FI Evening Grain Comments 02/07/22

PDF Attached

 

I
will be traveling through Tuesday, February 10, but will be sending out limited emails. S&D’s are due out Wednesday and will update accordingly.

 

Private
exporters reported sales of 507,000 metric tons of soybeans for delivery to unknown destinations. Of the total, 249,000 metric tons is for delivery during the 2021/2022 marketing year and 258,000 metric tons is for delivery during the 2022/2023 marketing year.

 

Weekend
rains across Argentina and Paraguay were not heavy enough to combat drought conditions. Central and Northern Brazil are too wet for soybean harvesting.  Soybeans traded higher on strong US demand and ongoing SA crop concerns. Corn rallied following soybeans.
Wheat was higher but gains were limited on softer Black Sea wheat export prices and favorable Black Sea weather. The Goldman roll began today.

 

Weather

 

 

World
Weather Inc.

WEATHER
EVENTS AND FEATURES TO WATCH

• Changes
  overnight included; wetter weather in France during the coming ten days, a few more showers in northern Africa than advertised late last week and drier biased conditions from central Argentina into southern Brazil
  
• Weekend
  precipitation was less than expected in northern cotton areas of Argentina and in southeastern Paraguay
• U.S.
  frost and freezes occurred as far south as southern Texas during the weekend possibly damaging some fruit and vegetable crops, but the losses were not nearly as great as those of last February
• Tropical
  Cyclone Batsirai impacted central and southern Madagascar with intensity Category 3 wind speeds and torrential rain resulting in flooding during the weekend
• Damage
  to personal property and infrastructure was widespread, although the assessments are still under way.
  
• Damage
  to agriculture was suspected, although no specific details were available as of the time of this reporting
  
• The
  storm has since left Madagascar and will move away from the nation and southern Africa this week ending its potential impact on the region
• Tropical
  Cyclone Batsirai was located 169 miles south southeast of Europa Island at 1500 GMT today moving southward at 11 mph
• The
  storm was producing maximum sustained wind speeds to 46 mph
• Tropical
  Storm force wind was occurring out 210 miles from the center of the storm
• Batsirai
  will continue moving southerly the next couple of days
• The
  storm will no longer produce adverse weather over Madagascar or any other landmass through the remainder of its existence
• Little
  change in intensity is expected over the next couple of days
• Heavy
  rain fell in central parts of Paraguay during the weekend bringing some much needed relief to one of the hottest and driest summers in recent memory
• Rainfall
  reached over 7.00 inches in central parts of the nation while the southeast (where many crops are produced) did not receive nearly as much rain
• Rainfall
  near the Misiones, Argentina border and the Parana border were not much more than 1.00 inch, but central areas did receive 3.00 to 6.00 inches and that locally greater amount over 7.00 inches noted above
• The
  rain in Paraguay was welcome, but some areas got too much and others not enough
  
• The
  precipitation also fell a little too late to seriously change soybean and other early season crop production, but the moisture might be good for Safrinha planting
• Brazil
  rainfall during the weekend was welcome and sufficient for a boost in topsoil moisture from western and southern Mato Grosso do Sul, western Parana and near Paso Fundo, Rio Grande do Sul through parts of Sao Paulo to Minas Gerais
• Some
  areas in central Mato Grosso also reported beneficial rain, but the greatest coverage was in the interior south and center south
• Rain
  totals were mostly in the 1.00 to 2.25 inch range
• Lighter
  rainfall occurred elsewhere
• Temperatures
  were seasonable
• Brazil
  weather over the next ten days will generate less than usual rainfall in most of the south
  
