FI Morning Grain Comments 08/23/22

PDF attached

 

Good
morning.

 

Under
the 24-hour announcement system, USDA reported 110,000 tons of new-crop soybeans sold to China.

 

US
weather appears to be unchanged. Rains will fall across ND, central TX for today then central TX, SD, MN tomorrow. KS and MN may see rain this weekend.

 

The
Pro Farmer crop tour revealed lower than expected results for day 1, sending CBOT futures price higher. Corn futures are leading the charge and are now up for the 5^th session. USDA US conditions declined last week, catching some off guard, with
55 percent rated for corn (down 2) and 57 percent for soybeans (down 1). Both China and EU cash oilmeal prices were higher overnight, following strength in Monday’s US CBOT session.

 

Ohio
corn yields were projected at 174.17 bushels per acre (bpa), the Pro Farmer Midwest Crop Tour said on Monday evening, below the 2021 crop tour average of 185.06 bpa and above the three-year crop tour average of 169.03 bpa.
The
four-day crop tour, which does not project soybean yields, estimated the amount of soybean pods in a 3-by-3-foot square in Ohio at an average of 1,131.64 pods, down from last year’s average of 1,195.37 pods, and up from the three-year average of 1,038.35 pods.
(Reuters)

 

South
Dakota corn yields were projected at 118.45 bushels per acre (bpa), the Pro Farmer Midwest Crop Tour said on Monday evening, the worst on the tour since 2012 and well below the 2021 crop tour average of 151.45 bpa and the three-year crop tour average of 161.59
bpa. The four-day crop tour, which does not project soybean yields, estimated the amount of soybean pods in a 3-by-3-foot square in South Dakota at an average of 871.40 pods, down from last year’s average of 996.86 pods and the three-year average of 1,026.86
pods. (Reuters)

 

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR AUGUST 23, 2022

• Not
  many changes overnight around the world
• A
  large part of Russia continues to dry down favoring crop maturation and harvesting, but stressing late season crops
• India’s
  latest heavy rain event is shifting from northwestern Madhya Pradesh into Rajasthan, northern Gujarat and Pakistan today; flood water is receding in the remainder of Madhya Pradesh, Chhattisgarh, Odisha and West Bengal
• India’s
  weather will improve in the second half of this week
• China’s
  Yangtze River Basin will remain very warm and dry for a few more days, but scattered showers and slowly moderating temperatures are expected thereafter
• Western
  Europe will be very warm and dry for the next few days and then will experience some showers this weekend into next week, but resulting rainfall will not greatly change river and stream flows
• Short
  term improvements in topsoil moisture may occur
• Recent
  rain in eastern Europe has bolstered soil moisture for improved crop and field conditions, but some of the rain has disrupted fieldwork
• Areas
  from Macedonia and western Bulgaria to eastern Germany and western Poland have been wettest
• Western
  U.S. Corn Belt rain Sunday through Tuesday will bolster topsoil moisture
• Second
  week U.S. Midwest weather drier biased
• Too
  much rain has fallen recently in parts of Texas and improved weather is expected in the coming week
• Northwestern
  U.S. will continue warmer than usual and dry
• Central
  Canada’s Prairies will remain dry
• No
  change in western Argentina’s dry status is likely for a while
• Australia
  weather is improving after recent abundant precipitation

Source:
World Weather INC

 

Bloomberg
Ag Calendar

Tuesday,
Aug. 23:

• Sinofert
  1H results briefing

Wednesday,
Aug. 24:

• EIA
  weekly US ethanol inventories, production, 10:30am
• Brazil’s
  Unica may release cane crush, sugar production data (tentative)
• US
  poultry slaughter

Thursday,
Aug. 25:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Malaysia’s
  Aug. 1-25 palm oil export data
• USDA
  red meat production

Friday,
Aug. 26:

• 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
  weekly update on crop conditions

Source:
Bloomberg and FI

 

 

 

 

Macros

 

Corn

·        
Grain price are higher on US yield concerns. US weather has not changed much. Corn is higher for the fifth consecutive session and soon we may find profit taking but for now the market is leading CBOT ags higher.

