FI Morning Grain Comments 10/17/22

PDF attached

 

Good
morning.

 

Black
Sea shipping concerns are lifting wheat and other grains higher. News is very light from that of Friday later afternoon.  Macros are expected to dominate trading this week.

 

 

 

 

Weather

 

World
Weather, INC.

WORLD
WEATHER HIGHLIGHTS FOR OCTOBER 17, 2022

• Southern
  Oklahoma received some welcome rain during the weekend while other areas in U.S. hard red winter wheat country were dry
• U.S.
  hard red winter wheat areas will continue dry biased for the next ten days
• A
  few showers will occur this coming weekend and next week in the Northwestern U.S. including the Pacific Northwest, Montana and southwestern Alberta, Canada
• Resulting
  rainfall will not be very great and more moisture will be needed
• Some
  of this precipitation will move east into the northern Plains and eventually the Midwest next week
• Frost
  and freezes in the U.S. Midwest, Delta and Mid-South region this week will induce some soybean and late corn quality declines, but very little production change is expected
• Some
  bean shattering may occur in the more immature fields, but that should be rare
• Blackened
  soybean will be the most common impact
• Argentina
  will see some showers infrequently over the next ten days, but greater rain will still be needed for summer crops and for winter wheat and barley development
• Some
  needed rain will fall in northeastern Brazil this weekend into next week and that should help improve soybean and corn planting conditions since it will be the first rain of the season for those areas
• A
  good mix of rain and sunshine is expected elsewhere in Brazil
• Eastern
  Australia will be moving back into another rainy period this week after weekend drying
• Concern
  over crop quality and production will continue
• The
  cool and wet conditions will also delay sorghum and cotton planting
• South
  Africa will get some needed rain later this week into next week that will bolster soil moisture for improved planting and establishment conditions for summer crops
• China’s
  Yangtze River Basin will be left dry over the next ten days continuing some worry over rapeseed planting potentials in the next few weeks
• Wheat
  planting in northern parts of the nation is advancing well with little change likely
• India
  will stay a little wetter than desired in central parts of the nation disrupting summer crop harvesting, but ensuring good planting moisture for winter crops
• Rain
  will be plentiful in the south
• There
  is potential for a tropical cyclone to impact the east coast next week
• Western
  Europe will receive some beneficial moisture in this coming week with the focus on the U.K., France and Germany
• Typhoon
  Nesat may damage rice, sugarcane and personal property on Hainan China during mid-week this week

Source:
World Weather INC

 

Bloomberg
Ag Calendar

Monday,
Oct. 17:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• US
  crop conditions and harvesting for corn, soybeans and cotton, winter wheat planting, 4pm
• Argus
  Fertilizer Europe conference, Madrid, day 1

Tuesday,
Oct. 18:

• China’s
  second batch of September trade data, including corn, pork and wheat imports
• China’s
  3Q pork output, hog inventory
• Oils
  & Fats International Congress, Kuala Lumpur, day 1
• Argus
  Fertilizer Europe conference, Madrid, day 2
• New
  Zealand global dairy trade auction
• EU
  weekly grain, oilseed import and export data

Wednesday,
Oct. 19:

• EIA
  weekly US ethanol inventories, production, 10:30am
• Oils
  & Fats International Congress, Kuala Lumpur, day 2
• Argus
  Fertilizer Europe conference, Madrid, day 3

Thursday,
Oct. 20:

• China’s
  third batch of September trade data, including soybean, corn and pork imports by country
• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• International
  Grains Council report
• Malaysia’s
  Oct. 1-20 palm oil export data
• USDA
  total milk, red meat production, 3pm

Friday,
Oct. 21:

• ICE
  Futures Europe weekly commitments of traders report
• CFTC
  commitments of traders weekly report on positions for various US futures and options, 3:30pm
• Asia
  3Q 2022 cocoa grind data
• FranceAgriMer
  weekly update on crop conditions
• US
  cattle on feed, 3pm

Source:
Bloomberg and FI

 

 

 

 

 

CFTC
Commitment of Traders

No
major surprises. Funds were a little more long than expected for corn and Chicago wheat. Funds were not as long for soybeans and soybean meal. Funds remain net short Chicago wheat.

 

 

 

 

Macros

 

Corn

·        
Corn futures
are higher from ongoing Black Sea shipping concerns despite favorable US harvesting weather.

·        
US river problems with low drafts are expected to keep inspections low for the month of November, as much as 20 percent below a 5-year average.

 

Barge
freight rates as of late Friday

 

Export
developments.

·        
None reported

 

Soybeans

·        
The soybean complex
is mixed with a surprising move to the upside in bean oil. Nothing catches our eye with meal lower and bean il higher other than US energy markets prompting up the biofuel sector.

·        
We are cautious any soybean oil rallies.

·        
Malaysian December palm oil futures increased 21 Ringgit to 3,854 and cash was down $2.50/ton to $892/ton.

·        
China November soybeans were down 0.1%, meal 1.0% higher, soybean oil 0.5% lower and palm oil 1.0% higher.

·        
Rotterdam vegetable oils were unchanged to 5 euros higher from this time Friday morning. SA meal was mixed.

·        
Offshore values this morning were leading soybean oil 94 points higher earlier this morning and meal $2.50 short ton lower.

 

 

 

Export
Developments

• None
  reported

 

Wheat

·        
US wheat futures are higher on Black Sea concerns.   News is extremely light outside of the war headlines.

·        
Paris December wheat was off 2.25 euros at 348.50 per ton.

 

Export
Developments.

·        
South Korean millers seek 45,000 tons of wheat on Tuesday for Dec 16-Jan 15, 2023, shipment.

·        
The Philippines bought about 165,000 tons of feed wheat from Australia for Q1 shipment at an average of $345/ton C&F.

·        
Jordan opened another import tender for 120,000 tons of feed barley, set to close October 19.

·        
Japan in a SBS import tender seeks 70,000 tons of feed wheat and 40,000 tons of barley on October 19 for arrival by February 24.

·        
Mauritius seeks 25,800 tons of wheat flour, optional origin, on October 28 for January through September 30, 2023, shipment.

 

Rice/Other

·        
South Korea plans to buy 450,000 tons of rice for reserves this year October 20 through December to stabilize domestic prices. This would be up from 350,000 tons last year.

·        
South Korea seeks 90,100 tons of rice from the US, Vietnam and other origins on October 19 for arrival between Jan 20 and Apr 30.

·        
Mauritius seeks 6,000 tons of rice on October 20, optional origin, for Jan-Mar shipment.