FI Morning Grain Comments 04/01/22

PDF attached

 

Good
morning.

 

Private
exporters reported sales of 136,000 metric tons of corn for delivery to unknown destinations during the 2021/2022 marketing year.

 

Soybeans
are lower on follow through selling although higher meal is limiting losses. The USD is higher and WTI lower. Soybean oil in on the defensive from lower energy prices and weakness in palm. Corn is lower in the front months while wheat is mixed. China sold
248,330 tons of 2019 soybeans from reserves out of 501k offered, at an average price of $791/ton, 49 percent of the planned sales. China will auction another 500,000 tons of imported soybeans from its reserves on April 7. NASS US crush is due out after the
close.

 

Weather

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR APRIL 1, 2022

• Not
  much change in world anomalies were noted overnight
• Southern
  Mato Grosso and Mato Grosso do Sul, Brazil will see less frequent and less significant rain for a while allowing the topsoil to firm up, but this is not the beginning of the dry season for that region
  
• rain
  will return during the middle to latter part of this month as a couple of frontal systems push into the region
• Three
  waves of significant rain will impact northeastern Argentina, southern Paraguay and southern Brazil starting this late weekend and continuing into the week of April  11 resulting in continued excessive soil moisture
  
• harvest
  delays and some concern over late season crop conditions are expected, but most Safrinha corn will not be seriously impacted
• Parana
  River levels will continue to rise allowing barge traffic to improve
• Argentina
  will see no more  threats of frost after Thursday’s cold and soil moisture will stay mostly favorable across the nation
• western
  U.S. hard red winter wheat areas are expecting to remain dry biased for the next ten days
• West
  and South Texas dry weather is also expected for the next ten days
• the
  earliest that rain could evolve in West Texas would be near mid-month and confidence is low
• U.S.
  Midwest, Delta and Tennessee River Basin will continue wet biased, although rain frequency will decrease 
• Cold
  temperatures are still expected in the southeastern U.S. late next week into the following weekend that might bring some unusual late season freezes to a part of the  Delta, Tennessee River Basin and other interior southeastern U.S. crop areas
• California
  and the  southwestern U.S. will stay dry biased for ten days
• There
  is some potential for rain to reach into southwestern parts of Canada’s Prairies and the northwestern U.S. Plains in the second week  of the  outlook, but confidence is not high
• Europe
  will see frequent bouts of snow and rain while temperatures are colder than usual in this coming week with some similar conditions possible in the second week of the  outlook, although with less intensive cold
• Western
  Russia will see abundant precipitation along with southern Belarus and northwestern Ukraine in the next ten days possibly raising flood potentials later this month in Russia
• China’s
  rapeseed and southern corn and rice areas will turn drier and warmer in the next ten days improving crop and field conditions
  
• rapeseed
  areas have been too wet recently

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

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

Sunday,
April 3:

• Egypt’s
  government this month started a local procurement program to buy wheat from its domestic harvest to counter expected shortages of supply from Ukraine

Monday,
April 4:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• Responsible
  Sourcing and Ethical Trade Forum, April 4-5, London
• Ivory
  Coast cocoa arrivals
• HOLIDAY:
  China

Tuesday,
April 5:

• U.S.
  crop progress and planting data for corn and cotton; winter wheat condition, 4pm
• EU
  weekly grain, oilseed import and export data
• Malaysia’s
  April 1-5 palm oil export data
• Purdue
  Agriculture Sentiment, 9:30am
• New
  Zealand global dairy trade auction
• HOLIDAY:
  China, Hong Kong

Wednesday,
April 6:

• EIA
  weekly U.S. ethanol inventories, production, 10:30am
• New
  Zealand Commodity Price
• HOLIDAY:
  Thailand

Thursday,
April 7:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Vietnam’s
  customs department releases coffee, rice and rubber export data for March
• Brazil’s
  Conab releases data on area, yield and output of corn and soybeans

Friday,
April 8:

• FAO
  World Food Price Index
• 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
• 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
• FranceAgriMer
  weekly update on crop conditions

Source:
Bloomberg and FI

 

 

 

 

 

Macros

European
Gas Buyers Have At Least 2 Weeks To Pay In Roubles, Says Kremlin – FT 

US
Change In Nonfarm Payrolls Mar: 431K (est 490K; prev 678K)

