FI Morning Grain Comments 04/18/22

PDF attached includes update fund sheet with CFTC COT and NOPA charts.

 

Good
morning. 

 

No
USDA 24-hour sales on Monday.

 

Friday
– USDA under the 24-hour reporting system reported 838,000 tons of soybeans sold to China and unknown.

-389,000
metric tons of soybeans for delivery to China. Of the total, 121,000 metric tons is for delivery during the 2021/2022 marketing year and 268,000 metric tons is for delivery during the 2022/2023 marketing year.

-272,000
metric tons of soybeans received during the reporting period for delivery to China during the 2022/2023 marketing year.

-177,000
metric tons of soybeans for delivery to unknown destinations during the 2021/2022 marketing year.

 

Crop
conditions will be out this afternoon and we see a slow start to US summer plantings. Wheat is higher as traders see no end in sight for the Black Sea conflict. Soybeans are seeing support from higher soybean oil and strength in outside markets, although a
higher USD might be limiting gains. WTI crude oil was higher this morning, lending support to corn and soybean oil. Also supporting soybean oil was NOPA’s lower than expected end of March stocks which is supporting some oil/meal spreading.

 

 

 

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR APRIL 18, 2022

• Dry
  weather is expected in Mato Grosso and Mato Grosso do Sul to Bahia, Minas Gerais and Sao Paulo over the next ten days
  
• seasonal
  rains have ended
• Mato
  Grosso topsoil moisture is rated short and subsoil moisture marginally adequate which implies some crop stress will be evolving later this month and in May without some needed rainfall soon
• Interior
  southern Brazil and southern Paraguay will be getting more hefty rainfall later this week returning moisture abundance after some welcome drying
• Argentina
  will see a good mix of rain and sunshine over the next ten days with Thursday into Sunday wettest 
• U.S.
  high Plains region from western Nebraska and eastern Colorado into western Texas will receive limited amounts of moisture during the next two weeks, although it will not be completely dry
• More
  snow in North Dakota, southeastern Saskatchewan and Manitoba, Canada during the weekend bolstered the snowpack 
  
• Minot,
  N.D. received another 12 inches on top of the 30 inches that fell last week; other areas in northern North Dakota received 2 to 7 inches of new snow
• Portions
  of North Dakota and Manitoba, Canada may be faced with a little spring flooding when the significant snow melts especially with another large storm expected late this week into the weekend
• U.S.
  Midwest rain this week will maintain wet field conditions, but warming later in the week and during the weekend will improve drying rates and some planting may evolve
• U.S.
  Delta and Tennessee River Basin will continue moist, but warmer temperatures will accelerate drying rates in time
• Southwestern
  Canada’s Prairies may get some relief from dryness next week with some moisture late this week into the weekend
• Southern
  Europe will be wetter biased in the next ten days while northern parts of the continent are a little drier and milder than usual
• A
  band of significant moisture is expected form Belarus into Russia’s Center Region this week and a part of northern Ukraine will be involved later in the week as well
• India
  and China weather is looking favorable for this time of year. 
• Australia
  will receive rain in central and southern New South Wales today into Tuesday and then drier weather will dominate cotton and sorghum areas until next week when rainy weather resumes
  
• Western
  Australia will remain dry for another week 

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

Monday,
April 18:

• China’s
  second batch of March trade data, including corn, cotton, wheat and pork imports
• China
  1Q pork output and inventory levels
• USDA
  export inspections – corn, soybeans, wheat, 11am
• U.S.
  crop progress and planting data for corn and cotton; spring wheat progress, 4pm
• Ivory
  Coast cocoa arrivals
• HOLIDAY:
  Australia, Hong Kong, New Zealand, France, U.K., Germany

Tuesday,
April 19:

• EU
  weekly grain, oilseed import and export data
• New
  Zealand global dairy trade auction
• HOLIDAY:
  Malaysia

Wednesday,
April 20:

• EIA
  weekly U.S. ethanol inventories, production, 10:30am
• China’s
  third batch of March trade data, including soy, corn and pork imports by country
• China
  Agricultural Outlook Conference, Beijing
• USDA
  monthly milk production, 3pm
• Malaysia’s
  April 1-20 palm oil export data

Thursday,
April 21:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• International
  Grains Council monthly report
• USDA
  red meat production, 3pm
• HOLIDAY:
  Brazil

Friday,
April 22:

• 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
• First
  quarter cocoa grinding data from Cocoa Association of Asia
• Brazil’s
  Unica may release cane crush and sugar output data (tentative)
• U.S.
  cattle on feed; cold storage data for pork, beef and poultry, 3pm
• FranceAgriMer
  weekly update on crop conditions

Source:
Bloomberg and FI

 

 

 

 

 

CFTC
Commitment of Traders

Traditional
funds were less long than expected for Chicago wheat (by 25,100 contracts), corn, soybeans and soybean meal.  Money managers extended their net long position for the major agriculture commodities with exception of soybean meal.  We see no price reaction from
the less than expected Chicago wheat net fund position as traders were busy buying that market mid last week before taking some profits on Friday. The net position futures and options of speculators and index funds for combined SRW, HRW, corn, soybeans, soymeal
and soyoil, remains near a record long. 