• This
  includes the region from Rio Grande do Sul and portions of Paraguay to southwestern Sao Paulo and southern Mato Grosso do Sul
• Totally
  dry weather is not expected, but rain totals of 0.20 to 0.80 inch may not be enough to counter evaporation leading to net drying
• Recent
  rainfall should carry most crops in southern Brazil for a while during the net drying biased period, but some areas in Rio Grande do Sul and southernmost Paraguay are going to need follow up rain soon to support crops and to minimize plant stress. However,
  follow up rain will be needed after mid-month to prevent a more serious bout of crop stress from taking place. Rio Grande do Sul will already have some significant moisture stress in parts of the state in the next two weeks, but other areas will manage the
  situation relatively well after recent rain.
• Center
  west and northern parts of center south Brazil will get frequent rain during the next ten days slowing fieldwork and possibly inducing some new flooding
• Minas
  Gerais, and parts of Goias will be wettest, but portions of Mato Grosso will also be plenty wet – especially in the northeast
• Concern
  about too much moisture hurting unharvested soybean quality and delaying Safrinha planting will continue this week until a better period of net drying evolves.
• Argentina
  rainfall during the weekend was greatest in the southern and far northern thirds of the nation while central areas failed to get enough rain to counter evaporation
• Rainfall
  varied from 0.20 to 1.00 inch in Buenos Aires with 1.00 to 2.00 inches in southwestern Buenos Aires and along the central east coast southeast of the city of Buenos Aires
• General
  Pico, La Pampa reported the greatest rainfall of 2.50 inches
• Northernmost
  rainfall was mostly less than 1.20 inches which was lighter than expected for Formosa and Chaco
  
• Temperatures
  were close to normal
• Argentina
  rainfall is expected to be restricted during the next ten days, although not totally absent
• Most
  of the rain will not be enough to counter evaporation, although the exceptions will be in parts of Buenos Aires, La Pampa, western Cordoba and the far northwestern corner of the nation where showers and thunderstorms are possible periodically – mostly late
  Thursday into Saturday
• Rainfall
  of 0.30 to 1.25 inches is expected most often with a few totals over 2.00 inches
• Heavier
  rain will fall in parts of Salta and near the south coast of Buenos Aires
• Net
  drying is expected in much of the nation and for central areas that missed the weekend rain (central and northern Cordoba, much of Santa Fe and parts of both Corrientes and Entre Rios) crop moisture stress is expected and pressure on yields may resume
• Feb.
  20-21 may bring some relief to the drier areas, but confidence is low on the timing and how significant the rain may be
• The
  bottom line will be one of concern for central Argentina crop areas and for many locations in the far north as well. Southern crop areas should do well because of timely rain and favorable soil moisture. Northern Argentina received some needed moisture during
  the weekend, but it was not nearly enough and crop stress will be quick to resume. Southern Argentina has the best soil moisture and timely rainfall will see to it that crop development advances well. Southern Argentina is where most of the late season soybeans
  are produced. Central Argentina production potential potentials could fall significantly if rain does not evolve soon.
  
• Argentina
  temperatures should be seasonable this week and a little warmer than usual next week
• South
  Africa reported flooding rainfall in Gauteng, southeastern Free State and southern Natal during the weekend
• Rain
  totals surpassed 4.00 inches in a few areas which may not sound like much, but some of the areas impacted have seen too much rain already this summer and flooding impacted urban and some rural areas
• Crop
  damage has not been assessed, but World Weather, Inc. believes it will be localized
• Several
  other bouts of local flooding have impacted parts of the nation this summer which may cut into production and crop quality, but many other areas have seen a good mix of weather
• Production
  may not be quite as good as the previous year, but it will still be a good summer for grain, oilseeds, sugarcane, citrus and rice
• Much
  of the cotton will perform well too except in areas that have been too wet
• South
  Africa will experience a more restricted rainfall pattern this week which will improve the wetter areas
• Most
  summer crops will remain in favorable condition
• A
  boost in rainfall should occur again next week
• Heavy
  rain and flooding occurred along the central west coast of Sumatra, Indonesia during the weekend
  
• One
  location reported 12.48 inches of rain while other reported over 6.00 inches
• Damage
  reports were not available at the time of this writing
• Southeast
  Asia will experience erratic rainfall over the next ten days
• The
  majority of crops in Indonesia, Malaysia and the Philippines will benefit from the environment
• Some
  showers may also impact the mainland areas of Southeast Asia periodically with only light amounts of rain resulting
• U.S.
  weekend precipitation was not very great, but rain fell in the southeastern states Friday while snow and rain ended in the northeastern and middle Atlantic Coast states
• Saturday
  morning temperatures were bitter cold in the southern Plains and Delta
• Lowest
  readings were in the upper single digits and teens in the Texas Panhandle, teens and 20s in central Texas, the 20s lower 30s in South Texas and in the upper teens and 20s in the Delta
• Damage
  to some fruit and vegetable crops occurred in southern Texas, although the losses were not nearly as great as those of last year in February when another bout of extreme cold occurred
• Temperatures
  were already warming during the weekend with highest readings Saturday and Sunday returning to the 50s in much of Texas with 60s in the south
  