·        
The USD is moderately higher and crude oil is higher.

·        
USDA crop conditions dropped last week and that will move our US yield lower. We will update production and our balance sheet later today for corn and soybeans.

·        
The annual Pro Farmer crop tour showed yields for corn and pod counts for soybeans below normal levels for Ohio and South Dakota (results on page one). Look for traders to continue to monitor results throughout the rest of the
workweek.

·        
USDA US corn export inspections as of August 18, 2022, were 740,508 tons, within a range of trade expectations, above 539,336 tons previous week and compares to 766,758 tons year ago. Major countries included Mexico for 290,356
tons, China for 198,331 tons, and Japan for 195,874 tons.

 

Export
developments.

·        
None reported

 

 

Soybeans

·        
Soybeans
are higher led by strength in corn and soybean meal. USDA crop conditions declined last week, and Pro Farmer tour results are supportive. US weather is good and may limit gains for the complex.

·        
Higher WTI crude oil and related markets are supporting soybean oil.

·        
USDA announced 110,000 tons of 2022-23 soybeans sold to China. We heard they are looking around for US soybeans this morning.

·        
India remains committed to buying about 2.6 million tons of palm oil from Indonesia, an Indonesia trade minister stated.

·        
Malaysia November palm oil was 74MYR higher at 4234 per ton, and cash was up $14 at $1036.50/ton.

·        
China soybean futures were down 0.5 percent, meal 3.6% higher, soybean oil up 1.2%, and palm 1.3% higher.

·        
Rotterdam vegetable oils were
10-18 euros higher, and meal up 12-15 euros for the positions we follow, from this time yesterday morning.

·        
Offshore values were leading SBO 28 points lower earlier this morning and meal $1.80 short ton higher.

 

Export
Developments

·        
Under the 24-hour announcement system, USDA reported 110,000 tons of new-crop soybeans sold to China.

·        
USDA this week seeks 1,500 tons of vegetable oil for the AMS/CCC to use in export programs. Shipment was set for Oct 1-31, later if from plants at the port.

·        
Passed: Tunisia was in for 6,000 tons of crude degummed vegetable oil for August 27 to September 10 shipment.

 

Wheat

·        
US wheat
is advancing with global import demand starting to increase, higher Matif futures, and the USD rally slowing. Jordan did pass on wheat, but they are expected to re-tender soon. News is light.

·        
Don’t rule out fund long buying as the net position has been short over the last several weeks, while funds remain long in corn and soybeans.

·        
Concerns over the China wheat crop are mounting as that country is experiencing drought conditions across the southern areas.

·        
Germany may see a larger wheat crop according to DBV association, at 21.8 MMT from 21.0 MMT last year.

·        
US spring wheat conditions were steady and about a third of the spring wheat crop had been collected, although lagging average.

·        
Paris September wheat was up 4.75 euros at 321.50 per ton as of 7:45 am CT.

·        
Ukraine exported about 720,000 tons of grains/oilseeds since the safe passage agreement. About 33 cargo ships have departed ports.

·        
USDA US all-wheat export inspections as of August 18, 2022, were 594,273 tons, within a range of trade expectations, above 389,914 tons previous week and compares to 729,288 tons year ago. Major countries included Japan for 179,283
tons, Mexico for 71,219 tons, and Philippines for 56,100 tons.

 

Export
Developments.

·        
Jordan passed on 120,000 tons of wheat.

·        
Japan seeks 118,881 tons of food wheat from the United States, Canada and Australia, on Thursday.

·        
Taiwan Flour Millers’ Association seek 34,025 tons of grade 1 milling wheat from the United States on August 25 for shipment out of the PNW between October 12 and October 26.

·        
Bangladesh seeks 50,000 tons of milling wheat on September 1, optional origin, for shipment within 40 days of contract signing.

 

Rice/Other

·        
Bangladesh seeks 50,000 tons of rice on September 6.