FI Morning Grain Comments 08/02/22

PDF attached

 

Good
morning.

 

The
US weather outlook is mostly unchanged. Grains, soybeans and soybean oil are lower after USDA reported better than expected crop conditions and resumption of Ukraine grain shipments. Soybean meal is strong, perhaps on product spreading and good US demand.
The US May soybean crush showed a slightly less than expected soybean use. Soybean futures are well off session lows with meal higher. Palm oil traded 5.4% lower overnight. Global export tenders are picking up. US representative visits to Taiwan are keeping
traders nervous as China may back off on buying US goods. Look for a choppy trade.

 

 

 

 

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR AUGUST 2, 2022

• Some
  rain will come to western Europe during the second half of this week as a cool front passed through the region, but rainfall of 0.10 to 0.75 inch will do little to fix long term moisture deficits from France to Germany and dryness is quick to return
• U.S.
  central and eastern Midwest crop areas as well as the Delta have all seen timely rainfall recently and have favorable soil moisture
  
• The
  prospects for more rain remains high and that should translate into status quo conditions
• U.S.
  Plains and a part of the western Midwest are still dealing with a more limited rainfall pattern and bouts of hot temperatures – at least in this first week of the outlook
  
• Crop
  moisture stress is most serious in the northwestern Corn Belt today and from there across much of the northern Plains and into Canada’s southwestern and south-central Prairies
  
• These
  areas of crop stress will not likely see much change in the coming ten days, although next week’s westward shift in the ridge of high pressure could allow a little rain into a part of the western Corn Belt
• Texas
  will continue dry and very warm
• The
  tropics in the Atlantic Ocean, Caribbean Sea and Gulf of Mexico remain quiet with no tropical systems perceived for a while
• Hot
  weather in the U.S. Pacific Northwest will soon be abating, but the dry bias will remain 
• China,
  India and Australia weather remains mostly unchanged and generally favorable, although India may get a little too much rain at times
• Argentina’s
  rain chances are improving again for its drought region in the west for late this coming weekend into early next week and that should be closely monitored
• Eastern
  Ukraine and western parts of Russia’s Southern Region will get some beneficial rain in the net week while most of the Russian New Lands see some net drying
• Southeastern
  and western Europe will continue quite dry, despite some brief showers
• Overall,
  in general weather around the world is status quo today

Source:
World Weather INC

 

Bloomberg
Ag Calendar

Tuesday,
Aug. 2:

• New
  Zealand global dairy trade auction
• EU
  weekly grain, oilseed import and export data
• Australia
  commodity index
• US
  Purdue Agriculture Sentiment, 9:30am
• EARNINGS:
  FMC, Green Plains, Andersons

Wednesday,
Aug. 3:

• EIA
  weekly U.S. ethanol inventories, production, 10:30am
• Malaysia’s
  July 1-20 palm oil export data
• New
  Zealand Commodity Price

Thursday,
Aug. 4:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• EARNINGS:
  Corteva

Friday,
Aug. 5:

• FAO
  World Food Price Index
• 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
• Malaysia’s
  Aug. 1-5 palm oil export data

Source:
Bloomberg and FI

 

 

 

 

USDA
inspections versus Reuters trade range

Wheat                 
256,601                 versus   250000-550000  range

Corn                     
856,938                 versus   550000-1150000                range

Soybeans           
555,083                 versus   300000-800000  range

 

Macros

 

Corn

·        
Corn futures are lower on better than expected US corn conditions and uncertainty over China potentially stepping back from buying US ag products per retaliation if higher level US officials visit Taiwan. A delegation from the
US arrived earlier this week.

·        
Ukraine grain shipments are expected to increase this week out of the Black Sea but some wonder if they will last as the grain moving was already at the ports. Getting grain from the interior to ports might be a challenge.

·        
US corn crop conditions were unchanged while the trade was looking for a one point decline.

 

 

Export
developments.

·        
Taiwan’s MFIG seeks up to 65,000 tons of corn on Aug 3 for Oct 1-20 shipment if from the Gulf/SA, or later if from PNW.

 

 

Soybeans

·        
US soybeans are mostly lower on better than expected US crop conditions, technical selling, and lower soybean oil. Palm oil fell more than 5 percent overnight. US/China trade and political tensions are also pressuring soybeans.
Soybean meal futures are rebounding after Monday’s big decline in cash prices, concerns over US supply and product spreading.

·        
The US weather forecast, which improved from that of Friday, is largely unchanged.

·        
There were no CBOT deliveries.

 

 

·        
Malaysia October palm was down 219 MYR to 3841 /ton and cash down $52.50 at $952.50.

·        
China soybean futures were up 0.3%, meal 1.7% lower, soybean oil down 2.4%, and palm 4.3% lower.

·        
Rotterdam vegetable oils were 30-48
euros lower earlier and meal mostly 8-21 euros lower, from this time yesterday morning.

·        
Offshore values were leading SBO 51 points lower earlier this morning and meal $2.40 short ton lower.

 

 

 

 

Export
Developments

·        
China looks to sell a half a million tons of soybeans out of reserves on August 5.

 

Wheat

·        
US wheat futures are lower from a higher USD, resumption of Ukraine grain shipments and lower related outside markets. US spring wheat crop conditions failed to decline as much as the trade was looking for.

·        
Global import tender announcements are picking up.

·        
Paris September wheat was down 1.500 euros at 334.50 euros as of 8:00 am CT.

·        
Turkey expects the first Ukraine grain shipment to anchor in Istanbul on Tuesday night.

 

 

Export
Developments.

·        
Results are awaited on Algeria seeking 50,000 tons of wheat for Sep/Oct shipment. 

·        
Japan seeks 122,103 tons of milling wheat later this week for October loading.

·        
Tunisia seeks 100,000 tons of soft wheat and 50,000 tons of barley on August 3 for nearby and October shipment.

·        
South Korea millers seek 100,000 tons of wheat from the US and Australia, 50k each, on Wed. for October (US) and/or LH December (Ausi) shipment.

·        
The Philippines seek 150,000 tons of milling wheat and 150,000 tons of feed barley on Thursday for OND shipment.

·        
Jordan bought 60,000 tons of wheat.

·        
Taiwan seeks 50,910 tons of US wheat on August 4 for shipment from the PNW between September 21 and October 5.

 

Rice/Other

·        
South Korea’s Agro-Fisheries & Food Trade seeks 92,100 tons of rice on Aug 3 for arrival in SK between Feb & Apr.