PDF Attached
Friday
most ag futures appreciated on ongoing concerns over shrinking supplies. CFTC showed the managed fund positions less long than expected. Next week we will start to see new crop analyst estimates for the upcoming May USDA report.
Reminder:
CME is resetting price limits for grain, soybean complex and lumber futures on May 2. For example, corn to 40 cents, soybeans to 1.00, wheat to 45.
https://www.cmegroup.com/content/dam/cmegroup/notices/ser/2021/04/SER-8761.pdf
CME
Margin changes:
CME
RAISES CORN FUTURES (C) MAINTENANCE MARGINS BY 7.9% TO $2,050 PER CONTRACT FROM $1,900 FOR MAY 2021
SAYS
INITIAL MARGIN RATES ARE 110% OF MAINTENANCE MARGIN RATES
SAYS
RATES WILL BE EFFECTIVE AFTER THE CLOSE OF BUSINESS ON MAY 3, 2021
RAISES
SOYBEAN FUTURES (S) MAINTENANCE MARGINS BY 7.2% TO $4,100 PER CONTRACT FROM $3,825 FOR MAY 2021
SAYS
INITIAL MARGIN RATES ARE 110% OF MAINTENANCE MARGIN RATES
SAYS
RATES WILL BE EFFECTIVE AFTER THE CLOSE OF BUSINESS ON APRIL 30, 2021
Past
7-days
Next
7 days
World
Weather, Inc.
MARKET
WEATHER MENTALITY FOR CORN AND SOYBEANS:
Alternating
periods of rain and sunshine in the U.S. Midwest during the next two weeks will prove beneficial for spring planting and early crop development. Too much rain in the Delta might induce some flooding and some crop damage.
In
South America, Argentina’s weather is still favorable for late season summer crop development and drier weather through the coming weekend will improve maturation and harvest conditions after recent rain. Brazil weather will be dry keeping a great amount of
concern over long term Safrinha corn production potentials.
Rapeseed
in Western Europe will see improved weather and some warming this week will help support better corn, sunseed and other spring and summer crop planting in southwestern Europe. Western Ukraine weather will remain inclement for planting of summer crops and the
same is true for parts of Eastern Europe.
China’s
rapeseed will experience better weather over the coming week with less frequent rain and some warmer weather, but too much moisture during much of the spring likely reduced production and quality. Spring planting of other coarse grain and oilseeds in the south
will improve with warmer temperatures and less rain for a while. China’s outlook may not be ideal, but it should improve for spring planting. Northern China planting weather is good.
India’s
harvest of winter coarse grain and oilseeds will advance well during the next two weeks. Australia’s canola planting will begin soon, but some rain is needed first – at least in some areas. Dry conditions in Australia will prevail for a while longer, but some
showers will develop in the southwest late this week and throughout Western Australia early next week.
Southeast
Asia oil palm production areas are experiencing a mostly good environment for crop development and little change is expected, despite some drier biased weather for a while.
Canada
canola planting should begin soon, but dryness and cold temperatures will be a concern for a while along with the potential for some cool weather in May.
Overall,
weather today will likely maintain support for the marketplace, but improving U.S. weather conditions may take some of the bullishness down a bit. Brazil is still the biggest potential problem area, though.
MARKET
WEATHER MENTALITY FOR WHEAT: Concern over dryness in the southwestern U.S. Plains will continue over the next week to ten days, although some showers are expected in this coming week. Rain is needed to support crops as they move toward reproduction. Dryness
is also an ongoing concern for Canada’s Prairies and the northern U.S. Plains where some increase in rainfall is expected during May. Poor seed germination and plant emergence will occur in spring wheat areas of Canada and the northern Plains without improving
rainfall.
Today’s
forecast in Australia is advertised to bring showers to many wheat and barley production areas during the coming ten days. Any precipitation would be welcome and good for moistening topsoil moisture ahead of planting, but greater amounts will still be needed.
Wheat
conditions in Europe and the western CIS are fair to good, although recent cold weather in Europe caused some concern over a few crops. Rainy weather in western Russia and parts of Ukraine has been raising concern over winter crop conditions and early season
planting delays.
India’s
harvest is moving along well while China’s wheat is rated favorably. Some spring planting is under way in northern China and it should advance well.
North
Africa wheat is in mostly good shape, but rain is needed in northwestern Algeria and southwestern Morocco. The best crops are in northern Morocco and that will not change for a while.
Overall,
weather today is likely to have a mixed influence on market mentality.
Source:
World Weather, Inc.
