FI Morning Grain Comments 09/15/21

PDF attached

 

Good
morning.

 

WASHINGTON,
September 15, 2021- Private exporters reported to the U.S. Department of Agriculture the following activity:

-Cancellations
export sales of 132,000 metric tons of soybeans for delivery to China during the 2021/2022 marketing year.

-Cancellations
export sales of 196,000 metric tons of soybeans for delivery to unknown destinations during the 2021/2022 marketing year.

 

Soybeans,
corn and wheat are higher this morning in part to the grains extending their rally, higher energy markets and lower USD.  There is chatter China bought additional Brazil soybean cargoes.  Soybean oil is sharply higher, keeping soybean meal on the defensive.

 

 

 

Weather

7-day

 

 

World
Weather Inc.

MOST
IMPORTANT WEATHER OF THE DAY

• Tropical
  Depression Nicholas dissipated overnight with the remnant low still drifting near the southwest coast of Louisiana
  

o  
Total rainfall since Monday has ranged from 2.00 to 5.17 inches in central and southern Louisiana and 2.00 to 7.00 inches along the upper Texas Coast

o  
Frequent rain will continue to fall over the next week in Louisiana, central and southern Mississippi, the southwest half of Alabama and far western parts of the Florida Panhandle 
as a strong on-shore flow of tropical moisture continues through the next week

• Additional
  rainfall will vary from 2.00 to 6.00 inches with a few greater amounts
• Flooding
  is expected, but the rain intensity is not likely to be excessive on any given day

o  
Sugarcane sucrose levels will fall because of too much moisture ahead of harvest and harvest delays are likely into early October because of wet fields

• A
  tropical wave northeast of the Bahamas is still expected to become a tropical cyclone later this week

o  
A tropical depression or tropical storm is likely to evolve later today or Thursday and the storm system is expected to move near the North Carolina coast Thursday before turning
back out to sea Friday and Saturday

o  
Some rain will fall in eastern North Carolina and neighboring states, but no damaging wind or flooding is expected

• Today’s
  forecast is wetter in the northern U.S. Plains and upper Midwest as well as southeastern parts of Canada’s Prairies next week
  

o  
Today’s 06z GFS model run reduced rain previously advertised for the western Dakotas and eastern Montana down to a more reasonable 0.10 to 0.50 inch after the 00z GFS run had much
greater rain in the region

o  
The European model run is too wet for the western Dakotas

o  
Eastern Dakotas, eastern Nebraska, Minnesota, western Wisconsin and parts of Iowa get 1.00 to 3.00 inches and locally more

• Harvest
  delays are expected, but no quality decline is expected
• Wettest
  from extreme eastern Dakotas into western Ontario, including northern Minnesota

o  
The model rainfall is overdone and persists too long

• Other
  U.S. Midwestern crop areas will experience a good mix of rain and sunshine over the next ten days favoring summer crop maturation and harvest progress around brief period of rain
• West
  Texas weather will be mostly good for the next ten days with only a few showers expected later this week

o  
Temperatures will be warm enough to promote quick crop development

• U.S.
  southeastern states will experience a good mix of weather

o  
Rainfall may be a little more abundant than desired, but no serious impact is expected other than slowing crop maturity and some fieldwork

• U.S.
  Great Plains weather will be mostly favorable for summer crop maturation, harvesting and some winter crop planting; however greater rain is needed in the northwestern Plains and in many other winter wheat production areas to adequately prepare the soil for
  planting, germination and emergence

o  
Some showers are advertised for a part of the northwestern Plains this weekend, but resulting rainfall will not be enough to seriously change soil moisture

• Frost
  and freezes coming up later this week and early next week in the Canadian Prairies will have no negative impact on summer crops because of their faster than usual  maturation this year
• Frost
  and freezes will also impact a part of the northwestern U.S. Plains early next week and that, too, should have a low impact on crops because of their advanced state this year
• Another
  bout of rain is expected in the U.S. Pacific Northwest this weekend into Monday, but the moisture will be mostly confined to the Cascade Mountains and the northern Rocky Mountains with very little moisture in the Yakima, Snake or Columbia River Basins.
  
