FI Evening Grain Comments 03/28/22

PDF Attached does not include daily estimate of funds.

 

In
a light volume trade, US CBOT agriculture futures were lower as traders assessed Ukraine/Russia developments. Negotiating teams are planning to meet in Turkey this week.

 

Private
exporters reported the following activity:

-132,000
metric tons of soybeans for delivery to China during the 2021/2022 marketing year

-127,920
metric tons of corn for delivery to unknown destinations.  Of the total, 77,120 metric tons is for delivery during the 2021/2022 marketing year and 50,800 metric tons is for delivery during the 2022/2023 marketing year.

 

SX/CZ
ratio was under a large amount of pressure today

 

 

 

 

 

 

Weather

 

World
Weather Inc.

WEATHER
EVENTS AND FEATURES TO WATCH

• Cooler
  weather in Europe and the eastern parts of North America may be linked to the latest Stratospheric Warming event that is under way.
• Expected
  additional changes in the forecast over the next two weeks that may allow these colder biases to persist
  
• There
  may also be some impressive amounts of snow accumulating in parts of western Russia over the next week that may contribute to spring flooding
• Southern
  Europe will trend wetter because of the colder bias
• Limited
  precipitation is expected in the High Plains region of the United States, including areas from western Texas through eastern Colorado and western Kansas to Montana and the western Dakotas during the next two weeks
  
• Totally
  dry weather is unlikely, but most of the precipitation advertised is unlikely to bolster soil moisture enough to counter evaporation
• Temperatures
  will be slightly warmer than usual
• Precipitation
  in eastern hard red winter wheat areas will be sufficient to maintain a good outlook for crop development in the next few weeks
• U.S.
  Midwest, Delta and southeastern states will receive some periodic precipitation while temperatures are a little cooler biased this week resulting in some limited field progress
• Drier
  and warmer weather is needed for aggressive drying, planting and early crop development
• Rain
  will be most likely this week Tuesday night into Thursday with nearly all areas being impacted at one time or another
• Amounts
  will vary from 0.50 inch to 2.00 inches
• Some
  greater amounts are expected in the Midwest
• A
  follow up weather system is expected during the weekend producing 0.20 to 0.75 inch of rain and local amounts over 1.00 inch
  
• Missouri
  and Illinois will be wettest along with areas from the lower Delta into the southeastern states
• This
  event may diminish in future model runs
• A
  couple of additional weather systems may impact the Midwest, Delta and southeastern states next week keeping the ground wet and temperatures cool enough  to restrict drying rates at times.
  
• Flooding
  in U.S. is mostly confined to parts of the Red River Basin in the North, the Midwest and Delta with most of it rated minor to moderate.
  
• U.S.
  northern Plains and upper Midwest will receive additional snow and rain Tuesday and Wednesday adding to the runoff from recent melting snow raising river and stream flows additionally
• U.S.
  weekend precipitation was limited with light rain noted in the eastern Midwest with moisture totals varying up to 0.15 inch most often with a few greater amounts downwind from the Great Lakes
• Highest
  afternoon temperatures were in the 40s and 50s across the Midwest, but the southern Plains experienced 80- and 90-degree highs and the northern Plains noted highs in the 30s and 40s northeast and 40s and 50s southwest
• Lowest
  temperatures were in the negative and positive single digits in northern Minnesota and positive single digits and teens in neighboring areas of the northern Plains and western Great Lakes region.
• Freezes
  occurred southward into parts of hard red winter wheat country and into most of the Midwest.
  
• California
  is expecting additional rain and mountain snow today
• Resulting
  precipitation will not change the bottom line for drought or mountain snowpack and runoff potential
• As
  of March 25 Snowpack was 39% of normal in the northern Sierra Nevada, 49% of normal in central areas and 48% of normal in the south
• Water
  storage varies from 49-67% of historical averages away from the Sierra Nevada and from 57-95% near the mountains
• West
  and South Texas precipitation is still advertised to be limited during the next ten days, although there is a little more shower activity suggested for a few areas
  
• The
  impact of rain on water supply soil moisture will be minimal.
• Mexico’s
  dryness and drought have been expanding this winter due to poor precipitation resulting from persistent La Nina
• The
  region will continue lacking precipitation for an expected period of time
• Eastern
  and southern Mexico will remain seasonably dry this week and will only receive light rainfall next week
• Argentina
  rainfall over the next ten days to two weeks will be restricted to east-central and northeastern parts of the nation
• Sufficient
  rain will fall in these areas to maintain moisture abundance
• Net
  drying is expected in the southwest half of Argentina
• Soil
  moisture is sufficient to carry on normal crop, despite limited new moisture
• Temperatures
  will be near normal this week
• Bahia
  and the northern two-thirds of Minas Gerais will continue dry biased for the next ten days to two weeks
• The
  region is already considered to be too dry and moisture stress for minor corn, soybean, sugarcane and coffee areas is rising
  
• moisture
  stress may lead to some negative impact on late season crops
• Most
  other areas in Brazil will get rain over the next ten days to two weeks with some of it likely to be excessive.
  
