Global Ag News for Feb 8.22

TODAY

Wheat prices overnight are down 11 1/2 in SRW, down 11 in HRW, down 6 1/4 in HRS; Corn is down 3; Soybeans down 7 3/4; Soymeal up $0.16; Soyoil down 1.17.

For the week so far wheat prices are down 1 1/4 in SRW, down 1 in HRW, up 6 1/2 in HRS; Corn is up 13 1/4; Soybeans up 21 3/4; Soymeal up $1.04; Soyoil down 0.86. For the month to date wheat prices are down 4 in SRW, down 1/2 in HRW, up 8 1/2 in HRS; Corn is up 6 1/4; Soybeans up 83 1/2; Soymeal up $35.50; Soyoil down 0.65.

Chinese Ag futures (MAY 22) Soybeans down 21 yuan ; Soymeal up 73; Soyoil down 198; Palm oil down 186; Corn up 18 — Malasyian Palm is down 58. Malaysian palm oil prices overnight were down 87 ringgit (-1.57%) at 5449.

There were no changes in registrations. Registration total: 1,900 SRW Wheat contracts; 17 Oats; 50 Corn; 146 Soybeans; 137 Soyoil; 0 Soymeal; 92 HRW Wheat.

Preliminary changes in futures Open Interest as of February 7 were: SRW Wheat down 4,008 contracts, HRW Wheat down 1,370, Corn up 4,317, Soybeans up 10,185, Soymeal up 5,254, Soyoil up 354.

Brazil Grains & Oilseeds Forecast: Rio Grande do Sul and Parana Forecast: Mostly dry through Friday. Temperatures near to below normal through Wednesday, near normal Thursday, near to above normal Friday. Mato Grosso, MGDS and southern Goias Forecast: Scattered showers Monday, north Tuesday-Friday. Temperatures near normal through Friday.

Argentina Grains & Oilseeds Forecast: Cordoba, Santa Fe, Northern Buenos Aires Forecast: Mostly dry through Wednesday. Isolated showers Thursday night-Friday. Temperatures below normal Monday-Tuesday, near to below normal Wednesday, near normal Thursday, near to below normal Friday. La Pampa, Southern Buenos Aires Forecast: Mostly dry through Wednesday. Isolated showers Thursday night-Friday. Temperatures below normal Monday-Tuesday, near to below normal Wednesday, near normal Thursday, near to below normal Friday.

The player sheet for Feb. 7 had funds: net buyers of 2,500 contracts of  SRW wheat, buyers of 19,000 corn, buyers of 17,000 soybeans, buyers of 6,000 soymeal, and  sellers of 0 soyoil.

TENDERS

• SOYBEAN SALE: The U.S. Department of Agriculture (USDA) reported private sales of 507,000 tonnes of U.S. soybeans to unknown destinations. Of the total, 249,000 tonnes were for shipment in the 2021/22 marketing year and 258,000 tonnes were for shipment in the 2022/23 season.
• CORN SALE: South Korea’s Feed Leaders Committee (FLC) purchased about 66,000 tonnes of animal feed corn to be sourced from optional origins in a private deal on Monday without an international tender being issued
• CORN SALE: Leading South Korean animal feedmaker Nonghyup Feed Inc. (NOFI) is believed to have purchased an estimated 133,000 tonnes of animal feed corn in an international tender which closed on Monday
• FEED WHEAT SALE: NOFI purchased around 110,000 tonnes of animal feed wheat to be sourced from optional origins including India in an international tender on Monday
• MILLING WHEAT TENDER: A Syrian state grains agency has issued an international tender to purchase and import 200,000 tonnes of milling wheat

PENDING TENDERS

• CORN TENDER: Turkey’s state grain board TMO has issued an international tender to purchase about 325,000 tonnes of animal feed corn. The deadline for submission of price offers is Feb. 8.
• BARLEY TENDER: Jordan’s state grains buyer has issued a new international tender to purchase 120,000 tonnes of animal feed barley. The deadline for submission of price offers in the tender is Feb. 8
• WHEAT, SOYMEAL TENDER: An importer group in the Philippines is tendering to purchase animal feed wheat and soymeal with total tonnage sought unclear. The deadline for submission of price offers in the tender is Feb. 11.
• WHEAT TENDER: Bangladesh’s state grains buyer has issued an international tender to purchase 50,000 tonnes of milling wheat. The deadline for submission of price offers is Feb. 14.

