FI Morning Grain Comments 04/08/22

PDF attached

 

Good
morning.

 

USDA
report day. Consensus is for US stocks to decline from March for corn and soybeans and wheat to be near unchanged. SA soybean production is projected to decline about 2 million tons. Traders are positioning this morning ahead of the numbers and we are seeing
a higher trade. Yesterday Argentina’s BA Grains Exchange warned soybean production could fall below their current estimate of 42 million tons due to recent early frost events. We didn’t see any major import developments. China plans to auction off another
500,000 tons of soybeans next week, on April 15, third auction of the season. The UN reported the FOA Food Price Index hit a record during the month of March to 159.3 points versus a revised 141.4 for February. June Malaysian palm oil settled 94 ringgit higher
to 5,921 (futures were 6 percent higher for the week). Offshore values were leading soybean oil 94 points lower and meal $0.30 higher.

 

 

 

Weather

 

World
Weather Inc.

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

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

Monday,
April 11:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• Malaysian
  Palm Oil Board’s data for March output, exports and stockpiles
• Malaysia’s
  April 1-10 palm oil export data
• Brazil’s
  Unica may release sugar output and cane crush data (tentative)
• U.S.
  crop progress and planting data for corn and cotton; spring wheat progress, 4pm
• Ivory
  Coast cocoa arrivals

Tuesday,
April 12:

• France
  Agriculture Ministry report; 2022 crop plantings
• EU
  weekly grain, oilseed import and export data
• U.S.
  winter wheat condition, 4pm

Wednesday,
April 13:

• EIA
  weekly U.S. ethanol inventories, production, 10:30am
• China’s
  first batch of March trade data, incl. soybean, edible oil, rubber and meat imports
• FranceAgriMer
  report; monthly French grains outlook
• New
  Zealand food prices
• Holiday:
  Thailand

Thursday,
April 14:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• May
  ICE white sugar contract expiry
• HOLIDAY:
  Argentina, India, Thailand

Friday,
April 15:

• 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
• U.S.
  green coffee stockpiles data released by New York-based National Coffee Association
• FranceAgriMer
  weekly update on crop conditions
• HOLIDAY:
  Major markets closed due to Good Friday holiday

Source:
Bloomberg and FI

 

 

 

 

 

 

 

 

 

 

 

Macros

Canadian
Net Change In Employment Mar: 72.5K (est 79.9K; prev 336.6K)

Canadian
Unemployment Rate Mar: 5.3% (est 5.4%; prev 5.5%)

Canadian
Hourly Wage Rate Permanent Employees (Y/Y) Mar: 3.7% (est 3.7%; prev 3.3%)

Canadian
Participation Rate Mar: 65.4% (est 65.4%; prev 65.4%)

Canadian
Full Times Employment Change Mar: 92.7K (est 41.7K; prev 121.5K)

Canadian
Part Time Employment Change Mar: -20.3K (est 38.2K; prev 215.1K)

 

Corn

·        
US corn futures are higher on pre-USDA report positioning and a higher WTI crude oil market. 

·        
On Monday we look for USDA to report US corn plantings at 4 percent complete, up from 2 percent as of last Sunday. 

·        
Yesterday the US EPA announced decisions on refineries that were seeking exemptions to biofuel blending mandates. 36 petitions were denied for the 2018 compliance year.  The EPA will provide 31 of those refineries with another
avenue to seek relief, without purchasing credits to show compliance with the law. Before this announcement, about 69 requests were pending.  The refineries will still need to file compliance reports even though they won’t be forced to also submit biofuel
credits, according to a Bloomberg story.

 

Export
developments.

·        
None reported

 

Soybeans

·        
The CBOT soybean complex was higher on follow through buying in soybeans and positioning ahead of the USDA report. FOA reported a 23.2 percent increase in the global vegetable oils index for the Monday of March from February.   

·        
China plans to auction off another 500,000 tons of soybeans next week, on April 15, third auction of the season.

·        
Argentina’s BA Grains Exchange warned soybean production could fall below their current estimate of 42 million tons due to recent early frost events. 

·        
June Malaysian palm oil settled 94 ringgit higher to 5,921. Futures were up 6 percent for the week. Cash palm was up $20 at $1,403 per ton.

·        
China May soybeans increased 0.6 percent, meal was up 1.2 percent, palm up 0.8 percent and palm down 0.5 percent. 

·        
Rotterdam vegetable oil prices were mixed and meal 1-5 euros lower.

·        
Offshore values were leading soybean oil 94 points lower and meal $0.30 higher.

·        
Consultancy Datagro noted Brazil soybean sales by producers reached 68.8 million tons out of the 125.1 million production projection, or 55 percent, as of April 1. That percentage would be down from 71.5% year ago.  New crop sales
(2022-23) for the upcoming crop (planted this fall) were 6.9%, below 8.4% year ago. That tells us some producers are still making up their mind for new crop plantings. 

 

Export
Developments

·        
Results awaited: China was to auction off 500,000 tons of imported soybeans this week.

 

Due
out April 11

 

Wheat

·        
US wheat is higher, but gains are limited on slow US exports while Russia continues to export wheat and surging India exports over the past month. Next week the US will see a large storm bring heavy snow to the upper Great Plains
and risk for threatening weather for the upper Midwest.

·        
Traders should monitor Ukraine and Russia wheat stocks are they could be boosted by USDA if exports are again cut. 

·        
The French soft wheat crop was rated 92% as of April 4, unchanged from the previous week and above a year-earlier score of 87%.4 percent of the corn crop had been planted, below 8 percent year ago.

·        
The UN reported the FOA Food Price Index hit a record during the month of March to 159.3 points versus a revised 141.4 for February.

·        
In USDA’s crop progress report next week, we look for a one point improvement in the combined good and excellent condition to 31 percent, bias an increase in Midwestern states and Texas.

·        
Earlier May Paris wheat futures were up 3.75 euros at 367.50 euros.

·        
Russia set their export tax for wheat at $101.40 for the April 13-19 period, up from $96.10 previous.

·        
StoneX estimates Brazil will produce a record wheat crop, above 10 million tons, as the planted area was expected to expand nearly 21 percent.  We think the drastic switch relates to higher global wheat prices, record fertilizer
inputs, and less dependency on Argentina wheat imports. 

 

Last
7-days

 

Export
Developments.

·        
Bangladesh seeks 50,000 tons of wheat on April 11 for shipment within 40 days after contract signing.

·        
Jordan seeks 120,000 tons of feed barley on April 12.

·        
Jordan seeks 120,000 tons of milling wheat for LH May and/or through July shipment on April 13.

 

Rice/Other

·        
(Reuters) – India could export a record 9 million tons of sugar in 2021/22 marketing year as production is likely to jump to a record 35 million tons, nearly 5% more than the previous estimate, according to IMSA.

·        
(Bloomberg) —

•     U.S. 2021-22 cotton ending stocks seen at 3.54m bales, slightly above USDA’s previous est.,

according to the avg in a Bloomberg survey of nine analysts.

•     Estimates range from 3.2m to 4m bales

•     Global ending stocks seen at 82.64m bales vs 82.57m bales in March