• Wednesday
  of this week and again from Saturday through Monday, April 4 will be the two wettest periods, although a third period of rain April 5-8 will perpetuate the wet bias
• Drier
  weather is needed from northeastern Argentina through Rio Grande do Sul and southern Paraguay to southern and eastern Mato Grosso do  Sul, Parana and southwestern Sao Paulo to protect late season crop development
• Temperatures
  will be near normal with a slight cooler bias in the wetter areas
• Safrinha
  crops will have plenty of moisture going through much of April this year, but the wetter areas will need drying to promote harvesting of full season crops and to limit any crop quality declines because of too much moisture.
  
• China
  precipitation during the weekend was mostly light, but widespread from the Korean Peninsula through the southern Yellow River Basin and southward to the coastal provinces.
  
• China’s
  precipitation in the east-central and southeastern provinces will be less frequent and less significant this week and especially next week allowing the ground to firm up
• This
  change will improve spring planting and early season winter and spring crop development
• Europe
  precipitation during the weekend continued limited while temperatures were mild to warm.
  
• Europe
  weather is expected to slowly trend a little wetter with some timely rainfall expected over time that should hale improve early season farming activity and crop development
• Russia,
  Ukraine, Belarus and Baltic States will experience a more active precipitation pattern during the next two weeks
  
• The
  combination of new precipitation and moisture abundance will maintain wet field conditions in many areas
• There
  is need for drier and warmer weather especially in April when spring planting occurs in many areas.
  
• Heavy
  snow will fall from western Ukraine and southeastern Belarus to the Ural Mountains with accumulations of 4 to 15 inches and possibly more
• this
  may lead to more flooding in April as the snow melts over saturated soil
• India
  rainfall will be confined to a few far southern crop areas and in the far Eastern States during the next two weeks while most other areas are dry and warm biased
• Temperatures
  will be near to above normal – warmest relative to normal in the north
• Good
  winter crop maturation and harvest conditions are expected
• Southeast
  Asia rainfall will continue frequent and abundant
• No
  area in the mainland areas, Philippines, Indonesia or Malaysia are expected to be too dry
• Too
  much rain may impact northeastern Philippines late this weekend into next week
• East-central
  Africa rainfall will continue greatest in Tanzania, although parts of Uganda and Kenya will get rain periodically as well.
  
• Ethiopia
  rainfall should be most sporadic and light
• West-central
  Africa rainfall will continue periodically and sufficient to support coffee and cocoa development
• Rainfall
  so far this month has been a little sporadic, but no area has been seriously dry biased
• Pockets
  in Ivory Coast and western Ghana have received less than usual rain, but crop development has advanced well
  
• North
  Africa rainfall will be greatest Tuesday through Thursday of this week and again early next week in Morocco and northwestern Algeria
• Crop
  conditions will improve as a result of the rain
• Australia
  reported rain in both the east and western most crop areas during the weekend.
  
• Moisture
  totals in Queensland northeastern New South Wales ranged from 0.30 to 1.00 inch most often with a few amounts of 1.00 to 3.25 inches
  
• Heavier
  rainfall occurred along the upper east coast of New South Wales where a few coastal areas reported more than 6.00 inches
• Western
  Australia rain totals varied from 0.27 to 1.14 inches with local totals approaching 2.00 inches
• The
  precipitation was associated with the remnants of tropical cyclone Charlotte that dissipated last week
• Western
  Australia will continue to receive periods of rain through Wednesday of this week before drying down again Thursday
• The
  additional moisture will further boaster topsoil moisture for use in the autumn wheat, barley and canola planting season that begins in late April
• Eastern
  Australia precipitation is expected to become quite limited this week bringing on a better environment for cotton in the open boll stage of development
• The
  drier weather will also be good for early season planting which begins soon
• Irrigated
  late season sorghum and other crops will continue to develop favorably
• Some
  of the dryland crop that is still immature still needs greater moisture
• South
  Africa weather during the weekend brought rain to the northeast, east central and southeastern summer crop areas
• Moisture
  totals were not much more than 1.00 inch
• South
  Africa rainfall over the next couple of weeks will be less frequent and less significant resulting in a very good environment for early season crop maturation and harvesting
• some
  timely rainfall in April will prove to be beneficial for late season crops only if it is brief and light
• Colombia,
  Ecuador, western Venezuela and parts of Peru will remain plenty wet during the next ten days
• Frequent
  rain is expected
• The
  moisture will be great for coffee and cocoa flowering and well as support of all crops
• Today’s
  Southern Oscillation Index is +13.03 
• The
  index will slowly slip lower over the coming week
• Central
  America precipitation will be greatest along the Caribbean Coast during the next seven to ten days and in both Panama and Costa Rica
• Guatemala
  will also get some showers periodically

