SBO futures up on railroad stoppage, crush figures
US soybean oil (SBO) futures rose by 2.5pc during the past week, amid a rail strike in Canada and a new crush report showing higher US soybean crush for July but lower soybean oil stocks.
The September CBOT soybean oil contract closed at 41¢/lb on 21 August, up from 40.01¢/lb a week earlier.
The National Oilseed Processors Association (NOPA's) July crush report on 15 August showed US soybean crush at 182.9mn bushels, 5.5pc higher from last year and up by 4.2pc from the prior month. But July soybean oil stocks were reported at 1.5bn lbs, down by 7.6pc from the prior year and 1.8pc lower from the prior month, indicating more consumption.
Market talk also revolved around a strike involving Canada's two largest railroads Canadian Pacific Kansas City and Canadian National.
US biofuel producers and the US food industry import soybean oil and canola oil from Canada, mostly the latter since Canada is the largest canola producer in the world. Market participants mentioned some veg oil sellers are suggesting canola oil food customers switch to soybean oil for the short term, even though it could be too early to gauge potential consequences from the strike.
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Canada rail strike stopped by forced arbitration
Canada rail strike stopped by forced arbitration
Calgary, 22 August (Argus) — A Canadian rail strike that started early Thursday morning will be short-lived as the federal government stepped in to force the union and two railroads into binding arbitration. The federal government is now directing the Canada Industrial Relations Board (CIRB) to "assist the parties in settling the outstanding terms of their collective agreements by imposing final binding arbitration," labour minister Steven MacKinnon said Thursday. The minister has the authority under section 107 of the Canada Labour Code to mandate the sides return to the bargaining table, a tool the federal government was reluctant to use until now. Operations for Canadian Pacific Kansas City (CPKC) and Canadian National (CN) stopped at 12:01am ET Thursday when they could not reach agreements over contract terms with the Teamsters Canada Rail Conference (TCRC). Operations will resume at the railroads during arbitration. By Brett Holmes Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Brazil's cellulose sector to invest R105bn by 2028
Brazil's cellulose sector to invest R105bn by 2028
Sao Paulo, 22 August (Argus) — Brazil's paper and cellulose sector will invest R105bn ($18.9bn) to build new plants and logistics infrastructure as well as expand existing ones by 2028, Brazilian forestry industry (IBA) president Paulo Hartung said on Tuesday. Multiple companies will invest, with some already doing so. Suzano will invest R15.9bn to build a plant with capacity to produce 2.55mn metric tonnes (t)/yr of eucalyptus-based cellulose. It will also spend R6.3bn in other initiatives, such as building logistical infrastructure and planting. Chile's Arauco will invest R25bn to build its first cellulose plant in Brazil in 2028. The unit will have an initial production of 2.5mn t/yr and will double that by 2032. The project also foresees generation of 400MW of clean energy, which will ensure its energy self-sufficiency. Another Chilean company, CMPC, will also invest R25bn to build a new industrial plant and a port terminal in Rio Grande do Sul state. The 2.5mn t/yr plant will produce bleached eucalyptus-based cellulose, which can be used to make different kinds of paper, packaging and hygiene products. It is also used some food items, medicines and cosmetics. Eldorado Brasil will invest an additional R25bn to add a second production line in its Mato Grosso do Sul state operations and a railway to transport production. Bracell — which is controlled by Singapore-based Royal Golden Eagle — will invest R5bn in a paper tissue plant, which will be installed next to its cellulose plant in Lencois Paulista, in Sao Paulo state. The firm disclosed neither plants' capacity. Finally, Klabin — Brazil's largest producer of packaging paper and corrugated cardboard — also announced a R1.6bn investment, but did not detail how it will use that money. Hartung's announcement came during a sector meeting with Brazilian President Luiz Inacio Lula da Silva and vice-president and trade minister Geraldo Alckmin. "These investments are being made in areas of low economic activity," Hartung said, adding that the paper and cellulose sector is planting cultivated forests that are replacing unproductive pastures. Brazil's paper and cellulose sector had 10mn hectares of productive planted areas in 2023, according to the federal government. The area to grow cellulose increased by 19pc in the first half of 2024 from the same period last year, it said, without giving a more recent figure. Brazil is the largest exporter and second largest producer of cellulose, according to Alckmin. The 47 companies linked to IBA produced 25mn t of cellulose, 11mn t of paper and 8.5mn m³ of wood panels last year, according to IBA figures. Additionally, Brazil exported a record 19.1mn t of cellulose, the group said. By Lucas Parolin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
Work stoppage begins at Canadian railroads
Work stoppage begins at Canadian railroads
