FI Morning Grain Comments 09/08/22

PDF attached

 

Good
morning.

 

Conab
updated their 2021-22 Brazil crop estimates. They upward revised soybeans by 1.5 MMT to 125.6 million tons and lowered total corn by 1.4 MMT to 113.3 million.  There was no poll conducted by the news wires for trade comparison. 2021-22 soybean exported were
increased to 77.2 million tons versus 75.2 million previous. Conab estimated 2022 wheat production at 9.37 million tons, a 22 percent increase from 2021.

 

US
weather forecast was mostly unchanged. Rain will fall across the upper WCB and southeast through this weekend. Rest of the growing areas will see light or no rain. US CPC reported chances for La Niña are expected to decrease from 91% in the coming season to
54% during January-March 2023.

 

The
soybean complex is mixed, with slightly lower soybeans, higher meal and lower soybean oil. WTI was $1.15 higher at the time this was written. The USD was up 31 and equities pointing towards a lower open. China lockdowns should limit gains, if any, for soybeans.
Corn was lower and wheat higher on follow through momentum from yesterday’s trade. News was light. Black Sea trade developments will be closely monitored.
Offshore values were leading
soybean oil 57 points higher earlier this morning and meal $1.70 short ton higher. A Bloomberg poll looks for weekly US ethanol production to be down 5,000 thousand (950-980 range) from the previous week and stocks down 207,000 barrels to 23.326 million.

 

 

 

Weather

 

 

 

World
Weather, INC.

WORLD
WEATHER HIGHLIGHTS FOR SEPTEMBER 8, 2022

• Ten
  days of drying will occur in the central and southern U.S. Plains, despite a few showers around
• Southeastern
  U.S. wet bias will continue into early next week and then take a break for a short period of time
• Northern
  U.S. Plains and northern Midwest precipitation will occur periodically, but lightly
• U.S.
  temperatures will be above normal in the central U.S. and Midwest during week 2 of the outlook
• California
  heat wave will break down in the next couple of days
• Europe
  is still expecting to see periods of rain develop across the continent in the coming week offering relief to ongoing drought
• Western
  CIS weather will favor slowly improving moisture for winter wheat emergence and establishment
• Eastern
  China will continue to dry out for the next ten days
• Drying
  in northeastern China and the North China Plain is welcome and good for most farming activity
• Drying
  in the central Yangtze River Basin remains a problem with low water supply and rice production among a few other crops
• India’s
  monsoon is expected to surge northward again during its second week outlook possibly bringing rain to far northern parts of the nation during the second week of the forecast and impacting early cotton harvesting and other crop maturation
• Pakistan
  and extreme northwestern India will likely continue seasonably dry
• Eastern
  Australia will be wet today and Friday and then dry down for about five days before getting more rain late next week
• Western
  Australia will not be nearly as wet as the southeast, but crop conditions will be highly rated
• Argentina
  remains drier than usual for at least ten days with the west missing most of the rain
• Early
  sunseed planting is under way
• Winter
  wheat conditions vary greatly with some crops struggling from dryness, according to the AG minister last week
• Canada’s
  Prairies are still quite dry in the central and southwest, but harvesting is advancing well
• Rain
  is needed for spring 2023, but the dry bias is great for crop maturation and harvest progress
  
• Despite
  some recent commentary…..La Nina events have lasted this long before and this is not unprecedented to have it prevail into early 2023
• A
  few years ago predictions were made that La Nina events would become a thing of the past, but researchers were missing the association with solar cycles.

Source:
World Weather INC

 

Bloomberg
Ag Calendar

Thursday,
Sept. 8:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Black
  Sea Grain and Oilseeds conference, Rostov-on-Don, Russia
• EIA
  weekly US ethanol inventories, production, 11am
• Brazil’s
  Conab releases data on area, yield and output of corn and soybeans

Friday,
Sept. 9:

• 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
• Vietnam’s
  customs department releases August coffee, rice and rubber exports
• Brazil’s
  Unica to release cane crush and sugar output data (tentative)
• HOLIDAY:
  Korea

Source:
Bloomberg and FI

 

 

 

 

Macros

ECB
Interest Rate Decision was as expected, +75 basis points.

Initial
Claims  222k Expected 235K

Continuing
Claims 1473K  Expected 1430K

 

Corn

·        
CBOT corn ended lower for the overnight session on lack of news.

·        
Ukraine shipment concerns and strength in wheat may limit losses.

·        
Look for energy markets to influence CBOT agriculture futures price movements.

·        
Black Sea trade developments will be closely monitored.

·        
China planned to sell 37,700 tons of pork from reserves.

·        
A Bloomberg poll looks for weekly US ethanol production to be down 5,000 thousand (950-980 range) from the previous week and stocks down 207,000 barrels to 23.326 million.

 

 

Export
developments.

·        
There were no USDA 24-H sales

 

Soybeans

·        
The soybean complex is mixed with soybeans slightly lower, higher meal and lower soybean oil. WTI turned higher and that trimmed some losses for soybean oil before the electronic close. The euro made another leg down this morning
on ECB comments over inflation.

·        
China lockdowns should limit gains, if any, for soybeans.

·        
Argentina was thought to have traded 2.1 MMT of soybeans over a two day period (Mon-Tue), according to the Rosario Board of Trade. Yesterday’s amount was not included. We heard 2.5+ million tons over the three day period.

·        
According to AgriCensus, Argentina soybean oil sales have been slow despite the massive increase in soybean producer sales as traders waits to see how the market rebalances. Cash SBO premiums have been under pressure so far this
week.

·        
MPOB Malaysian palm oil S&D data will be released September 12 and traders are looking for stocks to increase to just over 2 million tons.

·        
Malaysia palm oil futures traded 149 ringgit lower to 3,541 and cash was down $26/ton to $890.00/ton.

·        
China soybean futures were up 0.2 percent, meal up 1.2%, soybean oil down 1.2%, and palm off 1.6%.

·        
Rotterdam vegetable oils were 20-45 euros lower from this time yesterday morning, and SA meal 3 to 7 euros higher.

·        
Offshore values were leading soybean oil 57 points higher earlier this morning and meal $1.70 short ton higher.

 

Export
Developments

·        
Results awaited. 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.

 

Wheat

·        
CBOT wheat prices are higher on the above Black Sea headlines.

·        
Paris December wheat was down 0.50 euros at 328.25 per ton as of 8:00 am CT.

·        
News was light.

·        
French soft wheat was estimated at 33.6 million tons per growers group AGPB, down from 33.87 previous.

 

Export
Developments.

·        
The Taiwan Flour Millers’ Association bought 55,375 tons of milling wheat from the United States in one consignment of various types for Nov. 2 and Nov. 16 off the PNW.

• Dark
  northern spring wheat of a minimum 14.5% protein content bought at $405.28 a ton FOB U.S. Pacific Northwest coast.
  
• Hard
  red winter wheat of a minimum 12.5% protein content bought at $437.16 a ton FOB
• Soft
  white wheat of a maximum 9.5% protein bought at $380.02 a ton FOB. (Reuters)

·        
Jordan seeks 120,000 tons of wheat on September 13 for March and April shipment.

·        
Jordan seeks 120,000 tons of barley on September 14 after passing September 7 for Feb-Mar shipment. 

·        
Japan in a SBS import tender seeks 70,000 tons of feed wheat and 40,000 tons of barley on September 14 for arrival in Japan by February 24.

·        
Bangladesh seeks 50,000 tons of milling wheat on September 18.  It’s for optional origin with shipment within 40 days of contract signing.

 

Rice/Other

·        
None reported