U.S. Corn, Soybean, Wheat Inspections by Country: Feb. 3

• Soybeans for China-bound shipments made up 765k tons of the 1.22m total inspected
• Japan was the top destination for corn inspections, South Korea led in wheat

Brazil 2021-22 Soy Harvest 16% Done as of Feb. 3: AgRural

Compares with 10% a week earlier and 4% a year before, according to consulting firm AgRural. Summer corn harvest 18% done, compared with 14% a year earlier, AgRural says

Mato Grosso Harvest 47% done, Record Production Expected: IMEA

Mato Grosso producers are pegged to harvest a record soybean and second corn crop this year, according to the Instituto Mato-Grossense de Economia Agropecuária (IMEA).

• Soybean harvest in Mato Grosso, Brazil’s biggest producing state, is 47% done, by Feb. 4th. The crop is pegged at 39.4m tons, 9.5% above last year
• Second corn crop is 42% planted as of Feb. 4th and crop can reach 40.4m tons, 24% above last year
• Rains for the next two weeks could delay soy harvest and corn plantings, but IMEA forecasts that over 90% of the second corn crop will be planted within the ideal window

Russian Wheat Exports Decline 21% Y/y So Far This Season: Agency

Russian wheat shipments for the 2021-22 season amounted to 23.9m tons as of Feb. 3, down 21% from a year earlier, the Federal Center of Quality and Safety Assurance for Grain and Grain Products said on its website, citing inspections before exports.

• That means wheat exports totaled about 300k tons in the week to Feb. 3, compared with 600k tons in the previous week
• Exports of all grains are at 34m tons so far this season
  • Barley exports declined 33% y/y
  • Corn exports rose +23% y/y
• NOTE: Data are preliminary and include exports to the Eurasian Economic Union, which is a customs union of countries that includes Russia

WHEAT/CEPEA: International and domestic demands continue high

The currency exchange rate and international wheat prices have been pressing down wheat quotations in some Brazilian regions surveyed by Cepea, due to the decrease in the export parity. Still, official estimates indicate high demand for the national cereal, from both the domestic and the international markets, which tends to underpin prices in Brazil. Despite the record Brazilian output (7.8 million tons), imports have been high, having surpassed six million tons in the past twelve months.

Data from Cepea indicate that, between January 28 and February 4, the prices paid to wheat farmers rose by 0.32% in Santa Catarina (SC) and by 0.15% in Paraná (PR) but decreased by 0.39% in Rio Grande do Sul (RS). In the wholesale market (deals between processors), prices increased by 0.88% in RS and 0.59% in SC. On the other hand, in PR and in São Paulo, values dropped by 0.49% and 0.67%, respectively. The US dollar dropped by 1.24% in the week, closing at BRL 5.326 on Friday, 4.

EXPORTS – Data from Secex show that, in Jan/22, Brazil exported 648.1 thousand tons of wheat, the second highest monthly volume registered in the series, which began in Jan/96, only after that from March/11 (763.7 thousand tons).

IMPORTS – In Jan/22, Brazil imported 501.55 thousand tons of wheat, 13.1% more than the volume from Dec/21, but 22.1% less than that in Jan/21. Of the total imported, 85.4% came from Argentina; 6.1%, from Uruguay; 4.7%, from Paraguay; 3.8%, from the United States; and 0.01%, from France and China. In the past 12 months, Brazil imported 6.1 million tons of wheat.

BY-PRODUCTS – Of wheat flour, Brazil imported 19.75 thousand tons in Jan/22, 21.7% down from that in Dec/21, but 4.6% up from that in Jan/21. On the other hand, flour exports totaled 1.48 thousand tons last month, a steep 83.2% down from that in Dec/21 and 56.6% lower than that in Jan/21, according to Secex.

Brazilian Fertilizer Price Surge Shaken by Geopolitical Tensions

International pressures are affecting Brazil’s fertilizer market, yet we don’t expect prices to reach new highs. Urea prices, which peaked in November, strengthened after India’s tender announcement highlighted strong demand. China is still restricting exports, limiting supply and making the large volumes India requires difficult to obtain. If cargoes are diverted to India, trades in Brazil may stall. Potash supply from Belarus remains uncertain after transport through Lithuania was suspended on Feb. 1. Diversion to Russia is an option but comes with increased logistical costs and operational constraints. Phosphates demand is recovering as grain prices at record highs strengthen barter ratios, giving farmers more confidence to place new orders.

USDA Unveils $1B for ‘Climate Smart’ Agriculture

USDA plans to invest $1B to support agricultural practices that reduce greenhouse gas emissions or sequester carbon, marking the Biden administration’s latest step in its battle against climate change. The investment, which will draw from a Depression-era program designed to stabilize farm income, will go toward financing pilot projects that incentivize farmers, ranchers and others to adopt environmentally-friendly practices, measure, track and verify their subsequent benefits, or establish markets for the resulting commodities. USDA for months has been reviewing public input on the federal initiative, which follows moves by agricultural companies to reward farmers for carbon capture and other practices.