FI Morning Grain Comments 03/29/22

PDF attached

 

Good
morning.

 

Note
limits for Chicago and KC are 85 cents and MN was already down limit 60 cents.

https://www.cmegroup.com/trading/price-limits.html

 

Talks
between Ukraine and Russia today in Turkey will be closely monitored and could have an impact on markets. Some headlines hinted talks were progressing. WTI sold off and was down $5.70 at the time this was written. USDA was 96 points lower and US stocks higher.
CBOT ags are lower led by a sharply downward moved in wheat in another risk off session. Weakness in wheat is in large part to headline trading and an improvement in the Kansas winter wheat rating. May CBOT corn failed to trade at $7.50 after trading at the
level last 18 consecutive session. Soybeans, meal and oil are lower on China Covid-19 concerns weakness in outside commodity markets. India paid $2,150 per ton CIF for 45,000 tons of Russian sunflower oil, a record price, for April shipment. Fertilizer prices
are around a record according to a Bloomberg story, adding to food inflation and leaving some second guessing the size of the US corn planted area. Results are awaited with Algeria seeking milling wheat. Tunisia is in for soft wheat and feed barley. Turkey’s
TMO bought 100,000 tons of corn out of 300-325k sought for optional origin shipment between April 8 and May 5. They paid $400.87/ton C&F and $407.87/ton. 

 

 

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR MARCH 29, 2022

• U.S.
  Midwest, Delta and Tennessee River Basin weather over the next ten days will remain active with frequent rain and mild to sometimes cool temperatures
  
• Saturated
  or nearly saturated soil will be present for a while delaying spring planting and slowing winter crop development
• U.S.
  high Plains crop areas will continue drier than usual, including the  northwestern Plains, western hard red winter wheat areas and West Texas
• Both
  West and South Texas will continue without much meaningful rain for a while threatening dryland cotton, corn and sorghum production
• Rain
  in California Monday and that lingering today will be great for the areas impacted in southern California, but mountain snowpack in the Sierra Nevada range is unlikely to change enough to alter the drought situation and water supply for the year ahead
• No
  changes were noted overnight in South America
• Argentina
  will be dry biased in the west for the coming week and then may get “some” rain around day ten 
• Bahia
  and northern Minas Gerais will be dry biased for at least another ten days and that means crop stress in unirrigated grain, oilseed, coffee and sugarcane areas will continue
• Central
  and southern Europe and western parts of Russia are still looking at a frequent rain and snowfall pattern that may raise flood potentials in parts of Russia when snow melts later this spring
• China’s
  Yangtze River Basin and areas to the south will remain wet today and Wednesday and then at least a full week of drying is expected and that will improve crop and field conditions while increasing spring planting
• Eastern
  Australia’s cotton conditions are expected to improve during the next ten days as less frequent and less significant rain evolves
• A
  more active tropical weather pattern may impact southeastern Asia next week and into the following weekend with a few storm systems expected to evolve

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

Tuesday,
March 29:

• EU
  weekly grain, oilseed import and export data
• Vietnam’s
  General Statistics Department releases March export data for coffee, rice and rubber

Wednesday,
March 30:

• EIA
  weekly U.S. ethanol inventories, production, 10:30am
• USDA
  hogs and pigs inventory, 3pm

Thursday,
March 31:

• U.S.
  annual acreage prospective planting data for various farm commodities, including wheat, barley, corn, cotton, soybeans and sunflower, noon
• USDA
  quarterly stockpile data for wheat, barley, corn, oats, soybeans and sorghum, noon
• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• U.S.
  agricultural prices paid, 3pm
• Malaysia’s
  March palm oil export data

Friday,
April 1:

• ICE
  Futures Europe weekly commitments of traders report
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• Australia
  Commodity Index
• USDA
  soybean crush, DDGS output, corn for ethanol, 3pm
• FranceAgriMer
  weekly update on crop conditions

Source:
Bloomberg and FI

 

Reuters
trade estimates for USDA

 

 

 

 

 

 

 

 

Soybean
and Corn Advisory

Estimated
2022 U.S. Corn Acreage 91.5 mac, Soybeans 88.5 mac

2021/22
Brazil Soybean Estimate Unchanged at 123.0 Million Tons

2021/22
Brazil Corn Estimates Unchanged at 112.0 Million tons

2021/22
Argentina Soybean Estimate Unchanged at 39.0 Million Tons

2021/22
Argentina Corn Estimate Unchanged at 49.0 Million Tons

 

USDA
inspections versus Reuters trade range

Wheat                 
341,191                 versus   300000-500000  range

Corn                     
1,606,535             versus   1000000-1665000             range

Soybeans           
628,819                 versus   500000-800000  range

 

Macros

 

Corn

·        
US corn futures are lower on headline trading. Ukraine/Russia talks are ongoing. WTI trended $5.77 lower around 7:50 am. USD was down 96 points.  Turkey bought optional origin corn.

