FI Morning Grain Comments 01/27/22

PDF attached

 

Good
morning. 

 

US
GDP Annualized (Q/Q) Q4 A: 6.9% (exp 5.5%; prev 2.3%)

US
Initial Jobless Claims Jan-22: 260K (exp 265K; R prev 290K)

US
Durables Goods Orders Dec P: -0.9% (exp -0.5%; R prev 3.2%)

 

USDA
export sales were above expectations for the grains. Soybeans were ok  while soybean product shipments were very good. The USD is screaming higher this morning from ongoing concerns over Ukraine/Russia tensions.
March
Soybeans hit a new contract high overnight.  Previous high was 14.4550 from June 7th.  March Soyoil hit a new contract high overnight. Previous high was 64.68 from June 10th. Since then, the soybean complex sold off. Corn is lower from slowing domestic industrial
demand (ethanol). Wheat is seeing follow through selling. April Malaysian palm futures traded higher by 115 ringgit to 5,444, a new record high. Indonesia announced all cooking oil producers will be required to sell 20% of their planned export to the domestic
market.  The mandatory portion of palm oil to be sold in the domestic market will be set at a maximum price of 9,300 rupiah ($0.6465) per kg for crude palm oil and 10,300 rupiah per kg for olein.

 

 

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR JANUARY 27, 2022

• Argentina
  will experience drier weather for a while, although there will be a couple of small rain events that should disrupt the trend for a while.
• In
  the meantime, crop development will improve follow the past week of rain.
• A
  ridge of high pressure is still expected to return in Argentina during the middle part of February.
  
• Paraguay
  and southwestern Brazil crop areas will get some rain over the next couple of days and temperatures will finally cool down somewhat, but the relief will only be temporary and no reversal in crop production potential is expected.
  
• Rio
  Grande do Sul, Brazil may have to wait another week before the chances for meaningful rain reach into some soybean production areas in the north.
  
• Flooding
  is still expected to evolve in sugarcane, coffee and some grain and oilseed production areas of Sao Paulo, northern Parana and northern and eastern Mato Grosso do Sul from Friday through Tuesday.
  
• Rain
  totals of 4.00 to 8.00 inches will result with some potential for more in a few areas.
  
• U.S.
  hard red winter wheat production areas will have a potential for snow and rain briefly during mid-week next week while the remainder of the two week outlook is drier than usual.
  
• Most
  of the precipitation will not impact the southwestern Plains.
• Frequent
  precipitation will soon begin (next week) in the eastern United States.
• Frost
  and freezes are expected Sunday in Florida citrus and sugarcane areas, although temperatures may not be cold enough for a long enough period of time to induce serious crop damage. 
  
• California
  and the inter-mountain west is not likely to see good precipitation over the next two weeks.
  
• Greater
  precipitation is now being advertised for western Europe during the second week of the forecast today, although moisture totals will be light.
  
• Eastern
  Europe and the western CIS will experience frequent bouts of snow and some rain over the next ten days.
  
• Eastern
  China will remain wet biased from the Yangtze River Basin to the southern coastal provinces over the next ten days with some significant snow in the parts of the Yangtze Basin.
  
• India
  will be relatively dry.
• Eastern
  Australia will see scattered showers and thunderstorms, although Queensland’s unirrigated areas in the east will not see much significant moisture before the second week of the outlook.
  
• South
  Africa will see a good mix of weather and Northwest Africa will continue dry biased. 

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

Thursday,
Jan. 27:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Paris
  Grain Day conference, Jan. 27-28
• Port
  of Rouen data on French grain exports

Friday,
Jan. 28:

• ICE
  Futures Europe weekly commitments of traders report, ~1:30pm
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• U.S.
  cattle on feed, 3pm

Source:
Bloomberg and FI

 

 

 

 