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

Monday,
March 28:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• Ivory
  Coast cocoa arrivals

Tuesday,
March 29:

• EU
  weekly grain, oilseed import and export data
• Vietnam’s
  General Statistics Department releases March export data for coffee, rice and rubber

Wednesday,
March 30:

• EIA
  weekly U.S. ethanol inventories, production, 10:30am
• USDA
  hogs and pigs inventory, 3pm

Thursday,
March 31:

• U.S.
  annual acreage prospective planting data for various farm commodities, including wheat, barley, corn, cotton, soybeans and sunflower, noon
• USDA
  quarterly stockpile data for wheat, barley, corn, oats, soybeans and sorghum, noon
• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• U.S.
  agricultural prices paid, 3pm
• Malaysia’s
  March palm oil export data

Friday,
April 1:

• ICE
  Futures Europe weekly commitments of traders report
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• Australia
  Commodity Index
• USDA
  soybean crush, DDGS output, corn for ethanol, 3pm
• FranceAgriMer
  weekly update on crop conditions

Source:
Bloomberg and FI

 

Reuters
trade estimates for USDA

 

 

 

 

 

 

USDA
inspections versus Reuters trade range

Wheat                 
341,191                 versus   300000-500000  range

Corn                     
1,606,535             versus   1000000-1665000             range

Soybeans           
628,819                 versus   500000-800000  range

 

 

 

GRAINS
INSPECTED AND/OR WEIGHED FOR EXPORT

                 
REPORTED IN WEEK ENDING MAR 24, 2022

                           
— METRIC TONS —

—————————————————————————

                                                  
CURRENT     PREVIOUS 

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

 
GRAIN      03/24/2022  03/17/2022  03/25/2021    TO DATE     TO DATE  

 

BARLEY             
0           0       1,497       10,010       32,520 

CORN       
1,606,535   1,496,798   1,789,432   29,030,547   34,006,675 

FLAXSEED           
0           0           0          324          509 

MIXED              
0           0           0            0            0 

OATS               
0           0         399          400        4,815 

RYE                
0           0           0            0            0 

SORGHUM      
342,326     335,599     244,739    4,165,410    4,449,284 

SOYBEANS     
628,819     553,582     450,807   43,428,819   54,269,171 

SUNFLOWER          
0           0           0          532            0 

WHEAT        
341,191     333,970     307,167   16,894,292   20,347,102 

Total      
2,918,871   2,719,949   2,794,041   93,530,334  113,110,076 

————————————————————————–

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
Wholesale Inventories (M/M) Feb P: 2.1% (est 1.2%; prev 0.8%; prevR 1.0%)

US
Retail Inventories (M/M) Feb: 1.1% (est 1.4%; prev 1.9%)

US
Advance Goods Trade Balance Feb: -$106.6Bln (est -$106.3Bln; prev -$107.6Bln)

(Bloomberg)
— Russia’s ruble extended its run of gains into a sixth day against the dollar

 

Corn

·        
US corn futures traded lower with some light at the end of the tunnel for the Ukraine/Russia situation. Outside commodity markets also pressured corn. WTI crude oil was off more nearly $8.00 when the agriculture markets closed. 
May futures lost more ground to other 2022 contracts. It was interesting to see some of the back month 2023 contracts closed higher. 

·        
Earlier on May CBOT corn
traded at $7.50 for the 18^th consecutive session.

·        
We read reports over the weekend many Ukraine storage and handling facilities are destroyed so it is unknown how long it will take them to recover. Plantings are also a big uncertainty.

·        
Ukraine exported some corn by train to Europe, according to APK-Inform. Prices for buyers from Poland and the Baltic States were $250 to $265 per ton and $275 per ton for Slovakia.

·        
South Africa’s Crop Estimates Committee (CEC) estimated the 2021-22 South African corn crop at 14.68 million tons, up slightly from their previous estimate. Yellow was pegged at 7.11 million and white corn at 7.56 million tons.
Year ago, the crop was 16.31 million tons.

·        
Bulgaria reported a bird flu outbreak at an industrial farm with over 177,000 laying hens.  The town of Asenovgrad is the sixth industrial farm hit by bird flu since late last year.

