FI Morning Grain Comments 04/28/23

PDF Attached

 

Good
morning. 

 

USD
was 57 points higher, WTI crude up 59 cents and US equities lower. Later today EIA may release biofuel February production and Monday NASS will
update US March crush which we expect to be a record for the month. Some CBOT agriculture commodity futures are higher from technical buying after sustaining heavy losses since mid-last week. Corn turned lower on lack of fresh fundamental news and expectations
for additional corn commitment cancellations by China. Chicago wheat is mixed, KC higher, and MN higher. Soybeans and meal are higher, rebounding from heavy losses that started around April 19. Soybean oil turned lower. CBOT FND day deliveries for soybean
oil were 199 with one commercial stopper of 125. There were no soybean or soybean meal deliveries. Offshore values were leading SBO higher by about 83 points this morning (220 higher for the week to date) and meal $1.60 short ton higher ($5.60 higher for the
week). There were no CBOT corn FND deliveries. The US Midwest will see rain bias northeastern areas today, central areas over the weekend, and again northeastern areas Monday through Tuesday. Brazil north central and northwestern areas will start to dry down
next week after seeing rain on and off through Tuesday. Global export developments were light. Later today final results on Algeria’s wheat import tender should be out. Chicago wheat deliveries were heavier than expected. For the US Great Plains, precipitation
will favor southern MN, eastern NE, much of KS and OK, and eastern TX today. Much of the Great Plains will be dry Sunday through Tuesday.

 

Fund
estimates as of April 27

 

 

 

Weather

 

Last
7 days

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR APRIL 28, 2023

• Unusual
  warmth will occur in the western North America during the next week to ten days with high temperatures expected in the 70s and possible in the lower 80s as far north as Canada’s western Prairies
• The
  heat in western Canada will come with a strong wind and will induce notable drying resulting in more serious concern about drought in east-central and southern Alberta and west-central and some interior southwestern Saskatchewan locations
• Warming
  will be slow to occur in the U.S. Midwest during the coming week. cool conditions and some showers in the north will be a concern over soil temperatures, but precipitation will slowly become lighter overtime and farmers will likely plant more aggressively
  as soon as it becomes obvious that warming is coming
• Additional
  showers will fall in U.S. hard red winter wheat areas today into Saturday morning with a couple of frontal systems expected to bring showers a thunderstorms infrequently next week
• Greater
  rain is still needed in most of the high plains region; including all of Nebraska and some northern Kansas and northeastern Colorado locations into the Texas Panhandle
• Oklahoma
  experienced the greatest relief from dryness through this week’s rain
• West
  Texas cotton areas will continue to struggle with dryness over the next ten days, despite a few showers
• California
  will start to trend wetter again next week and the wet weather will linger into the following week
  
• Significant
  warming will induce some notable snowmelt for a while in this coming week
• U.S.
  Delta and southeastern states will remain plenty moist with alternating periods of rain and sun
• Iowa,
  South Dakota, Nebraska, Missouri and Illinois rainfall will be restricted over the next ten days
• Not
  much change was noted in South America overnight
• A
  little more shower activity is advertised for parts of Spain late next week into the following weekend, but relief from dryness will be restricted in the south
• North
  Africa will get some shower activity, but not enough to seriously change soil or crop conditions – many areas are still too dry
• Kazakhstan
  and southern and some eastern portions of Russia’s eastern New Lands will continue to dry out and heat up during the next ten days – some 80-degree Fahrenheit temperatures are expected
• Western
  Russia (west of the Ural Mountains) and eastern Ukraine as well as Russia’s Southern Region will trend wetter over the next ten days
• Unusually
  active weather is expected in India over the next ten days raising harvest concerns for some winter crops
• Southeastern
  China will trend much wetter again for a while next week
• North
  China soil moisture will be favorable except in Liaoning, eastern Shandong and some areas north into interior eastern Inner Mongolia
• Eastern
  Australia will get some rain today and early Saturday; Western Australia will be dry for at least another week
• Indonesia
  and Malaysia will continue plenty wet for the next ten days

Source:
World Weather, INC.

 

Bloomberg
Ag calendar

Friday,
April 28:

• ICE
  Futures Europe weekly commitments of traders report
• CFTC
  commitments of traders weekly report on positions for various US futures and options, 3:30pm
• Euro
  Grain Hub Exchange & Forum, Bucharest, day 3
• FranceAgriMer’s
  weekly crop condition report
• US
  agricultural prices paid, received, 3pm

Saturday,
April 29:

• Vietnam’s
  coffee, rice and rubber export data

Monday,
May 1:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• USDA
  soybean crush, corn for ethanol, DDGS production, 3pm
• US
  winter wheat condition, 4pm
• US
  planting data for corn, cotton, spring wheat and soybeans, 4pm
• HOLIDAY:
  Labor day holiday in several countries, including UK, Germany, Argentina, India, Brazil, China, Singapore and Hong Kong

Tuesday,
May 2:

• US
  Purdue Agriculture Sentiment
• Malaysia’s
  April 1-30 palm oil exports
• New
  Zealand global dairy trade auction
• HOLIDAY:
  China, Vietnam

Wednesday,
May 3:

• EIA
  weekly US ethanol inventories, production, 10:30am
• HOLIDAY:
  China, Japan, Vietnam

Thursday,
May 4:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Port
  of Rouen data on French grain exports
• New
  Zealand Commodity Price
• HOLIDAY:
  Japan, Malaysia, Thailand, Bangladesh

Friday,
May 5:

