FI Morning Grain Comments 09/16/22

PDF attached

 

Good
morning.

 

Keep
an eye on comments from Russia and Turkey as they are meeting at the SCO summit in Uzbekistan.
Grains are lower on ongoing global demand concerns. The temporary agreement to avoid a US railroad strike increased producer selling on Thursday which should spill over into today. Commercials that went long on Monday were unwinding
positions yesterday. Soybeans and meal are lower while soybean oil higher. WTI is mixed and USD higher. US weather will be unusually warm this weekend well into next workweek, benefiting late developing soybean development. Results awaited on Saudi Arabia
seeking 535,000 tons of wheat for arrival from November 10 to February 25 arrival. 

 

 

 

Weather

Last
7 days

 

 

World
Weather, INC.

WORLD
WEATHER HIGHLIGHTS FOR SEPTEMBER 16, 2022

• Not
  much change overnight
• Brazil’s
  center west and center south crop areas will begin receiving rain late next week into the following weekend with early soybean planting to follow the first decent rain amounts
• Early
  season corn planting and development is already advancing well in southern Brazil
  
• Concern
  over wheat conditions in Parana, Brazil will continue due to frequent rain
• Cordoba,
  Argentina will continue to go without much rain of significance
• Rain
  is expected in La Pampa, Buenos Aires and some eastern most crop areas of Argentina Sunday into the first part of next week inducing short term improvements for wheat development and for sunseed establishment
• U.S.
  Lower Midwest, Delta, southeastern states and southern Plains will experience net drying during the next ten days
• Central
  U.S. temperatures will be well above normal next week accelerating drying rates for some areas
• Limited
  rain is expected in U.S. hard red winter wheat areas during the next ten days, although complete dryness is not likely
• Some
  rain fell from the Texas Panhandle to central Nebraska Thursday and early today with local totals over 1.00 inch occurring in a few areas benefiting future wheat planting and establishment, but more rain will be needed
• Canada’s
  Prairies will see some shower activity periodically possibly slowing some harvest progress, but rain amounts will not be enough to seriously change drought status
• Europe
  rainfall is expected to continue improving soil moisture except in France and the United Kingdom where limited precipitation and dryness will prevail
• Temperatures
  will be cool across Europe in this coming week
• Russia
  and Ukraine soil moisture will slowly improve as rain falls across the western CIS improving the establishment and emergence of winter crops while slowing some fieldwork
• No
  change in drought status is expected in the Yangtze River Basin during the next ten days
• Tropical
  Storm Muifa continued to produce heavy rain along the upper portion of the east-central China coast Thursday and is dissipating as it races through the northeastern provinces today
  
• Damage
  from the storm was greatest in southern Jiangsu, Shanghai and northeastern Zhejiang
• Typhoon
  Nanmodal is expected to reach Kyushu and neighboring areas of Shikoku and western Honshu, Japan Sunday into Monday producing damaging wind and flooding in many areas across Japan’s larger islands through the middle part of next week
  
• Gujarat
  India will now dry down for a while after frequent rain this week
• All
  of northwestern India from Gujarat to Haryana and Punjab into Pakistan will be dry in the next ten days
• No
  changes in South Africa, Southeast Asia or Australia’s weather outlooks occurred overnight

Source:
World Weather INC

 

Bloomberg
Ag Calendar

Friday,
Sept. 16:

• 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
• HOLIDAY:
  Malaysia

Sunday,
Sept. 18: 

• China’s
  second batch of August trade data, including corn, pork, wheat imports

Monday,
Sept. 19:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• US
  crop conditions for corn, soybeans and cotton; spring wheat, corn, cotton, soybean harvesting, 4pm
• MARS
  monthly crop conditions report
• USDA
  total milk production, 3pm
• HOLIDAY:
  UK, Japan

Tuesday,
Sept. 20:

• China’s
  third batch of August trade data, including soy, corn and pork imports by country
• EU
  weekly grain, oilseed import and export data
• New
  Zealand global dairy trade auction
• Malaysia’s
  Sept. 1-20 palm oil export data
• World
  Agri-Tech Innovation Summit, London, Sept. 20-21

Wednesday,
Sept. 21:

• EIA
  weekly US ethanol inventories, production, 10:30am
• Globoil,
  international edible oil conference, Agra, India, day 1
• Sugar
  and ethanol conference by Indian Sugar Mills Association and Datagro

Thursday,
Sept. 22:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• US
  cold storage data for beef, pork and poultry, 3pm
• Globoil,
  international edible oil conference, Agra, India, day 2
• International
  Grains Council monthly report
• USDA
  red meat production, 3pm
• Future
  Food Tech Conference, London, Sept. 22-23

Friday,
Sept. 23:

• ICE
  Futures Europe weekly commitments of traders report
• CFTC
  commitments of traders weekly report on positions for various US futures and options, 3:30pm
• Globoil,
  international edible oil conference, Agra, India, day 3
• FranceAgriMer
  weekly update on crop conditions
• Brazil’s
  Unica may release cane crush and sugar production data (tentative)
• US
  cattle on feed, poultry slaughter, 3pm
• HOLIDAY:
  Japan

