FI Morning Grain Comments 05/13/22

PDF attached

 

Good
morning.

 

Conab
late yesterday corrected their Brazil 2021-22 production forecast to 114.6 million tons, not 116.2 previously reported. That is down from 115.6 million tons previous month (not up).

 

 

High
protein wheat is seeing follow through buying while Chicago wheat is lower on technical selling. Soybeans and corn are higher, meal higher and SBO mixed. The USD was down 3 points and WTI up $2.77. US equities are rebounding. Look for positioning ahead of
the weekend. The morning US weather forecast is still wetter for this week for the US Midwest and unchanged for the Great Plains. Rains are expected to fall across parts of the northern Great Plains today and central GP bias NE and KS over the weekend. Follow
up rain will occur for the northern Great Plains early next week. Hot temperatures are expected for the southern Great Plains. Southern Brazil could see light frost events late next week. Unfavorable weather in France is starting to impact crops

 

 

 

 

Weather

Past
7-days

 

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR MAY 13, 2022

• Rain
  will fall across eastern Canada’s Prairies this weekend resulting in delays to farming activity that will extend into much of next week for some areas, although drier weather is expected
  
• temperatures
  will be cool enough following the rain event to keep evaporation rates subdued
• Another
  weather system is expected later next week
• U.S.
  Midwest weather will be wet enough to slow fieldwork over the coming ten days, but some progress is expected
• Southern
  U.S. Plains, Delta and southeastern states should experience net drying conditions, despite some showers due to warm temperatures
• Net
  drying is expected in most of the southern Plains wheat and cotton areas
• No
  change in South America weather has evolved overnight
• dryness
  will continue in Mato Grosso and Goias
• Frost
  is still possible in some southern Grain areas late next week and into the following weekend
• Argentina
  will continue drier biased
• Europe
  is not likely to get abundant rain, but some showers are expected in the coming week
  
• France
  and Germany will be wettest late in the week and during the following weekend
• Western
  and northern Russia will be wet in the coming ten days slowing fieldwork and leaving soil moisture abundant
• East-central
  China; including the North China Plain, will experience net drying during the next two weeks leading to rising concern over low soil moisture
• Eastern
  Australia rains this week have bolstered soil moisture and water supply for winter crop planting, but delayed late summer harvesting
• A
  strong southwest monsoon is evolving and that will lead to flooding rain in Myanmar, the far Eastern States of India and possibly the lower west coast of India during the next ten days
  
• abundant
  rains will also occur in Philippines and the remainder of the mainland areas of Southeast Asia 
• Eastern
  Indonesia will also be wet

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

Friday,
May 13:

• 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,
May 16:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• U.S.
  crop progress and planting data for corn, soybeans, spring wheat and cotton; winter wheat conditions, 4pm
• HOLIDAY:
  India, Indonesia, Malaysia, Singapore, Thailand

Tuesday,
May 17:

• EU
  weekly grain, oilseed import and export data
• New
  Zealand global dairy trade auction
• GrainCom
  conference in Geneva, May 17-19

Wednesday,
May 18:

• EIA
  weekly U.S. ethanol inventories, production, 10:30am
• China’s
  second batch of April trade data, incl. corn, wheat, sugar and pork imports
• USDA
  total milk production, 3pm
• HOLIDAY:
  Argentina

Thursday,
May 19:

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

Friday,
May 20:

• 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
• China’s
  third batch of April trade data, including soy, corn and pork imports by country
• FranceAgriMer
  weekly update on crop conditions
• Malaysia’s
  May 1-20 palm oil export data
• U.S.
  cattle on feed
• EARNINGS:
  IOI Corp

Source:
Bloomberg and FI

 

 

 

 

 

Macros

US
Import Price Index (M/M) Apr: 0.0% (est 0.6%; prev 2.6%)

US
Import Price Index Ex Petroleum (M/M) Apr: 0.4% (est 0.7%; prev 1.1%)

US
Import Price Index (Y/Y) Apr: 12.0% (est 12.3%; prev 12.5%)

US
Export Price Index (M/M) Apr: 0.6% (est 0.7%; prev 4.5%)

US
Export Price Index (Y/Y) Apr: 18.0% (est 19.2%; prev 18.8%)

 

 

Corn

·        
Corn are unchanged to moderately higher on strength in soybeans and a slightly weaker US Dollar. News is light.

