FI Morning Grain Comments 09/16/21

PDF attached

 

Good
morning.

 

USDA
export sales were within expectations for the soybean complex, below for corn, and higher end of a range of expectations for all-wheat.  The USD is up 35 and WTI 55 cents lower.  Look for some selling at the open, creating an opportunity for commercial buying. 
Corn turned lower post USDA export sales report.  Soybeans are higher on follow through buying.  A reversal in soybean oil/meal spreading is lifting meal higher.  Malaysia is on Holiday today. China soybean complex was higher led by soybean oil and higher
trade in China palm oil.  Wheat is lower this morning on light profit taking. 

 

 

Weather

 

 

 

7-day

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR SEP. 16, 2021

• Not
  many changes were noted overnight.
• Rain
  was slightly reduced in the northern U.S. Plains and upper Midwest relative to Wednesday’s forecast for late this weekend and early next week.
  
• Alternating
  periods of cold and warm weather will occur in the central U.S. over the coming week
  
• Tropical 
  moisture will continue to stream into the Gulf of Mexico coast states from Louisiana to Florida and Georgia disrupting summer crop maturation and harvest progress.
  
• China,
  India and Australia weather have not changed much.
• Heavy
  rain is expected in a part of China’s Yellow River Basin over the next few days causing local flooding once again
  
• India’s
  monsoon is still not likely to withdraw for at least another ten days.
• Southwestern
  Russia and parts of Ukraine will receive some needed moisture to improve winter wheat, rye and barley planting, germination and emergence in the coming ten days. 

Source:
World Weather Inc. 

 

Bloomberg
Ag Calendar

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

 

 

 

 

USDA
Export Sales

USDA
export sales for soybeans were 1.264 million tons, within expectations.  They included China (945,200 MT, including decreases of 100 MT), and unknown destinations (163,000 MT).  Soybean meal sales of 95,400 tons old crop and 42,400 tons new-crop were also
within expectations.  Shipments were slow at 57,100 tons.  Soybean oil sales were negative 1,600 tons old crop and new-crop were positive 6,100 tons.

Corn
sales were a low 246,600 tons and well down from 905,800 tons week earlier. 

All-wheat
export sales were a good 617,100 tons. 

 

 

 

Macros

US
Retail Sales Advance (M/M) Aug: 0.7% (est -0.7%; prev -1.1%)

US
Retail Sales Ex-Auto (M/M) Aug: 1.8% (est 0.0%; prev -0.4%)

US
Retail Sales Ex-Auto, Gas Aug: 2.0% (est 0.0%; prev -0.7%)

US
Philadelphia Fed Business Outlook Sep: 30.7 (est 19.0; prev 19.4)

US
Initial Jobless Claims Sep 11: 332K (est 323K; prevR 312K; prev 310K)

US
Continuing Claims Sep 4: 2665K (est 2740K; prevR 2852K; prev 2783K)

Canadian
Wholesale Trade Sales (M/M) Jul: -2.1% (est -2.0%; prev -0.8%)

Canadian
International Securities Transactions Jul: 14.19B (prev 19.70B)

 

Corn

·        
US corn turned lower on poor USDA export sales.  It was higher early in the morning from an increase in South Korean demand, US yield concerns and fund buying coupled with slowing harvest progress across the far southern US Delta. 
Concerns over small grain production are supportive for corn.  Note CBOT oats prices are sitting at their highest level since March 2014 and trading at a premium over corn. 

·        
The weekly USDA Broiler Report showed eggs set in the US up 4 percent and chicks placed down 1 percent from a year ago.  Cumulative placements from the week ending January 9, 2021 through September 11, 2021 for the United States
were 6.72 billion. Cumulative placements were up slightly from the same period a year earlier.

·        
Weekly US ethanol production was up 14,000 barrels per day to 937,000 and stocks decreased 380,000 barrels to 20.010 million.  A Bloomberg poll looked for production to be up 3,000 barrels and stocks down 226,000 barrels.  Production
and stocks this crop year (September-August) are off to a similar to last year.  We are using 5.029 billion bushels for 2020-21 (USDA 5.035) and 5.250 billion bushels for 2021-22 (USDA 5.200 billion). 

