Global Ag News for May 3.22

TODAY – U.S. Soybean Crushings at 193M Bushels in March

Wheat prices overnight are up 2 1/2 in SRW, up 7 1/4 in HRW, up 2 1/4 in HRS; Corn is up 4 3/4; Soybeans down 1 1/2; Soymeal up $0.22; Soyoil down 0.43.

For the week so far wheat prices are up 2 1/4 in SRW, down 1/2 in HRW, up 4 in HRS; Corn is down 5 1/4; Soybeans down 41; Soymeal up $0.08; Soyoil down 4.52. For the month to date wheat prices are up 2 1/4 in SRW, down 1/2 in HRW, up 4 in HRS; Corn is down 5 1/4; Soybeans down 41; Soymeal up $0.80; Soyoil down 4.52.

Year-To-Date nearby futures are up 35% in SRW, up 36% in HRW, up 18% in HRS; Corn is up 38%; Soybeans up 26%; Soymeal up 8%; Soyoil up 47%.

China and Malaysia markets are closed for holiday.

There were no changes in registrations. Registration total: 2,185 SRW Wheat contracts; 38 Oats; 0 Corn; 0 Soybeans; 98 Soyoil; 0 Soymeal; 154 HRW Wheat.

Preliminary changes in futures Open Interest as of May 2 were: SRW Wheat down 1,396 contracts, HRW Wheat down 652, Corn down 371, Soybeans up 4,395, Soymeal up 732, Soyoil down 1,616.

Northern Plains Forecast: Mostly dry Tuesday. Isolated showers south Wednesday. Mostly dry Thursday-Friday. Temperatures near to below normal through Wednesday, near to above normal Thursday-Friday. 6-to-10-day outlook: Isolated to scattered showers Saturday-Wednesday. Temperatures near to above normal Saturday, near to below normal Sunday-Wednesday.

Central/Southern Plains Forecast: Isolated to scattered showers through Thursday. Mostly dry Friday. Temperatures below normal north and above normal south though Wednesday, near to below normal Thursday, near normal Friday. 6-to-10-day outlook: Mostly dry Saturday. Isolated showers Sunday-Wednesday. Temperatures above normal Saturday-Sunday, near to above normal Monday, below normal northwest and above normal southeast Tuesday, near to below normal Wednesday.

Western Midwest Forecast: Mostly dry Tuesday. Scattered showers Wednesday-Friday, mostly south. Temperatures near to below normal through Friday.

Eastern Midwest Forecast: Scattered showers Tuesday. Mostly dry Wednesday. Scattered showers Thursday-Friday. Temperatures near to below normal northwest and above normal southeast Tuesday, near to below normal Wednesday-Friday. 6-to-10-day outlook: Scattered showers Saturday. Mostly dry Sunday. Isolated to scattered showers west Monday-Wednesday. Temperatures near to below normal Saturday, near to above normal Sunday, above normal Monday-Wednesday.

Canadian Prairies Forecast:  Isolated showers west through Wednesday. Temperatures near to above normal west and below normal east Tuesday, near to above normal Wednesday. Isolated showers west Thursday-Friday. Temperatures above normal Thursday-Friday. 6-10 Day Outlook: Scattered showers Saturday-Wednesday. Temperatures near to above normal Saturday, below normal west and above normal east Sunday-Monday, below normal Tuesday-Wednesday.

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

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

The player sheet for 5/2 had funds: net sellers of 1,500 contracts of  SRW wheat, sellers of 17,500 corn, sellers of 21,000 soybeans, sellers of 1,500 soymeal, and  sellers of 9,000 soyoil.

TENDERS

• WHEAT TENDER: A group of South Korean flour mills has issued a tender to purchase about 50,000 tonnes of milling wheat to be sourced from the United States
• WHEAT PURCHASE CANCELED: Turkey’s state grain board TMO was believed to have canceled all provisional purchases of about 480,000 tonnes wheat in tenders made on Friday with no buying finally made

PENDING TENDERS

• WHEAT TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 tonnes of milling wheat
• FEED BARLEY TENDER: Jordan’s state grains buyer issued an international tender to purchase 120,000 tonnes of animal feed barley

U.S. Inspected 1.684m Tons of Corn for Export, 601k of Soybean

Brazil 2021/2022 Second Corn Crop Estimate Lowered to 88.14 Million T – StoneX

BRAZIL 2021/2022 SECOND CORN CROP SEEN AT 88.14 MILLION TNS VERSUS 91.9 MILLION TNS IN PREVIOUS FORECAST – STONEX

BRAZIL 2021/2022 SOYBEAN CROP SEEN AT 123.4 MILLION TNS VERSUS 122 MILLION TNS IN PREVIOUS FORECAST – STONEX

Thai Cabinet Raises Corn Imports to Ease Animal Feed Shortage

Thailand’s Cabinet approved a lower tax and higher import quota for corn from May through July to ease the burden of rising animal feed costs along with a shortage of local supply.