Monday,
May 3:
- USDA
export inspections – corn, soybeans, wheat, 11am - U.S.
crop plantings – corn, wheat, cotton; winter wheat condition, 4pm - EU
weekly grain, oilseed import and export data - U.S.
corn for ethanol, soybean crush, DDGS production, 3pm - Honduras,
Costa Rica monthly coffee exports - International
Cotton Advisory Committee updates world supply and demand outlook - Australia
Commodity Index - Ivory
Coast cocoa arrivals - HOLIDAY:
U.K., Japan, China, Vietnam, Thailand
Tuesday,
May 4:
- Purdue
Agriculture Sentiment - New
Zealand global dairy trade auction - EARNINGS:
Bunge, Andersons, Minerva - HOLIDAY:
Japan, China, Thailand
Wednesday,
May 5:
- EIA
weekly U.S. ethanol inventories, production - Malaysia
May 1-5 palm oil export data - New
Zealand Commodity Price - HOLIDAY:
Japan, China
Thursday,
May 6:
- FAO
World Food Price Index - USDA
weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am - Port
of Rouen data on French grain exports
Friday,
May 7:
- China
customs publishes trade data, including imports of soy, edible oils, meat and rubber - 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 - CNGOIC
monthly report on Chinese grains & oilseeds - Canada’s
Statcan to issue wheat, canola, barley and durum stockpile data - FranceAgriMer
weekly update on crop conditions
Source:
Bloomberg and FI
Changes
to WASDE starting May
Starting
with the May 12, 2021 release (issue No. 612), the following changes will be made to the World Agricultural Supply and Demand Estimates (WASDE) report:
-
U.S.
Soybeans and Products Supply and Use (page 15): “Biofuel” will replace “Biodiesel” in the soybean oil section, reflecting recent changes to the monthly biofuels data reported by the U.S. Energy Information Administration. The WASDE will follow soybean oil
used for biofuel as reported in the Monthly Biofuels Capacity and Feedstocks Update – Table 2C (PDF, 287 KB). -
World
Soybean Meal Supply and Use (page 29): Soybean meal supply and use for China will be presented separately. -
The
U.S. Rice Supply and Use table (page 14): The table will include separate categories for U.S. imports of long-grain and combined medium and short-grain rice. The addition is made due to the significant rise in U.S. imports of long-grain and medium- and short-grain
rice over the past decade. -
The
United Kingdom officially left the European Union on January 1, 2021; the trade bloc now has 27 member states instead of 28. Beginning with the January 2021 WASDE report, the heading for the EU-28 region will change from “European Union” to “EU-27+UK”. Starting
May 2021, (when projections for the new Marketing Year are released), the UK data will be disaggregated from the regional total and presented separately in the report, where applicable.
FRIDAY
FND (released Thursday night)
SUNDAY
DELIVERIES
CFTC
Commitment of Traders
There
were no notable record positions this week. SBO prices have managed to climb substantially despite the net fun position unable to test its record long position established 2016. Managed money for corn is near a recent record. Managed money for Chicago wheat
ticked higher with nearby prices at highs not seen since 2012. As we said in the past, we caution taking the daily estimate of funds literally, rather look at the momentum of buying. Funds estimates missed the corn position by most for the week ending April
27 in our recorded history dating back to 2012.
Speculators
cut corn net long position-CFTC – Reuters News
SUPPLEMENTAL
Non-Comm Indexes Comm
Net Chg Net Chg Net Chg
Corn
335,631 -19,286 413,831 -2,948 -733,660 21,448
Soybeans
133,912 924 183,053 9,994 -320,269 -11,244
Soyoil
57,308 -3,850 120,794 5,846 -197,028 -1,566
CBOT
wheat -18,508 6,831 160,331 1,671 -131,321 -10,531
KCBT
wheat 13,528 6,699 68,666 5,058 -81,151 -9,838
=================================================================================
FUTURES
+ OPTS Managed Swaps Producer
Net Chg Net Chg Net Chg
Corn
378,663 -5,336 239,774 -1,299 -710,596 18,036
Soybeans
180,014 7,470 71,146 2,279 -283,625 -6,847
Soymeal
54,086 6,039 74,657 -532 -188,549 -7,517
Soyoil
92,587 2,595 105,756 2,752 -218,831 -146
CBOT
wheat 13,399 11,816 80,823 -5,530 -105,929 -6,036
KCBT