• Lowest
  morning temperatures in the Midwest were in the negative and possible single digits with a few readings in the teens near and south of the Ohio River
• Snow
  cover was sufficient to protect winter crops from any threat of damage
• Freezes
  occurred as far south as the central U.S. Gulf of Mexico coast, but no freezes occurred in Florida, southern Georgia or southern South Carolina
• U.S.
  precipitation in the next ten days will be limited in in the Great Plains, lower Midwest, Delta, Tennessee River Basin, interior southeastern states and in many areas in southern Rocky Mountain region and southwestern states
• Waves
  of snow will occur in the northern Plains and northern Midwest where some significant snowfall is possible, but it comes in short term waves
  
• No
  threatening cold will impact winter crop areas during the next ten days
• Any
  precipitation in hard red winter wheat areas will be too light to change the condition of soil or crops
• West
  Texas will also fail to get much moisture during the forecast period, although the Texas Panhandle will not be completely dry
• U.S.
  weather Feb. 17-22 may become more active once again in the southeastern portions of hard red winter wheat country, a part of central and eastern Texas, the Delta and lower eastern Midwest as well as the middle and northern Atlantic Coast states with at least
  one storm and possibly two
• Temperatures
  may trend a little cooler in the western states during this period of time while some warming occurs in the southern Plains, southeastern States, Delta and lower Midwest
• Readings
  in some of these warming areas will become near to above average
• Europe
  and the western Commonwealth of Independent States temperatures will remain non-threatening to winter crops for the next two weeks
• Readings
  will be near to above normal with the warmest weather relative to normal in Russia, and parts of eastern Europe
• Precipitation
  in Europe will continue lighter than usual in Spain and Portugal where no serious improvement in soil moisture is expected during the next ten days
• Waves
  of snow and rain will fall across eastern Europe and the western CIS; including most of Russia and parts of Ukraine
• Some
  southern areas may not get much significant moisture, but the ground will remain snow covered and brief bouts of additional snow and rain will be possible
• Northwestern
  Africa will continue missing out on “significant” precipitation during the next ten days, although some showers are expected
• Seasonal
  warming will begin later this month and continue in March raising the need for precipitation and this region will need to be more closely monitored
• Southwestern
  and northeastern Morocco and northwestern Algeria have the poorest soil moisture and the greatest need for precipitation
• Tunisia
  and northeastern Algeria crops are still rated favorably and will produce well as long as timely rainfall occurs this late winter and spring
• India
  weekend precipitation shifted from the far north Friday to the Eastern States with sufficient moisture to bolster topsoil moisture for a little while
• Last
  week’s moisture was greatest for winter wheat and a few other crops
• Moisture
  is still needed in rapeseed, millet, sorghum and pulse production areas as well as for other crops in the central and west to ensure the best yields this year
• Most
  crop conditions are rated quite favorably, though
• Northern
  India may get a few showers late Monday and Tuesday of this week with amounts of 0.05 to 0.35 inch
  
• Rajasthan,
  Punjab, northern Uttar Pradesh and areas to the north will get most of that moisture
• A
  few locations might get as much as 0.50 inch, but such occurrences will be rare
• Mostly
  conditions are likely in the majority of other India crop areas during the coming week and perhaps for ten days
• China’s
  weather will continue to support frequent bouts of snow and rain from the Yangtze River Basin to the south coast over the next ten days
• The
  moisture abundance will be good for early rice and other early season crops that get planted in late February and especially March
• Winter
  rapeseed and wheat are still rated in good condition with the bulk of wheat dormant and rapeseed in a state of semi-dormancy
• Eastern
  Australia weather will be relatively quiet over the next ten days
• Any
  showers that evolve will be extremely brief and light leaving soil conditions to slowly dry down
• Coastal
  areas of New South Wales and the upper Queensland coast, Australia were wettest during the weekend leaving most key summer crop areas in the nation dry
• Middle
  East snow cover remains more widespread than usual reaching across most of Turkey and into western and northern Iran
• Some
  snow melt is expected
• The
  moisture will be good for winter crops when warming melts the snow
• Ethiopia
  has been seasonably dry recently while periodic showers and thunderstorms occur in Uganda and southwestern Kenya
• Tanzania
  has been and will continue wettest which is normal for this time of year in east-central Africa
  
