Global Ag News for Apr 5

TODAY—WEEKLY EXPORT INSPECTIONS—CROP PROGRESS/CONDITIONS—

Overnight trade has SRW Wheat up roughly 2 cents; HRW down 1; HRS Wheat up 1, Corn is down 2 cents to up 6; Soybeans up 13; Soymeal up $3.50, and Soyoil up 70 to 40 points.

For the week, SRW Wheat prices were down roughly 2 cents; HRW down 3; HRS down 14; Corn was up 10 cents; Soybeans up 5 cents; Soymeal up $6.00, and; Soyoil up 60 points. Crushing margins are up 15 cents at $0.64 (July); Oil share unchanged at 38%.

Chinese Ag futures (May) were on holiday.

Malaysian palm oil prices were up 33 ringgit at 3,770 (basis June) at midsession following rival vegoils, tight supply forecasts.

U.S. Weather Forecast:

The bottom line for the United States is going to vary greatly during the next two weeks. Rain should fall in a timely manner across the Dakotas and parts of Nebraska to the Great Lakes region where some moderate to heavy rainfall is possible for brief periods of time into early next week. Rain will also fall in a timely manner in the southeastern states and Delta with their greatest rain expected during mid-week this week and again during the weekend with net drying most of next week. The southern half of the Great Plains will likely be driest during the next ten days to two weeks and the same is expected in the northwestern Plains, West Texas, all of the southwestern states and from the Yakima Valley into Oregon.

South America Weather Forecast:

Argentina’s bottom line still looks very good for most of its summer crops. Soil moisture will be maintained at favorable levels through the next ten days and that will translate into a good environment for late season crop development. Harvest progress will be slowed late this week because of rain, but the impact on crops will be low.

Brazil’s bottom line will be one of good rainfall in Mato Grosso supporting Safrinha corn and cotton development as the same will be true of Goias. Most other crop areas will continue to dry down raising moisture stress for many Safrinha corn crops from Mato Grosso do Sul and Paraguay to Sao Paulo. These latter areas will need significant rain soon to protect production potential for summer crops especially as reproduction approaches in late April and May.

The player sheet had funds net sellers of 7,000 contracts of SRW Wheat; sold 3,000 Corn; net sold 8,000 Soybeans; sold 8,000 lots of Soymeal, and; sold 2,000 Soyoil.

We estimate Managed Money net short 9,000 contracts of SRW Wheat; net long 427,000 Corn; net long 166,000 Soybeans; long 68,000t Soymeal, and; net long 94,000 Soyoil.

Preliminary Open Interest saw SRW Wheat futures up roughly 3,200 contracts; HRW Wheat up 2,700; Corn up 16,700; Soybeans down 600 contracts; Soymeal up 2,900, and; Soyoil up 1,700.

There were no changes in registrations—Registrations total 40 contracts for SRW Wheat; ZERO Oats; Corn ZERO; Soybeans 60; Soyoil 1,118 lots; Soymeal 175; Rice 1,013; HRW Wheat 1,291, and; HRS 235.

Tender Activity—Egypt seeks optional-origin supplies—Saudi bought 295,000t optional-origin wheat—

 

For the week ended March 25th

U.S All Wheat sales are up 1%, shipments unchanged with the USDA forecasting a 2% increase

By class, HRW wheat sales down 8%, shipments down 5%, with USDA down 7%

SRW down 24%, shipments down 30% (USDA down 18%)

HRS up 3%, shipments up 4% (USDA up 6%)

Corn up 106%, shipments up 85% (USDA up 46%)

Sorghum up 139%, shipments up 170% (USDA up 45%)

Soybeans up 66%, shipments up 73% (USDA up 34%)

Soymeal up 2%, shipments up 9% (USDA up 1%)

Soyoil down 29%, shipments down 13% (USDA down 8%)

 

USDA SAYS 4.9 MILLION TONS (164 MILLION BUSHELS) OF U.S. SOYBEANS CRUSHED IN FEBRUARY

Trade estimate was 165 mil bu versus 197 mil a month ago and 175 mil last year

USDA SAYS SOYOIL STOCK WERE 2.306 BIL LBS

Trade estimate was 2.253 bil lbs versus 2.306 bil last month and 2.390 bil a year ago

USDA SAYS SOYMEAL STOCKS WERE 544,000T VERSUS 512,000T LAST MONTH AND 396,000T A YEAR AGO

USDA SAYS 333 MILLION BUSHELS OF CORN USED FOR FUEL ALCOHOL IN FEBRUARY VERSUS 415 MIL LAST MONTH AND DOWN FROM 434 MILLION A YEAR AGO

