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2011 Cottonseed Prices: January

Cottonseed Supply/Demand Balance Sheet(000 tons)
Yrs beg Aug 1

USDA

USDA

Jan. / CSD

Jan. / USDA

Jan. / CSD

 

2007/08

2008/09

2009/10E

2010/11F

2010/11F

Beg. Stocks

489

643

514

342

342

Imports

3

0

24

0

0

Production

6589

4300

4149

6191

6210

Total Supply

7080

4943

4687

6533

6552

Crush

2706

2240

1900

2500

2520

Exports

599

191

291

350

370

Feed, Seed, & “Other”

3132

1999

2154

3204

3225

Total Disappearance

6437

4429

4305

6090

6115

End Stocks

643

514

342

443

437

COTTONSEED fob points
Prices 1-14-11Bid / Offer / TradeYr Ago
Southeast($/ton)

No. Carolina

Spot

207-208o / 208t

207o

 

Fb-Ag

210b / 216o

n/a

So. Carolina

Spot

208o

211o

 

Ja-Ag

216o

n/a

Georgia So.

Spot

195b / 200o / 195t

207o

 

Fb-Mr

195b / 202o

n/a

 

Fb-Ag

200b / 207o

n/a

Mid-South($/ton)

Memphis No.

Spot

230o / 225t

220-225t

 

JFM

227b / 230o

n/a

 

Ja-Ag

230b / 235o

235o

MO Bootheel

Spot

232o

225o

 

Fb-Mr

228o

235t

Southwest($/ton)

West Texas

Spot

230-235o

228-230o

 

Fb-Mr

235o

235o

 

Ap-Sp

240-245b / 250o

240-242o

Far West($/ton)

Arizona

Spot.

270t

260o

 

Fb-Mr

280o

n/a

Cal. Corc. N

Spot

308-310t

295-300o

& Stockton

Ja-Sp

310b / 325o

n/a

 
Specially Processed Products($/ton)

Easi Flo ™ Courtland, AL

Spot

260o

263o

FuzZpellets ™ Weldon, NC

Spot

n/a

265o

Cotton Flo™ Weldon, NC

Spot

n/a

265o

 
 
b = bid o = offer t = trade n/a = not available

COTTONSEED dlvd. points
Prices 01-14-11DumpHopperLive FloorRail
Northeast($/ton)

W. New York

Spot

258o

 

 

 

 

Fb-Ag

268o

   

SE Pennsylvania

Spot

258o

 

 

 

 

Fb-Ag

268o

   
NE Ohio

Spot

258o

   

 

Fb-Ag

268o

 

 

 

Midwest($/ton)

MI (Grand Rpds.)

Spot

268o

 

 

 

 

Fb-Ag

278o

 

 

 

MN (Rochester)

Spot

 

279-280o

281-285o

 

 

Ja-Ag

 

283-290o

290-295o

 

WI (Madison)

Spot

 

271-274o

276-279o

 

 

Ja-Ag

 

273-279o

282-285o

 

Southwest($/ton)

Texas / Dublin-

Spot

 

245o

 

 

Stephenville

Ja-Sp

 

268o

  
Rail - fob track points($/ton)

Laredo TX

(Mid-Bridge)

JFM

 

 

 

295o

California

Spot

 

 

 

n/a

Idaho (UP)

Spot

 

 

 

305t

 

Fb-Mr

 

 

 

310t

 

Ap-Sp

 

 

 

320o

WA/OR (BN)

Spot

 

 

 

315o

 

Fb-Sp

 

 

 

317t

b = bid o = offer t = trade n/a = not available

Cottonseed Dairy Buyer Profiles

GROUP 1: Base demand group that will formulate cottonseed in at a 4-6 lb. inclusion rate regardless of price.
GROUP 2: Formulates at a 2-3 lb. inclusion rate regardless of price, and would like to feed at the 4-6 lb. level. However, the last 2-4 lb. is price sensitive.
GROUP 3: This is the major swing factor for cottonseed demand. They enter the market when the price is right or other factors prevail (i.e. short hay supplies), and will subsequently exit when other opportunities exist.
GROUP 4: This group does not have access to, or the ability to incorporate whole cottonseed into their rations. However over time, dairymen in this group will migrate up into Groups 1, 2 or 3.




