FI Evening Grain Comments 04/26/21

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Impressive
upside again today in CBOT agricultural futures.  Inflation story, weather and supply concerns supported markets.  US corn and soybean plantings were as expected at 17 and 8 percent, respectively, but corn is lagging its respected 5-year averages by 3 points. 
Soybeans are running 3 points above average.  US spring wheat plantings were reported at 28 percent, as expected and 9 points above average.  US winter wheat ratings declined a more than expected 4 points to 49 percent good/excellent, 4 points below trade
expectations and below its 53 percent average.  But by class HRW wheat increased 1.3% from the previous week, and white was up slightly.  SRW declined 0.6% (see wheat section). 

 

Parts
of the US Delta saw flooding over the weekend from a large storm, from Central Louisiana through portions of southern Mississippi to southeastern Alabama and southern Georgia (3-6 inches).  The US central Plains will be hot over the next few days deleting
soil moisture levels. No threatening cold temperatures are expected over the next two weeks for the US corn belt.  Brazil weekend rain was expected, and this workweek rain is expected across northern Mato Grosso, Tocantins, western Bahia, as well as Rio Grande
do Sul, Brazil, while net drying occurs elsewhere, according to World Weather Inc.  Mexico is seeing drought conditions that will last for at least another 2 weeks.  Frost and freezes continued in northeastern parts of the European continent during the weekend,
but the outlook looks like weather improves. 

 

 

Weather

 

 

 

 

 

 

 

Next
7 days

 

World
Weather Inc. 

TODAY’S
MOST IMPORTANT WEATHER

• Brazil’s
  outlook is still dry biased for the next ten days and some forecast models keep the majority of Safrinha corn country mostly dry through the next two weeks
• Argentina’s
  weather still looks good with net drying this week and then some rain next week
• Western
  Russia, Belarus and central and western Ukraine are still advertised wet and cool biased over the coming week with a gradual trend toward less precipitation and some warming next week
  
• Europe
  will be cool and moist this week, although the North Sea region will be dry for a while this workweek
• North
  Africa will receive erratic rainfall and experience net drying in most areas except possible the far northernmost part of Morocco where rain is likely
• West-central
  Africa rainfall will be favorably mixed
• Indonesia/Malaysia,
  Mainland areas of Southeast Asia get periods of rain next two weeks

• Western
  Australia gets a little rain in the southwest late this week and more early next week over a larger part of the state that bolsters planting moisture, although more will be needed
• Some
  of the increase next week may be overdone
• U.S.
  outlook is still wet and stormy from late Tuesday into Thursday from eastern Oklahoma and central Texas to southern Illinois and southern Indiana; including the northern Delta where some excessive rain is expected and a little flooding
• Damaging
  wind, hail and some tornadoes will be possible, as well
• Virginia
  and the Carolinas are dry and need rain – some showers will occur briefly Friday
  
• West
  Texas rainfall potentials remain poor in the high Plains for at least ten days
• South
  Texas rainfall potential is also poor for next ten days
• Northern
  U.S. Plains and Canada’s Prairies will be drier biased in the coming week with some potential for at least a little rain in the following week

Source:
World Weather Inc. & FI

 

Bloomberg
Ag Calendar

Monday,
April 26:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• U.S.
  crop plantings – corn, wheat, cotton; winter wheat condition, 4pm
• Monthly
  MARS bulletin on crop conditions in Europe
• EU
  weekly grain, oilseed import and export data
• Ivory
  Coast cocoa arrivals
• Malaysia
  April 1-25 palm oil export data from AmSpec, SGS
• HOLIDAY:
  New Zealand

Tuesday,
April 27:

• Canada’s
  StatsCan releases data on seeded area for soybeans, barley, canola, wheat and durum

Wednesday,
April 28:

• EIA
  weekly U.S. ethanol inventories, production
• Brazil’s
  Unica publishes data on cane crush and sugar output (tentative)

Thursday,
April 29:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• Port
  of Rouen data on French grain exports
• International
  Grains Council monthly report
• HOLIDAY:
  Japan, Malaysia

Friday,
April 30:

• ICE
  Futures Europe weekly commitments of traders report (6:30pm London)
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• U.S.
  agricultural prices paid, received
• Malaysia’s
  April 1-30 palm oil export data
• FranceAgriMer
  weekly update on crop conditions
• Holiday:
  Vietnam

Source:
Bloomberg and FI

 

Due
out Tuesday April 27

 

USDA
inspections versus Reuters trade range                                

Wheat            
564,047           versus  400000-625000

Corn               
1,951,012        versus  1100000-1700000

Soybeans        
233,911           versus  150000-300000

 

 

 

GRAINS
INSPECTED AND/OR WEIGHED FOR EXPORT

                 
REPORTED IN WEEK ENDING APR 22, 2021

                           
— METRIC TONS —

————————————————————————-

                                                  CURRENT    
PREVIOUS 

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

 
GRAIN      04/22/2021  04/15/2021  04/23/2020    TO DATE     TO DATE  

 

BARLEY            
24           0          49       32,644       30,548 

CORN       
1,951,012   1,559,267   1,078,788   41,232,631   22,426,554 

FLAXSEED           
0           0           0          509          520 

MIXED              
0           0           0            0            0 

OATS               
0         599           0        4,290        3,343 

RYE                
0           0           0            0            0 

SORGHUM      
182,614     314,699     285,813    5,382,520    2,449,179 

SOYBEANS     
233,911     222,065     561,063   55,265,233   33,397,666 

SUNFLOWER          
0           0           0            0            0 

WHEAT        
564,047     626,670     506,700   22,599,479   22,508,623 

Total      
2,931,608   2,723,300   2,432,413  124,517,306   80,816,433 

————————————————————————

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.

