FI Morning Grain Comments 01/27/23

PDF attached

 

Good
morning.

 

Soybeans
and meal are softer this morning after posting solid gains over the last two sessions. Soybean oil is climbing higher from strength in US WTI crude oil and a rally in palm oil futures.  Grains are lower early Friday on positioning ahead of the weekend. Argentina’s
BA Grains Exchange reported an increase in soybean and corn conditions. China will be back from holiday Sunday evening. Look for a choppy trade. The USD was up 14 points earlier and US equity futures lower. There were 198 CBOT soybean registrations cancelled
(Chicago) Thursday evening (819 total now). 363 have been cancelled since January 19. Malaysia April palm futures rose 121 ringgit to 3902 and cash was up $25.00/ton to $965/ton. Offshore values were leading SBO higher by about 59 points this morning (188
higher for the week to date) and meal $2.40 short ton lower (4.20 lower for the week). South Korea’s feedmaker Nonghyup Feed Inc. (NOFI) bought 40,000 ton of rapeseed meal at an estimated $281.80 a ton c&f for shipment between May 21 and June 10. South Korea’s
Major Feedmill Group (MFG) bought 68,000 tons of feed wheat from Australia at an estimated $343.85 a ton c&f for shipment between May 15 and June 15.

 

 

 

Weather

US
and South American weather forecast is unchanged. Argentina will see rain bias Cordoba, Santa Fe, Entre Rios, southwest Buenos Aires, and north La Pampa through Monday. More rain is expected next week. Brazil’s outlook calls for rain across the northeast areas
today, north central areas Saturday and southern areas Sunday into Monday. The US Great Plains could see rain across the northern areas of Nebraska today into Sunday, and eastern TX Saturday into Monday. It will turn very cold for the Great Plains late this
week, but snowfall coverage is good. The Midwest will see precipitation bias ECB over the next few days.

 

World
Weather, INC.

WORLD
WEATHER HIGHLIGHTS FOR JANUARY 27, 2023

• Not
  many changes were noted around the world overnight
• Argentina
  rain fell in some key grain and oilseed production areas from northern Argentina to southern Cordoba overnight with another 0.50 to 1.25 inches and locally more than 1.50 inches
• The
  moisture provided another opportunity for crop and field improvements, though more precipitation will still be needed to restore subsoil moisture which is still quite low
• Alternating
  periods of rain and sun will impact Argentina, Paraguay, Uruguay and Brazil during the next two weeks
  
• The
  moisture will prove supportive for most crop development, although there will be some concern over field working delays in a part of Brazil as center west and center south crop areas see a return of greater rainfall
• Eastern
  Australia weather will improve for dryland sorghum and cotton areas next week as showers and thunderstorms begin to pop up more routinely in Queensland and New South Wales
• Eastern
  China will be dry biased for another week, but may get some welcome moisture in the second week of the two weeks outlook
• Northern
  India is anticipating rain this weekend that will briefly improve topsoil moisture in some winter crop areas where reproduction is expected soon
• No
  follow up rain of significance is expected for at least week and perhaps longer
• Limited
  precipitation is expected in western Europe over the next ten days while some periodic precipitation of light intensity occurs in the east
• Western
  CIS crop weather will be mild to warm with periodic light precipitation
• There
  is no threatening cold for Europe or Asia during the next ten days
• North
  Africa will continue to get some periodic rainfall with northern Algeria staying wettest
• U.S.
  hard red winter wheat areas not likely to get much precipitation of significance through Monday; southeastern parts of the region will get rain and a little snow during the Tuesday through Thursday period next week
  
• Weekend
  snow will protect wheat in Montana and parts of South Dakota from potentially damaging cold
• U.S.
  hard red winter wheat areas will trend much colder this weekend into early next week, but crop damaging cold is not very likely due to the coldest temperatures staying mostly in areas that have significant snow cover
  
• U.S.
  Delta, southeastern states and Tennessee River Basin will be wettest during the coming week to ten days with much of the region either becoming or staying saturated with moisture
  

Source:
World Weather and FI

 

 

 

 

Bloomberg
Ag calendar

Friday,
Jan. 27:

Paris
Grain Conference, day 2

ICE
Futures Europe weekly commitments of traders report

CFTC
commitments of traders weekly report on positions for various US futures and options

US
cattle inventory, 3pm

HOLIDAY:
China

Monday,
Jan. 30:

• USDA
  export inspections – corn, soybeans, wheat, 11am

Tuesday,
Jan. 31:

• Malaysia’s
  January palm oil export data
• EU
  weekly grain, oilseed import and export data
• US
  cattle inventory, 3pm
• US
  agricultural prices paid, received, 3pm

Wednesday,
Feb. 1:

• EIA
  weekly US ethanol inventories, production, 10:30am
• USDA
  soybean crush, DDGS production, corn for ethanol, 3pm
• HOLIDAY:
  Malaysia

Thursday,
Feb. 2:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Port
  of Rouen data on French grain exports

Friday,
Feb. 3:

• FAO
  World Food Price Index
• FAO
  Cereal Supply and Demand Brief
• ICE
  Futures Europe weekly commitments of traders report
• CFTC
  commitments of traders weekly report on positions for various US futures and options

Source:
Bloomberg and FI

 

 

 

 

Macros

US
Personal Spending Dec: -0.2% (est -0.1%; prev 0.1%)

US
Personal Income Dec: 0.2% (est 0.2%; prev 0.4%)

US
PCE Core Deflator (M/M) Dec: 0.3% (est 0.3%; prev 0.2%)

US
PCE Core Deflator (Y/Y) Dec: 4.4% (est 4.4%; prev 4.7%)

US
PCE Deflator (M/M) Dec: 0.1% (est 0.0%; prev 0.1%)

US
PCE Deflator (Y/Y) Dec: 5.0% (est 5.0%; prev 5.5%)

 

 

Corn

·        
CBOT corn
futures
are
lower on positioning ahead of the weekend and slightly improvement to Argentina corn crop conditions. 

·        
Argentina BA Grains Exchange reported an increase in crop conditions, from 3 percent last week to 7 percent this week for the good excellent for soybeans and 5 to 12 percent for corn. The left both the soybean and corn area estimated
unchanged. 98.8 percent of soybean crop had been planted and 94 percent for corn.

https://www.bolsadecereales.com/imagenes/pass/2023-01/962-ecc20230126.pdf

 

 

Export
developments.

·        
Nothing reported.

 

Soybeans

·        
Soybeans and meal are softer this morning after posting solid gains over the last two sessions. Improving Argentina crop conditions might be weighing on soybeans. Soybean oil is climbing higher from strength in US WTI crude oil
and a rally in palm oil futures (bargain buying).  

·        
There were 198 CBOT soybean registrations cancelled (Chicago) Thursday evening (819 total now). 363 have been cancelled since January 19.

·        
Deral lowered their soybean estimate for Brazil’s Parana state by 3 percent to 20.7 million tons. 81 percent of the crop was rated good.

·        
India’s January sunflower oil imports were a record 473,000 tons, nearly triple the regular monthly average. Black Sea was selling sunflower oil at a discount. Around early December Black Sea sunflower was trading at about $100
per ton below soybean oil. India will allow duty free sunflower oil imports through March 2024.

·        
Bloomberg: Indonesia is studying rules that would require exporters to trade at least some of their palm oil on local exchanges before shipping it overseas.

·        
Malaysia April palm futures rose 121 ringgit to 3902 and cash was up $25.00/ton to $965/ton.  

·        
China is on holiday all week.

·        
Nearby Rotterdam vegetable oils were
5-25 euros higher from early yesterday morning. Rotterdam meal was mostly 5-12 euros higher.

·        
Offshore values were leading SBO higher by about 59 points this morning (188 higher for the week to date) and meal $2.40 short ton
lower
(4.20 lower for the week).

 

Export
Developments

·        
South Korea’s feedmaker Nonghyup Feed Inc. (NOFI) bought 40,000 ton of rapeseed meal at an estimated $281.80 a ton c&f for shipment between May 21 and June 10.

·        
The CCC seeks 3,770 tons of vegetable oils on February 1 for last half March shipment.

 

Wheat

·        
US wheat is lower on positioning ahead of the weekend.

·        
Eastern Texas and southeastern Oklahoma will see precipitation this weekend into early next week. Single digit temperatures arrive late this week across the US central and northern Great Plains. US snow coverage should be sufficient
to minimize damage, if any.

·        
Paris March wheat was 2.50 euros lower earlier at 286.25 per ton. 

·        
Russia wheat export tax will increase for the February 1-7 period.

·        
The USDA Attaché estimated Australia wheat production at 37.0 million tons, up from 36.6 million previously.

 

https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Grain%20and%20Feed%20Update_Canberra_Australia_AS2023-0001

 

Export
Developments.

·        
South Korea’s Major Feedmill Group (MFG) bought 68,000 tons of feed wheat from Australia at an estimated $343.85 a ton c&f for shipment between May 15 and June 15.

·        
Jordan seeks 120,000 tons of wheat on Jan 31 for May and June shipment.

·        
Jordan seeks 120,000 tons of feed barley on Feb 1 for May and June shipment.

·        
China plans to auction off 140,000 tons of wheat on February 1, that includes stocks from the 2014-2017 crop years.

 

Rice/Other

·        
South Korea’s rice consumption hit a record low last year. The per-capita rice consumption averaged 56.7 kg in 2022, down 0.4 percent from the previous year.