Source:
Bloomberg and FI

 

 

 

 

 

Macros

Canadian
International Securities Transactions Jul: 14.83B (prev -17.54B)

Canadian
Wholesale Trade Sales (M/M) Jul: -0.6% (est -0.4%; prev 0.1%)

 

UK
Retail Sales (M/M) Aug: -1.6% (est -0.5%; prev 0.3%)

UK
Retail Sales (Y/Y) Aug: -5.4% (est -3.7%; prev -3.4%)

UK
Retail Sales Ex Fuel (M/M) Aug: -1.6% (est -0.7%; prev 0.4%)

UK
Retail Sales Ex Fuel (Y/Y) Aug: -5.0% (est -3.5%; prev -3.0%)

 

China
Industrial Production Y/Y Aug: 4.2% (est 3.8%, prev 3.8%)

Industrial
Production YTD Y/Y Aug: 3.6% (est 3.6%, prev 3.5%)

China
Retail Sales Y/Y Aug: 5.4% (est 3.2%, prev 2.7%)

Retail
Sales YTD Y/Y Aug: 0.5% (est 0.2%, prev -0.2%)

 

Corn

·        
CBOT corn is lower on ongoing global demand concerns

·        
The temporary agreement to avoid a US railroad strike increased producer selling on Thursday which should spill over into today. Commercials that went long on Monday were unwinding positions yesterday.

·        
French corn ratings for the week ending September 12 were unchanged from the previous week at 43 percent good/excellent, well off 89 percent year earlier. 14 percent of the corn crop had been harvested.  The French AgMin sees
a 11.33-million-ton crop, lowest since 1990.

·        
Coceral lowered their estimate of the EU corn crop to 51.9 million tons from a previous 66.0 million in May and compares to 70.2 million tons produced last year.

·        
The Rosario grains exchange mentioned some of Argentina’s corn belt is facing some of its driest conditions in around 30 years. The drought is stalling corn planting progress. 

·        
China plans to sell 15,000 tons of pork from reserves on September 17.

 

U
of I: Mulling Over Margin, Part 1: Introduction and Historical Background

Coppess,
J., J. Janzen, C. Zulauf, G. Schnitkey, K. Swanson, N. Paulson and J. Baltz. “Mulling Over Margin, Part 1: Introduction and Historical Background.”
farmdoc
daily
(12):142,  Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, September 15, 2022.

https://farmdocdaily.illinois.edu/2022/09/mulling-over-margin-part-1-introduction-and-historical-background.html

 

Export
developments.

·        
None reported

 

Soybeans

·        
Soybeans and
meal are lower while soybean oil is higher.

·        
US weather will be unusually warm this weekend well into next workweek, benefiting late developing soybean development.

·        
There were rumors US importers were inquiring over Argentina soybean oil imports. We are not confident Argentina soybean oil will reach the US, at least in large quantities, unless import duties are lowered and RIN credits are
granted for biofuel producers.

·        
Argentina’s central bank announced a rate hike to 75 percent.

·        
Malaysia is closed for public holiday.

·        
China futures for soybeans were up 0.4%, meal down 0.5%, SBO down 1.6% and palm down 1.6%.

·        
Rotterdam vegetable oils were down 10-15 euros from this time yesterday morning. SA meal mostly higher by 2-3 euros.

·        
Offshore values were leading soybean oil 116 points lower earlier this morning and meal $5.90 short ton lower.

·        
NOPA’s reported was seen supportive for soybean oil futures given end of August soybean oil stocks were well off the average trade average while the yield ticked higher (11.98-record for month of Aug.).   Soybean oil stocks of
1.565 billion pounds were lowest since June 2021. The US soybean crush came in 0.6 million bushels below expectations at 165.5 million, above year ago. We did hear a good amount of crush downtime during August.  The adjusted daily crush was lowest since September
2021. Year over year, the southwest and IL regions saw an increase.

 

Export
Developments

·        
No developments.

 

Wheat

·        
Wheat futures are lower on technical selling and favorable US weather for US winter wheat planting progress and spring wheat harvesting.

·        
Coceral lowered its estimate for EU soft wheat to 140.5 million tons from 143.0 million early in the crop season and compares to 143.4 million last year.

·        
Russian President Vladimir Putin said Russia was ready to supply more than 300,000 tons of Russian fertilizers stuck in European ports to the developing world for free.

·        
Paris December wheat was down 2.25 euros earlier at 330 per ton.

 

Export
Developments.

·        
Results awaited on Saudi Arabia seeking 535,000 tons of wheat for arrival from November 10 to February 25 arrival. 

·        
Jordan is back in September 20 for 120,000 tons of wheat.

·        
Jordan seeks 120,000 tons of barley on September 21.

·        
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