FI Evening Grain Comments 11/11/22

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US
CBOT agriculture commodities were higher on Friday higher after China eased some covid restrictions. China reduced the amount of time that travelers and close contacts of infected people must spend in quarantine. The news spilled over into other commodity
markets including some metals and energies. USD was down sharply. US equities were higher by late afternoon trading The UN met with Russia in Geneva today over Black Sea grain deal but no details were provided.  CFTC commitment of traders data will be out
Monday.

 

 

 

 

 

Weather

Eastern
TX, and eastern TX will see precipitation today. KS, OK, and TX has an opportunity for light rain Monday. Other parts of the Great Plains will see net drying. The Midwest will see showers across the northwestern areas through today. Many areas of Brazil will
see rain through early next week. Argentina saw less than expected rain yesterday. Argentina should see widespread rain through Sunday, then again late next week.

 

 

World
Weather, INC.

MOST
IMPORTANT WEATHER FOR THE COMING WEEK

• Rain
  developed in western Argentina overnight and was expected to shift across much of the nation this weekend into early next week
• Initial
  rainfall was not very great with amounts to 0.92 inch in northern San Luis and to 0.83 inch in La Pampa while most other areas reported no more than 0.56 inch
• Eastern
  Argentina was mostly dry and warm
• Rain
  in Argentina this weekend and early next week will be sufficient to boost topsoil moisture for some improved late season wheat conditions
• Some
  improvement in corn and sunseed conditions will also occur
• Soybean
  planting will likely increase in areas where the precipitation is greatest
• Rainfall
  will be greatest in the southwestern half of Argentina with 1.00 to 2.50 inches of moisture possible by Tuesday
• Northeastern
  Argentina will receive 0.30 to 1.00 inch of rain with a few amounts to 1.50 inches
  
• Temperatures
  will be seasonable
• Argentina
  will be dry during the middle to latter part of next week with some rain developing again in the southwest at the end of the week that will spread northeast during the following weekend
  
• Resulting
  rainfall will vary from 0.20 to 0.75 inch with a few totals over 1.00 inch
• Temperatures
  will be seasonable
• Argentina’s
  bottom line should be good for short term improvements in crop and field conditions. Most of the rain expected in the next two weeks will still be a little too light for long term crop and field conditions especially in the north and eastern parts of the nation
  where more rain will be needed late this month and into December. Field progress should advance well following the two bouts of rain expected, though some concern about the long term outlook will remain because of La Nina and the less than ideal rain distribution
  over the coming ten days.
• West-central
  and northwestern Brazil crop areas received rain Thursday with sufficient amounts in central and southern Mato Grosso do Sul and central Mato Grosso for a welcome boost in topsoil moisture
• All
  of Brazil will receive rain over the coming five days with amounts varying greatly from one region to another
• All
  of the precipitation will be welcome, but portions of center west and far southern Brazil will need more moisture
• Net
  drying is expected from mid- to late-week next week that might last into the following weekend
• Rain
  will fall more routinely in northeastern Brazil and in some northern center south crop areas
• Brazil’s
  bottom line will remain favorable for crops in most of the nation with most areas getting sufficient rain to support short term crop development. There is some concern about long term soil moisture in Mato Grosso, Goias and Rio Grande do Sul, but as long as
  timely rain falls the bottom line is expected to be favorable for crop development and production potential. Another round of increased rainfall should occur in center west and center south Brazil after Nov. 20. Minas Gerais to Tocantins will be plenty wet
  during the next two weeks.
• U.S.
  weather Thursday and overnight was dominated by three storm systems
• A
  blizzard occurred in North Dakota, northern Minnesota and also impacted southeastern Manitoba and southern Ontario
  
