FI Morning Grain Comments 04/20/22

PDF attached

 

Good
morning. 

 

The
USD was down 50 points (lending support to US commodities) and WTI crude oil rebounding by $1.24 at the time this was written. Soybeans, meal, nearby corn, and wheat are higher. Soybean oil is mixed. Paris May rapeseed futures, soon to be expiring, hit a new
contract high overnight at 1022.50 euros per ton. Expect a choppy trade. Jordan passed on 120,000 tons of wheat. Japan bought only 380 tons of feed barley in their weekly feed wheat & barley import tender. A Bloomberg poll looks for weekly US ethanol production
to be down 6,000 barrels to 989 thousand (970-1010 range) from the previous week and stocks down 77,000 barrels to 24.726 million.

 

 

 

 

 

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR APRIL 20, 2022

• Late
  week rain and snow in eastern Montana and western North Dakota will further ease long term dryness
• Flood
  potentials are rising in southern Manitoba especially near the Red River
• this
  will delay spring planting and some areas in southern Manitoba may not be able to plant prior to mid-May
• North
  Dakota will also be faced with some flood potential near the Missouri River
• No
  change in the high Plains region of the central U.S. were noted overnight 
  
• Dryness
  will continue over the next two weeks, although a few spits and spats of moisture will be possible
• West
  Texas crop areas will not get enough rainfall to change drought status during the next two weeks
• U.S.
  southeastern states will experience net drying during the next two weeks which may support aggressive planting progress, but there will be a need for rain later this month and in May to support good establishment
• Canada’s
  Southwestern Prairies will continue waiting for significant moisture
• Brazil’s
  center west and center south crop areas will continue in a net drying mode for the next two weeks and a close watch on Mato Grosso’s soil moisture is warranted since it is already a little dry in that state
• Argentina’s
  weather will stay mostly good with rain frequency highest in the east and in southern Brazil
• No
  changes in the outlook for Europe, the CIS, China, India or Australia were noted today and South Africa’s outlook has also remained mostly unchanged. 

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

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

 

 

 

 

 

 

Macros

Canadian
CPI NSA (M/M) Mar: 1.4% (est 0.9%; prev 1.0%)

Canadian
CPI (Y/Y) Mar: 6.7% (est 6.1%; prev 5.7%)

Canadian
CPI BoC Core (M/M) Mar: 1.0% (est 0.5%; prev 0.8%)

Canadian
CPI BoC Core (Y/Y) Mar: 5.5% (est 4.2%; prev 4.8%)

 

Corn

·        
CBOT corn is mixed with bull spreading in focus after futures hit contract highs early yesterday. The USD is sharply lower. WTI crude is higher. Slow US plantings and Ukraine planting concerns are underpinning the market and/or
limiting losses.

·        
Look for July corn to again test the 8.00 level.

·        
The US Midwest will warm up today through the weekend, allowing for fieldwork activity before rain returns early next week to the heart of the Midwest, western Delta, parts of TX and OK. The best planting conditions may occur
during the second week of the forecast.

·        
China Jan-March corn imports were 6.73 million tons. March corn imports from the US were 1.04 million tons, near year ago levels. They took in 1.36 million tons of Ukraine corn (sailed before the conflict), up 64 percent from
year earlier.

·        
China’s Ministry of Agriculture and Rural Affairs sees producer hog margins returning to a profit during the third quarter. Margins have been under pressure since last summer. Hog futures have been on the rise since April 15.

·        
A Bloomberg poll looks for weekly US ethanol production to be down 6,000 barrels to 989 thousand (970-1010 range) from the previous week and stocks down 77,000 barrels to 24.726 million.

 

Corn
Projected More Profitable than Soybeans Well into June

Schnitkey,
G., R. Batts, C. Zulauf, K. Swanson and N. Paulson. “Corn Projected More Profitable than Soybeans Well into June.”
farmdoc
daily
(12):53,  Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, April 19, 2022.

https://farmdocdaily.illinois.edu/2022/04/corn-projected-more-profitable-than-soybeans-well-into-june.html

 

Export
developments.

·        
None reported

 

 

 

 

Soybeans

·        
The soybean complex is mixed with soybeans and meal rebounding. Soybean oil is higher basis the May from higher WTI crude oil while the back months are pressured from light fund selling and global macro economic concerns. May
soybean oil hit a fresh record overnight.

·        
Oil World noted Russian sunflower oil shipments to India are picking up as current price favors imports over SA soybean oil. 

·        
We heard China was asking around for prices for US soybeans.

·        
China Jan-March soybean imports were 6.73 million tons. During the month of March, China imported 3.37 million tons of US soybeans, down from 7.18 million tons a year earlier. US January-March soybean imports are down 30 percent
from a year ago to 13.4 million tons. March Brazil soybean imports were 2.87 million tons, up from 315,334 tons a year ago.

·        
Paris May rapeseed, soon to be expiring, hit a new contract high overnight at 1022.50 euros per ton.

·        
The European Commission is studying if the European Union could achieve a target of a 45% share of renewable energy by 2030, instead of its previously proposed 40%, to become less dependent on energy imports.

·        
Malaysia is back from holiday and futures trended lower by 99MYR and cash was off $20/ton to $1,590/ton.

·        
Cargo surveyor AmSpec reported Malaysian palm oil products for the April 1-20 period fell 18% to 610,728 tons from 744,841 tons previous period month earlier. ITS reported a 14.5 percent decrease to 646,341 tons from 755,977 tons
during March 1-20, cargo surveyor.

·        
China soybean futures fell 0.3 percent, soybean meal up 1.6%, SBO down 0.3%, and palm oil down 1.5%.

·        
Rotterdam vegetable oils were mixed and meal mostly lower by 1-3 euros.

·        
Offshore values are leading soybean oil 34 points lower and meal $2.50 higher.

 

Export
Developments

·        
China looks for sell another 500,000 tons of soybeans during the April 18-23 workweek.

 

Wheat

·        
US wheat is
higher in the font months for the three type class wheat contracts. MN and KC are gaining on Chicago.

·        
The July KC/July Chicago wheat spread widened to 67.25 cents, KC premium, highest for the contract, from negative 20 cents March 22. US drought conditions and strong global demand for high protein wheat has supported this move.

·        
Some are doubting if Egypt will buy a large amount of Indian wheat as freight costs are around $70/ton but at $300 to $3355/ton fob, India is still cheaper than EU and US supplies.

·        
September EU wheat futures were 1.00 euros higher at 366.00 euros.

·        
Late week rain and snow will occur across eastern Montana and western North Dakota. The high Plains region of the central U.S. will continue to see net drying over the next two weeks. West Texas crop areas will see rain during
the next two weeks.

 

Export
Developments.

·        
Jordan passed on 120,000 tons of wheat.

·        
Japan bought only 380 tons of feed barley in their weekly feed wheat & barley import tender.

·        
Japan seeks 27,320 tons of wheat on Thursday.

·        
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