• FAO
  World Food Price Index
• Malaysia’s
  May 1-5 palm oil export data
• ICE
  Futures Europe weekly commitments of traders report
• CFTC
  commitments of traders weekly report on positions for various US futures and options, 3:30pm
• FranceAgriMer’s
  weekly crop condition report
• HOLIDAY:
  Japan, South Korea, Thailand

Source:
Bloomberg and FI

 

 

 

 

 

CME
selected agriculture limits change effective Monday evening

https://www.cmegroup.com/content/dam/cmegroup/notices/ser/2023/04/SER-9190.pdf

 

Macros

OPEC+
Cuts, China Demand Will Steer Oil Towards $90 By Year-End – RTRS Poll

US
Employment Cost Index (M/M) Q1: 1.2% (est 1.1%; prev 1.0%)

US
Personal Income Mar: 0.3% (est 0.2%; prev 0.3%)

US
Personal Spending Mar: 0.0% (est -0.1%; prev 0.2%)

US
PCE Core Deflator (M/M) Mar: 0.3% (est 0.3%; prev 0.3%)

US
PCE Core Deflator (Y/Y) Mar: 4.6% (est 4.6%; prev 4.6%)

US
PCE Deflator (M/M) Mar: 0.1% (est 0.1%; prev 0.3%)

US
PCE Deflator (Y/Y) Mar: 4.2% (est 4.1%; prevR 5.1%)

Canadian
GDP (M/M) Feb: 0.2% (est 0.2%; prev 0.5%)

Canadian
GDP (Y/Y) Feb: 2.5% (est 2.6%; prev 3.0%)

 

 

Corn

·        
Corn turned lower on lack of fresh fundamental news and expectations for additional corn commitment cancellations by China.

·        
There were no CBOT corn FND deliveries.

·        
The US Midwest will see rain bias northeastern areas today, central areas over the weekend, and again northeastern areas Monday through Tuesday.

·        
Brazil north central and northwestern areas will start to dry down next week after seeing rain on and off through Tuesday.

·        
China customs announced quarantine requirements for imports of breeding pigs from France.

·        
Bloomberg: “Biden administration officials have decided to issue an emergency waiver that will allow widespread sales of higher-ethanol E15 gasoline this summer, following a strategy used last year to help tamp down high pump
prices. The waiver, set to be announced by the Environmental Protection Agency on Friday, will temporarily exempt the 15% ethanol fuel blend from volatility requirements that effectively block sales from June 1 to Sept. 15 throughout much of the country. The
planned move was described by people familiar with the matter who asked not to be named because the decision isn’t public.”

·        
The Buenos Aires grains exchange reported 17.5% of the crop had been harvested. 

 

 

 

Export
developments.

·        
None reported

 

Soybeans

·        
Soybeans and meal are higher, rebounding from heavy losses that started around April 19. Soybean oil turned slightly lower.

·        
CBOT FND day deliveries for soybean oil were 199 with one commercial stopper of 125. Registrations of 598 were unchanged. There were no soybean or soybean meal deliveries.

·        
The Buenos Aires grains exchange warned Argentina’s soybean production may again be cut from their 22.5-million-ton estimate (43.3MMT year earlier).  28.2% of the crop had been collected.

·        
Malaysian markets are closed Monday for holiday.

·        
SGS reported Malaysian palm oil exports for the April 1-20 period fell 20.3 percent to 740,545 tons from 929,274 tons previous month period. AmSpec and ITS should be out over the weekend with full month of April results.

·        
Malaysia palm futures fell 117 ringgit to 3338, and cash fell $17.50 to $817.50/ton.

·        
China May soybean futures were down 1.4%, meal up 0.8%, SBO down 1.6% and palm oil futures down 2.1%.

·        
Nearby Rotterdam vegetable oils were unchanged to 5 euros higher from this time yesterday morning and meal near unchanged to 4 euros lower.

·        
Offshore values were leading SBO higher by about 83 points this morning (220 higher for the week to date) and meal $1.60 short ton higher ($5.60 higher for the week).

 

 

 

 

Export
Developments

• USDA
  seeks 860 tons of vegetable oil in 4 liter cans for use in export programs. Shipment was scheduled for Jun 1-30 (June 16 to July 15 for plants located at ports). All offers are due by early May 2.
  

 

Wheat

·        
Chicago wheat futures were mixed earlier, KC & MN higher. Technical buying was noted.  Paris wheat is lower.

·        
Chicago wheat deliveries were heavier than expected at 854 contracts although there was one estimate that did look for up to 1,500 contracts.

·        
For the US Great Plains, precipitation will favor southern MN, eastern NE, much of KS and OK, and eastern TX today. Much of the Great Plains will be dry Sunday through Tuesday.

·        
EU countries agreed to extend their import tariff suspension for Ukraine by a year, including agriculture products, but many countries have already placed to put in motion to ban imports on certain ag products to protect local
farmers.

·        
French soft wheat crop ratings as of April 24 improved one point to 94 percent G/E from the previous week and compare to 91 percent year ago.

·        
September Paris wheat futures were lower by 0.75 euro to 236.00 euros.

·        
Russia said the outlook for the grain export deal (is looking) “not very good.”

·        
India’s weather office warned of a heatwave during the month of May with above average rainfall.

 

FI
tentative US winter wheat by production by class

 

Export
Developments.

·        
Algeria’s OAIC started buying wheat today, valid until Friday, for May 16 through July 31 shipment. Price paid was around $295/ton. 

·        
Jordan seeks 120,000 tons of optional origin wheat on May 2.

·        
Jordan seeks 120,000 tons of feed barley May 3 for October through FH November shipment.

 

Rice/Other

·        
CME changed rice margin

https://www.cmegroup.com/content/dam/cmegroup/notices/clearing/2023/04/Chadv23-135.pdf