Commodities, Business & Shipping

The floating rig market has long since crossed an inflection point incentivising the reactivation of cold-stacked tonnage, yet operators remain disciplined in their approach, according to new research by Maritime Strategies International (MSI).

The International Transport Intermediaries Club (ITIC) – a mutual insurer that provides professional indemnity cover for transport intermediaries operating in the marine, offshore, renewable and aviation industries – is warning stakeholders to ensure measures are in place to cover additional financial obligations when settling unforeseen invoices.

In the latest edition of its Claims Review, published bi-annually, ITIC shared a case study where a ship was arrested to force the ship owner to compensate their agent for unpaid debts for a tug owner’s services during previous rescue efforts of a different ship within its fleet.

LONDON, July 20 (Reuters) - Rapid demand growth as a result of the energy transition could lead to a shortage of several metals in the next decade unless investment is increased, a global group of energy producers, consumers and financial institutions said.

Large supply gaps for lithium, nickel, graphite, cobalt, neodymium and copper could lead to higher prices and delay the goal of reaching net-zero emissions by 2050, the Energy Transitions Commission (ETC) said in a report.

ST PETERSBURG, Russia, July 20 (Reuters) - Russia's successor to McDonald's has teamed up with energy company Gazprom Neft (SIBN.MM) to fuel marine vessels with biofuel produced using waste cooking oil an effort to lower their carbon footprints, the companies said on Thursday.

Russia has said it was still committed to its climate targets despite the deepest political rift with the West in decades. Biofuels are widely considered to be less harmful in terms of emissions than conventional fuels.

Tankers Seized by US & Iran | US Enforces Freedom of Navigation in Persian Gulf but not Black Sea​

Jul 21, 2023
16:17

In this episode, Sal Mercogliano - maritime historian at Campbell University (@campbelledu) and former merchant mariner - discusses the difficulty the US is experiencing in offloading the seized tanker Suez Rajan, the actions of Iran in grabbing tankers, and Central Command being reinforced to ensure the Freedom of Navigation of the Strait of Hormuz.

00:00 Introduction
00:52 Iranian Seized Oil Stuck on Tanker off Texas
04:12 Background to Seizure of Suez Rajan by US
08:50 Tanker War in the Persian Gulf in the 1980s
10:00 US Defending Freedom of the Seas in the Persian Gulf
11:57 US NOT Defending Freedom of the Seas in the Black Sea
14:06 Conclusion

- Black Sea Grain Ends | Ukraine Proposes A Temporary Maritime Route | Russia Declares a Danger Zone • Black Sea Grain E...
- WSJ: Texas Lightering Firms Too Scared of Iran to Touch Seized Cargohttps://www.maritime-executive.com/ar...
- US Confiscation of Iranian Oil Cargo Preceded ‘Advantage Sweet’ Tanker Seizurehttps://gcaptain.com/us-confiscation-...
- Iran Seizes Another Tanker in Strait of Hormuzhttps://gcaptain.com/iran-seizes-anot...
- Iran Seizes Merchant Tanker in Gulf, U.S. Navy Sayshttps://gcaptain.com/iran-seizes-merc...
- U.S. Seizes Four Iranian Fuel Cargoes En Route to Venezuelahttps://gcaptain.com/u-s-seizes-four-...
- U.S. Seizes Iranian Oil Cargo Near Greek Island -Sourceshttps://gcaptain.com/u-s-seizes-irani...
- U.S. Navy Says it Prevented Iran from Seizing Tankers in Gulfhttps://gcaptain.com/u-s-navy-says-it...
- Pentagon Sending More Forces to Protect Shipping Against Iranian Threatshttps://gcaptain.com/pentagon-sending...
- Russia Issues Warning to Ukrainian-Bound Shipshttps://gcaptain.com/russia-issues-wa...
- Russia Says It Has No Plans to Attack Civilian Ships in Black Seahttps://gcaptain.com/russia-says-it-h...
- US Navy Backs Away From Ukraine’s Proposal To Protect Grain In NATO Watershttps://gcaptain.com/us-navy-backs-aw...