• Central
  and southern California weather will continue mostly dry for the next ten days

o  
some northern California areas will get some rain during the weekend, but amounts will be light away from the coast

• Most
  of the southwestern U.S. monsoon rainfall has ended
• The
  heart of Canada’s Prairies will not receive much rain over the next ten days

o  
The exceptions will be in western Alberta and in a few Manitoba locations where some rain is expected

o  
Good crop maturation and harvest weather is expected

o  
Planting of winter crops will advance, too, although some areas are still too dry for quick germination and plant emergence

• Mexico
  precipitation will continue greater than usual in central and southern parts of the nation during the coming ten days
  

o  
The moisture will be good for late season crops; including dry beans, corn, sorghum, citrus, sugarcane and coffee

o  
Northern Mexico rainfall will be more limited

• Argentina
  rainfall will continue lacking significance in the driest areas of the west and north for at least another ten days

o  
No rain is expected through Sunday

o  
Showers will develop next week across much of Argentina, but rain amounts will be lightest in parts of the west

• Southern
  Brazil received additional rain Tuesday with amounts through 0600 GMT today varying from 0.05 to 0.60 inch from southern Mato Grosso do Sul to southern Sao Paulo, Parana and in a few eastern Santa Catarina locations.
  

o  
Central Parana reported 0.71 to 1.14 inches and one location in southern Mato Grosso do Sul reported 1.04 inches

o  
Temperatures were seasonably warm to hot in center west and northern parts of center south Brazil where highs in the 90s to 102 degrees Fahrenheit resulted

• Additional
  waves of rain are likely in southern Brazil through next week with areas from Parana to Rio Grande de Sul wettest

o  
Another 0.20 to 0.75 inch will occur in Parana while areas to the south receive 0.75 to 2.50 inches with a few amounts in Santa Catarina and northeastern Rio Grande do Sul getting
upwards to 4.00 inches

• Center
  west and center south Brazil will experience net drying over the next ten days

o  
Rain is still needed in all coffee, citrus and sugarcane production areas and it would be good for soybean and corn areas in center west and center south

• The
  earliest that these areas will get rain is in about ten days and confidence is low
• South
  Africa crop areas will continue to receive periodic rainfall near the coast and rain would be welcome in many winter wheat areas to support aggressive spring crop development
• Australia
  rainfall will continue limited in Queensland, northern New South Wales and northern parts of Western Australia through the weekend stressing some reproductive crops that do not have much subsoil moisture

o  
Queensland winter wheat and barley yields are likely to slip lower this year because of frost, freezes and dryness in unirrigated areas

o  
The remainder of Australia’s winter crops are still poised to perform quite favorably

• Tropical
  Storm Chanthu was located 249 miles southwest of Sasebo, Japan at 0900 GMT today moving east southeasterly at 4 mph and producing maximum sustained wind speeds of 52 mph

o  
Chanthu will move to the northeast today and then to the east northeast during the rest of this week and through the weekend

• The
  path will take the storm through the Korea Strait and then across Hokkaido Friday and Saturday
• Heavy
  rainfall of 2.00 to more than 6.00 inches will accompany the storm across parts of western Japan and there will be some local flooding, but damage to crops and property will be low
  

o  
Chanthu has moved far enough away from eastern China to allow port activity to return to normal today

• Eastern
  China crop areas will see another couple of days of drying before rain resumes in the north

o  
Recent drying was welcome and more is needed to support summer crop maturation and harvest progress

o  
Drying will continue in the interior southeast and in some east-central locations for the next week to nearly ten days

o  
Rain is expected to resume in Gansu, Shaanxi and eastern Sichuan Friday before advancing northeast through the Yellow River Basin and the northeastern provinces disrupting farming
activity once again through Monday

• Rainfall
  will range from 2.00 to 6.00 inches with a few greater amounts possible
• Some
  local flooding will be possible

o  
Another wave of rain will impact northern China crop areas late next week and into the following weekend, but resulting rainfall will not be as great

• India’s
  monsoon will continue to last longer than usual

o  
Another ten days of frequent rainfall will occur in the central and north parts of the nation raising some concern over the condition of early maturating crops

• Cotton
  in the open boll stage in the north needs to dry out for harvesting
• Too
  much rain may harm its quality and could string some fiber out of open bolls

o  
Southern India will continue dry biased for the next two weeks with rainfall well below average

o  
Eastern India will see frequent rain as well

o  
Above normal rainfall in central and northern India will be good for some late season crops, but some drying will soon be needed

