Written Commentary
TODAY—WEEKLY ETHANOL STATS —
Overnight trade has SRW Wheat up roughly 3 cents, HRW down 1; HRS Wheat down 1, Corn is up 1 cent; Soybeans up 8 to 4 cents; Soymeal up $3.00, and Soyoil up 10 points.
Chinese Ag futures (May) settled up 90 yuan in soybeans, unchanged in Corn, up 37 in Soymeal, down 6 in Soyoil, and down 12 in Palm Oil.
Malaysian palm oil prices were down 44 ringgit at 3,886 (basis June) at midsession on position-evening.
South America Weather Forecast: Argentina’s environment will still be favorable in most areas for late season crop development and most of the nation will receive meaningful rain Wednesday through Saturday. Net drying in much of Brazil, excluding the far south and northwest Mato Grosso, will still benefit fieldwork advancement but also raise concern of crop moisture stress. Shower and thunderstorm activity will return to the drier areas of Brazil in early April with resulting moisture below normal.
U.S. Weather Forecast: Last evening’s GFS model run was similar to the midday GFS model run of showing a surge of way below average temperatures to move down into the central and southern U.S. Apr. 3 – 6.
The player sheet had funds net buyers of 5,000 contracts of SRW Wheat; bought 3,000 Corn; net bought 4,000 Soybeans; bought 1,000 lots of Soymeal, and; net bought 2,000 lots of Soyoil.
We estimate Managed Money net long 10,000 contracts of SRW Wheat; long 349,000 Corn; net long 155,000 Soybeans; net long 55,000 lots of Soymeal, and; long 98,000 Soyoil.
Preliminary Open Interest saw SRW Wheat futures up roughly 30 contracts; HRW Wheat up 940; Corn down 3,700; Soybeans down 1,400 contracts; Soymeal down 1,200, and; Soyoil down 310.
There were no changes in registrations—Registrations total 40 contracts for SRW Wheat; ZERO Oats; Corn ZERO; Soybeans 60; Soyoil 1,218 lots; Soymeal 175; Rice 1,013; HRW Wheat 1,291, and; HRS 710.
Tender Activity—S. Korean feed groups bought 131,000t optional-origin feed wheat—
US ethanol production may notch highs unseen since before the pandemic, according to analysts surveyed. Daily ethanol production reported by the EIA in its weekly report tomorrow is forecast to land anywhere between 977,000 barrels a day and 1.052M barrels
—Ethanol stocks are projected to keep falling, with analysts forecasting stocks to total anywhere from 20.2M barrels to 21.4M barrels–potentially the lowest inventories have been since early November of last year.
Wire story reports the latest weather outlooks for the U.S. spring are favorable for American farmers to plant what could very likely be record corn and soybean crops. However, the moisture situation is vastly different than in the past two years, and that could come into play later in the season. It has been three years since strong U.S. corn and soy yields have been observed, so the Corn Belt’s plentiful soil moisture in 2019 and 2020 did not exactly fend off yield losses. The reasons for those losses were different in each year: late planting and an abundance of unplanted, high-yielding acres in 2019, and drought coupled with an unusually severe storm in 2020. The United States cannot afford a third consecutive short harvest in 2021 as domestic corn and soybean stockpiles are forecast to drop to seven-year lows by August.
The U.S. Environmental Protection Agency said on Tuesday it was finalizing a proposal to extend the deadlines for oil refiners to prove their compliance with the nation’s biofuel blending laws for the years 2019 and 2020. The agency said refiners now have until Jan. 31, 2022, to submit compliance documentation for the 2020 year, while small refiners have until Nov. 30, 2021, to submit their documentation for the 2019 year.
- BRAZIL SOY EXPORTS SEEN REACHING UP TO 16.1 MILLION TNS IN MARCH VERSUS UP TO 16.4 MILLION TNS FORECAST IN PREVIOUS WEEK – ANEC
- BRAZIL CORN EXPORTS SEEN REACHING 115,000 TNS IN MARCH VERSUS 136,140 TNS FORECAST IN PREVIOUS WEEK – ANEC
Russia will export 920,000 tonnes of corn to destinations outside the Eurasian Economic Union (EAEU), according to the forecast of the JSC Rusagrotrans analytical center. The center’s head Igor Pavensky said this would be a record, amounting to more than a third of corn supplies since the start of the current farming year on July 1, 2020. He said 2.5 million tonnes of corn had been exported over this period. From March 1 to 22, its exports came to 840,000 tonnes.
Ukrainian vegetable oil refineries have processed 7.3 million tonnes of sunflower seed in the first half of the 2020/21 season or almost 57% of the volume available for crushing from the 2020 harvest, the Ukrainian vegetable oil association said. Ukraine is the world largest sunoil exporter which supplied 6.63 million tonnes of sunoil to foreign markets in the 2019/20 season which runs from September to August. Ukraine harvested 13.1 million tonnes of sunseed in 2020 and could process 12.9 million tonnes, the association predicted. The economy ministry forecast that farmers would harvest 13.5 million tonnes of sunflower seed this year. APK-Inform agriculture consultancy said this week Ukrainian sunflower oil asking export prices had risen by up to $115 a tonne, reaching $1,700-$1,175 fob Black Sea for March-April delivery owing to an increase in sunflower seed prices.
Euronext wheat rebounded on Tuesday after a run of 10 straight daily losses, joining Chicago futures in a technical rebound. A sharp fall in the euro against the dollar and renewed strength in corn prices also helped wheat to steady. Front-month May milling wheat was up 2.75 euros, or 1.3%, at 221.50 euros ($262.81) a tonne. It earlier fell to equal Monday’s five-week low of 218.25 euros. That increased a decline in front-month prices to more than 13% since the March 1 peak of 252.75 euros, which had marked a near eight-year high.
South African maize farmers are expected to harvest 6% more of the staple crop in the 2020/2021 season compared with the previous season, boosted by favourable weather conditions and increased plantings, a Reuters survey showed. South Africa’s Crop Estimates Committee (CEC) is expected to forecast the maize production at 16.289 million tonnes for the 2020/2021 season, up from the 15.300 million tonnes planted last season, an average estimate of five traders and analysts showed.
Indonesia set its crude palm oil reference price for April higher at $1,093.83 per tonne, an official at the country’s coordinating economics ministry said, bringing export taxes higher. Export taxes for crude palm oil in April will be $116 per tonne, up from $93 in March. Export levies however, will be kept at $255. The crude palm oil reference price for March was set at $1,036.22 per tonne.
Malaysia’s exports of palm-based biodiesel are likely to fall this year to their lowest since 2017 due to European Union restrictions and the coronavirus pandemic, the Malaysian Biodiesel Association (MBA) said. Exports from Malaysia are estimated to fall to 350,000 tonnes from 378,582 tonnes in 2020.
Global palm oil production is likely to rebound by 3.2 million tonnes in the 2020/21 crop year, leading analyst Thomas Mielke said. Indonesia’s palm oil output is seen up 3.3 million tonnes while Malaysian production is likely to fall 500,000 tonnes in the 2021/21 year. Global palm oil consumption is likely to see a slight recovery of less than 1 million tonnes in 2020/21, Mielke said, adding that prices of edible oils are likely to peak within the next four weeks.
Indonesia’s palm oil inventories at the end of 2021 are expected to fall by nearly half to 2.67 million tonnes from 4.87 million tonnes last year, an official at the Indonesian Palm Oil Association (GAPKI) said. Total demand for export and domestic consumption in 2021 is expected to rise 9% from the year before to 56 million tonnes, while production is set to rise 4% to 49 million tonnes
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