·        
Conab late yesterday corrected their Brazil 2021-22 production forecast to 114.6 million tons, not 116.2 previously reported. That is down from 115.6 million tons previous month (not up). 

·        
The May CBOT contracts expire today.

 

Export
developments.

·        
Taiwan’s MFIG seeks up to 65,000 tons of corn from the US and/or SA on May 18 for August shipment.

·        
Today China planned to buy 40,000 tons of pork for reserves.

 

Soybeans

·        
Soybeans, meal and nearby soybean oil are higher. US weather calls for rain this weekend into next week that could slow US Midwest plantings, but fieldwork should still get done. 

·        
On Monday NOPA will release its April US crush data and the trade looks for 172.4 million bushels, down from 181.8 million during March and up from 160.3 million year ago. End of April soybean oil stocks are seen at 1.839 billion
pounds, a five-month low, down from 1.908 billion at the end of March and up from 1.702 billion year earlier.

·        
Ukraine sunflower plantings were 3.24 million hectares as of Thursday, about two-thirds complete.

·        
India April palm oil imports were 572,508 tons, a 6 percent increase from March but well down from 701,795 tons during April 2021. Soybean oil imports fell to 273,151 tons from 299,421 tons in March. Sunflower oil imports dropped
to 54,426 tons from 212,484 tons in March.

·        
Egypt said they have enough vegetable oils in reserves to last 5 months.

·        
Offshore values are leading SBO 119 points higher (149 lower for the week to date) and meal $5.70 short ton higher ($6.00 higher for the week).

·        
Rotterdam meal was mostly 2-4 euros higher from this time yesterday morning and vegetable oils 10-15 euros higher.

·        
Malaysia’s financial markets will be closed on Monday, May 16 for a public holiday.

·        
Malaysian palm oil ended 27 ringgit per ton higher at 6,369 and cash was down $20/ton at $1,540 ton.

·        
China September soybean futures were up 1.2%, meal up 1.9%, SBO 0.9% higher and China palm oil up 0.3%.

 

 

Export
Developments

·        
China plans to sell another 500,000 tons of soybeans from reserves on May 20. Results are awaited on today’s 500,000-ton auction.

·        
The USDA seeks 550 tons of vegetable oils under its PL 480 program on May 17 for late June/FH July shipment.

 

Wheat

·        
US wheat is mixed with Chicago lower, KC mostly lower, and Minneapolis higher. The southern Great Plains will return to a net drying bias over the next week and northern Great Plains will see additional rain next week. 

·        
September Paris wheat futures hit a fresh record high, currently up 5.00 euros at 418.75 at the time this was written.

·        
Unfavorable weather in France is starting to impact crops. FranceAgriMer reported 82% of French soft wheat crops were in good or excellent condition as of May 9, down from 89% the previous week and compares to 79% year earlier.
Spring barley ratings fell 12 points to 76% and compare to 85% year ago. Winter barley dropped 7 points to 79% and durum fell 6 points to 77%.

·        
Ukraine has about 20 million tons of old crop grain stocks according to the AgMin and about half of the wheat area regions within Ukraine are occupied or being fought over.  

·        
A Ukraine official mentioned Ukraine can export no more than 1.5 million tons of agriculture products a month because it cannot access its ports.

·        
StoneX looks for Ukraine wheat production to fall about 41 percent while Russia could expand 13 percent. Earlier we were looking for a 40 percent reduction and 10 percent gain for Russia.

 

Export
Developments.

·        
Taiwan bought 40,000 tons of US wheat for June 26-July 10 shipment. It included 14.5% protein dark northern spring wheat at $530.57 ton FOB PNW, 12.5% protein hard red winter wheat at $550.52 FOB and 10.5% protein soft white wheat
at $444.03 a ton FOB. Freight was $68.25.

·        
Japan seeks 70,000 tons of feed wheat and 40,000 tons of barley on May 18 for arrival by October 27.

·        
Jordan seeks 120,000 tons of barley on May 18 for Aug/Sep shipment.

·        
Bangladesh seeks 50,000 tons of wheat on May 23 for shipment within 40 days of contract signing.

 

Rice/Other

·        
Results awaited: South Korea seeks 136,000 tons of rice on May 12 for Sep-Dec arrival.

·        
Egypt’s GASC seeks at least 25,000 tons of white rice for July and August arrival.