 

Macro

US
March Retail Sales Revised To +9.7% (Prev +9.8%)

EPA
Reconsiders Previous Administration’s Withdrawal Of California’s Waiver To Enforce Greenhouse Gas Standards For Cars And Light Trucks

US
Durable Goods Orders Mar P: 0.5% (est 2.5%; prevR -0.9%; prev -1.2%)

 

US
Durables Ex-Transportation Mar P: 1.6% (est 1.6%; prevR -0.3%; prev -0.9%)

US
Cap Goods Orders Nondef Ex-Air Mar P: 0.9% (est 1.8%; prevR -0.8%; prev -0.9%)

US
Cap Goods Ship Nondef Ex-Air Mar P: 1.3% (est 1.5%; prev -1.1%)

 

Corn

• Another
  limit up day in corn with May and July both up 25 cents. CK synthetically on the close was $6.8550.  CBOT
  corn
  was higher today on ongoing fund buying amid Brazil second crop production concerns and heavy rain flooding local fields across the Delta over the weekend.  Brazil’s second corn crop is approaching the critical pollination stage. We see Brazil corn production
  around 103 million tons (76.64 million ton second corn crop).  USDA is at 109 million tons.  There was chatter over Argentina looking at raising grain export taxes.  Argentina’s inflation remains out of control and this is seen supportive for corn and soybean
  meal.  Argentina currently has a 33% tax on soybean exports, 31% on soymeal & soyoil, and 12% on corn and wheat.  US producer selling ticked up today. 
  
• On
  Monday funds bought an estimated net 60,000 corn contracts.
• Price
  increases in Chicago could stall this week with warmer weather expected across the US Midwest that could boost planting progress.  However, $7.00 corn is not out of reach. 
  
• US
  corn and soybean plantings were as expected at 17 and 8 percent, respectively, but corn is lagging its respected 5-year averages by 3 points. 
  
• Corn
  basis at Decatur, IL, was up 4 cents to 40 over the July and corn at Cedar Rapids, IA, was up 4 cents to 29 over the July. 
  
• The
  USD was slightly lower as of 2:45 pm CT. 
• There
  were rumors Friday that China bought about 1 million tons of Q1 2021-22 US corn. 
  
• Bulgaria
  reported a fifth bird flu outbreak at an industrial farm affecting 40,000 laying hens. 
  
• Brazil’s
  meat lobby group said meatpackers are looking at using more wheat for feed as grain prices are getting very expensive. 
  

• The
  European Union granted imports licenses for 65,000 tons of corn imports, bringing cumulative 2020-21 imports to 12.152 MMT, 30 percent below same period year ago

 

Export
developments.

• South
  Korea’s FLC bought 65,000 tons of corn, likely from South America, at $305.99/ton c&f, for arrival around August 25. 
  

 

 

 

Updated
4/26/21

May
corn is seen in a $6.50 and $7.25 range

July
is seen in a $6.00 and $7.75 range

December
corn is seen in a $4.00-$6.50 range.

 

Soybeans

• CBOT
  soybeans,
  meal and oil were higher on supply concerns and strong US interior soybean basis.  Slow plantings of the US corn and soybean crops across the US last week from cold temperatures were noted.  An Indiana location hit $16/bu for soybeans late last week.  We are
  hearing Brazil’s FOB soybean price for May hit a new high of around $560/ton Friday.  Council Bluffs IA soybean basis was up 15 cents from Friday.  Soybean meal basis across selected US main locations was unchanged from Friday.  Many dealers were already rolling
  from the May to July futures.  July soybeans were up 23.25 cents, July meal up $5.70 and July SBO up 211 points.  The May position for SBO was up 250 points and May meal & soybeans were little stronger than July.  Increasing Covid-19 cases across India may
  slow vegetable oil imports over the short term as parts of the country go back into lockdown.  Egypt is in for vegetable oils.
  
• US
  corn and soybean plantings were as expected at 17 and 8 percent, respectively, but corn is lagging its respected 5-year averages by 3 points.  Soybeans are running 3 points above average. 
  
• Cargo
  surveyor SGS reported month to date April 25 Malaysian palm exports at 1,116,919 tons, 102,757 tons above the same period a month ago or up 10.1%, and 157,831 tons above the same period a year ago or up 16.5%.  ITS reported April 1-25 Malaysian palm exports
  at 1.103 million tons, a 9 percent increase from the same period last month.  AmSpec reported 1.104MMT, up 8.5%. 
  
