FI Evening Grain Comments 03/13/13

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Headline
trading in a fragile market. Perhaps we are no different, or the US Fed takes a pause from raising interest rates, only to go north later. Lower soybean complex market. Weakness in soybeans prompted spreading in corn, which ended lower on bear spreading. Lack
of news for the front end will do that. Higher for US high protein wheat on short covering despite a massive move to import wheat from major importers. Black Sea grain export deal talks are moving along but only a 60-day extension is not promising for importers
to book cargoes.

Weather

South
American weather does offer some light rains for dry Argentina. Brazilian Soy harvest might slow as rains increase Safrinha corn areas. Northern areas will see a pickup in harvest, where the corn crop for the second season is mostly planted. Ongoing rains
hammering the west coast will spread east this week providing additional wintery storms for the upper US. TX and OK have a chance for rain bias eastern areas, much needed where its topsoil remains dry.

Map

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MOST
IMPORTANT WEATHER FOR THE DAY

Argentina
was very warm to hot and dry during the weekend

Highest
afternoon temperatures Friday and Saturday were in the 90s to near 104 Fahrenheit
Crop
moisture stress continued high in much of the nation due to limited soil moisture, the lack of rain and presence of warm to hot temperatures

Argentina
rainfall will continue limited through Tuesday; showers are expected Wednesday into Saturday favoring the west and south, but some will occur in the drier areas of east-central Argentina as well

Rainfall
by Saturday will vary from 0.20 to 0.80 inch with local totals of 1.00 to 2.50 inches favoring the far southwest and east-central parts of the nation

The
heart of Argentina may continue driest.

Temperatures
will continue well above normal until the rain increases in the second half of this week when “some” cooling is likely

Additional
rainfall is expected in Argentina next week with most crop areas impacted at one time or another.

Another
0.50 to 1.50 inches and local totals over 2.00 inches occurring in 75% of the nation by March 24
Cooling
is expected next week as the rain increases, although there may still be a slight warmer bias for some areas

Argentina’s
bottom line offers status quo conditions early this week with crop stress resulting from very warm to hot temperatures and little to no rain. Showers late this week and those into the weekend will offer “some” relief from dryness and heat stress, but much
more rain will be needed to more fully restore soil moisture and stop the decline in crop conditions. Additional improvement in crop and field conditions will occur next week as additional rain falls. A complete restoration in crop production potential is
not possible because of the lateness of the season, but some late season corn and especially peanut and soybean conditions may result. Follow up rain will be imperative to perpetuate any improving trend. Production will still be seriously cut this year because
of the seriousness of drought throughout the growing season.
Brazil
soil moisture on Friday had improved in southern Mato Grosso and Mato Grosso do Sul resulting in some increase in fieldwork late last week and during the weekend

Weekend
precipitation was limited in Mato Grosso do Sul, Parana and western and southern Sao Paulo offering an opportunity for drying in areas that had been too wet for aggressive fieldwork; however, more dry weather was needed
Weekend
temperatures were seasonable

Southern
Brazil daily rainfall will resume this week and continue into next week resulting in a reversal in the recent drying trend for at least some areas

Delays
in farming activity will resume and concern over late planting of Safrinha crops and harvesting of soybeans will resume

The
daily rainfall, however, may be more sporadic and infrequent allowing some fieldwork to occur around the rain

Progress
rates will be slow, but some fieldwork should continue

The
next ten days of weather will be driest in northern Rio Grande do Sul, central Santa Catarina and from central through northern Minas Gerais
Previously
planted Safrinha crops will continue to develop well in an environment including periods of sun and rain
Temperatures
should be seasonable

China
topsoil moisture is in a steady declining trend due to dry weather and well above normal temperatures recently

Weekend
high temperatures in wheat production areas ranged in the lower to middle 80s Fahrenheit in the Yellow River Basin and North China Plain as well as the Yangtze River Basin
Weekend
rainfall was mostly confined to the Yangtze River Basin where 0.25 to 0.62 inch resulted with local totals of 1.00 to nearly 2.50 inches in Jiangxi and southern Hunan

Eastern
China temperatures will continue warmer than usual especially in east-central and northeastern areas

Limited
rainfall is expected in the Yellow River Basin and North China Plain which is normal for this time of year

Drying
in this region should be closely monitored since wheat is breaking dormancy and evaporation is firming the soil faster than usual