USDA SAYS 1.406 MILLION TONS OF DDGS PRODUCED IN JANUARY VERSUS 1.753 MT A MONTH AGO AND DOWN FROM 1.818 MILLION A YEAR AGO

Archer Daniels Midland said on Thursday it would restart ethanol production at two of its U.S. corn dry mills this year, as the grains trader expects demand for the biofuel to rebound from a pandemic-led slump. The company had last April decided to temporarily idle ethanol production at its facilities in Cedar Rapids, Iowa, and Columbus, Nebraska due to lower gasoline demand. Demand for corn-based ethanol, blended into gasoline, is set to rise as people are expected to start driving more as COVID-19 vaccinations gather pace and as China imports more volumes

• CME RAISES SOYBEAN FUTURES (S) MAINTENANCE MARGINS BY 11.7% TO $3,350 PER CONTRACT FROM $3,000 FOR MAY 2021

Chicago corn futures fell ahead of last week’s much anticipated U.S. government reports, but heavily bullish speculators stayed the course, extending their long position on the yellow grain.

An industry group representing America’s biggest meatpackers on Thursday pushed the U.S. Department of Agriculture to appeal a federal court decision that canceled an agency rule that allows pork plants to slaughter pigs more quickly. The decision issued on Wednesday in U.S. District Court in Minnesota could raise costs for meatpackers like Seaboard Foods and Clemens Food Group and slow meat production after COVID-19 outbreaks in slaughterhouses limited output last year. A lawsuit brought against the USDA by the United Food and Commercial Workers Union had challenged the 2019 rule, arguing that faster slaughter speeds undermined worker safety. A federal judge said there was no evidence the Trump era rule had evaluated worker safety. USDA says it is evaluating the decision.

China released 2 million tonnes of rice from state reserves for sale to feed producers this week to bolster supplies of feed grains amid elevated corn prices. Corn prices hit record highs in China earlier this year as dwindling stocks and reduced output raised concerns over supplies. China on Wednesday sold between 1.4 million and 1.5 million tonnes of rice – about 70% of the total volume put up for sale – for feed use. This rice would be sold through state companies directly to feed makers, unlike the rice sold from reserves in regular auctions to the broader market. There will be more such auctions coming. The government will keep releasing (rice and wheat) until corn prices are tamed.

China has the foundations, conditions, confidence and capability to safeguard the country’s grain security, which has withstood the test of the COVID-19 epidemic, an official said. Supported by high output, stable supply and sufficient reserves, China’s grain security has remained sound, the deputy head of the National Food and Strategic Reserves Administration. The country has secured a bumper harvest for 17 years in a row, with its annual grain output exceeding 650 million tonnes for six consecutive years. Meanwhile, China’s per capita share of grain has exceeded 470 kg, higher than the internationally-recognized security baseline of 400 kg.

A wave of African swine fever outbreaks this year has wiped out at least 20% of the breeding herd in northern China, industry sources and analysts said, exceeding expected losses and raising fears about the potential for further impact in the south. The estimates point to the extent of the disease’s resurgence in the first quarter of 2021 after more than a year of declining outbreaks, heralding a significant setback to China’s efforts to replenish its hog herds after African swine fever reached the country in August 2018 and wiped out 50% of the country’s pigs within a year.

Argentina brought in $2.77 billion from agricultural exports in March, the CIARA-CEC chamber of export companies said, as high grains prices pushed revenue from international shipments to an 18-year high. The chamber represents companies accounting for 40% of Argentina’s total exports. The sector is Argentina’s biggest source of much needed export dollars as the government tries to stabilize its economy as it struggles to exit a three-year recession that has been exacerbated by the COVID-19 pandemic. The sector brought in $6.72 billion in the first quarter, CIARA-CEC said in a statement. March revenue marked a 53.22% increase over February.

Russian agriculture consultancy Sovecon said on Friday it had lowered its forecast for Russia’s 2020/21 wheat exports by 0.2 million tonne to 38.9 million tonnes. Russia doubled its wheat export tax to 50 euros ($59) per tonne last month in an attempt to curb high food price inflation amid the coronavirus pandemic. The tax was at 25 euro/tonne on Feb. 15-28. The current low pace of wheat exports brought the estimate down, as did the fall in export prices in March, Sovecon, one of the leading agriculture consultancies in Moscow, said. The domestic market is adjusting to the new taxes more slowly than expected. Uncertainty about how to calculate a permanent formula-based export tax for wheat from June 2 was also a factor.