Dry weather drives cattle liquidation: Weekly Livestock Market Update for 7/21/23​

Jul 21, 2023

17:30

- This week in the markets – Live fed cattle prices were up $3.75 on the week, and feeder cattle prices were $1.00 to $4.00 higher this week. August live cattle were down $0.50 on the week, and August feeder cattle were down $0.70 on the week as September corn futures were up $0.21 this week. Choice box beef was down $5.90 this week and stands $34.25 above the year-ago level. Cash hogs were up $1.80 this week. August lean hog futures were up nearly $5.00 on the week. Pork cutout values were up $2.90 this week on strong bellies.
- Weekly Slaughter Numbers – At the end of the week, cattle slaughter was 628,000 head, down 5,000 on the week and down 35,000 for the year. Hog slaughter was 2.316 million head, that's down 12,000 from the previous week and up 21,000 on the year. Year-to-date cattle slaughter is down 3.7%, while hog slaughter is up 1.2%
- Livestock Slaughter – June 2023 beef production was 2.3 billion pounds, 4.9% below the year-ago level. Year-to-date beef production trails last year's level by 4.0% due to lower weights and reduced slaughter. June 2023 pork production totaled 2.2 billion pounds, 2.4% below the year-ago level. January through June pork production is 0.9% above the same period last year.
- July Cattle Report – All cattle and calves inventory was 97.3% of a year ago as dry weather continues to drive liquidation in many parts of the country. Beef cow inventory contraction is continuing as the report shows current inventory is 97.4% of a year ago. Beef heifers replacements were 97.6% of a year ago. The report came in near the midpoint of pre-report estimates.
- Cattle on Feed – Cattle on Feed, July 1, was 98.2% of a year ago. June cattle placements were 102.7% of a year ago and at the upper end of the pre-report estimates. The percentage of heifers on feed grew to 39.9% this quarter, another sign that beef cow inventory will continue to move lower.
- Next week's reports – Cold Storage

Markets Now: Closing Markets -7-21-23​

Jul 21, 2023

9:09

Grains mostly lower except old crop soybeans on profit taking & hedge selling. Grains had a higher but volatile week trading war and weather headlines but what's next? Dow hits new highs for the year. What does mean for money flow into the ag commodities? Tommy Grisafi, Advance Trading shares insight.

Heat, War and Export Bans: Global Food Threats Are On the Rise​

By Agnieszka de Sousa, Flavia Rotondi and Tarso Veloso

(Bloomberg) –As scorching temperatures ravage farms from the US to China, crop harvests, fruit production and dairy output are all coming under pressure. That extreme weather is just one of threats to food supplies that are once again mounting around the world.

This week, top rice exporter India banned some shipments of the commodity – a staple for about half of the world’s population — to keep domestic prices in check. Russia quit a deal that allowed Ukrainian grain to flow safely across the Black Sea.

On top of that is the recent arrival of the El Niño weather pattern that may cause further damage to agriculture.

All of this is renewing concerns about food security and prices, creating a risk that rampant inflation on supermarket shelves will stick around for longer. That would be a fresh blow to consumers, who were just starting to see some better news after a long-running squeeze on household budgets.

More:

FRANKFURT/LONDON, July 26 (Reuters) - German industry is finding new ways to transport cargoes from coal to chemicals as increasingly frequent low water levels on the Rhine disrupt Europe's largest economy.

The 1,230 km (764.29 miles) river, a world famous tourist destination and a part of the national psyche, is the commercial artery for 80% of the German economy's inland shipping of goods, including crude oil and natural gas.

The Commodities Feed: All eyes on the Fed​

The Federal Reserve is expected to raise rates by 25bp today, and markets will be on the lookout for any signals suggesting this could be the central bank's final hike or whether there could be more still to come

Crop markets fixed on Black Sea region again: Weekly Commodity Market Update for 7/26/23​

Jul 26, 2023

14:25

Market recap (Changes on week as of Monday's close):
- September corn up $.49 at $5.48
- December 2023 corn up $.50 at $5.56
- August soybeans up $.20 at $15.04
- November soybeans up $.28 at $14.06
- August soybean oil up 6.14 cents at 70.90 cents/lb
- August soybean meal up $13.10 at $447.50/short ton
- September 2023 wheat up $.92 at $7.45
- July 2024 wheat up $.65 at $7.64
- June WTI Crude Oil up $4.34 at $78.37/barrel

Weekly Highlights
• US energy stocks were mostly steady week over week on slightly higher gasoline demand. The one exception was ethanol stocks up 21 million gallons or 2%. Ethanol production increased 12 million gallons on the week to the largest volume of the second largest volume of the marketing year.
• Last week’s agricultural export sales volumes for the current marketing year were mixed. Corn and soybeans were on the lower end of expectations, soybean oil and wheat were below all pre-report estimates, but grain sorghum experienced the second largest weekly volume since last September due to China.
• Open interest positions increased across the board: Chicago Wheats (+4.6%), corn (+2.4%), soybeans (+6.5%), soybean oil (+0.3%), soybean meal (+3.2%), cotton (+1.5%), and rough rice (+1.7%).
• Futures and option position trading was pretty active on the week. Producers and merchants increased their short corn position 13,316 contracts while managed money traders shrank their short position. The same was true for soybeans with an additional 7,673 short positions for producer and merchants while managed money traders bought 13,066 positions to add to their net long.
• USDA reported Cattle on Feed as of July 1 to be 98.2% of last year and above the trade’s estimate of 97.7%. The higher number than expected was due to higher than anticipated June placements, which were 102.7%. Marketings were as expected. All cattle and calves in the US of 95.9 million heads was 3% lower than a year ago.
• Russia attacked Ukraine grain export terminals along the Danube River Monday morning- signaling that the war has shifted to an environment where Russia is actively trying to prevent Ukrainian agricultural exports.
• Weekly agricultural export inspections were mixed- corn was down week over week while soybeans, sorghum and wheats were all up. Wheat volumes exceeded all pre-report expectations.
• US corn conditions were flat on the week when the trade was expecting a little increase. Cotton conditions improved slightly and while not good remain well above conditions experience last year. Soybean, and spring wheats conditions all deteriorated a little on the week.
• 68% of the US winter wheat crop has been harvested compared to 75% at this time last year and a three-year average of 77%.