• Interior
  parts of mainland Southeast Asia will receive near to above normal precipitation over the next ten days resulting in an improvement in soil moisture and water supply which is needed for winter crops

o  
Some local flooding will be possible

• Philippines
  rainfall will be greater than usual for a while and a new tropical cyclone could impact the nation next week

o  
Some local flooding will be possible

• Southwestern
  Russia and central and western Ukraine will receive some needed rain this weekend into next week that will help improve soil moisture for winter wheat, rye and barley planting and emergence

o  
Lower parts of the Volga River Basin, eastern Ukraine and Kazakhstan will remain dry

• Northern
  Russia will continue wet biased, but planting in those areas should be mostly complete
• Europe
  weather Tuesday was good for widespread fieldwork, although rain shifted from Portugal and Spain into France

o  
The moisture in the southwest will continue to shift into France, northern Italy and parts of Germany over the next few days.

o  
Temperatures will be warm biased

o  
Eastern Europe will get rain Thursday into the weekend and again later next week causing some disruption in fieldwork

• Rain
  will be good in improving topsoil moisture for winter crops in the southeast
• North
  Africa showers over the next ten days will be brief and light
• West-central
  Africa rain will continue to come and go favorably for coffee, sugarcane, rice, cocoa and other crops

o  
Cotton production from the region has been better than last year in some areas especially Mali and Senegal

• East-central
  Africa coffee, cocoa and other crop development has advanced well due to timely rainfall that will continue for a while
• Today’s
  Southern Oscillation Index was +9.38 and will rise over the next several days
• Ontario
  and Quebec weather will continue favorably mixed over the next two weeks for late season farming activity and harvesting of summer crops
• New
  Zealand will be wetter than usual in the next seven days in North Island and western parts of South Island while lighter rain falls in eastern parts of South Island

o  
Next week will be wetter in western parts of South Island

Source:
World Weather Inc. 

 

Bloomberg
Ag Calendar

Wednesday,
Sept. 15:

• EIA
  weekly U.S. ethanol inventories, production
• FranceAgriMer
  monthly grains report
• Malaysia
  Sept. 1-15 palm oil exports
• Brazil’s
  Unica releases cane crush and sugar output data (tentative)

Thursday,
Sept. 16:

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

Friday,
Sept. 17:

• 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

 

 

 

 

 

Macros

US
Import Price Index (M/M) Aug: -0.3% (est 0.2%; prev 0.3%)

US
Import Price Index Ex-Petroleum (M/M) Aug: -0.1% (est 0.2%; prev 0.1%)

US
Import Price Index (Y/Y) Aug: 9.0% (est 9.4%; prev 10.2%)

US
Export Price Index (M/M) Aug: 0.4% (est 0.4%; prev 1.3%)

US
Export Price Index (Y/Y) Aug: 16.8% (est 17.0%; prev 17.2%)

US
Empire Manufacturing Sep: 34.3 (est 17.9; prev 18.3)

Canadian
CPI NSA (M/M) Aug: 0.2% (est 0.1%; prev 0.6%)

Canadian
CPI (Y/Y) Aug: 4.1% (est 3.9%; prev 3.7%)

Canadian
CPI Core-Common (Y/Y) Aug: 1.8% (est 1.8%; prev 1.7%)

Canadian
CPI Core-Median (Y/Y) Aug: 2.6% (est 2.7%; prev 2.6%)

Canadian
CPI Core-Trim (Y/Y) Aug: 3.3% (est 3.1%; prev 3.1%)

 

 

Corn

·        
US corn futures are higher from a lower USD, higher energy futures prices and technical buying. 

·        
US field reports this week, unlike last week, are showing signs some producers will harvest lower yields than that of last year across areas of the Midwest. 

·        
A Bloomberg poll looks for weekly US ethanol production to be up 3,000 barrels (905-950 range) from the previous week and stocks down 226,000 barrels to 20.164 million.

·        
Argentina Buenos Aires grains exchange estimated the 2021-22 Argentina corn crop at 55 million tons, using a 7.1 million hectares area, up from 6.6 million hectares in 2020-21.

