Feed Peas Values Still Pumped

VANCOUVER - Sep 7/07 - SNS -- Feed pea markets in Europe posted another strong finish for the week against major advances in grower and dealer markets on the Continent and in the United Kingdom.

Markets are at levels which should ration product to livestock feed markets and which may hasten abandonment of the ingredient by more compound feed manufacturers.

However, ingredient markets in general are stronger and this should help maintain interest in the commodity, if only at nominal levels in some key markets. Competition for land between corn, soybeans and wheat will remain a key feature of markets for at least another year, contributing to relatively strong fed ingredient markets.

In his latest weekly market review, Alaron Trading Corp's Tim Hannagan argues "corn remains long term bullish. Even with the huge increase in planted acres this year and our ending stocks going from 1.137 billion bushels this year to 1.516 in 2008, we have little room for any production concerns. 2008 sees corn challenged to maintain its marginal ending stocks on these issues.

"One, as beans move higher ahead of next spring's planting to find acres to keep from running out of beans in 2009, corn will follow closely in hopes of not losing any of the 14 million acres they gained this year when they moved over 4.00 last spring to gain those acres so we did not run out of corn in 2008.

"Additionally, record high wheat prices and demand surely have corn growers pondering a switch. Do not forget the US government mandate to increase ethanol production each year through 2012, sees demand only increasing. Corn got the acres it needed in 2007 but can it hang on to them in 2008 as beans and wheat try to steal them."

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