·        
Argentina producers have been aggressive sellers of corn this month, selling 250,000 tons for the week ending the 8^th which brings new-crop corn sales to about 6.5 million tons. 

 

Export
developments.

• South
  Korea’s MFG bought 198,000 tons of corn in three consignments.  One consignment was purchased at an estimated premium of 304 cents c&f over the Chicago December 2021 contract.  Prices for the other two purchases were not provided.  Shipment was between Oct.
  10-29 and/or Oct. 20 and Nov. 10.
• South
  Korea’s NOFI bought an estimated 201,000 tons of animal feed corn and 65,000 tons of feed wheat.
• 68,000
  tons of corn was bought at a premium of 304 cents over the December for arrival in South Korea around Dec. 10.
• 68,000
  tons was bought at 303 cents over December for arrival in South Korea around Dec. 20.
• 65,000
  tons was bought at 302.5 cents over the December for arrival in South Korea around Dec. 20.
  

 

 

 

Soybeans

·        
Soybeans are higher on follow through buying. 

·        
A reversal in soybean oil/meal spreading is lifting meal higher. 

·        
Malaysia is on Holiday today.

·        
Brazil will see rain across southern Parana and Santa Catarina through Saturday, and southern RGDS Sunday-Monday.

·        
CBOT delivery process is done and there were no changes in registrations. 

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

·        
China soybean futures were up 0.4%, meal slightly lower and SBO 124 yuan/ton higher or 1.4%.  China palm was up 2.2%.  .

·        
Offshore values are leading soybean oil 114 points lower and meal $3.20/short ton higher. 

·        
Malaysian palm oil

HOLIDAY

·        
China cash crush margins were last positive 147 cents on our analysis (144 previous) versus 139 cents late last week and 97 cents around a year ago. 

·        
China

·        
NOPA reported the August crush at 158.8 million bushels, exceeding expectations by a large 4.7 million bushels from August.  Soybean oil stocks were reported 113 million pounds above trade expectations. 
This implies soybean oil demand was ok last month.  Soybean meal shipments improved from July and year ago. 

·        
We lowered our US September soybean export projection to 110 million bushels, well down from 264 million from September 2020.  Our 2021-22 export projection was also lowered by 15 million bushels to 2.065 billion, below USDA’s
current 2.090 billion outlook and compares to USDA’s 2020-21 projection of 2.260 billion. 

 

Export
Developments

• Results
  awaited: Algeria’s ONAB seeks up to 30,000 tons of soymeal, for shipment between Nov. 10-30 and Dec. 1-15.

 

Wheat

·        
Wheat is lower on light profit taking. 

·        
Strategie Grains said reduced its forecast for 2021 EU soft wheat production by 2.4 million tons to 129.1 million tons, 10.3 million tons above last year. 

·        
Export Sales report due out later this morning, see trade estimates attached below. 

·        
December Paris wheat was down 1.00 at 247.550 euros. 

·        
The USD was 35 points higher as of 7:51 am CT.
Light
rain will fall across central NE today, and eastern NE Friday. 

·        
Yesterday Reuters noted Russia could see winter wheat sowings down 0.5-1 million hectares from 17.8 million last year. 

 

Export
Developments. 

·        
Results awaited: Bangladesh’s state grains buyer seeks another 50,000 tons of milling wheat. 

·        
Results awaited: Jordan seeks 120,000 tons of feed barley for Dec/Jan/Feb shipment. 

·        
South Korea’s NOFI bought an estimated 201,000 tons of animal feed corn and 65,000 tons of feed wheat.  The Black Sea feed wheat was for shipment between Sept. 20 and Oct. 15 and bought at $339.00 a ton. 

• Taiwan
  seeks 49,580 tons of US wheat on September 23 between November 6 and November 20. 
  
• Jordan
  seeks 120,000 tons of wheat on September 22 for LH December through FH February shipment. 
  
• Russia
  shipped 30,000 tons of Black Sea wheat to Algeria last week. 

