FI Morning Grain Comments 08/05/22

PDF attached

 

Good
morning.

 

Private
exporters reported the following sales activity:

-132,000
metric tons of soybeans for delivery to China during the 2022/2023 marketing year

-132,000
metric tons of soybeans for delivery to unknown destinations during the 2022/2023 marketing year

 

The
Midwest will see an increase in rain across Midwest this weekend. For the WCB, northwestern Iowa and northeastern Nebraska could see up to 1.00 inch by Sunday and
1-2 inches could occur from eastern South Dakota into central and southern Minnesota. But note weather models still vary for the rain projected from now through the
weekend for the WCB. Some weather forecasts showing a little warmer and drier on the 6-10 day forecast.

 

Grain
prices are down slightly this morning on positioning. The soybean complex is seeing a reversal in product spreading, pressuring soybeans. The USD is screaming higher by 116 points and WTI turned lower after US jobs data was released. US equities are lower.

 

US
Nonfarm Payrolls Jul: 528K (est 250K; prev 372K)

US
Unemployment Rate Jul: 3.5% (est 3.6%; prev 3.6%)

US
Average Hourly Earnings (M/M) Jul: 0.5% (est 0.3%; prev 0.3%)

US
Average Hourly Earnings (Y/Y) Jul: 5.2% (est 4.9%; prev 5.1%)

 

 

 

 

Weather

 

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR AUGUST 5, 2022

• A
  strong cold front moving through U.S. crop areas early to mid-week next week will bring some needed moisture to the western Corn and Soybean Belt
  
• The
  greatest relief to dryness is expected in eastern South Dakota, southern Minnesota and northern Iowa
• Rainfall
  farther to the south in the western Corn Belt may not be very great limiting the break from dryness
• Hotter
  and drier weather will follow the frontal system in the second week of the forecast with very little rain likely in the western Corn Belt after Tuesday night for at least a week and some west-central and southwestern areas may be dry for ten days with rising
  temperatures in week 2
• West
  Texas received a few showers and thunderstorms overnight and more will be possible during the middle to latter part of next week
• Canada’s
  Prairies will continue in a net drying mode in the central and south for the next ten days with very warm temperatures
  
• crop
  conditions will be deteriorating in southern and central Saskatchewan and southern Alberta
• Argentina
  has a good chance for rain in some of the drier western wheat areas Sunday and Monday, but much more rain will be needed
  
• coverage
  of the precipitation may be a little low for the driest areas
• Southern
  Brazil will get more rain for its wheat crop next week
• Europe
  rainfall will continue restricted over the next ten days with temperatures warmer than usual
• Some
  drying will also occur in Russia’s New Lands and eastern parts of its Southern Region
• Rice
  areas of southeastern China will dry out over the coming ten days while rain falls frequently in corn and soybean areas
• Flooding
  rain is still expected in central India next week probably in the middle to latter part of the week possibly causing a little crop and property damage
• Australia
  weather will continue plenty moist for winter crops

Source:
World Weather INC

 

Bloomberg
Ag Calendar

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

Sunday,
Aug. 7: 

• China’s
  first batch of July trade data, incl. soybean, edible oil, rubber and meat imports

Monday,
Aug. 8:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• US
  crop conditions for wheat, corn, soybeans and cotton; spring wheat harvest, winter wheat progress, 4pm
• Vietnam
  Customs releases July coffee, rice, rubber export data
• HOLIDAY:
  Pakistan

Tuesday,
Aug. 9:

• EU
  weekly grain, oilseed import and export data
• HOLIDAY:
  Singapore, India, Bangladesh

Wednesday,
Aug. 10:

• EIA
  weekly U.S. ethanol inventories, production, 10:30am
• Malaysian
  Palm Oil Board’s data on stockpiles, production and exports
• Malaysia’s
  Aug 1-10 palm oil export data
• Brazil’s
  Unica to release cane crush, sugar production data (tentative)

Thursday,
Aug. 11:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Brazil’s
  Conab to publish output and planting data for soybeans and corn
• HOLIDAY:
  Japan

Friday,
Aug. 12:

• USDA’s
  monthly World Agricultural Supply and Demand (WASDE) report, 12pm
• China’s
  agriculture ministry (CASDE) releases monthly report on supply and demand for corn and soybeans
• 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
• New
  Zealand food prices
• FranceAgriMer
  weekly update on crop conditions
• EARNINGS:
  Olam, Golden Agri
• HOLIDAY:
  Thailand

Source:
Bloomberg and FI

 

 

 

 

 

Macros

US
Nonfarm Payrolls Jul: 528K (est 250K; prev 372K)

US
Unemployment Rate Jul: 3.5% (est 3.6%; prev 3.6%)

