FI Morning Grain Comments 03/27/23

PDF attached

 

Good
morning.

 

Private
exporters reported sales of 112,800 metric tons of corn for delivery to unknown destinations during the 2022/2023 marketing year.

 

US
equities are higher and WTI up over $1.00. Quiet start for the week. Look for positioning this week ahead of USDA’s March 31 reports. US soybeans, meal and oil futures are finding a bid from follow through buying in outside related oilseed markets. EU rapeseed
prices were higher. China products rebounded from trading lower last week. Palm oil futures ended a 7-day losing streak. CBOT corn futures are lower despite a higher trade in WTI crude oil and lower USD. US wheat futures are mostly lower after rallying Friday.

 

 

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR MARCH 27, 2023

• Rain
  and snow in the central U.S. Plains was welcome during the weekend lifting topsoil moisture in southern Nebraska, northwestern Kansas and northeastern Colorado
• The
  southwestern U.S. Plains are still too dry and not likely to see much moisture for a while
• U.S.
  Planting delays are likely over the next ten days in the Delta and possibly in early April in some lower Midwest locations
• Concern
  over significant flooding in the Red River Basin and upper Mississippi River Basin remains on the rise, but the runoff will not likely become significant for at least another week.  Some snow melt is expected to begin later this week, though
• Argentina
  and Brazil experienced quieter weather during the weekend and more of the same is expected this workweek.
  
• Argentina
  will trend wetter in the weekend and especially next week with Brazil wetter in the second week of the outlook
• Central
  Brazil crop areas will not likely see much rain for a while in the coming week favoring late soybean harvesting and any other fieldwork that needs to be completed like wheat planting and spraying in Safrinha crop areas
• Spain
  and North Africa will continue dry biased for much of the next two weeks leading to lower yields in unirrigated wheat and barley production areas
  
• Northern
  India received more rain during the weekend along with Pakistan and another storm system is expected in these same areas late this week further raising concern over crop quality
• China
  weather was excessively wet in the far south during the weekend with 3.50 to 13.23 inches of rain falling
  
• Southern
  China will dry down for a little while this week, but more rain is coming later this week that will be lighter than that of the weekend
• Other
  areas in China were dry or mostly dry during the weekend and will stay that way for a while this week, but rain is expected to develop during the weekend and continue early next week in the winter wheat and barley production region that will be ideal in restoring
  favorable soil moisture after drying in recent weeks
• Western
  CIS crop areas and much of Europe outside of the southwest will be trending wetter in the next week to ten days
• Northern
  India has another rain event coming up for Wednesday of this week into the weekend resulting in more downward pressure on winter crop quality, especially wheat

Source:
World Weather, INC.

 

 

Bloomberg
Ag calendar

Monday,
March 27:

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

Tuesday,
March 28:

• EU
  weekly grain, oilseed import and export data

Wednesday,
March 29:

• EIA
  weekly US ethanol inventories, production, 10:30am
• Coffee,
  rice and rubber exports from Vietnam

Thursday,
March 30:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Port
  of Rouen data on French grain exports
• USDA
  hogs & pigs inventory, 3pm
• HOLIDAY:
  India

Friday,
March 31:

• US
  prospective planting data for several crops, including corn, soybeans, wheat, cotton, barley and rice, noon
• USDA’s
  quarterly stockpiles data for corn, soybeans, wheat, barley and sorghum
• ICE
  Futures Europe weekly commitments of traders report
• CFTC
  commitments of traders weekly report on positions for various US futures and options, 3:30pm
• FranceAgriMer’s
  weekly crop condition report
• Malaysia’s
  March palm oil export data
• US
  agricultural prices paid and received, 3pm

Source:
Bloomberg and FI

 

 

 

 

 

 

CFTC
Commitment of Traders

Good
fund selling was seen in soybean meal for the week ending March 21. Funds trimmed their net short position for corn.

 

 

 

 

Macros

 

Corn

·        
Quiet start for the week. Look for positioning this week ahead of USDA’s March 31 reports.

·        
CBOT corn futures are lower despite a higher trade in WTI crude oil and lower USD.