 

 

 

 

 

 

SUPPLEMENTAL     
Non-Comm               Indexes                  Comm

       
                Net        Chg        Net        Chg        Net        Chg

Corn              
271,085      5,107    491,696     -2,040   -726,160    -14,117

Soybeans           
97,896      4,286    208,914     -1,144   -279,616     -5,000

Soyoil      
       55,157      5,718    117,946      1,036   -194,383    -12,749

CBOT
wheat         -36,974        707    161,157     -2,293   -121,646       -646

KCBT
wheat          15,695      1,504     62,862       -956    -80,755     -1,912

=================================================================================

 

FUTURES
+ OPTS     Managed                 Swaps              Producer

                       
Net        Chg        Net        Chg        Net        Chg

Corn              
369,952      7,647    286,077     -4,837   -714,681    -13,812

Soybeans          
171,873      8,218    112,854     -6,179   -271,708     -1,692

Soymeal            
93,411     -7,133     90,345        940   -234,989      4,996

Soyoil             
84,063      7,313     85,555     -1,422   -198,640    -11,698

CBOT
wheat          16,639      2,679     68,689     -5,089    -95,363        250

KCBT
wheat          49,392      4,364     23,988        472    -70,849     -1,958

MGEX
wheat          18,120       -135        642        243    -27,514     -1,572

                
———- ———- ———- ———- ———- ———-

Total
wheat         84,151      6,908     93,319     -4,374   -193,726     -3,280

 

Live
cattle         39,498       -766     73,856     -3,007   -128,779       -987

Feeder
cattle       -4,800     -2,207      5,214         -1      3,644        855

Lean
hogs           54,675     -3,076     54,415     -1,121   -107,298      2,737

 

                     
Other             NonReport                  Open

                       
Net        Chg        Net        Chg   Interest        Chg

Corn               
95,273        -48    -36,621     11,050  2,263,395     92,529

Soybeans           
14,176     -2,205    -27,195      1,860    984,410      5,374

Soymeal            
15,533       -715     35,700      1,912    461,136        356

Soyoil              
7,740       -189     21,281      5,995    432,997     22,039

CBOT
wheat          12,572        -71     -2,537      2,231    486,821      6,367

KCBT
wheat          -4,731     -4,241      2,199      1,364    210,439      2,157

MGEX
wheat           4,553        890      4,199        574     76,329      5,212

                
———- ———- ———- ———- ———- ———-

Total
wheat         12,394     -3,422      3,861      4,169    773,589     13,736

 

Live
cattle         28,586      4,630    -13,160        128    358,692      5,586

Feeder
cattle          452         72     -4,508      1,281     59,887      3,427

Lean
hogs            4,805       -541     -6,596      2,000    319,762      4,306

Source:
CFTC, Reuters and FI

 

Macros

 

Corn

·        
May corn
is higher on higher wheat amid Black Sea concerns. WTI crude is higher.

·        
Ongoing Black Sea shipping concerns should underpin corn this week. The slow start to US plantings and cold US weather could also be supportive.

·        
China imported 2.41 million tons of corn last month, a 25 percent increase from a year ago.

·        
Ukraine’s AgMin updated their 2022 summer grain planting intentions to 14 million hectares, up from previous 13.4 million, and well down from 16.9 million planted in 2021.  This estimate is well above private forecasts.  The AgMin
said producers have planted 146,400 hectares of spring wheat, 742,900 hectares of spring barley, 100,500 hectares of peas, 122,600 hectares of corn, 433,700 hectares of sunflower, 110,300 hectares of sugar beet and some other crops. (Rueters)

·        
APK-Inform estimates Ukraine could harvest 38.9 million tons of grain in 2022, almost 55% less than in 2021.

·        
FranceAgriMer reported 8% of the corn crop had been planted, compared with 4% a week earlier and 16% year ago.

·        
China corn futures are near a one-month high.

·        
Bulgaria reported an outbreak of bird flu at an industrial farm in the village of Bogdanitsa, southern part of the country.

 

Export
developments.