Seasonal
rains usually do not begin until May, although April usually has a couple of precipitation events that could provide some relief from dryness if they occur this year.
The
next two weeks will be seasonably dry and warm in this region

Rain
will fall frequently in the Yangtze River Basin supporting rapeseed development over the next two weeks

Some
rice planting and early development will advance in the Yangtze Basin, but some of the southern coastal provinces will need greater rain soon for improved rice and corn planting conditions

Additional
rain fell in Queensland and northeastern New South Wales, Australia during the weekend

Amounts
varied from 0.45 inch to 2.00 inches and all of it was welcome especially for dryland crops

Rain
already impacted a part of this same region late last week

Central
and western cotton and sorghum areas of New South Wales were missed by this rain as were a few minor southwestern Queensland crop areas

Showers
in eastern Australia will linger early this week followed by ten days of net drying beginning Tuesday or Wednesday

Temperatures
are expected to rise above normal as the dry weather resumes

Tropical
Cyclone Freddy moved into central Mozambique during the weekend and dissipated with peak wind speeds reaching 105 mph near the coast during landfall

Landfall
was east northeast of Quelimane
The
storm was producing 50 mph wind speeds at 1800 GMT Sunday and the remnant low pressure center today was producing 35 mph wind speeds near the southeastern border of Malawi
Freddy
has dissipated as a viable tropical cyclone

The
system is unlikely to get regenerated
Freddy
has set records for the longest tropical cyclone track across the Indian Ocean and for longevity with the storm first evolving Feb. 3

The
system diminished to a tropical low pressure center for a little while after moving into southern Mozambique Feb. 24 through March 1 when it made a loop and then moved over open water in the Mozambique Channel March 2 and became a tropical cyclone March 3
and then a very strong storm prior to reaching central Mozambique Saturday

Torrential
rain and damaging wind accompanied the storm inland during the weekend

U.S.
snowfall during the weekend was greatest in California’s Sierra Nevada and in the Cascade Mountains, but significant snow also fell from North Dakota to Iowa and east through Northern Illinois and Michigan to New York, southern New England and areas south
into the West Virginia and Virginia Mountains

Snow
accumulations officially ranged from 30 to 40 inches in the southern Sierra Nevada, although not all areas have reported their snow totals and it was strongly suggested that some amounts may have ranged up to 60 inches
Snowfall
from northeastern North Dakota to northwestern Minnesota and northern Minnesota ranged from 6 to 17 inches with the greatest amounts along the northwestern shore or Lake Superior

One
location along the south short of western Lake Superior in Wisconsin reported 22 inches
Snowfall
in the remainder of the northern Midwest and northeastern states ranged from 1 to 6 inches with a few local totals to 9 inches except in Wisconsin where many central and eastern locations reported up to 13 inches

Weekend
rain and snowfall in the Midwest produced moisture totals through this morning varying from 0.05 to 0.55 inch

North
Dakota precipitation totals varied up to 0.44 inch with Williston reporting 1.10 inches of moisture and 7 inches of snow while Minot, N.D. reported 13 inches and Grand Forks, N.D. reported 12 inches
U.S.
Delta and southeastern states received rain with amounts of 0.30 to 1.24 inches occurring often

Local
totals reached up to 1.55 inches
Little
to no rain occurred from southern Louisiana through southern Alabama to northwestern Florida

Central
and southern Florida continued to experience drought or drought-like conditions
Pacific
Northwest moisture during the weekend varied from nothing in western Oregon crop areas while varying from 0.05 to 0.37 inch elsewhere
Dry
weather occurred in most of hard red winter wheat production areas and areas south into the heart of Texas

U.S.
hottest weekend temperatures reached the 80s and 90s from southern Oklahoma to South Texas and into the lower 80s in southern Louisiana, southeastern New Mexico and Florida.

Temperatures
were cooler than usual in the northern Plains and a part of the northern Midwest where 20- and 30-degree highs were noted and lows in the negative and positive single digits in the northwestern Plains and parts of New England.