• Snowfall
  of 16-22 inches occurred in central North Dakota with Bismarck getting 24 inches
• Northeastern
  North Dakota received 6 to 16 inches while northwestern Minnesota reported 4 to 11 inches through dawn today
• A
  frontal boundary pushing from central and eastern Oklahoma through eastern Kansas and Missouri to Wisconsin produced 0.60 to 1.56 inches of rain
• Remnants
  of Tropical Storm Nicole produced 1.00 to 2.24 inches of rain from northern Florida to Georgia and South Carolina with lighter rain farther to the north
• No
  crop damage resulted from the north after it left east-central Florida, although cotton may have experienced enough rain for short term discoloring
• U.S.
  weather coming up of interest to the marketplace…
• West-central
  U.S. Plains wheat production areas will continue dry or receive only a limited amount of moisture during the next two weeks
• Rain
  is expected in the Texas Panhandle and west Texas crop areas Sunday night into Monday with some snow possible in the north
• This
  system will move through Oklahoma and the remainder of Texas to the lower eastern Midwest Monday into Tuesday
  
• A
  band of snowfall varying from 1 to 6 inches will be possible while most of the moisture totals varying from 0.20 to 0.80 inch with a few amounts over 1.00 inch
  
• U.S.
  Delta will get some rain today and again during the early part of next week
• U.S.
  southeastern states will also receive some additional moisture early to mid-week next week with some rain lingering from Nicole today
  
• The
  moisture will maintain good soil moisture for winter crops, but field work may be slow for a while until drier weather resumes
• U.S.
  Pacific Northwest is unlikely to get a tremendous amount of precipitation during the next two weeks, but brief waves of rain and snow will impact the region
• California
  and southwestern states should remain dry over the next two weeks
• Another
  wave of cold coming into the northern Plains and upper Midwest during the late weekend and early part of next week will generate some additional light snow of a dusting to 3 inches
  
• U.S.
  temperatures will be colder than usual this weekend next week, although the eastern states will be a little slow cooling down
• Temperatures
  well below average will occur from Canada’s Prairies through the northern Plains, although the southern Plains and western Midwest will also be colder than  usual for a while this weekend and especially next week
  
• Warming
  is expected after Nov. 20.
• U.S.
  navigable river water levels will drift lower in the coming week, although parts of the lower Delta will get enough moisture for a short term boost in water levels briefly next week
  
• Ontario
  and Quebec, Canada weather will be mostly good for advancing corn and soybean harvesting and winter crop planting during the next ten days, despite a couple of precipitation events
  
• Precipitation
  days will be limited and moisture totals should be light
• A
  boost in precipitation is likely today and Saturday as remnants of Tropical Storm Nicole pass near the region
• Showers
  of snow and a little rain will occur infrequently thereafter through Nov. 23, although a cold front pushing through the region during mid-week next week will be responsible for the greatest precipitation
  
• Europe
  and western CIS temperatures will be warmer than usual over the coming week with Western Europe still warm in the second week of the outlook.
  
• Temperatures
  in western Russia and Ukraine will trend a little cooler than usual next week and into the following weekend
• No
  bitter cold is expected
• Restricted
  precipitation is expected across eastern Europe and western Asia during the coming week
• Totally
  dry weather is unlikely, but the precipitation that falls should be light
• Western
  areas will be wetter than the east
• Snow
  cover will remain restricted in western Asia through much of the forecast period, although a little snow will accumulate in the New Lands over time next week when temperatures are colder
• A
  boost in rainfall is expected in eastern Europe during the latter part of next week and into the following weekend that should bring some relief to drought in the lower Danube River Basin
• Western
  Europe will see a more active weather pattern next week with waves of rain raising soil moisture
• Drought
  will be eased in southern France and eastern Spain
• China
  temperatures will be warmer than usual over the next ten days
• China
  precipitation today into the weekend will be greatest in the Yellow River Basin and north China Plain
  
• This
  event will produce 0.20 to 0.80 inch of moisture with a few 1.00 to 2.00-inch amounts in a part of winter wheat country
  
• Winter
  crops will become better established because of this precipitation
• Some
  of this rain will reach the northern Yangtze River Basin this weekend and more likely early next week with moisture totals of 0.10 to 0.75 inch
  
• Some
  moisture “may” also reach the heart of rapeseed country in the Yangtze River Basin next week and into the following weekend
• China’s
  southern coastal provinces received welcome rain in the past week and more will occur late next week and into the following weekend
• Waves
  of rain are still expected in far southern India over the next ten days keeping the ground abundantly to excessively wet
• Rainfall
  will vary from 2.00 to 6.00 inches and local totals over 7.00 inches by Nov. 20
• Most
  of the heavy rain will be associated with a tropical cyclone that will evolve in the Bay of Bengal during mid-week next week and will reach southern India during the following weekend.
  