• Little
  change is expected in these patterns through the next two weeks
• West-central
  Africa will continue seasonably dry with near normal temperatures for the next ten days
• A
  few showers are possible in coastal areas, but very little rain will reach into coffee or cocoa production areas
• Today’s
  Southern Oscillation Index is +6.44 
• The
  index will move higher over the next few days
• New
  Zealand will continue to receive significant rain in North Island and in some western and northern parts of South Island this week
  
• Follow
  up precipitation is possible in the north next week
• The
  moisture will be welcome and help to raise topsoil moisture
• Temperatures
  will trend a little a little cooler than usual
• Mexico
  will experience cooler than usual weather with rain in some of the east-central parts of the nation periodically over the coming week
  
• The
  moisture will be good for early season crop development late this month and in March
• Sugarcane,
  citrus and winter rice will benefit most, but some other fruits and vegetable crops will also benefit
  
• Early
  season sorghum and corn planting will occur well this year if the precipitation is great enough
  
• The
  remainder of the nation will be dry
• Central
  America precipitation will be greatest along the Caribbean Coast during the next seven to ten days
• Guatemala
  will also get some showers periodically
• Western
  Colombia, Ecuador and Peru rainfall may be greater than usual in the coming week
  
• Western
  Venezuela will soon begin receiving rain once again after a bout of dryness
• The
  remainder of Venezuela will remain dry

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

Monday,
Feb. 7:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• Ivory
  Coast cocoa arrivals
• HOLIDAY:
  New Zealand

Tuesday,
Feb. 8:

• Canada’s
  StatCan releases wheat, durum, canola, soybeans and barley stockpile data, 8:30am
• EU
  weekly grain, oilseed import and export data

Wednesday,
Feb. 9:

• EIA
  weekly U.S. ethanol inventories, production
• USDA’s
  monthly World Agricultural Supply and Demand (WASDE) report, 12pm

Thursday,
Feb. 10:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Malaysian
  Palm Oil Board’s data on palm oil reserves, output and exports
• French
  agriculture ministry releases 2022 winter grain and rapeseed planting estimates
• Brazil’s
  Conab report on yield, area and output of corn and soybeans
• Brazil’s
  Unica releases sugar output and cane crush data (tentative)
• IKAR
  grain conference in Moscow
• Vietnam’s
  customs department to publish data on coffee, rice and rubber exports in January
• Malaysia’s
  Feb. 1-10 palm oil exports

Friday,
Feb. 11:

• ICE
  Futures Europe weekly commitments of traders report, ~1:30pm
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• March
  ICE white sugar contract expiry
• HOLIDAY:
  Japan

Source:
Bloomberg and FI

 

 

 

USDA
inspections versus Reuters trade range                                                    

Wheat                 
417,750                 versus   250000-450000  range

Corn                     
1,053,202             versus   975000-1300000                range

Soybeans           
1,217,991             versus   1000000-1850000             range

 

China
was a large taker of 765,329 tons of soybeans, followed by Egypt of 93,691 tons.  Last week China had 2.55 million tons of outstanding soybean sales while Egypt had 590,000 tons. 