U.S.
hard red winter wheat areas will experience some showers Thursday of this week

Moisture
totals of 0.05 to 0.20 inch and local totals to 0.30 inch will impact western crop areas which will not have much impact on drought status
Moisture
totals farther to the east will vary from 0.30 to 1.00 inch and locally more with the greatest moisture in northern and eastern fringes of crop country

Nebraska
will be wettest with some significant snowfall expected varying from 5 to more than 12 inches

The
greatest snow will be northeast of key wheat production areas

Another
chance for rain and snow “may” evolve next week

This
event is up for debate, but it could be most significant in the south (Texas and Oklahoma) – confidence is low

U.S.
Midwest precipitation over the next ten days will be lighter than usual varying from 0.05 to 0.75 inch

U.S.
Delta and southeastern states should be wetter with 0.75 to 2.00 inches likely and a few greater amounts of 3.00 inches or more
Portions
of West Texas will get some rain early this week with a better chance for moisture late this week into next week; confidence in the timing and intensity is still low, but some moisture is expected
South
Texas and a part of northeastern Mexico will receive some rain during mid-week this week and again late this week

The
moisture will be welcome, but much more will be needed to induce a serious improvement in dryland corn, sorghum and cotton planting

California
and parts of the Pacific Northwest will receive periods of rain and mountain snow early this week with some additional moisture next week

Water
supply in these areas is destined for improvement when the snow melt season arrives

Northern
U.S. Plains and Canada’s Prairies will receive restricted precipitation during the next ten days, though many areas will get at least some moisture

Snow
fell in Canada’s Prairies during the weekend was greatest from central and southern Alberta through western and southern Saskatchewan to southern Manitoba

Moisture
totals varied up to 0.88 inch in south-central Saskatchewan while up to 0.39 inch occurred in southeastern Alberta and 0.27 inch in southern Manitoba. Most other areas received a trace to 0.25 inch of moisture
The
moisture will be good for use in the spring after prolonged dryness in some areas, but more moisture will be needed

Europe
soil moisture has been rising in the north recently brought on by recent precipitation
Southern
Europe soil moisture is still lacking in eastern Spain, and parts of the lower Danube River Basin where weekend precipitation was minimal once again
Most
of Europe reported precipitation during the weekend except in Scandinavia, the Iberian Peninsula, Italy and a part of the Danube River Basin

Temperatures
were mild to cool in the north and warm in the south

CIS
rain and snow fell abundantly from Ukraine to western Russia and the Baltic States during the weekend with lighter precipitation to the east into the Ural Mountain region

Moisture
totals varied from 0.25 to 1.18 inches and few greater amounts in southwestern Ukraine
The
ground is already saturated in many areas and runoff is likely raising river and stream flows in many areas

CIS
weekend temperatures were warmer than usual and will continue that way which is melting some snow cover

Highest
temperatures Friday and Saturday were in the 20s and 30s in northern Russia and in the 30s and 40s in the south except in southern parts of Russia’s Southern Region where temperatures reached the 60s to near 70 degrees

CIS
precipitation will continue frequent and abundant in northern Russia through the next ten days

A
more limited precipitation bias is expected in Ukraine Belarus and some parts of Russia’s Southern Region

India
weekend weather was dry and temperatures were in the lower to middle 90s Fahrenheit with some upper 90- to 102-degree Fahrenheit readings in the northwest

The
heat stressed crops and dryness left many unirrigated crops poised for lower production

India
weather will continue drier biased through mid-week this week leaving winter crops stressed because temperatures will be warm at the same time

Rain
Thursday through Monday, March 20 will increase in central and eastern parts of the nation benefiting late season crops especially rice and sugarcane

Moisture
totals will vary from 0.60 to 2.50 inches and locally more than 3.00 inches

North
Africa rainfall during the weekend was very limited and another week of the same is expected with temperatures above normal

Some
rain is expected next week in northeastern Algeria and northern Tunisia
More
rain is needed throughout all production areas to induce better production potentials
Temperatures
will continue warm

West-central
Africa rainfall is expected to increase from Wednesday of this week through Tuesday of next week bolstering soil moisture and improving conditions for flowering coffee and cocoa

Weekend
precipitation was limited and net drying occurred while temperatures were very warm

Turkey
will receive frequent bouts of rain over the next ten days bolstering soil moisture for wheat development and rice and cotton planting

Other
spring planting will benefit from the coming moisture boost

Other
areas in the Middle East are unlikely to get much volume of rain during the next two weeks, although some timely rain will fall in western Iran, northern Iraq and northern Syria during the middle and latter parts of this week
Philippines
rainfall will be light to locally moderate most days through the coming week