US
Average Hourly Earnings (M/M) Jul: 0.5% (est 0.3%; prev 0.3%)

US
Average Hourly Earnings (Y/Y) Jul: 5.2% (est 4.9%; prev 5.1%)

US
Private Payrolls Jul: 471K (est 230K; prev 381K)

US
Manufacturing Payrolls Jul: 30K (est 20K; prev 29K)

US
Average Weekly Hours All Employees Jul: 34.6 (est 34.5; prev 34.5)

US
Labour Force Participation Rate Jul: 62.1% (est 62.2%; prev 62.2%)

 

Canadian
Net Change In Employment Jul: -30.6K (est 15.0K; prev -43.2K)

Canadian
Unemployment Rate Jul: 4.9% (est 5.0%; prev 4.9%)

Canadian
Hourly Wage Rate Permanent Employment Jul: 5.4% (est 5.9%; prev 5.6%)

Canadian
Participation Rate Jul: 64.7% (est 64.9%; prev 64.9%)

Canadian
Full Time Employment Change Jul: -13.1K (prev -4.0K)

Canadian
Part Time Employment Change Jul: -17.5K (prev -39.1K)

 

 

Corn

·        
The USD rallied more than 80 points post US jobs report, adding some pressure on grain prices. However, corn ended the overnight session slightly lower.

·        
French corn ratings dropped again. 63% of the corn crop was in good or excellent condition by August 1, down from 68% the previous week, and compares to 90% year ago. The French corn ratings is down 20 points since early July.

·        
Russia’s AgMin warned they may lower their 2022-23 grain export forecast from current 50 million tons if the production does not reach the projected 130 million ton estimate.

·        
The US weather forecast still calls for rain to increase across the Midwest for this weekend and parts of the far northwestern Corn Belt, where net drying has stressed crops.

·        
Three ships carrying corn set sail from Ukraine on Friday.

• 12,000
  tons from Chornomorsk toTurkey
• 13,041
  tons from Chornomorsk  to Britain
• 33,000
  tons from Odesa to Ireland

 

Export
developments.

·        
None reported

 

EIA:
U.S. propane spot prices have declined from multiyear highs

https://www.eia.gov/todayinenergy/detail.php?id=53339&src=email

 

Soybeans

·        
Soybeans and meal are lower this morning in what appears to be a reversal amid positioning ahead of the weekend. Oil share is higher with strength in soybean oil.

·        
News is light.

·        
There were 17 CBOT soybean meal deliveries posted this morning.

·        
Malaysia October palm was up 57 MYR to 3878/ton and cash up $17.50 at $965/ton.

·        
Data from MPOA showed CPO production for the month of July was down 1.14 percent.

·        
For the week palm oil futures were down 9.6 percent.

·        
China soybean futures were up 0.2%, meal 2.1% higher, soybean oil down 1.6%, and palm 0.9% higher.

·        
Rotterdam vegetable oils were mixed
earlier and meal 11-20 euros higher for the positions we follow, from this time yesterday morning.

·        
Offshore values were leading SBO 34 points lower earlier this morning (down 132 for the week to date) and meal $8.90 short ton lower (big rally in futures on Thursday),
$12.60/short ton lower for the week.

 

U
of I: An Estimate of Soybean Production From the 18 Leading Soybean States

Ibendahl,
G. “An Estimate of Soybean Production From the 18 Leading Soybean States.” farmdoc daily (12):115, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, August 4, 2022.

https://farmdocdaily.illinois.edu/2022/08/an-estimate-of-soybean-production-from-the-18-leading-soybean-states.html

 

Export
Developments

·        
China looks to sell a half a million tons of soybeans out of reserves on August 12.

·        
Private exporters reported the following sales activity:

-132,000
metric tons of soybeans for delivery to China during the 2022/2023 marketing year

-132,000
metric tons of soybeans for delivery to unknown destinations during the 2022/2023 marketing year

 

Wheat

·        
US wheat futures are lower this morning on lack of bullish news and Philippines passing on wheat. 

·        
Paris September wheat was down 2.25 euros at 340 euros as of 7:40 am CT.

·        
Russia’s AgMin warned they may lower their 2022-23 grain export forecast from current 50 million tons if the production does not reach the projected 130 million ton estimate.

·        
The Canadian Prairies will see above normal rainfall across the northern Prairies over the next 10 days while drier weather for the southern areas could increase crop stress.

·        
The FAO food price index fell 9% in July and is lowest since January.

 

 

Export
Developments.

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

·        
Jordan seeks 120,000 tons of wheat on Aug 9 for Jan/Feb shipment.

·        
Jordan seeks 120,000 tons on Aug. 10 for Dec through Feb shipment.

 

Rice/Other

·        
Mauritius seeks 6,000 tons of rice, optional origin, for October 1 and December 31 delivery.