 

 

 

GRAINS
INSPECTED AND/OR WEIGHED FOR EXPORT

                 
REPORTED IN WEEK ENDING FEB 03, 2022

                           
— METRIC TONS —

————————————————————————-

                                                  
CURRENT     PREVIOUS 

             ———–
WEEK ENDING ———-  MARKET YEAR  MARKET YEAR

 
GRAIN      02/03/2022  01/27/2022  02/04/2021    TO DATE     TO DATE  

 

BARLEY             
0           0           0       10,010       24,636 

CORN       
1,053,202   1,035,783   1,586,642   18,597,272   21,604,077 

FLAXSEED           
0         100           0          324          509 

MIXED              
0           0           0            0            0 

OATS               
0           0           0          400        2,693 

RYE                
0           0           0            0            0 

SORGHUM      
155,534     127,641     201,462    2,433,085    3,269,148 

SOYBEANS   
1,217,991   1,415,892   1,906,263   37,642,888   49,374,591 

SUNFLOWER          
0           0           0          432            0 

WHEAT        
417,750     376,524     485,545   14,024,919   17,052,113 

Total      
2,844,477   2,955,940   4,179,912   72,709,330   91,327,767 

————————————————————————-

CROP
MARKETING YEARS BEGIN JUNE 1 FOR WHEAT, RYE, OATS, BARLEY AND

FLAXSEED; 
SEPTEMBER 1 FOR CORN, SORGHUM, SOYBEANS AND SUNFLOWER SEEDS.

INCLUDES
WATERWAY SHIPMENTS TO CANADA.

 

Macros

81
Counterparties Take $1.680 Tln At Fed Reverse Repo Op (prev $1.643 Tln, 79 Bids)

US
CDC Raises Japan Travel Advisory To Level 4, Very High

 

Corn

·        
Corn traded higher led by the front months (March up 14.75 cents to $63525) following soybeans on SA crop concerns. $6.2450 is the March absolute contract high.  SK bought corn over the weekend.  WTI was more than $1.15 lower
by 1:10 pm CT and the USD up 29 points. 

·        
USDA US corn export inspections as of February 03, 2022 were 1,053,202 tons, within a range of trade expectations, above 1,035,783 tons previous week and compares to 1,586,642 tons year ago. Major countries included Japan for
300,952 tons, Mexico for 253,434 tons, and China for 208,779 tons.

·        
Several reports will be out this week starting with StatsCan on Tuesday.

·        
The Goldman roll began today.

·        
Iraq’s state news agency reported the country plans to import yellow corn and soybeans to fulfill domestic needs. 

 

Export
developments.

·        
South Korea’s Feed Leaders Committee (FLC) bought about 66,000 tons of corn to be sourced from optional origins at an estimated $339.74 a ton c&f for arrival in South Korea around May 20.

·        
South Korea’s NOFI bought an estimated 133,000 tons of corn in two consignments. The first consignment of about 66,000 tons was bought at an estimated $339.74 a ton c&f for arrival around May 20. The second consignment of about
67,000 tons was bought at an estimated $339.49 a ton c&f for arrival around May 25.

 

Updated
2/2/222

March
corn is seen in a $5.95 to $6.55

December
corn is seen in a wide $5.25-$7.00 range

 

Soybeans

·        
Soybeans were 20.25-28.75 cents higher, with march at an 8-moonth high, on strong US demand and ongoing SA crop concerns.   Meal was sharply higher while spreading against soybean oil caused that market to traded tow-sided, ending
mixed.  We upward revised our meal and soybean price ranges for the nearby contract. The March contract rallied above $15.80/bu and has made new highs 9 times over the past month, according to Barchart. March is up about 160 cents since January 1. $15.8950
was the contract high today.  We think $16.00 is not out of reach by mid-week if SA weather models fail to improve. 

·        
Weekend rains across Argentina and Paraguay were not heavy enough to combat the drought conditions. Central and Northern Brazil are too wet for soybean harvesting.  Rio Grande do Sul will see dry conditions intensify this week. 
Argentina will see hot and dry conditions this week, although conditions improve in the 11-15 forecast. 

·        
StatsCan will issued December 31 grain and oilseed stocks Tuesday morning. Traders are looking for canola stocks to decrease 43 percent from Dec 31, 2020, or 5.8 million tons to 7.5 million tons. 

·        
AgRural: Brazil harvested 16 percent of the soybean crop, up from 10 percent previous week and above 4 percent year ago.  They mentioned wet weather has slowed harvesting. 