Weather
conditions in the next ten days should be mostly good for the nation

Indonesia
and Malaysia rainfall will occur abundantly during the next two weeks with all areas impacted and no area experiencing much net drying
Mainland
areas of Southeast Asia will receive very little rain of significance for a while which is normal for this time of year
South
Africa weather will be a little drier than usual, but the environment will be good for early season crop maturation and harvesting

Greater
rain will soon be needed to maintain the best possible late season crop conditions

Eastern
Africa precipitation is expected to scatter from Tanzania to Ethiopia over the next ten days

The
moisture will be good for ongoing crop development

Eastern
Mexico and portions of Central America will receive rain during the next ten days

The
precipitation will be most organized in Central America with Costa Rica and Panama wettest, but some areas in western Honduras, northwestern Nicaragua and Guatemala this weekend into next week

Moisture
totals may be enough to stimulate premature coffee flowering and that potential event should be closely monitored

Most
likely the advertised rain is overdone and will be reduced in future forecast model runs.

Today’s
Southern Oscillation Index was +4.33 and it was expected to move lower over the coming week

Source:
World Weather, INC.

Bloomberg
Ag calendar

Monday,
March 13:

USDA
export inspections – corn, soybeans, wheat, 11am
New
Zealand food prices

Tuesday,
March 14:

EU
weekly grain, oilseed import and export data

Wednesday,
March 15:

EIA
weekly US ethanol inventories, production, 10:30am
FranceAgriMer
monthly grains balance sheet
Malaysia’s
March 1-15 palm oil export data
Eurasian
agri-commodities conference, Kazakhstan, day 1
Grain
Export Conference, Paris

Thursday,
March 16:

IGC
grains market report
USDA
weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
Eurasian
agri- commodities conference, Kazakhstan, day 2
Port
of Rouen data on French grain exports

Friday,
March 17:

ICE
Futures Europe weekly commitments of traders report
CFTC
commitments of traders weekly report on positions for various US futures and options, 3:30pm
FranceAgriMer’s
weekly crop conditions reports
USDA
cattle on feed

Source:
Bloomberg and FI

From
Friday evening

USDA
inspections versus Reuters trade range

Wheat
249,017 versus 250000-500000 range

Corn
999,388 versus 500000-1225000 range

Soybeans
618,803 versus 300000-950000 range

Combined
inspections were again slow last week

GRAINS
INSPECTED AND/OR WEIGHED FOR EXPORT

REPORTED IN WEEK ENDING MAR 09, 2023

— METRIC TONS —

————————————————————————–

CURRENT PREVIOUS

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

GRAIN 03/09/2023 03/02/2023 03/10/2022 TO DATE TO DATE

BARLEY
0 0 0 2,154 10,010

CORN
999,388 933,312 1,146,807 16,318,510 25,933,969

FLAXSEED
0 0 0 200 324

MIXED
0 0 0 0 0

OATS
0 0 0 6,486 400

RYE
0 0 0 0 0

SORGHUM
72,899 72,114 261,389 820,167 3,487,485

SOYBEANS
618,803 552,388 798,693 43,329,564 42,279,373

SUNFLOWER
248 0 100 2,408 532

WHEAT
249,017 341,087 307,584 15,903,900 16,220,987

Total
1,940,355 1,898,901 2,514,573 76,383,389 87,933,080

————————————————————————-

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

US
Crude Futures Settle At $74.80/Bbl, Down $1.88, 2.45%

US
President Biden’s 2024 National Security Budget Request Of $886 Billion Has $842 Billion Earmarked For Pentagon

Biden’s
Pentagon Budget Asks For 83 Lockheed Martin-Made F-35 Jets, Up From 77 Enacted In 2023

Budget
Request Includes Multi-Year Buys Of Missiles And Rockets

Corn

·
Corn futures
were volatile. Bear spreading is hard to justify unless you look at the soybean/corn relationship.

·
News for the corn market was light.

·
Look for additional precipitation for the upper Midwest to boost soil moisture head of planting season.

·
Ukraine is expected to see a shortfall in fertilizer supplies for this growing season, not a surprise given the conflict.

Export
developments.

None
reported

Updated
03/7/23

May
corn $5.80-$6.80

July
corn $5.75-$7.00

Soybeans

·
Nothing changed fundamentally. Outside markets detoured momentum.

