FI Morning Grain Comments 09/23/22

PDF attached

 

Good
morning.

 

End
of week risk off is seen early Friday with widespread commodity selling. The USD was up 72 points earlier and WTI off $3.76/barrel. Equities were indicating a sharply lower open. Many developing country central banks raised key interest rates this week, an
indication global recession might be on hand. US harvesting progress increased this week and should ramp up nest week with favorable weather conditions. Offshore values were leading soybean oil 197 points lower (279 lower for the week to date) earlier this
morning and meal $0.10 short ton lower ($1.30 lower for the week). There was talk China was in for US soybeans out of the PNW. Look for positioning today.

 

 

 

US
weather forecast was unchanged. Rains favor the northwest Midwestern growing areas today and north central/eastern areas Saturday this weekend. Overall net drying will be good for the Delta and Midwest over the next week. Temperatures will be warmer next week
than that of the cold air blast seen during the second half of this week for the upper US. The central and northern areas of the US Great Plains will see rain this weekend. Brazil will see rain over the next week while Argentina’s forecast is unchanged, calling
for light rain across La Pampa and southern BA Sunday into early next week.

 

 

Weather

 

World
Weather, INC.

WORLD
WEATHER HIGHLIGHTS FOR SEPTEMBER 23, 2022

• Tropical
  Depression Nine evolved in the Caribbean Sea overnight and will become Tropical Storm Hermine later today or early Saturday
• The
  storm will intensify quickly this weekend reaching hurricane intensity by early next week with landfall across western Cuba and Florida
• Damage
  to citrus, sugarcane and rice is expected in Cuba and damage to citrus and some sugarcane in Florida is possible if today’s storm path verifies
• Confidence
  on the storm’s movement is much higher today with most computer forecast models on board with a Cuba and Florida impact.
  
• There
  is still time for change and a close watch on the storm is warranted especially since it will be a Category 2 storm with some potential to become stronger
• Dry
  biased weather will occur from Texas to the interior southeastern U.S. over the next ten days
• Brief
  periods of light rain and mostly dry conditions will impact other U.S. crop areas over the next ten days
• Recent
  rain in U.S. hard red winter wheat areas has improved soil moisture for planting
• Dryness
  will remain in Canada’s Prairies next ten days – drought will prevail, but the environment will be great for harvesting
• Europe
  will get waves of rain over the next ten days
• France
  and the U.K. will eventually get some much needed moisture for improved planting
• Western
  Russia and Ukraine will continue to get periodic precipitation improving wheat emergence and establishment while slowing field progress
• China’s
  Yangtze River Basin will remain dry biased for another ten days
• Drought
  continues a threat to rice production and could slow rapeseed planting if it prevails in October
• No
  changes in India, South Africa, Argentina or Australia
• Eastern
  Australia will be drier biased this weekend and then get back into the rain again next week
• Brazil
  is still expecting waves of rain in center west and center south crop areas with some of it unusually heavy for so early in the season

Source:
World Weather INC

 

Bloomberg
Ag Calendar

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

Monday,
Sept. 26:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• US
  crop conditions for corn, soybeans and cotton; spring wheat, corn, cotton, soybean harvesting, 4pm
• Malaysia’s
  Sept. 1-25 palm oil export data
• HOLIDAY:
  New Zealand

Tuesday,
Sept. 27:

• EU
  weekly grain, oilseed import and export data
• G20
  Agriculture Ministers Meeting in Bali, day 1

Wednesday,
Sept. 28:

• EIA
  weekly US ethanol inventories, production, 10:30am
• G20
  Agriculture Ministers Meeting in Bali, day 2

Thursday,
Sept. 29:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• G20
  Agriculture Ministers Meeting in Bali, day 3
• Vietnam
  General Statistics Dept. releases Sept. coffee, rice and rubber exports data
• USDA
  hogs & pigs inventory, 3pm

Friday,
Sept. 30:

• USDA’s
  quarterly stockpiles data for wheat, barley, corn, oat, soybeans and sorghum
• US
  wheat production data, noon
• 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
• US
  agricultural prices paid, received, 3pm
• HOLIDAY:
  Canada

Source:
Bloomberg and FI

 

 

 

 

 

Macros

Canadian
Retail Sales (M/M) Jul: -2.5% (est -2.0%; prev 1.0%)

Canadian
Retail Sales Ex Auto (M/M) Jul: -3.1% (est -1.0%; prevR 0.6%)

Canada
Retail Sales Rise 0.4% In August: StatsCan Flash Estimate

 

 

Corn

·        
CBOT corn is leading the grain markets lower. End of week risk off is seen early Friday with widespread commodity selling. The USD was up 66 points earlier and WTI off $3.78/barrel. Equities were indicating a sharply lower open.