 

Export
developments.

·        
South Korea’s KFA bought 68,000 tons of corn at an estimated $326.39/ton c&f and 305 cents over the December for arrival around December 5. 

 

 

Soybeans

·        
Soybeans are higher following strength in grains and Chinese demand.  There is chatter China bought additional Brazil soybean cargoes.  SA soybean premiums are 10-15 cents higher this morning for the nearby positions.  Talk of
dry SA weather was noted but it’s too early to see any impact on planting progress.  Soybean oil is sharply higher, keeping soybean meal on the defensive.

·        
Private exporters cancelled soybeans under the USDA 24-hour system. 

·        
Talk of disappointing early yield assessments for the US Midwest are supporting prices. 

·        
AmSpec estimated Malaysian  palm oil exports for the September 1-15 period at 832,355 tons, up 54% from the same period a month ago.  ITS reported 853,625 vs 528,736, up 61.5%.  

·        
Malaysian palm posted a 100 point gain for the November position to 4,440 MYR/ton and cash was up $17.50 to $1,152.50/ton. 

·        
China futures were near unchanged/mixed.

·        
Offshore values are leading soybean oil 41 points lower and meal $3.10/short ton higher. 

·        
Results are awaited on Algeria’s import tender for soybean meal. 

·        
NOPA is due out with a US soybean crush later. 

·        
Argentina Buenos Aires grains exchange estimated the 2021-22 Argentina soybean crop at 44 million tons, from 43.1 million this year.  The soybean area was estimated at 16.5 million hectares, down from the 16.9 million year earlier. 

·        
Malaysian palm oil

·        
China cash crush margins were last positive 144 cents on our analysis (140 previous) versus 139 cents late last week and 97 cents around a year ago. 

·        
China

 

 

 

Export
Developments

• Algeria’s
  ONAB seeks up to 30,000 tons of soymeal on Wednesday, for shipment between Nov. 10-30 and Dec. 1-15.
• WASHINGTON,
  September 15, 2021- Private exporters reported to the U.S. Department of Agriculture the following activity:
• Cancellations
  export sales of 132,000 metric tons of soybeans for delivery to China during the 2021/2022 marketing year.
  
• Cancellations
  export sales of 196,000 metric tons of soybeans for delivery to unknown destinations during the 2021/2022 marketing year.
  

 

Wheat

·        
Wheat is higher as traders extend long positions on crop concerns.  The KC wheat contract is back trading at a premium over Chicago wheat.  The central Great Plains remains dry. 

·        
FranceAgriMer lowered its 2021-22 forecast of French soft wheat exports for the non-European Union to 9.6 million tons from 10.5 million in July.  2021-22 soft wheat stocks were projected at 2.9 million tons from 3.7 million estimated
in July. 

·        
China will relax on quality specifications for French wheat imports.  They will now accept test weight readings of 75 kgs (165 lb.) per hectoliter, compared with a 77 kg minimum initially required.  Algeria and Saudi Arabia have
already eased weight requirements.  (Reuters)

·        
December Paris wheat was up 2.00 at 245.00 euros. 

·        
The USD was 6 points lower as of 7:56 am CT.

·        
Argentina Buenos Aires grains exchange estimated the Argentina wheat crop at 19.2 million tons, from 19 million tons previously.

 

Export
Developments. 

·        
Jordan passed on 120,000 tons of wheat for
last half December through first half February shipment. 

·        
Japan in a SBS import tender bought 220 tons of feed barley and passed on wheat (they were in for 100,000 tons of feed barley and 80,000 tons of wheat). 

·        
Japan seeks 118,771 tons of food wheat this week.

·        
Bangladesh’s state grains buyer seeks another 50,000 tons of milling wheat on September 16. 

·        
Jordan seeks 120,000 tons of feed barley on September 16 for Dec/Jan/Feb shipment. 

·        
Pakistan issued a new import tender for 500,000 tons of wheat set to closed on September 20. 

·        
Turkey seeks 260,000 tons of feed barley on September 21 for October 8-October 31 shipment. 

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

·        
Morocco seeks 363,000 tons of US wheat on September 21 for arrival by the end of the year. 

 

Rice/Other

·        
Bangladesh seeks 50,000 tons of rice on September 23.