·        
Some are pointing to the weakness in the US corn market to weaker China hog prices, which may curb China feed demand. China corn futures declined to an August low. 

·        
China’s sow herd increased 1.7% for the month of February from a year earlier, according to the AgMin. The herd was 43.4 million sows, 5% above the government target.

 

EIA:
Renewable generation surpassed coal and nuclear in the U.S. electric power sector in 2022

https://www.eia.gov/todayinenergy/detail.php?id=55960&src=email

 

Export
developments.

• USDA
  reported private exporters reported sales of 112,800 metric tons of corn for delivery to unknown destinations during the 2022/2023 marketing year.

 

 

 

Soybeans

·        
US soybeans, meal and oil futures are finding a bid from follow through buying in outside related oilseed markets. EU rapeseed prices were 6.50 euros higher (well off highs) at 463.50 earlier. China products rebounded from trading
lower last week. Palm oil futures ended a 7-day losing streak.

·        
AgRural estimated Brazil soybean harvest progress at 70 percent through Thursday, up 8 points from the previous week and compares to 75 percent last year.

·        
Indonesia January palm oil exports were 2.95 million tons, up 35.2% from a year ago. Production was 3.89 MMT. Stocks fell to 3.09 MMT from 3.56 MMT at the end of January 2022.

·        
Cargo surveyor AmSpec reported Malaysian palm oil exports during the March 1-25 period at 1.137 million tons, up 19.8 percent from the same period previous month.

·        
Cargo surveyor ITS reported Malaysian palm oil exports during the March 1-25 period at 1.151 million tons, up 11.4 percent from the same period previous month.

·        
Malaysia June palm futures were down up 64 ringgit to 3,576 and June cash was unchanged at $880/ton. 

• China
  May soybean futures were down 0.2%, meal up 0.2%, SBO up 1.1% and palm oil futures up 1.4%.

·        
Nearby Rotterdam vegetable oils were sharply higher by 40-50 euros from this time Friday morning and meal 2-11 euros higher.

·        
Offshore values were leading SBO higher by about 64 points this morning and meal $3.20 short ton lower.

 

Export
Developments

·        
None reported

 

 

Wheat

·        
US wheat futures are mostly lower led by KC and Chicago on weakness in Paris wheat and lack of fresh fundamental news. A slightly lower USD might be limiting losses. Turkey is in for a large amount of wheat tomorrow.

·        
Iraq seeks to import 600,000 to 1,000,000 tons of wheat this season after production is expected to hit their 4.0 million ton objective to ensure food supply.

·        
Ukraine grain exports for the week as of March 26 were 804,197 tons, down from 1.08 million tons week earlier.

·        
Reuters: Prices for Russian wheat with 12.5% protein content, delivered free on board (FOB) from Black Sea ports, fell $5 to $272 a tonne last week, the IKAR agriculture consultancy said.

·        
As reported last week, the unfavorable weather across India’s wheat area is still being addressed. Punjab officials said 40 percent of their wheat crop was impacted, an may result in a 15 percent yield loss.

·        
This afternoon USDA will release selected state ratings and the following week put out a initial US rating. With little change in the US drought monitor and precipitation occurring this week across the central and upper Great
Plains, some states may post an increase in ratings early next week, but southwestern states may stay the same.

·        
Paris May wheat was down 3.00 euros earlier at 256.25 per ton.

 

Export
Developments.

·        
Turkey’s TMO seeks 695,000 tons of red milling wheat on March 28 for shipment May 18 to June 16 and June 12 to July 10.

·        
Jordan seeks 120,000 tons of wheat on March 28 for Sep-Oct shipment.

·        
China plans to auction off 140,000 tons of wheat from state reserves on March 29.

 

Rice/Other

·        
Results awaited: South Korea seeks 121,800 tons of rice, most of it from China.

·        
(Reuters) – Indonesia’s food procurement agency (Bulog) will import 2 million tons of rice until December this year, a Bulog official said. Awaluddin Iqbal, Bulog’s corporate secretary said the first phase will see the import
of 500,000 tons. The policy is aimed at stabilizing rice supplies.