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

·        
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

• South
  Korea’s Agro-Fisheries & Food Trade Corp. bought an estimated 42,222 tons of rice from the United States and Thailand.  It included 20,000 tons of U.S.-origin medium grain brown rice at an estimated $1,238.42 a ton c&f. 22,222 tons of long grain brown rice
  from Thailand was bought at an estimated $485.00 and $487.00 a ton c&f in two equal consignments. The rice was sought for arrival in South Korea between Feb. 28 and April 30, 2022. (Reuters)

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

 

 

U.S. EXPORT SALES FOR WEEK ENDING  09/09/21 

 

	CURRENT MARKETING YEAR						NEXT MARKETING YEAR
COMMODITY	NET SALES	OUTSTANDING SALES		WEEKLY EXPORTS	ACCUMULATED EXPORTS		NET SALES	OUTSTANDING SALES
		CURRENT YEAR	YEAR AGO		CURRENT YEAR	YEAR AGO
	THOUSAND METRIC TONS
WHEAT
HRW	449.6	1,742.6	1,705.7	214.4	2,332.7	3,210.4	0.0	0.0
SRW	24.3	762.7	478.3	21.9	907.8	639.7	0.0	0.0
HRS	76.4	994.3	1,794.9	131.4	1,807.2	2,052.9	0.0	0.0
WHITE	46.8	569.2	1,244.2	146.4	1,241.6	1,491.9	0.0	0.0
DURUM	20.0	27.4	236.8	0.0	43.2	277.9	0.0	0.0
TOTAL	617.1	4,096.3	5,459.9	514.1	6,332.5	7,672.8	0.0	0.0
BARLEY	0.0	20.5	30.8	0.8	4.7	8.4	0.0	0.0
CORN	246.6	24,212.8	19,308.4	192.0	359.9	1,147.7	2.3	333.2
SORGHUM	204.6	2,147.7	2,464.2	1.8	1.8	105.4	0.0	0.0
SOYBEANS	1,264.2	22,031.2	30,084.0	244.4	258.3	2,143.3	2.0	2.0
SOY MEAL	95.4	1,290.4	752.1	57.1	10,945.6	11,328.0	42.4	2,148.8
SOY OIL	-1.7	13.3	101.1	3.4	674.1	1,175.9	6.1	7.6
RICE
L G RGH	9.5	179.1	230.6	72.3	169.8	51.8	0.0	0.0
M S RGH	0.0	8.1	27.4	0.1	1.1	1.5	0.0	0.0
L G BRN	2.3	3.2	8.1	0.2	12.3	4.1	0.0	0.0
M&S BR	0.1	22.3	19.1	0.1	13.7	13.9	0.0	0.0
L G MLD	17.0	176.3	73.2	7.8	84.8	38.1	0.0	0.0
M S MLD	2.6	42.0	49.4	2.6	47.5	56.0	0.0	0.0
TOTAL	31.5	431.0	407.8	83.1	329.1	165.5	0.0	0.0
COTTON		THOUSAND RUNNING BALES
UPLAND	284.8	5,132.2	5,959.6	237.5	1,174.8	1,669.9	0.0	686.8
PIMA	9.6	135.6	207.0	3.1	39.1	63.6	0.0	0.0

 

This summary is based on reports from exporters for the period September 3-9, 2021. 

Wheat:  Net
sales of 617,100 metric tons (MT) for 2021/2022–a marketing-year high–were up 59 percent from the previous week and up noticeably from the prior 4-week average.  Increases primarily for Nigeria (328,900 MT, including decreases of 200 MT), Mexico (78,300
MT, including decreases of 3,700 MT), South Korea (69,100 MT), Taiwan (54,600 MT), and Guatemala (34,900 MT switched from unknown destinations), were offset by reductions for unknown destinations (31,300 MT).  Exports of 514,100 MT were up 32 percent from
the previous week, but down 1 percent from the prior 4-week average.  The destinations were primarily to Mexico (172,800 MT), the Philippines (111,100 MT), China (71,000 MT), Taiwan (52,800 MT), and Nigeria (47,600 MT).  

Corn:  Net sales for 2021/2022 of 246,600 MT primarily for Mexico (154,300 MT, including
decreases of 65,400 MT), unknown destinations (75,200 MT), Canada (15,100 MT), Jamaica (5,000 MT), and Honduras (3,500 MT, including decreases of 3,700 MT), were offset by reductions for Colombia (12,000 MT).  Total net sales for 2022/2023 of 2,300 MT were
for Canada.  Exports of 192,000 MT were to Mexico (177,500 MT), El Salvador (7,200 MT), Canada (6,100 MT), Taiwan (1,000 MT), and South Korea (200 MT). 