·        
USDA US soybean export inspections as of February 03, 2022 were 1,217,991 tons, within a range of trade expectations, below 1,415,892 tons previous week and compares to 1,906,263 tons year ago. Major countries included China for
765,329 tons, Egypt for 93,691 tons, and Japan for 84,607 tons.

·        
Palm oil futures hit a record high on Monday before settling lower. They it rallied slightly during the short overnight third session. Traders are looking for end of January Malaysian palm oil stocks to be little changed from
December.  Production and exports likely dropped from December. 

·        
China is back from holiday and as expected the market traded sharply higher led by SBM following CBOT gains last week. 

·        
China and Argentina on Sunday pledged to expand their commodity and currency trading relationship over a five year period.  China buys a large amount of soybeans and beef from Argentina. 

 

 

Export
Developments

• Ukraine
  will supply Turkey with 50,000 tons of sunflower seeds with zero export duty. 
  
• Private
  exporters reported sales of 507,000 metric tons of soybeans for delivery to unknown destinations. Of the total, 249,000 metric tons is for delivery during the 2021/2022 marketing year and 258,000 metric tons is for delivery during the 2022/2023 marketing year.

 

 

Nearby
soybeans – nearby corn spread widened to its highest level since 2014

Source:
Reuters and FI

 

Updated
2/7/22

Soybeans
– March $14.75-$16.50

Soybeans
– November is seen in a wide $12.00-$15.75 range

Soybean
meal – March $420-$480

Soybean
oil – March 66.50-69.00

 

Wheat

·        
US wheat futures traded higher (few contracts traded two-sided during the session) with gains limited on favorable global weather for the major wheat producing countries and slow US export demand.  MN led the 3 US markets. 

·        
USDA US all-wheat export inspections as of February 03, 2022 were 417,750 tons, within a range of trade expectations, above 376,524 tons previous week and compares to 485,545 tons year ago. Major countries included Korea Rep for
95,357 tons, Mexico for 76,648 tons, and Japan for 70,973 tons.

·        
StatsCan will issued December 31 grain and oilseed stocks Tuesday morning. Traders are looking for all-wheat stocks to decrease 31 percent from Dec 31, 2020, or 7.7 million tons to 17.3 million tons. 

·        
EU wheat futures were up 1 euros to 266.50 euros per ton. On Thursday Paris milling wheat hit a 4-month low. 

·        
Black Sea wheat prices eased last week by $7-9/ton to $323 and $319/ton, respectively, according to private trade groups.  Today it was unchanged to slightly lower. 

·        
(Reuters) – Ukrainian winter grain crops sown to 2022 harvest were mostly in good or satisfactory condition as of Feb 3, APK-Inform agriculture consultancy reported on Monday, citing Ukraine’s service of food protection.

·        
The Russian wheat export tax adjusted this week to $93.20/ per ton from $93.90.

·        
Iraq sees a 3-million-ton wheat crop. Consumption is around 4.5-5.0 million tons.  Ukraine exported 39.2 million tons of grain so far in the 2021/22 July-June season, up 32.8% from the same stage a season earlier.  The total volume
included 17.2 million tons of wheat, 5.5 million tons of barley and 16.1 million tons of corn. (Reuters)

·        
(Interfax) – Russia exported 2.95 million tons of wheat in December 2021, down 7.5% year-on-year, the Federal Customs Service said on Monday.

 

Export
Developments.

·        
Syria seeks 200,000 tons of wheat on February 14, open for 15 days.

·        
The Philippines seeks feed wheat from Australia and soybean meal from Argentina on February 11. Amounts are unknown.

·        
Bangladesh seeks 50,000 tons of wheat set to close February 14.

·        
Jordan seeks 120,000 tons of feed barley on February 8.

 

Rice/Other

·        
(Bloomberg) — U.S. 2021-22 cotton ending stocks seen at 3.29m bales, slightly above USDA’s previous est., according to the avg in a Bloomberg survey of ten analysts.

Estimates
range from 3.0m to 3.7m bales

Global
ending stocks seen at 84.95m bales vs 85.01m bales

 

Updated
2/2/22

Chicago
March $7.25 to $8.30 range

KC
March $7.45 to $8.55 range

MN
March $8.75‐$10.00