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Table 4. US export customers by product, 2008-2013 (metric tons), continued Product/Country 2008 2009 2010 2011 2012 2013 12/13 Animal protein meals Indonesia1 192,279 260,471 336,349 387,037 222,998 230,923 3.6 Mexico2 108,874 83,729 72,710 91,425 99,049 83,334 -15.9 China1 10,572 14,059 45,241 26,723 33,292 50,939 53.0 Canada 29,876 38,051 43,488 30,333 38,044 43,380 14.0 Chile 4,656 3,045 13,128 21,587 57,394 35,970 -37.3 Philippines 5,736 4,456 9,629 4,386 33,037 29,704 -10.1 Malaysia 860 0 0 0 2,060 16,190 685.9 Thailand 6,080 3,646 7,019 11,512 12,884 14,951 16.0 Guatemala 12 0 18 10 1,037 12,595 1,114.6 Ecuador 5,861 5,270 3,490 4,255 4,893 6,790 38.8 Netherlands 787 833 2,211 3,502 5,518 5,675 2.8 Cambodia 0 0 0 0 206 5,308 2,476.7 Bangladesh 1,546 0 0 0 1,277 3,425 168.2 Honduras 197 315 253 167 900 3,406 278.4 Turkey 11 0 164 0 442 2,649 499.3 Colombia 168 253 310 1,001 724 2,276 214.4 Vietnam 16,793 2,921 1,303 3,017 2,050 1,780 -13.2 Peru 17 10 27 337 680 1,156 70.0 Costa Rica 78 515 1,603 1,948 349 781 123.8 Total 385,092 418,007 538,139 591,307 523,140 552,753 5.7 Source: Global Trade Atlas. 1NRA estimates. 2From Mexico customs office. Market Report Continued from page 13 In 2013, the domestic price of high-protein poultry meal as reported by The Jacobsen had close to a 79 percent correlation to the price of fish meal. In addition, high-protein poultry meal traditionally has a $90 to $100 premium over feed-grade poultry meal in the domestic market, but that premium today is $200 to $300, and even more so in the export market. The importance of the growing aquaculture industry should not be overlooked as a very important element to the future demand growth for rendered products. Fats and Greases The global market for fats and greases was led by the release of excessive stocks of palm oil from Indonesia. Chart 1 shows the dramatic decline in prices through 2013. Palm oil prices fell from a high of $1,166 per metric ton in April 2012 to a low of $765 in July 2013, putting downward pressure on rendered fat prices. However, throughout 2013, tallow and yellow grease prices remained well above palm oil, pricing those products out of the global market. This was very much seen on the export side as exports of US fats and greases in 2013 fell by 20 percent from the previous year and 40 percent over 2011 exports. In the past, the export market sustained prices for US rendered fats, but due to demand, it was the domestic market that sustained prices the last two years. In 2013, tallow exports to Mexico were down 12 percent and exports to Turkey were down over 50 percent from the historic average. Exports to traditional soap markets like Nigeria are now nonexistent. It is to be seen if these markets will return when prices normalize. On the biodiesel front, production continues to act as a major demand source for rendered fats as well as palm oil. Global biodiesel and renewable fuel demand remained strong % Change in 2013. The top three global biodiesel producers continued to utilize animal fats and used cooking oil as feedstocks. The United States used over one million metric tons, the 27 countries of the European Union took 1.7 million metric tons, and Brazil consumed over 541,000 metric tons of animal fats and used cooking oil for biodiesel production in 2013. This demand should continue this year. Outlook The IMF predicts world output will grow this year by 3.7 percent, up three percent from 2013. The market for both rendered fats and proteins should improve in 2014 mainly due to strong demand but also because of softer supplies of competing products. A drought in Brazil is already starting to put downward pressure on soybean forecasts and meteorologists are predicting an El Niño effect this year could put affect fish meal supplies. These forces should keep demand strong for rendered proteins. In addition, Indonesia is increasing its biofuel mandate from seven percent to 10 percent. The Indonesian palm oil industry was traditionally based around exports; however, according to Fadhil Hasan as reported in Bloomberg, “Now we see domestic consumption of biodiesel is the most significant factor if the government is really committed to the program.” If the word biodiesel was replaced with ethanol in that phrase, he would sound exactly like many US corn farmers. In addition, Malaysia is expanding its biodiesel mandate and Brazil is rumored to be considering raising its requirement from five percent to seven percent. Indeed, as we move into 2014, prices for both rendered fats and protein meals are strengthening. It is yet to be seen if rendered products will reenter some of the global market for industrial uses that they were priced out of during the last two years. R www.rendermagazine.com Render April 2014 15


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