USDA
Export Sales

Overall
good for the grains and soybean products (shipments). Soybeans ok. USDA US soybean export sales were 1.026 million tons and included increases primarily for China (540,200 MT, including 132,000 MT switched from unknown destinations and decreases of 2,600 MT),
Mexico (345,300 MT, including decreases of 67,200 MT), Spain (105,900 MT, including 97,000 MT switched from unknown destinations), and the Netherlands (84,200 MT, including 80,000 MT switched from unknown destinations and decreases 1,800 MT).  New-crop soybean
sales were 202,800 tons, on the lighter side given the rumors last week China was pricing a good number of new-crop US soybeans. Soybean meal sales were 330,100 tons, within expectations and shipments were very good at 327,100 tons. Soybean oil sales of 12,200
tons slowed from the previous week but shipments were also excellent at 49,900 tons. Previous week shipments for SBO were also an impressive 49,500 tons.  USDA US corn export sales of 1.402 million tons topped a range of expectations and included heavy sales
to Japan and Mexico.  New-crop posted a net reduction of 165,000 tons.  Sorghum sales of 328,500 tons for 2021-22 included China (202,500 MT) and unknown destinations (126,000 MT). USDA US all-wheat export sales of 676,700 tons were above expectations and
a marketing year high. The Philippines, Nigeria, Japan and Mexico were large buyers. 

 

 

 

Macros

US
GDP Annualized (Q/Q) Q4 A: 6.9% (exp 5.5%; prev 2.3%)

 

US
Core PCE (Q/Q) Q4 A: 4.9% (exp 4.9%; prev 4.6%)

–         
Personal Consumption Q4 A: 3.3% (exp 3.4%; prev 2.0%)

–         
GDP Price Index Q4 A: 6.9% (exp 6.0%; prev 6.0%)

US
Initial Jobless Claims Jan-22: 260K (exp 265K; R prev 290K)

–         
Continuing Claims Jan-15: 1675K (exp 1653K; R prev 1624K)

US
Durables Goods Orders Dec P: -0.9% (exp -0.5%; R prev 3.2%)

–        
 Durables Ex-Transportation Dec P: 0.4% (exp 0.3%; R prev 1.1%)

–         
Cap Good Orders Nondef Ex-Air Dec P: 0.0% (exp 0.4%; R prev 0.3%)

–         
Cap Goods Ship Nondef Ex-Air Dec P: 1.3% (exp 0.5%; R prev 0.4%)

 

 

Corn

·        
CBOT corn is lower after EIA confirmed slowing corn for industrial use demand on Wednesday, a lower trade in wheat and sharply higher USD. USDA export sales for corn of 1.4 million tons were above expectations. 

·        
US weekly ethanol production decreased a more than expected 18,000 barrels (trade looking for down 10k) to 1.035 million. Ethanol stocks were up a much larger than expected 884,000 barrels (trade looking for 363,000 barrels higher)
to 24.476 million, highest since May 1, 2020.  Gasoline stocks increased 1.3 million barrels to 247.9 million. Gasoline product supplies was 8.505 million barrels, 281,000 above the previous week and near the average for the past 4 previous weeks. The ethanol
blend rate was 91.5%, below 90.8% previous week.

·        
The USDA Broiler Report showed eggs set in the US up 1 percent and chicks placed down 2 percent.  Cumulative placements from the week ending January 8, 2022 through January 22, 2022 for the United States were 553 million. Cumulative
placements were down 2 percent from the same period a year earlier.

 

Export
developments.

·        
None reported

 

Soybeans

·        
March soybeans hit a new contract high overnight. Previous high was 14.4550 from June 7th.  March Soyoil hit a new contract high overnight. Previous high was 64.68 from June 10th. Since then, the soybean complex sold off. April
palm oil hit a fresh all-time high. 

·        
Traders are looking for US producer selling to increase today.  US crush margins are firm this morning.  US product shipments were very good last week via the export sales report. 

·        
The Gulf is maxed out for shipments for corn wheat and soybeans.  

·        
April Malaysian palm futures traded higher by 115 ringgit to 5,444, a new record high. 

·        
Malaysian cash CPO was up $37.50/ton to $1,362.50. 

·        
Indonesia announced all cooking oil producers will be required to sell 20% of their planned export to the domestic market.  The mandatory portion of palm oil to be sold in the domestic market will be set at a maximum price of
9,300 rupiah ($0.6465) per kg for crude palm oil and 10,300 rupiah per kg for olein.

·        
China soybean futures traded 0.3% lower, meal 2.50% higher, SBO up 1.6% and palm 2.0% higher. 