• Funds
  on Monday bought an estimated net 16,000 soybean contracts, 5,000 soybean meal and 9,000 soybean oil.
• ICE
  canola futures were sharply higher today with the May topping $900. July was up $15.80 or 1.9% to $840.
  
• Viterra
  announced they plan to build a 2.5 million ton canola crushing plant in Regina, Saskatchewan, set to open sometime in late 2024.  This would be the largest canola crushing plant in the world. 
  
• MARS
  revised down the 2021 EU rapeseed yield to 3.19 tons per hectare 3.26 in March.
• The
  European Union reported soybean import licenses since July 1 at 11.937 million tons, above 11.817 million tons a year ago. European Union soybean meal import licenses are running at 13.844 million tons so far for 2020-21, below 14.574 million tons a year ago.
  EU palm oil import licenses are running at 4.277 million tons for 2020-21, below 4.685 million tons a year ago, or down 9 percent.
• European
  Union rapeseed import licenses since July 1 were 5.370 million tons, above 5.178 million tons from the same period a year ago.

 

Top
US and Brazil soybean export prices, bottom China soybean and meal stocks at ports

 

Export
Developments

• Private
  exporters reported to the U.S. Department of Agriculture export sales of 120,000 tons of soybeans for delivery to unknown destinations during the 2021-22 marketing year.

• Egypt’s
  GASC seeks 30,000 tons of soybean oil and 10,000 tons of sunflower oil on April 28 for June 26-July 10 arrival.  They are also in for local vegetable oils, 3,000 soybean oil and 1,000 sunflower oil for June26-July 15 arrival. 
  
• The
  USDA under the food export program seeks 420 tons of vegetable oils for June 1-30 shipment.  
  
• The
  USDA bought 10,610 tons of bulk crude, degummed soybean oil last Thursday on behalf of the CCC program at $1,549/ton for 8,000 tons and rest at $1,658/ton. 
  

 

 

Updated
4/26/21

May
soybeans are seen in a $15.30-$16.10 range; July $14.75-$16.50; November $12.75-$15.00

May
soymeal is seen in a $415-$440 range; July $400-$460; December $380-$460

May
soybean oil is seen in a 63.50 and 67 cent range; July 56-70; December 48-60 cent range

 

Wheat

• Chicago
  wheat hit its highest level since February 2013.  Contracts in Chicago and KC ended nearly 30 cents higher.  MN was up 18-23.50 cents.  Global wheat
  futures
  were higher on supply concerns and US drought conditions for the western crop areas and parts of West Texas along with cold temperatures over the weekend for northern Europe.   Rain this week for the southern Great Plains could stall the futures wheat rally,
  but the northern Great Plains could use rain, keeping MN futures gaining over Chicago type wheat. 
  Egypt
  and Algeria are in for wheat. 
• Funds
  on Monday bought an estimated net 18,000 CBOT SRW wheat contracts.
• US
  spring wheat plantings were reported at 28 percent, as expected and 9 points above average. 
  
• US
  winter wheat ratings declined a more than expected 4 points to 49 percent good/excellent, 4 points below trade expectations and below its 53 percent average. 
  

• September
  Paris wheat closed 7 euros higher at 226 euros. 
• China
  sold 311,837 tons of wheat, or only 7.75% of the total offered, at an auction of state reserves last week. 
  
• The
  EU crop monitor MARS group lowered the average soft wheat yield for the EU crop to 5.86 tons per hectare from an initial projection of 5.89 in March, and 3 percent above a five-year average.  MARS revised down the 2021 EU winter barley yield to 5.83 tons per
  hectare from 5.88 previous.
• The
  European Union granted export licenses for 165,000 tons of soft wheat exports, bringing cumulative 2020-21 soft wheat export commitments to 21.677 MMT, well down from 29.498 million tons committed at this time last year, a 27 percent decrease.  Imports are
  near unchanged from year ago at 1.717 million tons.

 

 

Export
Developments.

• Algeria’s
  state grains agency OAIC seeks 50,000 tons of wheat on Wednesday, April 28, with offers remaining valid up to Thursday, April 29.
• Bangladesh
  seeks 50,000 tons of milling wheat on May 6. 
• Egypt
  seeks wheat for August 11-20 shipment, on April 27. 
• Jordan
  seeks 120,000 tons of feed barley on April 28 for Oct-Nov shipment. 

 

Rice/Other

·        
Egypt cancelled their import tender for 100,000 tons of raw sugar cane. 

·        
Results awaited: Bangladesh delayed their 50,000-ton rice import tender that was set to close April 18, to now April 26.  

·        
Bangladesh seeks 50,000 tons of rice on May 2.  

 

Updated
4/26/21

May
Chicago wheat is seen in a $6.90‐$7.75 range; July $6.75-$8.00

May
KC wheat is seen in a $6.70‐$7.50 range; July $6.60-$7.50

May
MN wheat is seen in a $7.10‐$7.75 range; July $7.15-$8.00