·        
France collected 26 percent of their corn crop as of September 19, above 14 week earlier and compares to only 1 percent year ago. French corn production is expected to be lowest since 1990.

·        
Belgium reported a H5N1 bird flu outbreak on a poultry farm near the border with the Netherlands. 29,919 birds are on the farm but it’s not known how many will be culled.

·        
China was to release 14,400 tons of pork from state reserves today. For the entire month, China was thought to release a combined 200,000 tons of pork, according to AgriCensus.

 

Export
developments.

·        
None reported

 

 

 

Soybeans

·        
The soybean complex is sharply lower in a risk off trade. US harvesting progress increased this week and should ramp up nest week with favorable weather conditions. The increase in US supplies should pressure domestic basis and
boost exports.

·        
There was talk China was in for US soybeans out of the PNW.

·        
China soybean meal was up about 10 percent this week on talk of shortages. Don’t discount another fresh round of buying by China over the next couple of weeks.

·        
Malaysian palm oil prices were lower Friday from weaker mineral oil and Dorab Mistry warning palm oil prices could erode 30 percent by the end of this year due to rising production and demand destruction. They had a low target
of 2,500 ringgit ($547.30 per ton). December futures closed the second session at 3,736 ($816 per ton).

·        
Malaysian December palm oil futures decreased 90 points to 3736 and cash was down $7.50/ton to $915/ton.

·        
China futures for soybeans were up 0.5%, meal up 0.4%, SBO 0.3% lower and palm off 1.6%.

·        
Rotterdam vegetable oils were unchanged to 25 euros higher from this time yesterday morning. SA meal was lower by 10-18 euros.

·        
Offshore values were leading soybean oil 197 points lower (279 lower for the week to date) earlier this morning and meal $0.10 short ton lower ($1.30 lower for the week).

 

Export
Developments

·        
None reported

 

Wheat

·        
Wheat is lower on extremely large Russian wheat production estimates and a fresh 20-year high in the USD, up 85 points earlier this morning.

·        
World commodity risk off trade is also pressuring wheat futures.

·        
IKAR raised their Russian grain harvest outlook for 2022 to 150 to 152 million tons, including 99 to 100 million tons for wheat. Previous IKAR was at 147-148 and 97 million tons for grain and wheat production, respectively. SovEcon
sees a record 100 million ton Russia wheat crop. USDA is at 91 million tons. IGC is at 93.4 MMT.

·        
Paris December wheat was down 5.75 euros earlier at 343.75 per ton.

·        
French soft wheat protein content was estimated by FranceAgriMer at 11.4%, below a 5-year average of 11.9%. About 59 percent of the crop was rated superior to premium quality.

·        
A UN chartered ship carrying 30,000 tons of wheat left Ukraine destined for Afghanistan.

·        
Ukraine’s AgMin reported 7.2 million tons of grains had been exported so far this season, down from 12.762 MMT last season. This season vs. last season:

wheat                          
2,451,000             7,740,000

barley                          
622,000                 3,431,000

rye
                 2,600                     28,700

corn                              
4,134,000             1,394,000

TOTAL
grain                7,235,000             12,762,000

·        
Bloomberg – Ruble adds 2.7% versus dollar in Moscow trading to 57.2750, poised to gain 5.3% in week

 

US
Wheat Associates

“This
is the final weekly report for SW harvest and indicates another No.1 SW wheat crop in 2022. HRS harvest is winding down and this year’s crop currently grades at U.S. No. 1 Northern Spring. Northern durum is almost 90% harvested and currently grades at U.S.
No. 1 Hard Amber Durum.”

 

Export
Developments.

·        
The Philippines bought 45,000 tons of Australian feed wheat at $335 per ton c&f for Dec-Feb shipment.

·        
Pakistan seeks 300,000 tons of wheat on September 26 for October shipment.

·        
Jordan opened a new import tender for 120,000 tons of wheat set to close Sep 27 for March and April shipment. 

·        
Jordan is back in for barley on September 28.

 

Rice/Other

·        
Vietnam said they are not in a deal with Thailand to raise rice export prices.