Fremantle Highway Catches Fire and Is Abandoned in the North Sea | At Least 1 Dead​

Jul 26, 2023

16:02

In this episode, Sal Mercogliano - maritime historian at Campbell University (@campbelledu) and former merchant mariner - discusses the fire on board the car carrier Fremantle Highway in the North Sea after the ship departed Bremerhaven for Asia, via the Suez Canal on July 25, 2023.

00:00 Introduction
00:42 Current Situation
03:42 Fremantle Highway Specifics
05:48 Past Car Carrier Fires
08:00 Ship Schedule
09:19 Safety and Shipping Review
11:00 Lithium Ion Batteries and Newark Fire

One Dead as Major Fire Rips Through Car Carrier in North Seahttps://gcaptain.com/major-fire-rips-...
One dead and several injured in major fire onboard car carrierhttps://splash247.com/one-dead-and-se...
Marine Traffic - Fremantle Highway https://www.marinetraffic.com/en/ais/...
K-Line Schedulehttps://www.klineglobalroro.com/sched...
Allianz Safety and Shipping Review 2023https://commercial.allianz.com/news-a...

Markets Now: Closing Markets 7-28-23​

Jul 28, 2023

9:39

Grains end lower as funds sell removing weather premium. Corn and soybeans do chart damage and have lower weekly closes. Wheat ends higher for the week still holding some war premium. Cattle supported by lower corn and feedlots holding out for higher cash, but post lower weekly closes. While the cash index keeps pulling along hog futures and August has a chart breakout. John Heinberg, Total Farm Marketing has analysis.

Beef in cold storage down 20.3% on the year: Weekly Livestock Market Update for July 28, 2023​

Jul 28, 2023

13:13

* This week in the markets – Live fed cattle prices were up $0.40 on the week with light trade through Friday morning, and feeder cattle prices were steady to $3.00 lower this week. August live cattle were down $1.60 on the week, while August feeder cattle were unchanged on the week. Choice box beef was down $0.75 this week and stands $35 above the year-ago level. Cash hogs were up $2.00 this week. August lean hog futures were up $2.35 on the week. Pork cutout values were up $0.60 this week on strong bellies.
* Weekly Slaughter Numbers – At the end of the week, cattle slaughter was 619,000 head, down 5,000 on the week and down 47,000 for the year. Hog slaughter was 2.392 million head, up 76,000 from the previous week and up 100,000 on the year. Year-to-date cattle slaughter is down 3.9%, while hog slaughter is up 1.3%
* Cold Storage – Beef in freezers at the end of June was 411.9 million pounds, down 20.3% relative to a year ago. Freezers contained 490.2 million pounds of pork at the end of June, 9.1 percent below a year ago. Belly stocks were 32.7 percent above a year ago. Beef and pork stocks have moderated through the first six months of this year.
* Next week's reports – Restaurant Performance Index, Jobs Report, and Land Values

Yellow, the third-largest less-than-truckload company that’s in the midst of financial chaos, said in a memo to laid-off, nonunion employees viewed by FreightWaves that the company is “shutting down regular operations” on Friday.

All locations will be closed and/or lay off some number of employees. As the memo stated:

“We regret to inform you that your employment with Yellow Corporation, or one of its subsidiaries, (collectively referred to as the ‘Company’) will permanently terminate on July 28, 2023, or within 14 days after (the ‘Separation Date’). The Company is shutting down its regular operations on July 28, 2023, closing and/or laying off employees at all of its locations, including yours (the ‘Shut Down’).”

The company on Friday morning laid off an unknown number of office employees, most of which were nonunion. It said in a memo to the laid-off employees that it was unable to alert them previously of this closing of business “because the Shut Down was not reasonably foreseeable.”

