FI Morning Grain Comments 08/24/21

PDF attached

 

Good
morning.

 

WASHINGTON,
August 24, 2021—Private exporters reported to the U.S. Department of Agriculture the follow activity:

•         
Export sales of 132,000 metric tons of soybeans for delivery to China during the 2021/2022 marketing year; and

•         
Export sales of 125,300 metric tons of corn for delivery to Mexico during the 2021/2022 marketing year.

 

Soybeans
and corn are higher after USDA reported a 1 and 2 point decline in crop ratings, respectively.  Soybeans are the strongest to the upside as August is an important month for US development.  Much of the US corn across the Midwest is nearly made.  Rains this
week across the Midwest will be beneficial for soybeans and late corn development.   41 percent of the US corn crop was in the dented stage, above 38 percent average.  4 percent of the corn was mature.  3 percent of the US soybean crop was dropping leaves.
We lowered our US corn yield from 174.5 to 173.6/bu per acre.  Our US soybean yield was taken down from 50.7 to 50.3/bu per acre.  The US spring wheat is 77 percent complete with harvest, up from 58 percent last week and 55 percent 5-year average. 

 

 

 

 

Weather

 

WORLD
WEATHER INC.

WORLD
WEATHER HIGHLIGHTS FOR AUGUST 24, 2021

• Rain
  is still projected for much of the U.S. Corn and Soybean production region during the next ten days, although the southwest may be the exception with a dry bias expected.
  
• Some
  heavy rain will fall in Minnesota and Wisconsin.
• A
  tropical cyclone is expected to evolve in the Caribbean Sea this week and move across the Yucatan Peninsula of Mexico this weekend before impacting Texas early next week.
  
• The
  storm could bring significant rain parts of Texas and may also relieve dryness in the southwestern U.S. Corn Belt later next week.
• Today’s
  outlook has reduced rain in western Argentina in days 11-15 relative to that of Monday
  
• Brazil
  coffee areas are still advertised to get some rain later this week into next week with some reduction in amounts noted.
  
• China
  will continue to get locally heavy rain
• Eastern
  Australia will see some periodic rain that will improve some of the drier areas of Queensland and northern New South Wales
• Northwestern
  India will continue dry biased
• Western
  Europe will be dry as well.
• Eastern
  Europe and the western parts of the CIS will get some timely rainfall. 
• Net
  drying will continue in much of the central and southern Russia New Lands and Kazakhstan
• Improving
  rain potentials are occurring for Ghana and recent rain in Ivory Coast has already brought on some improvement
• Indonesia
  rainfall continues routine enough to support most coffee, cocoa, sugarcane, rice, citrus and oil palm development as well as other crops
• South
  Africa weather continues favorable for winter wheat and canola ahead of early spring crop development
  
• Canada’s
  Prairies will continue to benefit from some periodic rainfall
• Partial
  recovery from drought is under way in many areas
• The
  moisture is too late for many crops, but some soybeans, corn and flax may benefit for a little while

Source:
World Weather Inc. 

 

Bloomberg
Ag Calendar

Tuesday,
Aug. 24:

• EU
  weekly grain, oilseed import and export data
• U.S.
  poultry slaughter

Wednesday,
Aug. 25:

• EIA
  weekly U.S. ethanol inventories, production
• Malaysia
  Aug. 1-25 palm oil export data
• Unica
  cane crush, sugar production (tentative)

Thursday,
Aug. 26:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• International
  Grains Council monthly report
• Port
  of Rouen data on French grain exports

Friday,
Aug. 27:

• ICE
  Futures Europe weekly commitments of traders report (6:30pm London)
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• FranceAgriMer
  weekly update on crop conditions

Source:
Bloomberg and FI

 

 

 

 

USDA
inspections versus Reuters trade range

Wheat                 
657,854                 versus                   300000-575000  range

Corn                     
724,784                 versus                   500000-950000  range

Soybeans           
214,061                 versus                   100000-350000  range

 

Macros

US
Philadelphia Fed Non-Manufacturing Regional Business Activity Index Aug: 39.1 (prev 53.8)  

Philadelphia
Fed Non-Manufacturing Full-Time Employment Index Aug: 8.2 (prev 24.8)

Philadelphia
Fed Wage And Benefit Cost Index Aug: 43.0 (prev 50.2)

Philadelphia
Fed Non-Manufacturing New Orders Index Aug: 27.4 (prev 31.8)

Philadelphia
Fed Non-Manufacturing Firm-Level Business Activity Index Aug: 37.2 (prev 44.8)

Canada
Factory Sales Fell 1.2% In July- StatsCan Flash Estimate

 

Corn

·        
Corn futures are higher on a drop in US crop conditions but could see a two-sided trade today if buying dries up. Wheat is lower and USD near unchanged. 