US
Unemployment Rate Mar: 3.6% (est 3.7%; prev 3.8%)

US
Average Hourly Earnings (Y/Y) Mar: 5.6% (est 5.5%; prev 5.1%)

US
Average Hourly Earnings (M/M) Mar: 0.4% (est 0.4%; prev 0.0%)

US
Change In Private Payrolls Mar: 426K (est 495K; prev 654K)

US
Change In Manufacturing Payrolls Mar: 38K (est 32K; prev 36K)

US
Average Weekly Hours All Employees Mar: 34.6 (est 34.7; prev 34.7)

US
Labour Force Participation Rate Mar: 62.4% (est 62.4%; prev 62.3%)

US
Underemployment Rate Mar: 6.9% (prev 7.2%)

 

Corn

·        
US corn futures are lower in the front month contracts and higher in the back months, a small reversal from the bear spreading we saw after the USDA report amid smaller than expected 2022 plantings.  There is some chatter China
might be in soon for spot corn yet this has been talked about for months.

·        
News is fairly light. WTI is lower and USD higher.

·        
US corn planting progress if initially released on Monday could be reported at 2 percent complete, about in-line with average.

·        
The Buenos Aires grains exchange warned early frosts could further damage corn and soybeans. The exchange estimates soybean production at 42 million tons and corn at 49 million tons.

·        
EIA reported January ethanol production slightly above our working estimate.

 

 

Export
developments.

·        
Private exporters reported sales of 136,000 tons of corn for delivery to unknown destinations during the 2021/2022 marketing year.

 

 

Soybeans

·        
The CBOT soybean complex is mixed with higher meal, lower soybeans and lower soybean oil. Soybean oil is under pressure from weakness in palm oil and lower crude oil. Soybeans are seeing some follow through selling after USDA
reported higher than expected acres. 

·        
Yesterday Russia placed quotas on sunflower oil and meal from April 1 through August 31.  Sunoil was set at 1.5 million tons and meal at 700,000. 

·        
US January soybean oil use for biofuel production was 791 million pounds, below our working estimate but up from 683 million for January 2021. We lowered our crop year SBO for biofuel use by 100 million pounds to 10.9 billion,
200 million above USDA. 

·        
Cargo surveyor SGS reported March Malaysian palm exports at 1,331,400 tons, 89,113 tons above the same period a month ago or up 7.2%, and 85,833 tons above the same period a year ago or up 6.9%.

·        
June Malaysian palm oil settled 139 ringgit lower to 5,5566. Cash palm was down $20 at $1,566 per ton.

·        
From this time yesterday morning Rotterdam meal from SA were mostly 10-14 euros lower and vegetable oils mixed. 

·        
China May soybeans were up 0.2, meal down 3%, soybean oil down 0.4% and palm off 2.2%.

·        
Offshore values are leading SBO 124 points higher and meal $6.50 short ton lower. 

 

 

 

Export
Developments

·        
China sold 248,330 tons of 2019 soybeans from reserves out of 501k offered, at an average price of $791/ton, 49 percent of the planned sales.

·        
China will auction another 500,000 tons of imported soybeans from its reserves on April 7.

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

 

Wheat

·        
US wheat futures are higher with technical buying and concerns over dryness across the US Great Plains. On Monday we look for the initial US winter wheat rating to be reported below its respected five-year average.  Combined G/E
could end up below 47 percent.  55 percent is 5-year average.

·        
Russia will increase its wheat export tax to $96/ton for the April 6-12 period, up $9 from the previous week.

·        
FranceAgriMer reported the weekly soft wheat crop ratings at 92 percent, unchanged from the previous week and compares to 87% year ago.

·        
May Paris wheat futures were down 1 euro to 368.50 euros.

 

Export
Developments.

·        
Jordan seeks 120,000 tons of feed barley on April 5.

·        
Saudi Arabia seeks 355,000 tons of 12.5% protein wheat for Sep-Nov delivery.

·        
Bangladesh is in for 50,000 tons of wheat with a deadline of April 4. Bangladesh seeks 50,000 tons of wheat on April 11 for shipment within 40 days after contract signing.

 

Rice/Other

·        
(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