·        
Rotterdam soybean oil for the Feb-Apr position was 20-25 euros higher from this time previous session and Rotterdam rapeseed oil 25-65 euros higher. SA soybean meal when imported into Rotterdam was 2-14 euros higher.

·        
Offshore values this morning were leading CBOT soybean oil about 6 points higher and meal $0.80 lower.

·        
Yesterday Safras & Mercado estimated Brazil’s 2022 soybean exports at 85.5 million tons, down from 90 million tons previously. That’s 165 million bushels. USDA January projected 90 million tons for the Feb 2022-Jan 2023 local
crop year.

 

Export
Developments

·        
South Korea’s NOFI group bought about 60,000 tons of South American soybean meal at an estimated $548.50 a ton c&f for arrival in South Korea around May 3.

·        
Turkey’s state grain board TMO seeks about 6,000 tons of crude sunflower oil on Jan. 28 for shipment between Feb. 8 and Feb. 25.

 

Indonesia
domestic use of palm oil accounts for about 35 percent of production. 

 

Wheat

·        
US wheat futures are lower on follow through selling and the USD screaming higher. Ongoing concerns over Ukraine/Russia tensions and good export sales should limit losses.

·        
USDA export sales for all wheat of 676,700 tons were above expectations, and a marketing year high.

·        
EU wheat basis the March position was down 1.00 euro at 280 euros.

 

Export
Developments.

·        
Japan bought 25,431 tons out of the 47,841 tons sought of food wheat from Australia.  Original details as follows.

• Jordan
  seeks 120,000 tons of feed barley on February 2.
• Three
  groups from the Philippines are seeking feed wheat for April-May, April-October and/or May-July shipment.
  

·        
Results awaited: Iran’s SLAL seeks 60,000 tons of barley, 60,000 tons of corn and 60,000 tons of soybean meal for Feb/Mar shipment.

·        
Jordan seeks 120,000 tons of wheat on February 1 for July – August shipment.

 

Rice/Other

·        
Results awaited: South Korea seeks 46,344 tons of rice from (mainly) China on Jan 27.

 

 

USDA
Export Sales

 

U.S.
EXPORT SALES FOR WEEK ENDING  1/20/2022

	CURRENT MARKETING YEAR						NEXT MARKETING YEAR
COMMODITY	NET SALES	OUTSTANDING SALES		WEEKLY EXPORTS	ACCUMULATED EXPORTS		NET SALES	OUTSTANDING SALES
		CURRENT YEAR	YEAR AGO		CURRENT YEAR	YEAR AGO
	THOUSAND METRIC TONS
WHEAT
HRW	279.2	2,165.8	1,356.2	130.2	4,614.1	6,001.4	15.0	39.5
SRW	86.9	743.9	443.1	45.2	1,831.9	1,156.6	16.0	70.5
HRS	199.9	1,361.7	1,894.3	111.3	3,265.8	4,513.2	15.0	31.0
WHITE	110.1	819.6	2,398.1	73.7	2,234.4	3,349.8	14.0	42.0
DURUM	0.4	54.6	168.0	0.4	113.1	489.8	0.0	33.0
TOTAL	676.7	5,145.6	6,259.7	360.9	12,059.2	15,510.8	60.0	216.0
BARLEY	0.0	18.0	13.3	0.0	12.5	17.2	0.0	0.0
CORN	1,402.3	25,549.0	29,648.7	1,436.9	18,399.1	19,021.3	-165.0	1,452.0
SORGHUM	328.5	4,172.0	3,358.6	73.9	1,962.8	2,398.7	0.0	53.0
SOYBEANS	1,025.5	9,101.5	12,271.2	1,594.1	35,032.4	45,485.3	202.8	1,196.9
SOY MEAL	330.1	2,938.4	2,845.9	327.1	3,937.2	4,052.3	-99.0	138.2
SOY OIL	12.2	176.1	233.7	49.9	304.5	340.0	-0.1	0.2
RICE
L G RGH	31.2	172.2	294.9	37.1	637.8	838.7	0.0	0.0
M S RGH	0.0	10.3	14.8	0.1	3.3	14.1	0.0	0.0
L G BRN	5.2	10.3	10.3	0.5	28.0	23.1	0.0	0.0
M&S BR	0.9	68.4	53.5	0.1	16.9	52.5	0.0	0.0
L G MLD	24.8	92.9	75.3	10.7	418.1	326.9	0.0	0.0
M S MLD	13.6	102.0	168.5	14.0	198.1	243.1	0.0	0.0
TOTAL	75.7	456.0	617.4	62.5	1,302.1	1,498.4	0.0	0.0
COTTON		THOUSAND RUNNING BALES
UPLAND	391.3	8,057.6	6,083.6	197.9	3,601.0	6,395.6	106.8	1,398.5
PIMA	3.6	220.8	271.8	4.3	165.8	373.6	0.0	5.3