GINNING REPORT: The runningbales ginned total at the beginning of the year was 16.4 million bales. This is an increase of 1.3 million bales compared to the previous report accounting for the first half of December. The total is 29% higher than the 3-year average for this time of year, which will drift lower as ginning in the past couple years were late. This is the first report since October where the increase of bales ginned for Texas was below a million bales. During the last two weeks of December Texas had a running-bales ginned total of 842,750 bales. The pace of ginning will continue to slow, yet over a million bales of cotton have yet to be ginned.

Running Bales Ginned Totals as of 01/01/11 Compared to 3-year Averages for the period

COTTONSEED MARKET: Cottonseed prices had a modest reaction to the futures rally in Chicago following the release of USDA’s production and ending stocks reports. Buying interest was slow coming around to higher price ideas. Meanwhile, those that have supplies to sell are willing to wait and see how high prices will rise before getting serious about selling.

In the California market prices climbed following the price strength in West Texas. Resellers were seen as the most serious buyers in the market following the report. By the end of the week there were some end users showing interest in booking forward supplies, which hasn’t been the case for the past few months. It appears that some are trying to get on board with cottonseed before other ingredient prices climb higher.

Nearby West Texas offers climbed over $30/ton since our last installment, and as in the past, local end users are not active buyers. Forward offers were raised as well but several dollars less than the spot market. There was some end user buying interest that came in and took on ownership through September. Compared to the strength in Chicago futures, forward quotes could be a reasonable price for end users.

In the Mid-South trading activity has been light, yet prices have firmed. Gins are not agressive sellers for the nearby or forward positions. They are seeing the possibility for additional upward price momentum and are willing to ride things out in hopes of getting more for the seed they have yet to sell. Oil mills in the region continue to pay the going nearby price, which provides price support. It appears that crushing economics will continue to support cottonseed prices. Seed quality has been good thanks to dry harvest and ginning conditions and this will keep supplies in good condition for crushing or sale into the feed market later in the year. Such a situation should be favorable for oil mills that have a large cottonseed ownership position.

In the Southeast prices have climbed. Ginning activity in Georgia continues to wane, which is aiding the development of a bullish market. By the end of the month, ginning should be completed in Georgia. Recent winter storms have also limited the movement of supply. However, given the below average temperatures, it should drum up new demand. The only problem is that the demand is coming to the market slower than what traders have anticipated.

COTTONSEED BALANCE SHEET: USDA raised cottonseed production by 36,000 tons compared to their balance sheet last month. The increase is inline with an increase to their cotton production. Exports were lowered 100,000 tons. The Feed, Seed and Other category picked up the changes climbing 136,000 tons. Compared to last year, this has climbed over a million tons. At this point in the crop year, changes to the balance sheet are apt to be less dramatic.

The Cottonseed Digest balance sheet had a 20,000-ton offsetting change from exports to the Feed, Seed and Other category. Merchants have mentioned that export buying interest, especially off the East Coast, has been lighter this year compared to last year. There have been some recent improvements in milk prices, which provide hope that there will be a turn around in the demand situation from the dairy sector. If grain prices continue their rally, certainly cottonseed at current prices would appear to be priced competitively and will win its way back in to dairy rations. The most recent export data through November was larger than the year ago by over 5,000 tons, yet the accumulative total for the year is down roughly 7,000 tons. A wildcard for exports is the flooding in Australia that could limit their availability of cottonseed for the world market and bring some buyers back to the US.










For weekly cottonseed pricing and commentary contact:

James Bueltel
Senior Analyst/Editor
Informa Economics, Inc.
3464 Washington Drive, Suite 120
Eagan, MN 55122
Direct: 651-925-1052
Main: 651-925-1060
Fax: 651-925-1061
james.bueltel@informaecon.com
www.Informaecon.com


Every effort has been made to assure the accuracy of the information and market data which is provided in this publication as a compilation for the use of its readers. Information has been obtained by Informa Economics, Inc. from sources believed to be reliable. However, because of the possibility of human or mechanical error, Informa does not guarantee the accuracy, adequacy or completeness of any information and is not responsible for any errors or omissions or for the results obtained from the use of such information.

Published by Informa Economics, Inc., 3464 Washington Drive, Suite 102, Eagan, MN 55122-1438.

 

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