Optional Origin Sales:  For 2021/2022, new optional origin sales of 60,000 MT were
reported for unknown destinations.  The current outstanding balance of 170,000 MT is for unknown destinations.   

Barley:  No net sales were reported for the week.  Exports of 800 MT were unchanged
from the previous week, but up 88 percent from the prior 4-week average.  The destination was to Japan. 

Sorghum:  Net sales for 2021/2022 of 204,600 MT were reported for China (115,500 MT),
unknown destinations (53,000 MT), and Mexico (36,100 MT).  Exports of 1,800 MT were to Mexico. 

Rice:  Net sales of 31,500 MT for 2021/2022 were down 7 percent from the previous week
and 39 percent from the prior 4-week average.  Increases primarily for Haiti (15,200 MT), Mexico (8,900 MT, including decreases of 8,800 MT), Canada (5,100 MT), El Salvador (4,100 MT switched from Guatemala), and Venezuela (2,500 MT), were offset by reductions
for Guatemala (5,700 MT).  Exports of 83,100 MT were up noticeably from the previous week and up 38 percent from the prior 4-week average.  The destinations were primarily to Mexico (31,700 MT), Venezuela (27,500 MT), Guatemala (9,900 MT), the Dominican Republic
(4,400 MT), and El Salvador (4,100 MT). 

Export for Own Account: For 2021/2022, new exports for own account totaling 100 MT
were for Canada. The current exports for own account outstanding balance is 100 MT, all Canada. 

Soybeans:  Net sales for 2021/2022 of 1,264,200 MT were primarily for China (945,200
MT, including decreases of 100 MT), unknown destinations (163,000 MT), Egypt (80,000 MT), Taiwan (20,500 MT, including decreases of 1,000 MT), and Indonesia (16,000 MT, including decreases of 200 MT).  Total net sales for 2022/2023 of 2,000 MT were for Indonesia.  Exports
of 244,400 MT were primarily to China (139,800 MT), Mexico (68,700 MT), Indonesia (10,800 MT), Malaysia (5,300 MT), and Taiwan (5,000 MT). 

Export for Own Account: For 2021/2022, the current exports for own account outstanding
balance is 5,800 MT, all Canada. 

Soybean Cake and Meal:  Net sales of 95,400 MT for 2020/2021 were up 57 percent from
the previous week and 80 percent from the prior 4-week average.  Increases primarily for Mexico (54,700 MT, including decreases of 1,800 MT), Canada (26,000 MT), Taiwan (4,600 MT), the Philippines (3,500 MT), and Sri Lanka (3,100 MT, including decreases of
200 MT), were offset by reductions primarily for Costa Rica (6,800 MT).  For 2021/2022, net sales of 42,400 MT were primarily for the Philippines (20,000 MT), Canada (13,500 MT), Mexico (3,300 MT), Costa Rica (2,300 MT), and unknown
destinations (2,000 MT).  Exports of 57,100 MT were up 29 percent from the previous week, but down 67 percent from the prior 4-week average.  The destinations were primarily to Mexico (23,300 MT), Canada (16,500 MT), El Salvador (6,000 MT), Cambodia (2,500
MT), and Japan (2,200 MT). 

Late Reporting:  For
2020/2021, exports totaling 6,000 MT of soybean cake and meal were reported late for El Salvador. 

Soybean Oil:  Net sales reductions for 2020/2021 of 1,700 MT resulting in increases
for Mexico (100 MT), were more than offset by reductions for Canada (1,800 MT).  Net sales for 2021/2022 of 6,100 MT were for Canada (6,000 MT) and Mexico (100 MT).  Exports of 3,400 MT were up noticeably from the previous week and from the prior 4-week average.  The
destinations were to Venezuela (3,000 MT), Canada (300 MT), and Mexico (100 MT). 