·        
May CBOT corn
failed to trade at $7.50 after trading at the level last 18 consecutive session.

·        
Texas reported 51 percent of their corn crop planted, above a 5-year average of 46 percent. Corn planting was 51% complete in Louisiana, 5% complete in Mississippi and 2% complete in Arkansas. (Reuters)

·        
Fertilizer prices are around a record according to a Bloomberg story, adding to food inflation and leaving some second guessing the size of the US corn planted area.

·        
Ukraine producers late last week started planting on 15-20% of the planned area according to Ukraine.

 

 

EIA:
Crude oil exports from other countries may pass through Russian infrastructure

https://www.eia.gov/todayinenergy/detail.php?id=51838&src=email

 

Export
developments.

• Turkey’s
  TMO bought 100,000 tons of corn out of 300-325k sought for optional origin shipment between April 8 and May 5. They paid $400.87/ton C&F and $407.87/ton. 
  

 

 

Soybeans

·        
CBOT May
soybeans, meal, and soybean are lower in another risk off trade, lower outside related commodity markets and ongoing Covid-19 lockdown concerns in China.

·        
India paid $2,150 per ton CIF for 45,000 tons of Russian sunflower oil, a record price, for April shipment. Before the escalation in the Black Sea, India was buying sunflower oil at around $1,630/ton.

·        
Indonesia set its crude palm oil reference price for April at $1,787.5 per ton, up from March’s $1,432.24 per ton.

·        
June Malaysian palm oil settled 42 ringgit higher to 6,020, Cash palm was up $15 at $1,565ton.

·        
From this time yesterday morning Rotterdam meal from SA were mostly 8-13 euros higher and vegetable oils 5-25 euros higher. 

·        
China May soybeans were down 1.0%, meal down 2.2%, soybean oil up 0.8% and palm down 0.5%.

·        
Offshore values are leading SBO 277 points higher and meal $0.80 short ton higher. 

 

China’s
Dalian Commodity Exchange
will increase raise trading limits and margin requirements on April 6.

Source:
Reuters

 

Export
Developments

·        
Turkey seeks 18,000 tons of sunflower oil on Thursday.

·        
China plans to sell about 500,000 tons of soybeans on April 1.

• USDA
  seeks 2,710 tons of packaged oil on April 7 for May shipment (May 23-June 13 for plants at posts).
  
• Qatar
  seeks to buy 960k cartons of corn oil in a tender closing April 4.

 

Wheat

·        
US wheat futures are lower on headline trading and an improvement in the KS winter wheat rating. Results are awaited with Algeria seeking milling wheat. Limit for Chicago and KC are 85 cents and MN was already down limit 60 cents.

·        
Talks between Ukraine and Russia today in Turkey will be closely monitored and could have an impact on markets.

·        
May Paris wheat futures were down 19.50 euros (5.3%) to 349.75 euros.

·        
Kansas’s winter wheat crop saw a good improvement in combined good/excellent conditions from the previous week to 32 percent from 25 percent. Oklahoma was rated 18 percent, down from 21 percent week earlier and Texas 7 percent,
up one point from last week. CO was rated 11 percent, a decline from 19 percent week earlier. NE was rated 27% versus 36% at the end of February. SD increased 2 points from late February to 26 percent.

·        
A Bloomberg article Australia was “pretty well” sold out of wheat for the first half of this year with second half available.

·        
Australia’s eastern coastal areas were again hit with heavy rain. La Nina tends to yield above average rainfall for eastern Australia.

·        
USDA Attaché sees 2022-23 Egypt’s July-June wheat imports at 11 million tons, down from 12 million tons projected for 2021-22.
https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Grain%20and%20Feed%20Annual_Cairo_Egypt_EG2022-0009

 

Export
Developments.

·        
Tunisia seeks 150,000 tons of soft wheat and 100,000 tons of feed barley on Wednesday. The wheat is sought for shipment between April 20 and June 25, depending on origin supplied. The barley is sought for shipment between April
25 and June 25.

·        
Algeria seeks 50,000 tons of milling wheat for May and/or June shipment. It might be set to close Wednesday.

·        
Taiwan seeks 40,000 tons of US wheat on March 30 for shipment off the PNW during the May 14 and May 28 period.

·        
Jordan issued an import tender for 120,000 tons of milling wheat for shipment during May, June, or July on March 31.

·        
Results awaited: Qatar seeks 105,000 tons of optional origin animal feed barley on March 27 shipment in April, May and June. 

·        
Bangladesh is in for 50,000 tons of wheat with a deadline of April 4.

 

Rice/Other

·        
US cotton futures hit a decade high on US drought concerns and strong demand from China.

·        
(Bloomberg) — Qatar is seeking to buy 1.2m bags of rice in a tender that closes April 4, according to the Ministry of Commerce and Industry’s website.  Qatar also seeks to buy 960k cartons of corn oil in a tender closing April
4