FI Morning Grain Comments 08/31/22

PDF attached

 

Good
morning.

 

Under
the 24-H reporting system, Private exporters reported sales of 167,000 tons of soybeans for delivery to China during the 2022-23 marketing year.

 

Weekly
export sales will likely be delayed again on Thursday, according to USDA. US EIA will update biofuel use and monthly/weekly ethanol production/stocks today.

 

Changes
in the global weather has diminished as a major factor in this week’s agriculture trading activity but should not be forgotten as the US and other northern Hemisphere countries approaches official harvest season. After net drying for much of the Corn Belt,
The Midwestern north central areas will see rain Friday and south central areas Sunday. TX will see good rains through Friday before tapering off. NE and CO will remain dry.  The WCB corn belt in general will see net drying over the next week. EU’s weather
outlook improved a touch with additional rain across central and southern France, Italy, Romania and Bulgaria.

 

Negative
global macro influences continue to weight on CBOT agriculture futures. US equities are higher. USD is 21 points higher at the time this was written and WTI crude down around $1.55.  News was light this morning. Malaysia is on holiday. For the month palm futures
lost 3.6%, 4^th monthly consecutive loss. Offshore values were leading SBO 40 points higher earlier this morning and meal $2.00 short ton lower. A Bloomberg poll looks for weekly US ethanol production to be down 16,000 thousand (950-992 range) from
the previous week and stocks up 70,000 barrels to 23.877 million.

 

 

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR AUGUST 31, 2022

• Eastern
  China from the Yangtze River Basin to the North China Plain will be dry or mostly dry next ten days
• Super
  Typhoon Hinnamnor located 92 miles southeast of Okinawa was moving west southwesterly at 15 mph and will gradually weaken over the next few days, but remain a viable typhoon
• The
  storm will shift south of the southwestern most Ryukyu Islands of Japan Thursday and Friday before beginning a turn to the north that will ultimately take the storm through the East China Sea to the Korean Peninsula during the weekend and early part of next
  week
• Damage
  over the southwestern most Ryukyu Islands late this week will be extensive and flooding rain and damaging wind may impact parts of South Korea next week as well
• U.S.
  Midwest experiences restricted rainfall during the next ten days
• Portions
  of central and southern Texas will be quite wet next week with some of the excessive rain possibly reaching the lower Delta, as well
  
• These
  areas will get rain periodically until next week which will leave the ground wet for the heavier rain event expected next week possibly leading to some significant flooding
• U.S.
  southeastern states will also be wet biased for a while next week
• Central
  U.S. Plains will not receive much rain in the next two weeks, although a few showers are possible
• Northern
  U.S. Plains and Canada’s Prairies will be dry or mostly dry through the first half of next week
  
• Hot
  temperatures and dry weather will impact the far western U.S. over the coming week to ten days
• Northeastern
  Mexico drought areas will get some relief in the next ten days
• Eastern
  Argentina and far southern Brazil will experience waves of rain in the next ten days while western Argentina and the remainder of Brazil are dry or mostly dry
• Australia
  is still expecting periodic rain in most wheat, barley and canola areas in the next two weeks
• Northwestern
  India and Pakistan are still expected to remain drier biased over the next ten days while rain falls periodically over the remainder of India
• Europe
  is still expecting scattered showers and thunderstorms over the next couple of weeks with “slowly” improving rainfall in the drought areas of the west this weekend and mostly next week
  
• The
  Baltic Plain is unlikely to get much rain until late next week
• Russia’s
  rainfall will be greatest in the far north, but a few showers will also impact the Southern Region and a part of Ukraine
  
• Cool
  weather in northern Russia will eventually bring on some frost and light freezes, but greater cloudiness in today’s outlook may hold the temperatures a little higher than previously expected for a while

Source:
World Weather INC

 

Bloomberg
Ag Calendar

Wednesday,
Aug. 31:

• EIA
  weekly US ethanol inventories, production, 10:30am
• Malaysia’s
  August palm oil export data
• US
  agricultural prices paid, received, 3pm
• HOLIDAY:
  India, Malaysia

Thursday,
Sept. 1:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Cocoa
  Association of Asia hosts International Cocoa Conference, day 1
• Australia
  Commodity Index
• USDA
  soybean crush, DDGS production, corn for ethanol
• HOLIDAY:
  Vietnam

