Milling & Baking News - December 30, 2003 - 41

I N G R E D I E N T

more users did not take advantage of the
dip in prices, given the uncertainties over
U.S. soybean supply in the final months
of the marketing year. But it seemed that
buyers were postponing consideration of
significant purchases until after the winter holidays. Most business last week was
in the form of fill-ins.
It was estimated that 50% to 60% of
prospective soybean oil business for the
first quarter of 2004 already was on the
books. Second-quarter coverage was estimated at no more than 20%.
Cash premiums on soybean oil have
eased in the past couple of weeks but remained historically strong. Oil yield from
the soybean crush remained somewhat
disappointing, which provided some underlying support to the cash basis.
Prices of canola oil, cottonseed oil and
sunflowerseed oil followed soybean oil
prices lower. Peanut oil remained exceptionally firm. Bucking the downtrend,
corn oil moved up partly on expansion in
export demand.
Lard and edible tallow prices were
steady, but the end of the holiday baking
season could encourage some weakness
in those markets in the weeks ahead.
Palm oil prices weakened reflecting
the softening in the markets for vegetable
oils and expectations for an increase in
world palm oil stocks.
Domestic shipments slowed during
the holiday-shortened week. MBN

Soy Flour
Bookings of soy flour were very light
last week. Price changes were erratic.
It seemed as though principal users of
soy flour, including bakers, were postponing consideration of major contract
extensions until after the winter holidays.
Virtually no significant business transpired last week. Manufacturers were
closed only for two days to mark the
Christmas holiday.
Manufacturers cautioned that prices
could be volatile and likely much higher
next summer and that thought should be
given to taking at least partial coverage
through old crop at current levels. U.S.
soybean exports have been very strong,
with China a particularly heavy buyer.
China demand was expected to remain
strong, and U.S. soybean stocks were expected to remain tight.
A few wary users have extended contract balances into the summer months.
For most, the decision on how to approach covering 2004 needs won't be
confronted until at least January. MBN

Corn Meal
Sales of corn meal were brisk last week,
though shipments were scaled back to
account for extensive holiday downtime
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being taken by several large breakfast cereal and snack food plants. Prices fell.
Demand for flaking grits from breakfast cereal manufacturers was strong. The
cereal makers also pressed orders for the
more finely granulated grits used in the
production of extruded products, including cereals used in party mixes. Snack
meal volume remained heavy. Brewer's
grits sales were seasonally sluggish.
Demand for corn flour could not keep
up with supply. Corn mills have been
running heavily in recent weeks. And the
2003 crop was producing more flour per
bu ground than was the case with the
2002 crop.
Corn mills took only minimal holiday
downtime last week, running about five
days or even 5½. MBN

Corn & Soy Futures
Wide declines were sustained in corn
futures prices last week. The market
opened the week softer and then
slumped ahead of the holiday break on
news that a slaughtered Washington
state Holstein cow had tested positive for
bovine spongiform encephalopathy, or
"mad cow disease."
Wide losses were sustained in soy
complex futures prices during the first
two sessions of the holiday-shortened
week on heavy selling by commodity
funds. Prices dropped further in early
Wednesday trading in sympathy with
corn but rallied in subsequent trading.
Late-week strength was attributed to
ideas that domestic demand for soybean

Spot Soybean Oil

W E E K

meal could expand should the use of
meat meal and bone meal as feed for
poultry and hog operations be banned in
the wake of the developing "mad cow
disease" scare. Such items already are
banned as feed for cattle. Export demand
for U.S soybeans remained strong. MBN

Oats
Bookings of food grade oat flakes were
very light last week. Prices were unchanged.
Most buyers were out of offices for the
holidays. Some of those who remained
behind their desks inquired about pricing deep into 2004, but no significant business was done as a result. Last week's
transactions were limited to fill-ins.
Shipments waned as several breakfast
cereal plants began holiday-related
downtime that for some would include
both holiday weeks. Oat mills ran heavily
up until midday Christmas Eve.
The pace of business was expected to
pick up crisply after New Year's as the
peak season for hot breakfast cereals was
in full swing. MBN

Sweeteners
Sweeteners markets were extremely
quiet last week. Activity was so light that
most processors either did not quote
prices or left them unchanged with no
intention of trading. As one trader said,
"We're closed for the holidays."
There was discussion about the newly
signed U.S.-Central America Free Trade
Agreement, which was widely thought

Oats

Decatur, Ill., bulk cents per lb
Dec. 26

Week's
change

Oat flakes, food grade, f.o.b.
Minneapolis, bagged, $ per cwt 18.75@19.25
Milling quality oats, No. 2 heavy,
delivered Minneapolis, $ per bu
1.631/2
Oat screening, clean out,
oats unground, $ per bu
.80@1.10
Oat hull, ground hulls only, $ per ton 10@15

-
-7
-
-

Spot Shortening
Bulk, cents per lb

Chicago Soybean Oil Futures
Bulk in tank cars, cents per lb
Dec. 26
Week's
Delivery
close
change
January
27.84
-0.21
March
27.70
-0.19
May
27.49
-0.18
July
27.22
-0.14
August
26.70
-0.25
September
26.10
-0.32

Year
ago
21.37
21.41
21.25
21.10
20.90
20.70

Dec. 26
Soybean oil, Decatur
29.50
Loose lard, Chicago
25.50
Edible tallow, Chicago
29.50
Cottonseed oil, Miss. PBSY 34.25
Palm oil, ports
26.25
Palm kernel oil, ports
30.50
Coconut oil, West coast
28.25
Peanut oil, Southeast
65.00
Corn oil, Decatur
30.00
Sunflowerseed oil, Midwest
31.25
Canola oil, Midwest
32.75

Week's
change
-.25
-
-
-.75
-.50
-.50
+1.25
-
+1.00
-.50
-.75

Milling & Baking News, December 30, 2003 / 41

Year
ago
22.75
19.50
20.50
...
23.75
26.75
23.75
45.00
30.00
33.00
31.50

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Milling & Baking News - December 30, 2003

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