wheat 30,038 11,292 45,405 649 -74,720 -9,374
MGEX
wheat 14,079 1,962 3,480 -189 -28,435 -2,995
———- ———- ———- ———- ———- ———-
Total
wheat 57,516 25,070 129,708 -5,070 -209,084 -18,405
Live
cattle 54,895 -16,424 85,543 -171 -157,997 10,079
Feeder
cattle 679 -1,569 7,763 67 -2,574 230
Lean
hogs 71,117 -2,129 59,136 -551 -136,454 3,188
Other NonReport Open
Net Chg Net Chg Interest Chg
Corn
107,963 -12,188 -15,803 785 2,399,229 -148,475
Soybeans
29,160 -3,229 3,303 327 1,167,102 -82,399
Soymeal
26,423 1,867 33,383 141 459,296 -17,824
Soyoil
1,562 -4,770 18,925 -431 572,191 -49,898
CBOT
wheat 22,209 -2,280 -10,502 2,030 548,366 -196
KCBT
wheat 321 -647 -1,044 -1,919 237,214 3,537
MGEX
wheat 3,302 1,955 7,574 -733 84,487 2,877
———- ———- ———- ———- ———- ———-
Total
wheat 25,832 -972 -3,972 -622 870,067 6,218
Live
cattle 24,563 2,323 -7,004 4,193 377,095 -399
Feeder
cattle 3,934 109 -9,802 1,162 55,554 2,643
Lean
hogs 13,846 -74 -7,644 -433 343,649 2,684
US
Personal Income Mar: 21.1% (est 20.2%; prevR -7.0%; prev -7.1%)
US
Personal Spending Mar: 4.2% (est 4.1%; prev -1.0%)
US
Real Personal Spending Mar: 3.6% (est 3.7%; prev -1.2%)
US
PCE Core Deflator (Y/Y) Mar: 1.8% (est 1.8%; prev 1.4%)
US
PCE Core Deflator (M/M) Mar: 0.4% (est 0.3%; prev 0.1%)
US
PCE Deflator (Y/Y) Mar: 2.3% (est 2.3%; prev 1.6%)
US
PCE Deflator (M/M) Mar: 0.5% (est 0.5%; prev 0.2%)
Canadian
GDP (M/M) Feb: 0.4% (est 0.5%; prev 0.7%)
Canadian
GDP (Y/Y) Feb: -2.2% (est -2.3%; prev -2.3%)
Canadian
Industrial Product Price (M/M) Mar: 1.6% (est 1.6%; prev 2.6%)
Canadian
Raw Materials Price Index (M/M) Mar: 2.3% (est 2.0%; prev 6.6%)
US
Employment Cost Index Q1: 0.9% (est 0.7%; prev 0.7%)
US
Q1 Employment Cost Index Report – BLS
- CBOT
corn
started lower only to settle limit higher in July (+25 @ 6.7325). Synthetic settle in July was $6.8475. Improving US weather conditions for plantings did little to slow fund buying. Nearby expiring May corn was up 38 cents to $7.40 per bushel. For the
week July corn was up 40.75 cents or 6.4% and up 5 consecutive weeks. The USD was up 65 points as of 1:20 pm CT.
- There
were no fresh import tenders reported overnight but we are hearing China bought new crop corn this past week that went unreported.
- Safras
& Mercado estimated the Brazil corn crop at 104.1 million tons, 8% below their previous forecast. Second crop corn was pegged at 70.7 million tons.
- The
BA Grains Exchange pegged Argentina corn harvesting at 19%, below a 5-year average of 30%. They left their Argentina corn production unchanged 46MMT (USDA @ 47).
- US
ethanol biofuel RIN’s closed at $1.53 Thursday, highest on record. Today they were down slightly for both ethanol and biodiesel.
- On
Friday, the funds bought an estimated net 55,000 corn contracts. - China
will exempt some imported seeds from value-added tax until the end of 2025 – Ministry of Finance via Reuters.
- Latest
China PMI data suggested the economy is slowing. 51.1 was reported for April, down from 51.9 in March.
- France
planted 74 percent of the expected corn crop, up from 41 previous week and ahead of a five-year average of 68 percent.
- Ukraine
spring grain plantings are 39 percent complete as of April 29.
USDA
attaché reports – note on China ASF
Export
developments.
- None
reported
Trade
News Service meat data
July
is seen in a $6.00 and $7.75 range
December
corn is seen in a $4.00-$6.50 range.
- CBOT
soybeans
set their best monthly winning stretch during the month of April. Tight US supplies, adverse weather and delays in the Brazil soybean harvest propelled prices higher, along with rising corn futures. Look for traders to shift their focus to US weather next
month. Spreads
are also red hot. For the week July soybeans were up 18.25 cents or 1.2% and up 5 consecutive weeks. - For
the day, soybeans started out lower early this morning but fund buying lifted soybeans sharply higher, after a very volatile week of trading. There were rumors China was back in today buying new crop soybeans. July soybeans finished 32 cents higher, July
meal $3.10 higher, and July soybean oil 250 points high, also limit. - Soybean
meal basis for the US interior rail markets were unchanged to down $1.00 on Friday. Decatur, IL, was at 4 under the July.