Friday,
Sept. 2:

• FAO
  world food price index, grains supply and demand outlook
• 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
• Cocoa
  Association of Asia hosts International Cocoa Conference, day 2

Source:
Bloomberg and FI

 

 

 

 

Macros

US
ADP Employment Change Aug: 132K (est 300K)

UK
Consumer Confidence Falls To Lowest Since Nov 2020, Biggest Drop Since April 2020 – Bank Of America Survey

Canadian
GDP (M/M) Jun: 0.1% (est 0.1%; prev 0.0%)

Canadian
GDP (Y/Y) Jun: 4.7% (est 4.9%; prev 5.6%)

Canadian
Quarterly GDP Annualized Q2: 3.3% (est 4.4%; prev 3.1%)

 

 

Corn

·        
CBOT corn is lower on global macro concerns. Look for trading activity to slow soon ahead of the upcoming US holiday weekend.

·        
Traders are awaiting EIA weekly and month ethanol figures. NASS will update crush and corn demand for ethanol on Thursday.

·        
Bloomberg: “An estimated 1m acres (404.7k hectares) were taken out of the US’s Conservation Reserve Program, or CRP, and will return to agricultural production in 2023, Agriculture Secretary Tom Vilsack told reporters Tuesday
at the Farm Progress Show in Iowa.

·        
A Bloomberg poll looks for weekly US ethanol production to be down 16,000 thousand (950-992 range) from the previous week and stocks up 70,000 barrels to 23.877 million.

 

Export
developments.

·        
Taiwan’s MFIG group seek 65,000 tons of corn on September 7 for November and/or early shipment from the US.

 

 

 

 

 

 

Soybeans

·        
Lower for the non-expiring soybean and meal contracts from spillover weakness in energy prices and improving global weather. Remarkably, soybean oil is higher despite weakness in outside related vegetable oil markets. Product
spreading is a feature.

·        
EU drought areas are seeing rain for the upcoming winter plantings and US eastern Corn Belt will see additional rain, although light, over the next week.

·        
News is light.

·        
Gulf soybean oil hit a premium of $665/ton over RBD palm oil on Tuesday.

·        
Malaysia is on holiday. For the month futures lost 3.6%, fourth monthly consecutive loss.

·        
China soybean futures were down 1.1 percent, meal 0.1& higher, soybean oil down 0.6%, and palm 0.01% lower.

·        
Rotterdam vegetable oils were
12-30 euros higher, and meal 1-6 lower for the positions we follow, from this time yesterday morning.

·        
Offshore values were leading SBO 40 points higher earlier this morning and meal $2.00 short ton
lower.

 

Export
Developments

·        
Under the 24-H reporting system, Private exporters reported sales of 167,000 tons of soybeans for delivery to China during the 2022-23 marketing year.

·        
For China’s 14^th weekly soybean auction set for September 2, they look for sell 500,000 tons.

·        
South Korea’s Agro-Fisheries & Food Trade Corp. seeks 30,000 tons of GMO-free soybeans on September 6 for arrival in SK between November 12 and Dec 12, and another arrival period of October 30 and November 30.

·        
USDA’s AMS CCC seeks to sell 3,150 tons of vegetable oil on September 7 for shipment for Oct 1-31 (Oct 16 to Nov 15 for plants at ports).

 

 

 

Wheat

·        
US wheat futures are lower on widespread commodity selling and improving global weather promoting winter grain plantings.

·        
Paris December wheat was down 1.75 euros at 321 per ton as of 8:30 am CT.

 

Export
Developments.

·        
Algeria started buying Russian milling wheat and prices were around $364-$365/ton for LH Sep through Oct 31 shipment.

·        
Jordan bought 60,000 tons of barley at $323.50/ton for LH Feb. shipment.

·        
Jordan seeks 120,000 tons of wheat on September 6.

·        
Jordan seeks 120,000 tons of barley on September 7 for Feb-Mar shipment. 

·        
Japan seeks 95,497 tons of food wheat form the US and Canada this week for arrival by December 31.

·        
Bangladesh delayed their 50,000 ton import tender of milling wheat set to close on September 1, to September 18.  It’s for optional origin with shipment within 40 days of contract signing.

 

Rice/Other

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