. China's meteoric growth in imports, surging by 47 per cent in 2010, means that it surpasses Japan as the third largest importer.

The EU's trade balance improved to the extent that it turned into a net exporter in 2010, for the first time since 2006. The €6 billion agricultural trade surplus is largely due to expansion in the value of exports, driven by stronger demand for final products, as the EU's trading partners came out of recession and higher prices for commodities and intermediate goods. Exchange rate fluctuations may also have contributed, given the weakening of the Euro against a number of major currencies in 2010.

The EU remains the biggest importer of agricultural products from developing countries, importing €59 billion worth of goods in 2008-10. This is far ahead of the US, Japan, Canada, Australia and New Zealand put together, whose combined imports from developing countries reached just €49 billion over this period.

The US reached a record agricultural trade surplus of €27 billion with the value of exports up by 24 per cent to an all time high. Brazil also saw record exports and growth of 23 per cent despite the strengthening of the Real against the US$, potentially damaging its competitiveness on global markets.

The recovery of the markets of some major importers is witnessed by the sharp growth in imports; Russia's imports rebounded by 26 per cent, despite continued market access restrictions for poultrymeat while China's imports surged by 47 per cent.

The prosperity of overseas markets is a key factor in determining opportunities for EU businesses. Trade growth now appears to be back on track after the exceptional decreases in 2009.