- Note
US soybean oil for biofuel for the month of February came in well below our expectations at 552 million pounds (626 by FI(, below 626 million for January and 575 million for February 2020. With US soybean oil stocks last month near last year levels, we question
the actual end of September carryout we are currently penciling in. This will be addressed Monday afternoon with USDA NASS updating US crush and stocks.
- There
were 629 soybean oil deliveries (JPM/Cargill) while the trade was looking for zero, but it appears some of them is retendering receipts that probably will get cancelled. The oil spread broke by 350 pts from top to bottom yesterday and that may be why today’s
reaction is muted. 66 soybean deliveries were posted, also a surprise. 22 of the soybean deliveries were at a new location.
- China
will be on holiday through Wednesday for Labor Day. Drier weather forecast for Argentina should boost harvest progress.
- Argentina
soybean harvest is now one third complete. - AmSpec
reported April Malaysian palm exports increased 9.7% to 1.4 million tons. - After
a one day holiday, palm futures fell 68 points to 3868MYR, and cash was down $10/ton to $985/ton.
- Russia
plans to reduce its export tax on soybeans to 20% from current 30% with a minimum level of $100 per ton (from min 165 euros or $200/ton), starting from July 1, according to the economy ministry. The new tax will be in place until September 2022. Russia grew
4.3MMT of soybeans last year, nearly four times higher than a decade ago. 2020-21 exports are projected by USDA at 1.45MMT, up from virtually zero ten years ago.
- APK-Inform
noted Ukraine rapeseed prices added $100/ton over the past 20 days to around $620 to $640/ton for July-August delivery.
- EU
MARS noted rapeseed projection this year was impacted by frost that had a direct impact on fields. Oilseed growers group FOP has estimated that France’s rapeseed crop area could shrink to 900,000 hectares by harvest time. The French farm ministry estimates
the area at 990,000 hectares. - A
Reuters poll calls for the March crush to be reported near 188.4 million bushels (5.94 mil bu per day), up from 164.3 million in February (5.87 mil/d) and below 192.1 million in March 2020 (5.85 million/day). Soybean oil stocks were estimated at 2.317 billion
pounds, up from 2.306 million in February and below 2.327 billion at the end of March 2020.
- Funds
on Friday bought an estimated net 18,000 soybean contracts, bought 3,000 soybean meal and bought 11,000 soybean oil.
- China
cash crush margins on our analysis were 178 cents (194 previous) vs. 141 cents late last week and compares to 132 cents year earlier.
- Algeria
seeks 30,000 tons of soybean meal on April 29 for shipment by June 15. - Results
awaited: Tunisia seeks 27,000 tons of soybean oil and/or rapeseed oil for late June / early July shipment.
- Results
awaited: USDA under the food export program seeks 420 tons of vegetable oils for June 1-30 shipment.
Updated
4/26/21
July
soybeans are seen in a $14.75-$16.50; November $12.75-$15.00
Soybean
meal – July $400-$460; December $380-$460
Soybean
oil – July 56-70; December 48-60 cent range
- Most
US wheat futures contracts started Friday mostly lower despite a decline in French crop conditions from the previous week, but then turned higher after corn rallied. Talk of a slowdown in US exports due to high prices was noted, but US basis is very strong.
July Chicago settled 5.0 higher, KC 9 higher and July MN a very impressive 19.25 cents higher.
- We
may see a 2 point decline in US winter wheat ratings when reported on Monday and a slowdown in spring wheat planting progress due to dry conditions across the northern Great Plains.
- French
soft wheat crop conditions declined 4 points to 81% good or excellent for the week ending April 26 against 85%, above 57% score at the same point last season. Durum wheat fell 8 points to 69%, up from 65% year ago. The winter barley rating dropped 4 points
to 77% while spring barley dropped 5 points to 82%. - Funds
on Friday bought an estimated net 5,000 CBOT SRW wheat contracts. - September
Paris wheat was up 0.50 at 219.25 euros.
USDA
attaché report – Australia:
- The
Philippines seeks up to 185,000 tons of wheat on May 4 for shipment in June, July and August depending on origin.
- Bangladesh
seeks 50,000 tons of milling wheat on May 6.
Rice/Other
·
Bangladesh seeks 50,000 tons of rice on May 2.
Updated
4/26/21
July
Chicago wheat is seen in a $6.75-$8.00 range
July
KC wheat is seen in a $6.60-$7.50
July
MN wheat is seen in a $7.15-$8.00
Terry Reilly
Senior Commodity Analyst – Grain and Oilseeds
Futures International
One Lincoln Center
18 W 140 Butterfield Rd.
Oakbrook Terrace, Il. 60181
W: 312.604.1366
ICE IM:
treilly1
Skype: fi.treilly
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Evecom-FI043021.pdf