·
Soybeans, meal and soybean oil were all lower from outside related markets and US economic uncertainty. Outside the US, fundamentals have not changed. SA weather improves this week, and we look for additional South American soybean
producer selling this week. Not all areas for Brazil will see ideal weather. Some of the central crop areas may see a slowdown in fieldwork progress due to daily rain showers. Palm oil futures are near a one-month low.

·
China plans to roll out additional policies to support grain production. They are already encouraging oilseed planted area expansion at the expense to grains.

·
AgRural reported 53 percent of the Brazil soybean crop collected as of last week, 10 points above the previous week and below 64 percent below last year. Safras and Mercado reported Brazil soybean harvest progress at 48.9% versus
60.5% year ago. Patria Agronegocios reported 52.9% versus 64.3% last year.

·
SGS reported palm oil exports from Malaysia for the March 1-10 period rose 50.8 percent to 487,000 tons from 323,280 tons for the same period month earlier.
AmSpec
reported Malaysia March 1-10 palm oil exports at 474,830 tons, a 52 percent increase from 312,092 tons reported during the same period in February. ITS reported a 45.3% increase to 501,514 tons from 345,080 tons prior period.

·
(Reuters) – India is likely to import 1.5 million tons of duty-free sunflower oil during the current fiscal year to March 31, trade and government sources said, half a million tons less than the quota allocated by the government.
India, the world’s biggest vegetable oil importer, buys sunflower oil from the Black Sea region, which accounts for 60% of the world’s sunflower oil output and 76% of exports. India has already imported 1.3 million tons of duty-free sunflower oil so far in
the 2022-23 fiscal year, and another 200,000 tons are expected by March 31, the sources said.

·
NOPA is due out on Wednesday for February US soybean crush and trade estimate have a wide range for US soybean oil stocks at the end of February. There is a 1,775-2,025 million pounds range for SBO, with a average of 1,886 million,
up 3 percent from 1,829 million at the end of January and compares to 2,059 million a year earlier. Crush is seen at 166.06 million bushels, down from 179.0 million during January and compares to 165.1 million during February 2022. Estimates for the February
2023 crush ranged from 162.000 million to 173.015 million bushels, another wide range. Look for price reaction post release. We are under the impression crush could end up slightly below expectations and soybean oil stocks to weigh in if there is a 100+
million pound discrepancy from the 1,886 million pound estimate.

USDA
Attaché: INDIA Oilseeds and Products Update

https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Oilseeds%20and%20Products%20Update_New%20Delhi_India_IN2023-0023.pdf

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Export
Developments

·
None reported

Updated
03/10/23

Soybeans
– May $14.50-$16.00

Soybean
meal – May $430-$520

Soybean
oil – May 55-61

Wheat

·
An extension of the Black Sea grain deal for 60 days is nothing for importers to contact grains, IMO.

·
US wheat futures fell during the electronic trade due to Black Sea grain export deal talks and lower outside markets, but rebounded post day session open on bottom picking. Weakness in the USD earlier limited losses.

·
Short covering was the move by players today.

·
At least 2000 Chicago wheat week 3 call spread options were blocked.

·
We think an agreement between the UN and Russia over the Black Sea export corridor deal will be reached this week ahead of the Saturday deadline (set to expire).

·
This week the trade could see a decision reached for the Black Sea grain deal. Talks are underway in Geneva.

·
China auctioned off 137,797 tons of wheat from state reserves at an average price of 2,793 yuan per ton, 97 percent of what was offered.

·
Ukraine grain exports: 24 percent below previous season at 34.2 million tons

o
19.9m tons of corn, down 2.1% y/y

o
11.8m tons of wheat, down 35% y/y

o
More than 2m tons of barley, down 62% y/y (BB)

May
Paris

Export
Developments.

·
Saudi Arabia bought 1.043 million tons of 12.5% protein wheat (480,000 tons sought) for July – August shipment, at an average price of $316.86/ton c&f.

·
Algeria seeks additional wheat. At least 50,000 tons is sought for May shipment.

·
Tunisia seeks 234,000 tons of soft milling wheat on March 14 for March 20-May 30 shipment.

·
Jordan seeks up to 120,000 tons of milling wheat, optional origin, on March 14, for shipment during Aug. 1-15, Aug. 16-31, Sept. 1-15 and Sept. 16-30.

·
Jordan seeks up to 120,000 tons of feed barley on March 15. Possible shipment combinations are for Aug. 1-15, Aug. 16-31, Sept. 1-15 and Sept. 16-30.