·        
None reported

 

Cost
to Produce Corn and Soybeans in Illinois—2021

Zwilling,
B. “Cost to Produce Corn and Soybeans in Illinois—2021.” farmdoc daily (12):52, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, April 15, 2022.

https://farmdocdaily.illinois.edu/2022/04/cost-to-produce-corn-and-soybeans-in-illinois-2021.html

 

Soybeans

·        
Soybeans are higher from strength in outside markets, USDA sales reported on Friday and higher soybean oil. As we mentioned over the weekend, we like soybean oil over meal based on the latest US NOPA crush report. Look for WTI
crude oil to continue influencing soybean oil prices.

·        
Argentina truck drivers’ strike ended Thursday night.  It started Monday.  Truckers are likely to see a 20 percent increase in pay. 

·        
We thought the NOPA report was bullish for soybean oil, neutral soybeans, and slightly bearish soybean meal. 

·        
NOPA reported a 181.8-million-bushel US March soybean crush, 0.2 million below expectations. Soybean oil stocks fell 164 million pounds below expectations at 1.908 billion pounds. Daily adjusted, the crush rate fell to 5.86 million
bu/day from 5.89 million/day during February. The lower than anticipated stocks reflected a steep monthly drop in the soybean oil yield to 11.83 pounds per bushel versus 11.93 pounds reported for the month of February.  Soybean oil stocks at the end of March
for all the major regions are up from end of March 2021, with exceptions of the far northwestern Corn Belt/upper Great Plains (MN, ND, SD, MT). The March soybean meal yield was 47.24, up from 46.99 previous month. Soybean meal production during March was the
fifth largest, for any month, in our recorded history. We look for oil/meal spreading Sunday/Monday. Graphs attached.

 

 

·        
Europe is on holiday today.

·        
Friday and Sunday/Monday morning combined…

·        
Including Friday, Malaysian palm and China futures suggest a higher lead for soybean oil by 102 points and meal by $1.60 short ton. 

·        
Cargo surveyor SGS reported month to date April 15 Malaysian palm exports at 495,096 tons, 79,797 tons below the same period a month ago or down 13.9%, and 88,779 tons below the same period a year ago or down 15.2%.

·        
AmSpec reported Malaysian April 1-15 palm oil exports at 436,548 tons, down 23 percent from 567,637 tons during the March 1-15 period. ITS reported 472,181 tons from 585,277 tons, down 19.3 percent.

·        
Russia’s sunflower oil export duty for the month of May will increase 19% or $58.90/ton to a maximum of $372.20/ton, highest since September 2021. 

 

Export
Developments

·        
Reported Friday: USDA under the 24-hour reporting system reported 838,000 tons of soybeans sold to China and unknown.

-389,000
metric tons of soybeans for delivery to China. Of the total, 121,000 metric tons is for delivery during the 2021/2022 marketing year and 268,000 metric tons is for delivery during the 2022/2023 marketing year.

-272,000
metric tons of soybeans received during the reporting period for delivery to China during the 2022/2023 marketing year.

-177,000
metric tons of soybeans for delivery to unknown destinations during the 2021/2022 marketing year.

·        
Results of the previous two China soybean auctions have not been posted, at least from a major newswire we use. On Friday it was announced China looks for sell another 500,000 tons of soybeans during the April 18-23 workweek.

 

Wheat

·        
US wheat is higher on ongoing Black Sea concerns and dry weather for parts of US winter wheat country.

·        
Look for wheat prices to find some support this week if US winter wheat ratings fail to improve more than a couple points.  As of April 12, 69 percent of US winter wheat production was within an area experiencing drought, unchanged
for the third consecutive week.  Durum wheat areas are in need of rain ahead of plantings. 86 percent of the US durum production areas are experiencing drought conditions.

·        
Kazakhstan decided to go ahead with restricting flour and wheat exports until June 2022. 1 million tons of wheat and 300,000 tons of wheat flour will be allowed to be exported during that time period.

·        
China sold 531,469 tons of wheat from reserves at an average price of 2,841 yuan per ton. That represents 96.43 percent of what was offered. 

·        
FranceAgriMer reported 92% of French soft wheat crop was in good or excellent condition for the week ending April 11, unchanged from the previous week and above 86 percent year ago. 

 

Export
Developments.

·        
Jordan seeks 120,000 tons of feed barley on April 19.

·        
Jordan seeks 120,000 tons of feed wheat on April 20.

·        
Japan seeks 70,000 tons of feed wheat and 40,000 tons of feed barley on April 20 for arrival by September 29.

·        
Taiwan seeks 47,120 tons of US wheat on April 21 for June 2 through June 21 if shipped off the PNW.

 

Rice/Other

·        
None reported