 

 This
summary is based on reports from exporters for the period January 14-20, 2022.  

Wheat:  Net
sales of 676,700 metric tons (MT) for 2021/2022–a marketing-year high–were up 78 percent from the previous week and up noticeably from the prior 4-week average.  Increases were primarily for the Philippines (111,100 MT), Nigeria (110,300 MT, including decreases
of 46,000 MT), Japan (102,600 MT, including decreases of 400 MT), Mexico (80,100 MT, including decreases of 4,800 MT), and South Korea (78,000 MT, including decreases of 5,000 MT).  Net sales of 60,000 MT for 2022/2023 were reported for Honduras (29,000 MT),
Japan (21,000 MT), and unknown destinations (10,000 MT).  Exports of 360,900 MT were down 8 percent from the previous week, but up 21 percent from the prior 4-week average.  The destinations were primarily to the Philippines (123,100 MT), Nigeria (50,300 MT),
Mexico (44,400 MT), Jamaica (29,500 MT), and Japan (29,300 MT). 

Corn:  Net
sales of 1,402,300 MT for 2021/2022 were up 29 percent from the previous week and 84 percent from the prior 4-week average.  Increases primarily for Japan (563,700 MT, including 219,700 MT switched from unknown destinations and decreases of 3,100 MT), Mexico
(266,000 MT, including decreases of 44,200 MT), unknown destinations (102,100 MT, including 65,000 MT – late), Colombia (98,400 MT, including 41,000 MT switched from unknown destinations and decreases of 8,600 MT), and Guatemala (67,900 MT, including decreases
of 1,900 MT), were offset by reductions for Morocco (100 MT).  Net sales reductions of 165,000 MT for 2022/2023 were reported for Japan (110,000 MT) and Mexico (55,000 MT).  Exports of 1,436,900 MT–a marketing-year high–were up 11 percent from the previous
week and 36 percent from the prior 4-week average.  The destinations were primarily to Japan (415,300 MT), Mexico (371,000 MT, including 27,300 MT – late), China (347,900 MT), Canada (104,600 MT), and Colombia (61,400 MT).   

Optional
Origin Sales:  For
2021/2022, new optional origin sales of 65,000 MT were reported for South Korea.  Options were exercised to export 74,000 MT to unknown destinations from the United States.  Decreases totaling 32,000 MT were reported for Italy.  The current outstanding
balance of 342,300 MT is for unknown destinations (235,000 MT), South Korea (65,000 MT), Italy (33,300 MT), and Saudi Arabia (9,000 MT).

Late
Reporting: For
2021/2022, net sales totaling 65,000 MT of corn were reported late for unknown destinations.  Exports totaling 27,300 MT of corn were reported late to Mexico. 

Barley:  No
net sales or exports were reported for the week.   

Sorghum:  Net
sales of 328,500 MT for 2021/2022 were down 31 percent from the previous week, but up 87 percent from the prior 4-week average.  Increases were reported for China (202,500 MT) and unknown destinations (126,000 MT).  Exports of 73,900 MT were down 46 percent
from the previous week and 44 percent from the prior 4-week average.  The destinations were to China (73,200 MT) and Mexico (700 MT). 