• Indonesia,
  Malaysia, Philippines, southern Vietnam, southern Cambodia and southern Thailand will be wet over the next ten days to two weeks
  
• Some
  areas of local flooding are likely periodically
• Rain
  will resume in eastern Australia this weekend, but it should not be excessively great
• Fieldwork
  will be disrupted and rain amounts should vary from 0.65 to 2.00 inches
• No
  new flooding is expected, but flood water that is already in place will be slow in abating
• A
  few showers will already impact the region today
• A
  return of restricted precipitation is expected later next week with some additional rain likely in the following weekend.
• Eastern
  Australia temperatures will be cooler than usual over the next two weeks keeping drying rates slow when rain is not falling
• Western
  Australia will often be colder than usual during the next ten days
• Western
  Australia winter crops are still well on their way to yielding very well with high quality as well.
  
• Rain
  will be limited throughout the forecast period
• South
  Africa has received rain frequently in recent days and more will fall periodically over the next two weeks
• Summer
  crop planting will advance around the moisture
• Some
  delay to farming activity will occur periodically, but progress will be made
  
• Good
  harvest weather is expected for wheat and canola in the western part of the nation where rainfall is expected to be very limited over the next two weeks
• Temperatures
  will be seasonable
• Mexico’s
  seasonal rains have largely diminished for the season and good crop maturation and harvest weather is expected into next week
• Some
  rain will fall lightly in the southeast periodically in the coming week to ten days
  
• Central
  America precipitation is expected to continue periodically during the next ten days, but no large region of excessive rain is expected this week
• Panama,
  Costa Rica and portions of southern and eastern Nicaragua will be wettest
• Some
  increase in rainfall may occur next week
• West-central
  Africa rainfall will occur periodically enough to support southern coffee, cocoa, sugarcane, rice and other crops during the next couple of weeks
• The
  precipitation will be greatest near the coast
• East-central
  Africa rainfall will be sufficient to support coffee and cocoa as well as a few other crops
• Rain
  will fall in portions of Ethiopia, Tanzania and Uganda
• Today’s
  Southern Oscillation Index was +11.29 and it will move erratically over the next few days

 

Source:
World Weather INC

 

Bloomberg
Ag Calendar

Friday,
Nov. 11:

• ICE
  Futures Europe weekly commitments of traders report
• DELAYED:
  CFTC commitments of traders weekly report on positions for various US futures and options, usually released Fridays, will be published Monday, Nov. 14
• New
  Zealand Food Prices
• HOLIDAY:
  US, France, Canada

Saturday,
Nov. 12:

• Atlantic
  Council Global Food Security Forum, Bali, day 1

Sunday,
Nov 13:

• Atlantic
  Council Global Food Security Forum, Bali, day 2

Monday,
Nov. 14:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• US
  crop harvesting for corn, soy and cotton; winter wheat plantation and condition, 4pm
• CFTC
  commitments of traders weekly report on positions for various US futures and options (delayed release as Friday was a holiday)
• Malaysian
  Palm Oil Council’s Internet Seminar, through Nov. 18

Tuesday,
Nov. 15:

• World
  Rice Conference in Phuket, Thailand – day 1
• Global
  Grain Geneva conference – day 1
• New
  Zealand global dairy trade auction
• EU
  weekly grain, oilseed import and export data
• Malaysia’s
  Nov. 1-15 palm oil export data
• Bloomberg
  New Economy Forum in Singapore, through Nov. 17
• HOLIDAY:
  Brazil

