FI Morning Grain Comments 03/08/22

PDF attached

 

Good
morning.

 

Day
13.  This morning we are finally seeing some of these markets take a breather. USD is 16 lower, WTI up about $5.69 and equities mixed.  US wheat futures are mostly lower as May Chicago reversed after hitting a fresh record overnight, only to rebound back higher
again. CBOT corn futures are mostly lower after US wheat reversed.  CBOT soybeans, meal and soybean oil are all higher on fund buying and soybean spreading against grains. USDA will update S&D’s on Wednesday. 

 

 

 

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR MARCH 8, 2022

• Additional
  rain will fall in northern Argentina through then end of this week further easing long term dryness.
  
• Southwestern
  Argentina, though, will experience ten days of drying.
• Southern
  Brazil will get some needed moisture Wednesday into Saturday and then experience at least a week and possibly ten days of drying.
  
• Brazil
  crop conditions will improve from both the expected rain and the coming dry weather.
  
• Center
  west and center south Brazil will see a good mix of weather, although parts of Mato Grosso will continue quite wet for a while. 
  
• In
  the U.S., hard red winter wheat areas will experience snow and some rain late Wednesday into Friday with southern Nebraska and Kansas getting some of the greatest snowfall varying from 2 to 6 inches and a few counties may get 6-11 inches.
  
• The
  southwestern Plains will not be impacted by the late week storm; including West Texas.
  
• Moisture
  totals in the central Plains could vary from 0.15 to 0.60 inch with locally more.
  
• Rain
  is still expected in the southeastern U.S. during the next several days bolstering soil moisture after recent dry and very warm conditions.
  
• The
  southeastern states are also expecting frost and freezes Saturday morning that may damage some fruit and vegetable crops. 
  
• The
  U.S. Midwest will stay wet along with the northern Delta and a part of the Tennessee River Basin.
  
• In
  the rest of the world frequent precipitation from the Middle East will reach through Kazakhstan, Uzbekistan and Tajikistan improving soil moisture in cotton areas and it will also reach the mountains of Xinjiang, China resulting in better spring runoff potential.
  
• Bitter
  cold is still expected in parts of Russia, but snow cover will protect crops. 
• Coffee
  and cocoa areas of west-central Africa will get some moisture in the next ten days
• North
  Africa, Spain and Portugal will get some periodic moisture during the next two weeks

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

Tuesday,
March 8:

• EU
  weekly grain, oilseed import and export data
• U.S.
  National Coffee Association Virtual Convention, day 1
• Bursa
  Malaysia Palm Oil Conference, day 2
• HOLIDAY:
  Russia, Ukraine

Wednesday,
March 9:

• USDA’s
  monthly World Agricultural Supply and Demand (WASDE) report, 12pm
• China’s
  agriculture ministry (CASDE) releases monthly report on supply and demand for corn and soybeans
• U.S.
  National Coffee Association Virtual Convention, day 2
• FranceAgriMer
  monthly French grains outlook
• EIA
  weekly U.S. ethanol inventories, production, 11am
• Bursa
  Malaysia Palm Oil Conference, day 3
• HOLIDAY:
  South Korea

Thursday,
March 10:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Malaysian
  Palm Oil Board’s monthly data for output, exports and stockpiles
• U.S.
  National Coffee Association Virtual Convention, day 3
• Malaysia’s
  March 1-10 palm oil export data
• Brazil’s
  Unica may release cane crush and sugar output data (tentative)

Friday,
March 11:

• 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
• FranceAgriMer
  weekly update on crop conditions
• New
  Zealand Food Prices

Source:
Bloomberg and FI

 

 

 

 

 

 

 

 

 

USDA
inspections versus Reuters trade range

Wheat                 
343,463                 versus   300000-500000  range

Corn                     
1,582,167             versus   1000000-1650000             range

Soybeans           
766,250                 versus   400000-1475000                range

 

Soybean
and Corn Advisory

2021/22
Brazil Soybean Estimate Unchanged at 124.0 Million Tons

2021//22
Argentina Soy Estimate Unchanged at 39.0 Million Tons

2021/22
Paraguay Soybean Estimate Unchanged at 5.0 Million Tons

2021/22
Brazil Corn Estimate Unchanged at 112.0 Million Tons

2021/22
Argentina Corn Estimate Unchanged at 49.0 Million Tons

 

Macros

Energy
giant Shell said Tuesday that it will stop buying Russian oil and natural gas and shut down its service stations, aviation fuels and other operations in the country amid international pressure for companies to sever ties over the invasion of Ukraine.

 

Corn

·        
CBOT corn futures
are mostly lower after US wheat reversed.  Rumors are still floating around that China was in for US corn, but we have yet to see large flash sales. 

·        
China looks to buy 38,000 tons of frozen pork for state reserves on March 10.  They bought pork last week, making the March 10 tender second for the crop year. 