Rice:  Net
sales of 75,700 MT for 2021/2022 were up 77 percent from the previous week and 88 percent from the prior 4-week average.  Increases were primarily for Mexico (25,500 MT), Haiti (15,100 MT, including decreases of 100 MT), Japan (12,000 MT), Canada (9,800 MT),
and Guatemala (6,700 MT).  Exports of 62,500 MT were up noticeably from the previous week and from the prior 4-week average.  The destinations were primarily to Mexico (29,600 MT), Japan (13,000 MT), Guatemala (9,400 MT), Haiti (7,100 MT), and Canada (2,100
MT). 

Exports
for Own Account: For
2021/2022, the current exports for own account outstanding balance is 100 MT, all Canada.  

Soybeans:  Net
sales of 1,025,500 MT for 2021/2022 were up 53 percent from the previous week and 77 percent from the prior 4-week average.  Increases primarily for China (540,200 MT, including 132,000 MT switched from unknown destinations and decreases of 2,600 MT), Mexico
(345,300 MT, including decreases of 67,200 MT), Spain (105,900 MT, including 97,000 MT switched from unknown destinations), the Netherlands (84,200 MT, including 80,000 MT switched from unknown destinations and decreases 1,800 MT), and Japan (79,000 MT, including
70,500 MT switched from unknown destinations and decreases of 100 MT), were offset by reductions primarily for unknown destinations (405,800 MT).  Net sales of 202,800 MT for 2022/2023 were reported for China (198,000 MT) and Japan (4,800 MT).  Exports of
1,594,100 MT were down 12 percent from the previous week, but up 1 percent from the prior 4-week average.  The destinations were primarily to China (844,400 MT, including 138,300 MT – late), Mexico (111,200 MT), Spain (105,900 MT), Japan (89,900 MT), and the
Netherlands (84,200 MT).   

Export
for Own Account: For
2021/2022, the current exports for own account outstanding balance is 3,000 MT, all Canada. 

Late
Reporting: For
2021/2022, export totaling 138,300 MT of soybeans were reported late to China. 

Soybean
Cake and Meal:  Net
sales of 330,100 MT for 2021/2022 were up 5 percent from the previous week and up noticeably from the prior 4-week average.  Increases primarily for Ecuador (70,900 MT), Vietnam (50,000 MT switched from Thailand), the Philippines (48,800 MT), Honduras (37,000
MT), and Guatemala (36,700 MT), were offset by reductions primarily for Thailand (53,000 MT) and Mexico (44,300 MT).  Net sales reductions of 99,000 MT for 2022/2023 resulting in increases for Canada (600 MT) and Japan (400 MT), were more than offset by reductions
for Spain (100,000 MT).  Exports of 327,100 MT were up 26 percent from the previous week and 51 percent from the prior 4-week average.  The destinations were primarily to Ecuador (70,300 MT), the Philippines (51,700 MT), Denmark (48,700 MT), Thailand (47,000
MT), and Morocco (29,700 MT).  

Optional
Origin Sales:  For
2021/2022, the current outstanding balance of 50,000 MT is for Venezuela.    

Soybean
Oil:  Net
sales of 12,200 MT for 2021/2022 were down 61 percent from the previous week, but up 22 percent from the prior 4-week average.  Increases were primarily for Mexico (5,000 MT), Venezuela (3,000 MT), the Dominican Republic (2,000 MT), and Canada (1,700 MT).  Total
net sales reductions of 100 MT for 2022/2023 were for Canada.  Exports of 49,900 MT–a marketing-year high–were up 1 percent from the previous week and 72 percent from the prior 4-week average.  The destinations were primarily to India (33,000 MT), Colombia
(7,100 MT), the Dominican Republic (5,000 MT), Jamaica (3,500 MT), and Mexico (1,000 MT).  