Cotton:  Net sales of 284,800 RB for 2021/2022 were down 37 percent from the previous
week, but up 9 percent from the prior 4-week average.  Increases were primarily for China (183,900 RB), Pakistan (33,800 RB), Turkey (17,600 RB), Peru (12,300 RB), and Vietnam (10,100 RB, including 1,300 RB switched from Japan).  Exports of 237,500 RB were
up 53 percent from the previous week and 27 percent from the prior 4-week average.  The destinations were primarily to China (86,600 RB), Pakistan (39,200 RB), Vietnam (35,600 RB), Bangladesh (25,000 RB), and Turkey (13,700 RB).  Net sales of Pima totaling
9,600 RB were down 21 percent from the previous week and 26 percent from the prior 4-week average.  Increases were primarily for India (2,600 RB), Peru (2,400 RB), Indonesia (2,000 RB), China (1,300 RB), and Japan (600 RB).  Exports of 3,100 RB were down 74
percent and 57 percent from the prior 4-week average.  The destinations were primarily to India (2,500 RB) and China (400 RB).  

Optional Origin Sales:  For 2021/2022, the current outstanding balance of 8,800 RB
is for Pakistan.   

Exports for Own Account:  For 2021/2022, the current exports for own account outstanding
balance of 4,800 RB is for China (4,700 RB) and Vietnam (100 RB).  

Hides and Skins:  Net
sales of 277,400 pieces for 2021 were down 31 percent from the previous week and 3 percent from the prior 4-week average.  Increases primarily for China (177,700 whole cattle hides, including decreases of 12,600 pieces), South Korea (43,300 whole cattle hides,
including decreases of 1,900 pieces), Thailand (25,500 whole cattle hides, including decreases of 300 pieces), Indonesia (13,700 whole cattle hides, including decreases of 100 pieces), and Brazil (8,800 whole cattle hides, including decreases of 100 pieces),
were offset by reductions primarily for Japan (200 pieces).  Exports of 422,300 pieces were up 21 percent from the previous week and 1 percent from the prior 4-week average.  Whole cattle hides exports were primarily to China (241,500 pieces), South Korea
(90,100 pieces), Mexico (27,600 pieces), Thailand (23,600 pieces), and Brazil (21,100 pieces).  

Net sales of 199,300 wet blues for 2021 were up noticeably from the previous week and up 80 percent from
the prior 4-week average.  Increases primarily for Italy (91,400 unsplit and 44,400 grain splits, including decreases of 300 unsplit), China (28,700 unsplit), Vietnam (27,500 unsplit), Mexico (4,300 grain splits, including decreases of 1,700 unsplit), and
Brazil (4,100 unsplit).  Exports of 219,500 wet blues were up noticeably from the previous week and up 60 percent from the prior 4-week average.  The destinations were primarily to Italy (69,000 unsplit and 14,600 grain splits), China (54,500 unsplit), Vietnam
(54,000 unsplit), Thailand (7,800 unsplit), and Taiwan (7,400 unsplit).  Total net sales of 83,400 splits, including decreases of 3,600 splits, were for China.  Exports of 160,000 pounds were to Vietnam.   

Beef:  Net
sales of 15,300 MT reported for 2021 were up 23 percent from the previous week and 24 percent from the prior 4-week average.  Increases primarily for Japan (6,000 MT, including decreases of 500 MT), South Korea (5,000 MT, including decreases 300 MT), China
(1,400 MT, including decreases of 100 MT), Mexico (700 MT, including decreases of 200 MT), and Canada (500 MT, including decreases of 100 MT), were offset by reductions for Panama (100 MT).  Net sales for 2022 of 3,900 MT were for South Korea (3,700 MT) and
Japan (200 MT).  Exports of 16,900 MT were down 10 percent from the previous week and from the prior 4-week average.  The destinations were primarily to Japan (6,500 MT), South Korea (4,000 MT), China (2,300 MT), Taiwan (1,000 MT), and Hong Kong (700 MT).  

Pork:  Net sales of 25,300 MT reported for 2021
were down 25 percent from the previous week and 9 percent from the prior 4-week average.  Increases were primarily for Mexico (5,800 MT, including decreases of 500 MT), the Dominican Republic (3,500 MT, including decreases of 100 MT), Japan (3,100 MT, including
decreases of 100 MT), Canada (2,700 MT, including decreases of 400 MT), and China (1,800 MT, including decreases of 100 MT).  Exports of 25,800 MT were down 11 percent from the previous week and from the prior 4-week average.  The destinations were primarily
to Mexico (8,400 MT), China (3,700 MT), Japan (2,600 MT), the Dominican Republic (2,300 MT), and Chile (2,000 MT).