More:

^^^^^^^

IBT MEMORANDUM RE: Yellow Corp. – July 27, 2023​

Faster Trade Winds: Tianjin Port to South America Direct Shipping Route Opens​

Revolutionizing Global Trade​

Global trade is set to experience a significant transformation as a direct shipping route from Tianjin Port in North China to South America was recently inaugurated. With the anchoring of a container ship, this new development marks a significant milestone in international commerce. The route will be served by nine 35,000-tonne container vessels operated by the maritime company, Wan Hai Lines, ensuring a consistent and reliable transport system. Notably, the vessels will make stops at major ports in Mexico, Panama, Columbia, and Ecuador, promoting connectivity and trade between these diverse regions.

More:

The Commodities Feed: Supply tightness could support copper​

Rising interest rates likely to impact ag for years​

Aug 1, 2023

15:23

Market recap (Changes on week as of Monday's close):
- September corn down $.49 at $5.04
- December 2023 corn down $.43 at $5.13
- September soybeans down $.83 at $13.70
- November soybeans down $.75 at $13.31
- September soybean oil down 5.10 cents at 63.11 cents/lb
- September soybean meal down $6.60 at $423.80/short ton
- September 2023 wheat 80 $.80 at $6.65
- July 2024 wheat down $.73 at $6.91
- June WTI Crude Oil up $3.51 at $81.88/barrel

Weekly Highlights
• Finally, one part of US corn demand is showing some life. US weekly ethanol production rose to a 28-month high last week at 322 million gallons.
• The Federal Reserve raised interest rates by a quarter of a percentage point on Wednesday, citing still elevated inflation as a rationale for what is now the highest US central bank policy rate in 16 years.
• Weekly US agricultural export sales were neutral last week with corn, soybeans and collective wheats up week over week. Sorghum was down week over week. Everything was within expectations.
• Open interest positions were down for corn (-2.8%), soybeans (-0.5%), soybean oil (-6.6%), and soybean meal (-0.1%) while being up for cotton (+11.5%), and rough rice (+15.3%).
• In the wake of renewed Russian attacks in Ukraine money managers bought back 73,529 positions of Chicago corn giving the commodity a net long while producers and merchants were sellers of 47,896 contracts. Managed money traders added 24,925 positions to their already long position while producers and merchants sold another 33,410 positions.
• US agricultural export inspections were on the higher end of all expectations and relatively strong compared to recent weeks. Wheat exports exceeded all pre-report expectations.
• US crop conditions largely fell more than market traders had expected this week. Corn and soybeans were down 2% while spring wheat was down 7% all compared to an expected 1% week over week decline, cotton fell 5%.
• 80% of the US winter wheat crop has been harvested compared to 81% at this time last year and a three-year average of 83%.

• Yellow Corporation's recent bankruptcy raises concerns about macroeconomic headwinds across the North American freight industry.
• Transportation companies are struggling with increasing labor costs due to pilot and trucker driver shortages, with those pressures unlikely to end without a significant economic slowdown.
• FedEx has benefited from the decline in fuel costs since 2022, but that pressure may soon rebound due to growing energy market issues.
• FDX's valuation has risen dramatically over the past year despite a significant negative trend in its sales and operating margins, indicating irrational exuberance.
• While FDX may be a short opportunity today, it could eventually benefit greatly from AI and automation technology, potentially improving its long-term (i.e, 2030s) profit potential.

The U.S. farm real estate value gained 7.4% in 2023: Weekly Livestock Market Update for 8/4/23​

Aug 4, 2023

13:28

• This week in the markets – Live fed cattle prices were up nearly $1.00 on the week, and feeder cattle prices were mostly steady this week. October live cattle were up $3.50 on the week, and October feeder cattle were up $4.40 on the week. Choice box beef was down $0.35 this week and stands $35.40 above the year-ago level. Cash hogs were down $0.60 this week. October lean hog futures were down $1.80 on the week. Pork cutout values were up $0.45 this week on strong bellies.
• Weekly Slaughter Numbers – At the end of the week, cattle slaughter was 61,000 head, down 6,000 on the week and down 35,000 for the year. Hog slaughter was 2.338 million head, down 54,000 from the previous week and up 3,000 on the year. Year-to-date cattle slaughter is down 3.9%, while hog slaughter is up 1.3%.
• Land Values – The U.S. farm real estate value gained 7.4% in 2023 relative to 2022, rising to $4,080 per acre. Cropland values were 8.1% higher and pasture land values were up 6.7%
• Jobs Report – The jobs report showed that 187,000 jobs were added in July, falling below pre-report estimates. The unemployment rate fell to 3.5%.
• Restaurant Performance Index – The June 2023 index rose back above 100 this month on optimism in the index's expectations component. Due to weaker customer traffic, the current situation index remained below 100 in June.
• Next week's reports – Monthly Trade Data, Retail Prices, WASDE, and Consumer Sentiment