Cotton:  Net
sales of 391,300 RB for 2021/2022 were up 43 percent from the previous week and 55 percent from the prior 4-week average.  Increases primarily for Vietnam (132,900 RB, including 600 RB switched from South Korea and 400 RB switched from Japan), India (62,400
RB, including decreases of 3,500 RB), China (58,200 RB, including 8,400 RB switched from unknown destinations and decreases of 2,200 RB), Bangladesh (39,400 RB), and Pakistan (37,300 RB), were offset by reductions for unknown destinations (8,400 RB).  Net
sales of 106,800 RB for 2022/2023 were primarily for Indonesia (33,900 RB), Pakistan (22,900 RB), Guatemala (14,000 RB), Turkey (13,600 RB), and Honduras (9,700 RB).  Exports of 197,900 RB were unchanged from the previous week, but up 25 percent from the prior
4-week average.  The destinations were primarily to China (64,200 RB), Turkey (23,800 RB), Vietnam (23,300 RB), Pakistan (20,300 RB), and Mexico (15,700 RB).  Net sales of Pima totaling 3,600 RB were down 5 percent from the previous week and 19 percent from
the prior 4-week average.  Increases were reported for India (1,700 RB), Vietnam (800 RB), China (800 RB), Japan (200 RB), and Mexico (100 RB).  Exports of 4,300 RB were down 43 percent from the previous week and 44 percent from the prior 4-week average.  The
destinations were primarily to India (1,700 RB), Peru (1,300 RB), China (700 RB), and Egypt (400 RB).   

Optional
Origin Sales:  For
2021/2022, the current outstanding balance of 61,600 RB is for Vietnam (52,800 RB) and Pakistan (8,800 RB).   

Exports
for Own Account:  For
2021/2022, the current exports for own account outstanding balance is 100 RB, all Vietnam. 

Hides
and Skins:  Net
sales of 592,900 pieces for 2022, primarily for China (351,800 whole cattle hides, including 10,600 whole cattle hides switched from Cambodia and decreases of 6,200 pieces), South Korea (72,700 whole cattle hides, including decreases of 3,200 pieces), Mexico
(54,400 whole cattle hides, including decreases of 500 pieces), Thailand (28,000 whole cattle hides, including decreases of 1,800 pieces), and Brazil (23,800 whole cattle hides, including decreases of 700 pieces), were offset by reductions for Cambodia (10,600
pieces).  In addition, total net sales of 7,000 calf skins were reported for Italy.  Exports of 420,900 pieces were primarily to China (258,300 pieces), South Korea (60,200 pieces), Mexico (37,100 pieces), Thailand (33,800 pieces), and Taiwan (10,600 pieces).  In
addition, exports of 3,200 were to Italy (1,800 calf skins and 1,400 kip skins). 

Net
sales of 343,400 wet blues for 2022 were primarily for Vietnam (145,400 unsplit, including decreases of 200 unsplit), Italy (96,500 unsplit and 100 grain splits), China (70,800 unsplit, including decreases of 100 unsplit), and Mexico (16,800 grain splits and
4,300 unsplit).  Exports of 169,900 wet blues were primarily to Vietnam (72,300 unsplit), China (50,800 unsplit), Italy 28,700 unsplit and 3,200 grain splits), Mexico (6,000 grain splits and 3,500 unsplit), and South Korea (3,200 grain splits).  Net sales
of 1,186,300 splits for 2022 were reported for Vietnam (1,184,800 pounds, including decreases of 16,000 pounds) and China (1,500 pounds, including decreases of 1,300 pounds).  Exports of 607,500 pounds were primarily to Vietnam (483,600 pounds). 

Beef:  Net
sales of 14,300 MT for 2022 were primarily for South Korea (6,200 MT, including decreases of 400 MT), Japan (3,900 MT, including decreases of 500 MT), Mexico (600 MT), China (600 MT, including decreases of 900 MT), and Indonesia (600 MT).  Exports of 14,300
MT were primarily to Japan (4,100 MT), South Korea (3,900 MT), China (1,900 MT), Taiwan (1,300 MT), and Mexico (900 MT). 

Pork:  Net
sales of 49,100 MT for 2022, primarily for Mexico (17,300 MT, including decreases of 300 MT), China (16,900 MT, including decreases of 200 MT), Canada (3,000 MT, including decreases of 500 MT), Japan (2,700 MT, including decreases of 400 MT), and South Korea
(2,600 MT, including decreases of 300 MT), were offset by reductions for Trinidad and Tobago (100 MT), Australia (100 MT), and Guatemala (100 MT).  Exports of 30,700 MT were primarily to Mexico (16,000 MT), Japan (3,600 MT), China (3,600 MT), South Korea (2,000
MT), and Canada (1,400 MT).

January
27, 2022                                 1             FOREIGN AGRICULTURAL SERVICE/USDA