Washington, 22 August (Argus) — Operations at Canada's two largest railroads ended Thursday morning at 12:01am ET as a work stoppage began following the failure of labor contract talks. Canadian Pacific Kansas City (CPKC) and Canadian National (CN) locked out union members, while the Teamsters Canada Rail Conference (TCRC) launched a strike at CPKC. The union has not yet issued a strike notice to CN , but its workers are barred from the property. The work stoppage freezes ongoing train shipments even if they have not reached their destinations. The railroads last week stopped loading railcars with shipments of certain toxic and poisonous materials to keep products from being abandoned in unsafe locations, and this week stopped loading all commodities and other freight within Canada. Operations along CN and CPKC's US lines continue but trains cannot cross into Canada. The union confirmed just after midnight that work stoppages at CN and CPKC had begun. Most Teamsters members stopped work at 12:01am ET, though rail traffic controllers at CPKC will keep working until 2:01am ET. CPKC and CN announced they had formally locked out employees represented by the Teamsters union. CN said the union did not respond to an offer it had made in a last attempt to avoid the strike. Wide range of commodities in crosshairs The work stoppage will affect freight deliveries for a variety of goods across North America, including shipments of propane to rural communities, grain and coal deliveries to Canadian export terminals, and chemical inputs to manufacturing facilities. CN said Wednesday that grain prices were already being affected and that sawmills in British Colombia were cutting shifts. Coal exports from Canadian mines would be held because those operations are only served by CN and CPKC. But western US coal exports are not expected to see much of a disruption since US carrier BNSF has rail lines going directly to Westshore Terminals near Vancouver. BNSF will not be able to interchange railcars with CN and CPKC in Canada, however. Crude markets are also not expected to see significant disruption from a strike in the short term because of pending maintenance at upstream oil sands facilities and spare pipeline capacity. Prices for Canadian propane and butane — which rely heavily on rail to move product from an oversupplied market to the US — fell Wednesday ahead of the strike. Wide gap between workers, railroads The railroads and the Teamsters remain far apart on contract terms. The union — which represents roughly 9,300 train operators and support staff at CN and CPKC and 85 rail traffic controllers at CPKC — said forced relocation and scheduling and fatigue management that will lead to safety risks are the key points of dispute. CN said its offers, which have been turned down repeatedly, would have improved safety, increased wages, and provided employees with better schedules. CPKC chief executive Keith Creel on 19 August claimed union leadership had made "wildly inaccurate characterizations" about the railroad's proposals in order to "create a false public narrative" about negotiations. He said the railroad did not unilaterally change or cancel the terms of the most recent collective agreement or make proposals that compromise safety. Creel said most recently CPKC has focused on a status quo-style contract renewal with a duration of three years. That proposal would have no work rule changes and the railroad only wanted to negotiate "reasonable adjustments" to the timing of held-away pay to address regulatory changes made by Transport Canada last year. CN called on Canadian minister of labour Steven MacKinnon to intervene this week. He has already been meeting with each railroad and the Teamsters. CPKC this week reiterated earlier calls for binding arbitration, but MacKinnon rejected that request on 15 August. By Abby Caplan Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
TLP4 acquires Western Australia's Yeeda beef operation
TLP4 acquires Western Australia's Yeeda beef operation
Dalby, 22 August (Argus) — Canada-based fund management firm affiliate TLP4 plans to take over Western Australia's (WA) Yeeda Pastoral, which includes a beef abattoir and two pastoral properties in the north of the state. Yeeda Pastoral earlier this year entered voluntary administration after its owner Asia Debt Management failed to meet its financial obligations. Yeeda has been sold to TLP4 Australian Holdings, a subsidiary of Alberta Investment Management Corporation, for A$55mn ($37mn). The sale still needs approval from the Foreign Investment Review Board and consent from the WA Pastoral Lands Board. The deal includes the Kimberley Meat Company abattoir, Yeeda Station, Mount Jowlaenga Station, along with a cattle herd of 13,800. Kimberley Meat is the sole operational abattoir in northern WA, processing more than 200 head of cattle daily and a key alternative to live export for local cattle producers. The planned sale provides much needed stability and certainty for the future of northern Australia's pastoral and beef processing infrastructure, said David Osborne from Korda Mentha that handled Yeeda's administration. By Amy Phillips Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.
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