·        
USDA reported that a highly pathogenic form of bird flu was reported in a commercial turkey flock in Buena Vista County, Iowa, second reported outbreak in that state.

 

Export
developments.

• None
  reported

 

 

Soybeans

·        
CBOT
soybeans, meal and soybean oil are all higher on fund buying and soybean spreading against grains. Higher WTI crude oil is lending soybean oil support. 

·        
South American rains improved and that should limit additional downside risk for estimated 2022 Argentina and southern Brazil soybean crop estimates going forward. 

·        
AgRural – 122.8 MMT Brazil soybeans, down from 128.5 previous.

·        
(Reuters) – China’s Zhengzhou Commodity Exchange said on Tuesday it will adjust the margin requirement for its thermal coal futures contracts for June 2022 to March 2023 delivery to 50% from settlement of March 10 onwards. It
also adjusted the transaction fee for its rapeseed meal futures contracts for May 2022 delivery to 12 yuan per lot from the night trading session of March 9.

·        
May Malaysian palm oil settled 210 ringgit lower to 6,416 ringgit. Cash palm was down $25/ton to $1,660/ton.

·        
From this time yesterday morning Rotterdam meal was unchanged to 40 euros higher and vegetable oils unchanged to 20 euros higher.

·        
China May soybeans were down 0.7%, meal up 1.9%, soybean oil down 1.4% and palm 1.3% lower. 

·        
Offshore values are leading SBO 172 points lower and meal $15.20 short ton higher.

 

 

Export
Developments

• Iran’s
  state purchasing agency GTC has issued an international tender to purchase about 30,000 tons of soyoil on Wed for March and April shipment.
  
• Iran’s
  SLAL seeks up to 60,000 tons of feed barley, 60,000 tons of feed corn and 60,000 tons of soymeal on Wednesday for March and April shipment.

 

Wheat

·        
US wheat futures are lower as May Chicago reversed after hitting a fresh record overnight.  It rallied again.  Some are wondering if a lower close will officially signal a key reversal.  Several import tenders were announced so
far this week. 

·        
May Chicago wheat already saw a 161.50 cent range and May KC a 116.25 range. 

·        
Traders are getting nervous Ukraine producers will not be able to apply fertilizers this spring. 

·        
May Paris wheat futures were down 3.25 euros at 393.25 euros. 

·        
Egypt does not need additional wheat shipments over the sort or medium term. 

·        
(Reuters) – A Ukrainian ship loaded with 11,000 tons of wheat has arrived at the port of Tripoli in northern Lebanon on Tuesday, the state news agency NNA reported. 1.5-2.0 months of grain reserves are seen for Lebanon. 

 

Export
Developments.

·        
Tunisia passed on 125,000 tons of soft wheat and 100,000 tons of barley, optional origin, on Tuesday. Shipment is for March through May.  Prices were too high. 

·        
South Korea’s NOFI group rejected all offers for up to 130,000 tons of animal feed wheat. Prices were regarded as too high.  The first consignment was sought for arrival in South Korea between May 1 and June 30. The lowest price
offered for the first consignment was said to be $428.86 a ton c&f. The second shipment was sought for arrival around July 15 and lowest offer was $435.00 a ton c&f.

·        
Iran seeks 60,000 tons of milling wheat with United States included as a possible origin, on Wednesday, for rapid shipment in March and April.

·        
Results awaited: Algeria seeks 50,000 tons of soft milling wheat, optional origin, on March 8, opening until the 9^th, for May shipment. 

·        
Jordan’s state grains buyer seeks 120,000 tons of milling wheat on March 9.  Shipment is between LH May and LH July.

·        
Taiwan seeks 50,000 tons of US PNW milling wheat on March 11 for April 23-May 7 shipment. 

·        
Iraq seeks two million tons of wheat to provide a strategic reserve.  Iraq looked for offers from international companies over the weekend.

·        
Jordan’s state grains buyer seeks 120,000 tons of feed barley on March 15.  Shipment is between July 16-31, Aug. 1-15, Aug. 16-31 and Sept. 1-15.

·        
Bangladesh seeks 50,000 tons of milling wheat on March 16 for shipment within 40 days of contract signing. 

 

Rice/Other

·        
(Reuters) – Vietnam will exempt import tax on 300,000 tons of rice from Cambodia this year, the government said in a statement on Tuesday.  Though Vietnam is one of the world’s largest rice exporters, Cambodian grains are also
consumed in the country and used by some Vietnamese traders to meet their rice export contracts.

·        
(Bloomberg) — U.S. 2021-22 cotton ending stocks seen at 3.37m bales, 127,000 bales below USDA’s previous est., according to the avg in a Bloomberg survey of seven analysts.

               
-Estimates range from 3.1m to 3.65m bales

               
-Global ending stocks seen unchanged at 84.31m bales