·        
China plans to soon release guidelines on commodity price index regulation.  They are seeking public comment through September 6. 

·        
USDA US corn export inspections as of August 19, 2021 were 724,784 tons, within a range of trade expectations, below 781,528 tons previous week and compares to 892,031 tons year ago. Major countries included China for 340,775
tons, Mexico for 256,214 tons, and Nicaragua for 26,542 tons.

• US
  corn conditions for the combined good/excellent conditions fell two points from the previous week to 60 percent and compares to 64 year ago.  Trade was looking for one point lower. 
  We lowered our US corn yield from 174.5 to 173.6/bu per acre. 
  

 

Export
developments.

• Results
  awaited:  Qatar seeks about 100,000 tons of barley on August 18 for Sep-Nov delivery. 
  

 

Soybeans

·        
US soybeans are higher from a decline in US crop conditions and technical buying.  Early this morning we heard China bought a couple cargoes of PNW soybeans at $3.25 over the November for October shipment. 

·        
The soybean products are higher led by another rally in soybean oil in part to higher WTI crude oil.  The USD was slightly higher. 

·        
China soybean futures were up 88 yuan or 1.6%.  China meal was nearly unchanged and soybean oil was up 48 or 0.5%. 

·        
Trader are looking for India to increase vegetable oil imports ahead of their new-crop season which starts in November after they lowered import taxes on crude soybean oil and crude sunflower oil. 

·        
Offshore values are leading soybean oil 141 points lower and meal $4.80 higher.  

·        
Malaysian palm oil was down 13 to 4303 ringgit and cash fell $5.00/ton to $1,075. 

·        
The Southern Peninsula Palm Oil Millers’ Association forecast an 11.5% month-on-month rise in Aug. 1-20 production. 

·        
Malaysian palm oil

·        
China cash crush margins were last positive 128 cents on our analysis (119 previous) versus 110 cents late last week and 90 cents around a year ago. 

·        
China

• USDA
  US soybean export inspections as of August 19, 2021 were 214,061 tons, within a range of trade expectations, below 277,686 tons previous week and compares to 1,223,251 tons year ago. Major countries included China for 69,542 tons, Mexico for 55,196 tons, and
  Indonesia for 6,319 tons.

·        
US soybean conditions for the combined good/excellent conditions fell one point from the previous week to 56 percent and compares to 69 year ago.  Trade was looking for a one-point decline. 
We lowered our US soybean yield from 50.7 to 50.3/bu per acre. 

 

Export
Developments

·        
South Korea’s Agro-Fisheries & Food Trade Corp. bought about 3,700 tons of non-GMO soybeans at $1,056/ton c&f for arrival between Oct. 20 and Nov. 19.

 

Wheat

·        
US wheat and EU wheat are lower on north American harvest pressure.  Many parts of the EU are done with harvesting. 

·        
The USD was 3 points higher as of early this morning. 

·        
Agritel: French soft wheat crop was estimated at 34.93 million tons, well below 36.69 million tons projected by the French AgMin earlier this month.  Some traders were looking for a 38-million-ton crop earlier this season.  Nearly
all the soft wheat crop had been harvested. 

·        
December Paris wheat was down 2.75 euros at 243.75 at the time this was written.  September was 3.75 lower at 269.75. 

·        
USDA US all-wheat export inspections as of August 19, 2021 were 657,854 tons, above a range of trade expectations, above 560,640 tons previous week and compares to 569,593 tons year ago. Major countries included China for 169,541
tons, Philippines for 118,156 tons, and Korea Rep for 81,916 tons.

 

Export
Developments. 

·        
Japan seeks 81,853 tons of food wheat from the US and Canada. 

·        
Results awaited: Pakistan received offers for 400,000 tons of wheat for Sep/Oct shipment.  Lowest was $355.99/ton. 

·        
Results awaited: Morocco seeks 363,000 tons of US durum wheat under a tariff import quota for shipment by December 31. 

·        
Jordan seeks wheat on Aug 25.

·        
Jordan seeks 120,000 tons of feed barley on August 26. 

·        
Bangladesh seeks 50,000 tons wheat on September 1.

·        
Mauritius seeks 47,000 tons of wheat flour, optional origin, on Sept. 21 for various 2022 shipment.

 

Rice/Other

• Egypt seeks 200,000 tons of raw sugar for Oct-Dec shipment on August 28.