"the price volatility of feed raw materials is a guide for pastoralists
This is the beginning:
"the farmer zhang has been sad lately, 'the feed factory says the corn has gone up to 2,800!' no, today we'll get the truth about the price fluctuations of the feed material! After reading this, farming friends can save at least 5% of their feed costs!"
I. Panorama of price fluctuations for feed raw materials (with real-time data)
A corn price, a roller coaster:
- average january price: $2580 per ton (northeast deep factories)
- average july price: $2920 per ton (honghuai)
- latest september price: $3180 per ton (reduced output due to typhoon)
Reasons for volatility:
1 12 per cent reduction in production of the heilong river due to flooding of black land
2 increased procurement by deep-processors (ethanol gasoline policy plus code)
3 cross-border trade tariff adjustment (united states corn import ring + 18 per cent)
Two bean bean bean bean price
- international prices in april: $1400/t (brazilian soybeans)
- domestic port prices in september: $5060 per ton (imports + 35% per year)
- domestic exploitation: 78 per cent (over 5 percentage points)
Industry insight:
Reductions in soybean production in south america are expected to drive futures up while domestic demand for aquatic feed surges (22 per cent over the same period)
3x3 peanuts price "wave line":
- peanut oil in june: $7,800 per ton (ten years high)
- pyramid equivalent cost: $4860/t (15% higher than maize)
- competition for alternatives: seed price dropped by $4,000 per ton for the first time
Ii. The three drivers behind price volatility
1 climate factor (35%)
- three consecutive years of drought in north china
- floods in south-east asia (10 per cent reduction in palm oil production)
- monsoon anomalies in india (25% reduction in cotton production)
Policy direction (28 per cent)
- e10 promotion of ethanol gasoline (an increase of 20 million tons of maize per year)
- subsidy on resourceification of animal and poultry faeces (impacting feed formulation adjustment)
- import tariff adjustment (from 3 per cent to 1. 5 per cent for bean imports)
3 market supply and demand (37%)
- pork cycle: the capacity of the sow column rose to 41 million. Head
- aquaculture: surge in demand for tilapia feed (+28%)
- avian feed: recovery of poultry meat consumption after avian influenza (+17%)
Iii. Secretariat of cost control required by the family
1 procurement strategy:
- establishment of a 3+1 procurement system (three suppliers + one backup)
- the four, three, two, one
40% price comparison
30% quality testing
20% term negotiations
10% logistics costs
- corn substitution:
Corn + wheat (1:1) replacement rate of 85%
Corn + milligram (7:3) protein deficit needs to be filled with soybeans
- alternatives to soybeans:
Seed + cotton seeding (5:5) costs reduced by 12%
Peanut + rice (6:4) vitamin e required
3 inventory management:
- establishment of the price curve model:
Decline route: 30 per cent stock locked
Uplink: 50 per cent lock on inventory
Steady period: 20 per cent stock maintained
- practical case: some 10,000 pigs farms saved $280,000/year through dynamic inventory management
Price projections and response scenarios
1 key forecasts:
- corn: possibly over 3,500 yuan/tonne in october-december (black land replant policy)
- beans: the increase in transport costs in south america will increase to $5,200 per ton
- cotton seedlings: recovery of xinjiang cotton production may lead to price recovery drop
• emergency preparedness:
- establishment of "price hedge funds" (not to exceed 5 per cent of liquidity)
- development of an early warning system for feed costs
- training of internal procurement teams (quarterly industry training)
V. Accomplishment of the red and black list for the purchase of feeding materials
Recommended purchaser:
1. A biotechnologie (leading in the use of maize by-products for deep processing)
2. A certain food logistics (complete national storage network coverage)
3. A trading company (maturity of cross-border procurement channels)
Queen's selection of suppliers:
1. Prices below 15 per cent of market prices (possible quality hazard)
2. Payments over 90 days (cash flow risk)
3. Formula adjustment response in excess of 3 working days (insufficiency of service capacity)
:
"price fluctuations are like springs, and you're strong, and it's weak! Now click on the collection and forward it to the farming team, and we'll talk later!"
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