Wednesday,
Nov. 16:

• EIA
  weekly US ethanol inventories, production, 10:30am
• World
  Rice Conference in Phuket – day 2
• Global
  Grain Geneva conference – day 2
• Panel
  on global food crisis at Bloomberg New Economy Forum

Thursday,
Nov. 17:

• International
  Grains Council’s monthly report
• USDA
  weekly net- export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Port
  of Rouen data on French grain exports
• World
  Rice Conference in Phuket – day 3
• Global
  Grain Geneva conference – day 3

Friday,
Nov. 18:

• China’s
  second batch of Oct. trade data, including corn, pork, wheat imports
• ICE
  Futures Europe weekly commitments of traders report
• CFTC
  commitments of traders weekly report on positions for various US futures and options
• FranceAgriMer
  weekly update on crop conditions
• US
  cattle of feed, 3pm

Sunday,
Nov 20:

• China’s
  third batch of October trade data, including soy, corn and pork imports by country

Source:
Bloomberg and FI

 

 

Macros

US
Univ. Of Michigan Sentiment Nov P: 54.7 (est 59.5; prev 59.9)

–
Current Conditions: 57.8 (est 62.8; prev 65.6)

–
Expectation: 52.7 (est 55.5; prev 56.2)

–
1-Year Inflation: 5.1% (est 5.1%; prev 5.0%)

–
5-10 Year Inflation: 3.0% (est 2.9%; prev 2.9%)

 

US
Baker Hughes Rig Count 11-Nov: 779 (prev 770)

–
Rotary Gas Rigs: 155 (prev 155)

–
Rotary Oil Rigs: 622 (prev 613)

 

Corn

·        
December corn futures bounced off a late August low after China eased some covid restrictions. China reduced the amount of time that travelers and close contacts of infected people must spend in quarantine. The news spilled over
into other commodity markets from metals to energies. WTI crude oil was up $2.50 around 1:30 pm CT.

·        
South Korea was in for corn. One group bought a cargo, and another passed.

·        
The UN and Russia met today over the Black Sea grain shipping deal. No details were provided at the time this was written. The gain deal officially expires a week from Saturday.

·        
The Dutch government released a shipment of 20,000 tons of Russian fertilizer that has been held up in Rotterdam since sanctions against Russia have been put in place. The shipment will head to Malawi within a week.

 

Export
developments.

·        
South Korea’s NOFI group bought 69,000 tons of corn, optional origin, at an estimated $331.90 a ton c&f for arrival around February 20.

·        
South Korea’s KFS passed on 68,000 tons of corn for arrival around February 25. Lowest price offered was $334.00/ton c&f.

 

Updated
11/10/22

December
corn is seen in a $6.40-$6.75 range. March $6.50-$7.50 range.

 

Soybeans

·        
CBOT soybeans were sharply higher after news broke overnight that China will relax on some Covid restrictions, such as shortening quarantine by two days.  This renewed demand hopes.  The soybean products also ended higher following
soybeans. December soybean oil settled sell off their session highs, up 88 points to 76.97 cents.

·        
News was light with several countries on holiday.

·        
December oil share reached a high of 49.10 percent during the session, end at 48.60 percent, highest level since June 16. Traders last week were looking for it to rise to the 49-50 percent area.

·        
Palm oil futures ended a 3-day losing streak. Indonesia plans to increase palm export taxes for November 16-30 shipments after setting the crude palm oil reference price to $826.58/ton.

·        
(Reuters) – Nine Indonesian companies on Friday signed contracts to sell 2.5 million tons of palm oil products valued at $2.6 billion to 13 Chinese buyers.

·        
Safras & Mercado sees the Brazil soybean crop at 154.5 million tons, up from 151.5 million tons previously. USDA is at 152.0 million tons.