• Tax-free corn import quota for animal feed increased to 600,000 tons during the period, according to a government statement after Tuesday’s Cabinet meeting
  • Normal quota is 54,700 tons with a 20% tax rate
  • The increased quota ceiling of 600,000 tons is half of the estimated demand for corn animal feed
• The decision aims to ease cost burden on animal feed producers as well as pig and chicken farmers that’s been exacerbated by the war in Ukraine and domestic drought
• Government allows private companies to import corn during the period instead of a state-owned Public Warehouse Organization monopoly

Argentina’s Vicentin Says Bunge Joins Viterra-Led Takeover Plan

Bunge has joined Glencore’s Viterra and Argentine farm cooperative ACA in the consortium that’s moving to take control of bankrupt soy exporter Vicentin, according to Vicentin’s external press representative.

• NOTE: Bunge’s inclusion comes after rival agriculture trader Molinos Agro exited the consortium
• NOTE: Family-run Vicentin, which has until the end of June to get approval from creditors for a $1.2b debt restructuring and the takeover, says it already has the approval of more than half of its roughly 1,700 creditors
  • It’s still working with the biggest lenders to reach agreements for at least two thirds of the debt
  • For the restructuring and takeover plan to succeed, the bankruptcy court requires more than half of the number of creditors representing at least two thirds of the value of the defaulted debt to approve it

WHEAT/CEPEA: Production may increase in Brazil, but decrease in both Argentina and Ukraine

Wheat production is expected to increase in Brazil this year, while in Argentina and in Ukraine, the harvest is expected to be lower.

In Brazil, according to data from Embrapa, the national area with wheat crops may be 13% larger this year, increasing from 2.7 million hectares to 3.1 million hectares. In Paraná, according to Deral/Seab, 1.17 million hectares are expected to be sown in the state, 5% down from that in the previous season. So far, 3% of the estimated area has been sown in PR. Still, if the weather continues favorable, PR may produce 3.9 million tons of wheat this year, 20% more than that last year.

In Argentina, a report released by the USDA last week estimated the output from the 2021/22 season at 21.9 million tons. On the other hand, in the 2022/23 season, the Argentinian production is forecast to decrease to 18.6 million tons. This scenario is linked to both the smaller area allocated to wheat crops in the country and lower productivity. Besides, the higher prices of inputs, majorly fertilizers, are making farmers uncertain about sowing, since wheat quotations have been high too. Wheat exports from Argentina are estimated by the USDA at 12.6 million tons in the 2022/23 season, down from that in the season before because of the current lower production in the country.

As for Ukraine, information released by SoEcon consultancy indicates that the national wheat output may total 23.1 million tons this year, 500 thousand tons down from that previously estimated and less than the volume harvested in 2021, which totaled 32.1 million tons. As for shipments, if the war ends still in the first semester of the year and exports get back to normal, Ukraine may ship 20 million tons of wheat in the 2022/23 season, since the domestic volume stocked is high.

BRAZILIAN EXPORTS – According to Secex, until the fourth week of April, Brazil had exported 125.08 thousand tons of wheat, more than the volume shipped in April last year (21.2 tons). On the other hand, Brazil imported 350.40 thousand tons of wheat last month, against 467.91 thousand tons in April 2021, a decrease of 25.1%.

PRICES – Wheat prices increased in Brazil last week, influenced by the US dollar appreciation against the Real, which favors the parity of the national product against the wheat imported.

According to Cepea surveys, between April 22 and 29, the prices paid to wheat farmers rose by 4.09% in Rio Grande do Sul (RS), 0.79% in Santa Catarina (SC) and 0.45% in Paraná (PR). In the wholesale market (deals between processors), quotations increased by 5.1% in RS, 1.44% in SC, 0.78% in São Paulo and 0.53% in PR. In the same period, the dollar rose by 3.15% against the Real, closing at BRL 4.948 on Friday, 29.

Fertilizer company Mosaic sees high ag-commodity prices continuing due to Russia-Ukraine conflict

Signs point to ‘persistent tight markets’ for phosphates and potash, Mosaic says

Fertilizer and feed producer Mosaic Co. late Monday said Russia’s invasion of Ukraine continues to push prices of some agricultural commodities higher, with the conflict also impacting fertilizer supplies amid low stocks globally.

Russia and Ukraine together supply more than a quarter of the world’s wheat and barley, 16% of corn, and more than three quarters of global sunflower oil, Mosaic (MOS) said.

That “supply uncertainty” continued to drive grain and oilseed prices higher, and prices were already higher before the February invasion amid a 20-year low in global stocks-to-use ratios, the company said.

Mosaic reported first-quarter earnings after the bell Monday, with shares down more than 2% following mixed results.

The Tampa, Fla., company said it earned $1.18 billion, or $3.19 a share, in the first quarter, compared with $157 million, or 41 cents a share, in the year-ago period.

Adjusted for one-time items, Mosaic earned $2.41 a share.

Revenue rose 71% to $3.9 billion as “stronger pricing more than offset lower volumes,” Mosaic said.

Analysts polled by FactSet had expected the company to report adjusted earnings of $2.40 on revenue of $4.1 billion.

Mosaic said it expects higher annual production in both potash and phosphates across the globe and a recovery of phosphate output from its North American operations.

“We take our responsibility of helping the world grow the food it needs very seriously and are working to mitigate some of the impact of reduced global supply by efficiently maximizing output,” the company said.

Mosaic said the Russia-Ukraine conflict is also impacting fertilizer supply. Russia accounts for 20% of the world’s nitrogen, phosphate and potash exports, and, when combined with Belarus, 40% of the global potash supply is at risk, Mosaic said.