 

Export
developments.

• Turkey
  bought 300,000 tons of optional origin corn with lowest price at $400.87/ton c&f, and highest at $433.50/ton, for April 8 and May 5 shipment.
  
• Private
  exporters reported the following activity:

-127,920
metric tons of corn for delivery to unknown destinations.  Of the total, 77,120 metric tons is for delivery during the 2021/2022 marketing year and 50,800 metric tons is for delivery during the 2022/2023 marketing year.

 

 

Source:
Reuters and FI

 

Updated
3/23/22

May
corn is seen in a $6.75 and $8.10 range

December
corn is seen in a wide $5.50-$7.50 range

 

Soybeans

·        
CBOT May
soybeans, meal, and soybean are lower on easing concerns over the Ukraine/Russia situation and Covid-19 lockdown concerns in China. Negotiating teams are planning to meet in Turkey this week. The CBOT crush appreciated after soybeans traded more than 40 cents
lower in the front three contracts. 

·        
China locked down a large city, Shanghai, over the weekend due to covid, potentially slowing imported soybean unloading’s. 26 million people reside in Shanghai.

·        
China plans to sell about 500,000 tons of soybeans on April 1.

·        
Brazil’s Abiove lowered their soybean crop production projection for Brazil to 125.3 million tons, a 7.7% decrease from January. They slashed exports by 9.2 million to 77.7 million tons and put crush at a record 48 million tons,
resulting in record meal exports (18.3MMT) and nearly record soybean oil exports (1.7MMT).

·        
The EU will see cold temperatures later this week that may impact the rapeseed crop as they begun to flower.

·        
Cargo surveyor SGS reported month to date March 25 Malaysian palm exports at 1,030,943 tons, 54,360 tons below the same period a month ago or down 5.0%, and 16,781 tons above the same period a year ago or up 1.7%.

 

Export
Developments

• Private
  exporters reported the following activity:

-132,000
metric tons of soybeans for delivery to China during the 2021/2022 marketing year

• USDA
  seeks 2,710 tons of packaged oil on April 7 for May shipment (May 23-June 13 for plants at posts).
  
• Qatar
  seeks to buy 960k cartons of corn oil in a tender closing April 4.

 

 

Source:
Reuters and FI

 

Updated
3/14/22

Soybeans
– May $16.00-$18.00

Soybeans
– November is seen in a wide $12.50-$16.00 range

Soybean
meal – May $430-$520

Soybean
oil – May 72.00-79.00

 

Wheat

·        
US wheat futures were sharply lower on Ukraine/ Russia headlines and hopes that Black Sea wheat trade will resume in the near future, at least for Ukraine. Russia is still shipping wheat. 

·        
China sold 546,015 tons of wheat out of auction. The average selling price of the wheat was 2,884 yuan ($453.05) per ton.

·        
May Paris wheat futures were down 12.75 euros to 369.75 euros, or 3.3%.

·        
Egypt is working with France to ensure wheat supplies.

·        
Black Sea wheat flow from Russia was steady last week, according to IKAR. SovEcon said Russia exported 400,000 tons of grains last week compared with 520,000 tons a week earlier. Both IKAR and SovEcon priced 12.5% protein content
wheat at around $390 per ton free on board (FOB).

·        
SovEcon upward revised their March Russia wheat export projection to 2.2 million tons from 1.6 million previous.

 

 

Export
Developments.

·        
Algeria seeks 50,000 tons of milling wheat for May and/or June shipment. It might be set to close Wednesday.

·        
Taiwan seeks 40,000 tons of US wheat on March 30 for shipment off the PNW during the May 14 and May 28 period.

·        
Jordan issued an import tender for 120,000 tons of milling wheat for shipment during May, June, or July on March 31.

·        
Results awaited: Qatar seeks 105,000 tons of optional origin animal feed barley on March 27 shipment in April, May and June. 

·        
Bangladesh is in for 50,000 tons of wheat with a deadline of April 4.

 

Rice/Other

·        
US cotton futures hit a decade high on US drought concerns and strong demand from China.

·        
China sold 9,727 tons of rice out of auction. The average selling price of the rice was 2,644 yuan ($415.34) per ton.

·        
(Bloomberg) — Qatar is seeking to buy 1.2m bags of rice in a tender that closes April 4, according to the Ministry of Commerce and Industry’s website.  Qatar also seeks to buy 960k cartons of corn oil in a tender closing April
4

 

Updated
3/14/22

Chicago
May $9.35 to $12.50 range

KC
May $9.25 to $12.50 range

MN
May $10.00‐$13.00