·        
A Reuters poll looks for the US NOPA October crush at 184.5 million bushels (wide range of 175.0-191.3 million, up from 158.1 million last month and 184.0 million October 2021. Soybean oil stocks are seen at 1.535 billion pounds,
up from 1.459 billion at the end of September.

 

December
soybean oil share

 

 

Export
Developments

·        
China auctioning off about 141,000 tons of soybeans form auction out of 500,000 tons offered.

·        
China plans to auction off 500,000 tons of soybeans from reserves on November 25.

 

Updated
11/8/22

Soybeans
– January $13.50-$15.00

Soybean
meal – December $400-$435, January $400-$475

Soybean
oil – December 73-77, January wide 67.00-76.00 range

 

Wheat

·        
US wheat futures ended higher from another dive in the USD and spillover strength in soybeans. The high protein contracts gained on Chicago. Global wheat export developments are strong .

·        
China domestic wheat prices hit a record high from lack of producer selling. Some producers were sitting on stockpiles waiting for higher prices and Covid controls slowed transportations.

·        
Buenos Aires Grains Exchange estimated the Argentina wheat production at 12.4 million tons, down from 14 million tons previous. Rosario the previous day pegged the Argentina wheat crop at 11.8 million tons. USDA is at 15.5 million
tons.

·        
Paris December wheat was down 0.25 euros at 327.25 euros a ton.

·        
Ukraine grain exports since July 1 dropped 30 percent from previous period year ago to 14.6 million tons as of November 9. It included:

5.6
MMT of wheat, down 57% y/y

1.2
MMT of barley, down 74% y/y

7.8
MMT of corn, up 149%

·        
(Interfax) – The export duty on Russian wheat will fall 3% on November 16 to 2,922.1 rubles per ton from 3,012 rubles per ton the week before.

 

Export
Developments.

·        
Tunisia bought 100,000 tons of soft wheat, 100,000 tons of durum, and 75,000 tons of barley, all for shipment between Dec. 5, 2022, and Jan. 25.

• The
  soft wheat was bought in four 25,000 ton consignments, at $377.34, $377.40 and $381.70 a ton c&f.
• The
  durum wheat was bought in four 25,000 ton consignments at $528.89 a ton, $537.68, $529.02, and at $532.17 a ton c&f.
• The
  barley was bought in two 25,000 ton consignments at $349.34 and $343.50 a ton c&f.

·        
Results awaited: Saudi Arabia seeks 595,000 tons of wheat with results expected November 14 for arrival between April and June.

·        
Egypt’s GASC was believed to have bought 280,000 tons of Russian wheat via direct purchases. Lowest offer at the original tender was $369.95/ton c&f for 40,000 tons of Russian wheat. GASC was negotiating for a price of $360 per
to and they may have got $362.50/ton, all for December shipment.

·        
Indonesia flour millers bought Canadian spring wheat and US soft white wheat for January and February shipment. 60,000 tons of Canadian wheat was bought at about $430 a ton c&f and a similar amount of US wheat was purchased at
about $395 a ton c&f.

·        
South Korea’s MFG bought 55,000 tons of Australian feed wheat in a private deal at an estimated $354.70 a ton c&f for March 15-April 15 shipment.

·        
The Philippines passed on 60,000 tons of wheat due to high prices. Shipment was for November 20-March 10, optional origin.

·        
Japan bought 94,603 tons of wheat this week for arrival by February 28. Original tender details as follows:

·        
Jordan issued an import tender for 120,000 tons of hard milling wheat set to close November 15 for March/April shipment.

·        
Jordan is back in for 120,000 tons of barley for March/April shipment on November 16 for March/April shipment.

·        
Japan in a SBS import tender seeks 70,000 tons of wheat and 40,000 tons of barley on November 16 for arrival by February 24.

 

Rice/Other

·        
None reported

 

Updated
11/9/22

Chicago
– December $7.75-$8.75, March $8.00 to $10.00

KC
– December $9.00-$10.15, March 8.50-$10.50

MN
– December $9.00-$10.30, March $9.00 to $10.50