Russia’s March exports of wheat, barley and maize (corn) are estimated at 2.4 million tonnes, down from 4.3 million tonnes in February, the SovEcon agriculture consultancy said.

Farms from ten of Ukraine’s regions have started 2021 spring sowing, seeding a total of 310,560 hectares of wheat, barley, peas and oats as of April 1, economy ministry data showed. The 2021 sowing campaign started a few weeks late due to lingering cold weather in most of the country. The overall grain area is likely to total 15.5 million hectares in 2021, including 7.96 million hectares of winter grains. The spring sowing area also will include 1.388 million hectares of barley, 176,600 hectares of wheat, 5.327 million hectares of corn, 194,050 hectares of oats and 235,400 hectares of peas. State weather forecasters said last month around 98% of Ukrainian winter wheat crops and 100% of winter barley were in good condition.

Ukraine’s APK-Inform agriculture consultancy said on Friday it saw the 2021 grain crop rising by 13% to 73.8 million tonnes, allowing the country to export 54.2 million tonnes of grain in the 2021/22 season that runs from July to June. The consultancy said the 2021 wheat harvest could rise by 10% to 27.5 million tonnes with the export of 19.8 million tonnes. The positive outlook is due to fairly good wintering conditions for winter crops, favorable conditions for sowing spring crops, as well as price trends.

Ukraine’s grain exports have fallen by almost 23% to 35.7 million tonnes so far this season, which runs from July 2020 to June 2021, economy ministry data showed. Traders sold 14.4 million tonnes of wheat, 16.6 million tonnes of corn and 4.1 million tonnes of barley. Traders have used 82.3% of the total wheat export quota of 17.5 million tonnes imposed for the whole 2020/21 July-June season. The ministry, however, said this week wheat exports were unlikely to reach 17.5 million tonnes this season.

Ukrainian wheat export prices have lost another $9 a tonne in the past week due to a fall in demand and good prospects for the 2021 wheat harvest, APK-Inform agriculture consultancy said on Monday. The government has said good weather is likely to help farmers increase their grain crop to at least 75 million tonnes this year from about 65 million tonnes in 2020. Asking prices for high-quality soft milling wheat decreased to $245-$251 from $254-$260 a tonne FOB Black Sea port a week ago. Feed wheat fell by up to $9 a tonne to $241-$247 FOB Black Sea.

Ukrainian sunflower oil bid export prices decreased by $35 tonne over the past week, following a global downward trend, analyst APK-Inform said. It said Ukrainian-origin sunoil prices decreased to a range of $1,485 – $1,495 per tonne FOB Black Sea from $1,520 – $1,530 a week earlier. Sunoil prices jumped to a record high of $1,710 and $1,725 per tonne FOB in early March.

• FARM OFFICE FRANCEAGRIMER ESTIMATES 87% OF FRENCH SOFT WHEAT IN GOOD/EXCELLENT CONDITION BY MARCH 29 VS 87% PREVIOUS WEEK
• FRANCEAGRIMER ESTIMATES 84% OF FRENCH WINTER BARLEY IN GOOD/EXCELLENT CONDITION BY MARCH 29 VS 85% PREVIOUS WEEK
• FRANCEAGRIMER ESTIMATES 100% OF FRENCH SPRING BARLEY SOWN BY MARCH 29 VS 99% PREVIOUS WEEK
• FRANCEAGRIMER ESTIMATES 91% OF FRENCH SPRING BARLEY IN GOOD/EXCELLENT CONDITION BY MARCH 29 VS 92% PREVIOUS WEEK

Egypt’s strategic reserves of wheat and sugar are at 3.6 months of consumption, the supply minister said on Sunday, ahead of the start of the local harvest season. Egypt is looking to procure 4 million tonnes of local wheat from farmers this season.

Malaysia’s palm oil inventories at the end of 2021 are projected to decline for a third consecutive year to 1.12 million tonnes, state agency the Malaysian Palm Oil Council (MPOC) said. Stockpiles in the world’s second-largest producer plunged to 1.27 million tonnes last year due to a combination of labor and logistic challenges caused by the COVID-19 pandemic, and as wet weather conditions caused by La-Nina hurt yield. The council is expecting a moderate recovery in exports and production this year while projecting month-end stocks to trend below 1.5 million tonnes for most parts of the year.

The Malaysian Palm Oil Board (MPOB) on Monday raised its forecast for palm oil export revenue in 2021 to 75 billion ringgit ($18.12 billion), up from 73.25 billion ringgit ($17.69 billion) last year. The industry regulator maintained its projection for the benchmark crude palm oil price to average 3,000 ringgit a tonne this year.