FI Morning Grain Comments 10/18/21

PDF attached

 

Good
morning

 

Lower
start to Monday despite a higher trade in WTI crude oil.  Rains across the Midwest over the weekend were near expectations, favoring MO, southern IL, IN, OH and MI.  Rain this week should favor the north central Midwest mid-workweek and eastern areas Thursday
through Friday.  The Great Plains will see light showers across eastern NE Tuesday and central TX Thursday. 
There
were five import tenders announced since Friday, including  Egypt in for vegetable oils and Ethiopia in for more wheat.  China’s pork production was up 38% in the first nine months of 2021 to 39.17 million tons, according to the National Bureau of Statistics
(NBS). 

 

 

 

 

 

Weather

7-day

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR OCTOBER 18, 2021

• Not
  much change overnight or during the weekend.
• Brazil’s
  weather still looks very good, although Rio Grande do Sul will likely dry out over the next ten days to two weeks along with Uruguay, and eastern most Argentina.
  
• Keep
  an eye on this region because as La Nina intensifies this area may have more dryness in November and December.
  
• Argentina’s
  rainfall will be restricted, although some rain is expected late this week and early in the weekend and again about one week later.
  
• Australia’s
  winter crop conditions remain very good with little change expected.
• Northern
  China will be drying down over the coming week while rain occurs in the east-central and southern parts of the nation.
  
• India
  turned wetter during the weekend but will dry down in northern and central areas again this week. 
  
• Flooding
  rain fell in central Vietnam during the weekend as expected with the Hue area reporting more than 18.00 inches of rain and more wet weather is expected later this week.
  
• Europe
  and western Russia weather will be favorably mixed.
• South
  Africa will get some welcome rain for spring planting this week
• West-central
  Africa coffee and cocoa production areas will be wetter than usual.
• Brazil
  citrus, sugarcane and coffee areas will remain favorably moist, as well. 

 

Bloomberg
Ag Calendar

Monday,
Oct. 18:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• U.S.
  crop conditions – corn and cotton; soybeans harvested; winter wheat planted, 4pm
• China’s
  second batch of trade data, including corn, wheat, sugar, pork imports
• China
  3Q pork output and inventories
• GrainCom
  conference, Geneva, day 1
• Ivory
  Coast cocoa arrivals

Tuesday,
Oct. 19:

• EU
  weekly grain, oilseed import and export data
• New
  Zealand global dairy trade auction
• S&P
  Global Platts European Sugar Virtual Conference, day 1
• GrainCom
  conference, Geneva, day 2
• HOLIDAY:
  Malaysia, Pakistan

Wednesday,
Oct. 20:

• EIA
  weekly U.S. ethanol inventories, production
• China’s
  third batch of trade data, including soy, corn and pork imports by country
• Malaysia
  Oct. 1-20 palm oil exports
• S&P
  Global Platts European Sugar Virtual Conference, day 2
• USDA
  total milk production, 3pm
• GrainCom
  conference, Geneva, day 3
• HOLIDAY:
  Indonesia

Thursday,
Oct. 21:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• International
  Grains Council monthly report
• Port
  of Rouen data on French grain exports
• USDA
  red meat production, 3pm

Friday,
Oct. 22:

• 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
• U.S.
  cattle on feed; cold storage data for pork, beef and poultry, 3pm
• HOLIDAY:
  Thailand

Source:
Bloomberg and FI

 

 

 

CFTC
Commitment of Traders

Funds
were 21,600 more long than expected in soybeans and 10,500 more long in soybean oil. 

 

 

 

 

 

 

Macros

Canadian
Housing Starts Sep: 251.2K (est 256.5K; prev 260.2K; prevR 262.8K)

 

Corn

·        
Corn is
lower on lack of US export demand, favorable US weather, and advancement of Brazil corn seedings.  Traders are waiting to see if China will but more US corn. 

·        
Traders should continue to monitor Argentina as some commercials late last week said the government was intervening on corn and wheat export licenses, at least for old crop.

·        
China’s pork production was up 38% in the first nine months of 2021 to 39.17 million tons, according to the National Bureau of Statistics (NBS).  Q3 pork output was highest in three years.  China slaughtered 491.93 million hogs
in the first nine months of the year, up 35.9%.  NBS reported Its pig herd expanded 18.2% to 437.64 million heads at end-September. 

·        
China corn imports during September were a large 3.53 million tons and year to date of 25 million tons are running 275 percent above the same period a year ago. 

 

 

Export
developments.

• None
  reported

 

Soybeans

·        
Soybeans, meal and soybean oil are lower despite a higher trade in WTI crude oil.  . Uncertainty over the RVO decisions from the EPA does continue to circulate .  Another 61 SBO registrations were cancelled, leaving 244 left registered. 

·        
La Nina has been officially declared and South America, but planting progress is advancing after recent rainfall during FH October. 

·        
Rains across the Midwest over the weekend were near expectations, favoring MO, southern IL, IN, OH and MI.  Rain this week should favor the north central Midwest mid-workweek and eastern areas Thursday through Friday. 

·        
Egypt floated an import tender for vegetable oils. 

·        
Malaysian January palm oil futures were up 89 ringgit, or 1.83%, to 4,948 ringgit ($1,186.71) a ton.  Cash palm was up $5.00 per ton to $1262.50. 

·        
Malaysian palm oil futures

·        
Rotterdam meal and oil values were higher by 5-20 euros and meal 1-3 euros lower. 

·        
Offshore values are leading soybean oil 5 points lower and meal $3.30/short ton lower.

·        
China cash crush margins were last 203 cents/bu on our analysis versus 206 cents late last week and 95 cents around a year ago. 

·        
China

·        
NOPA reported a lower-than-expected September US crush of 153.8 million bushels, a three-month low, from the 158.843 million bushels crushed in August and 4.8% below the 161.491 million bushels in crushed September 2020.  The
September crush was lowest since 2019 for that month.  Daily adjusted the crush improved slightly from August despite chatter there was more downtime taken.  Soybean oil stocks of 1.684 billion pounds from 1.668 billion at the end of August, compares to 1.433
billion a year earlier and highest for that month since 2012!  The SBO yield was unchanged from the previous month at 11.79 and compares to 11.60 year ago.  Soymeal exports last month fell to 603,545 short tons, down from 856,619 in August and 991,134 tons
in September 2020.  September meal exports were lowest since 2017 for that month and lowest for any month since mid-2019. 

 

Palm
conference:

MBOB: 
Average palm future price to average 4,100 ringgit per ton in 2021.  Palm production and exports to improve towards end of 2021, resulting in more manageably stocks. 

 

Oct
18 (Reuters) –Indian Vegetable Oil Producers’ Association

·        
Indian Vegetable Oil Producers’ Association Says It Sees Early Signs Of Demand Shift From Palm Oil To Soft Oil After India’s Duty Cut

·        
Indian Vegetable Oil Producers’ Association Says Indonesia’s Import Share Fell To 46% In 2020/21 From 72% In 2019/20

·        
Indian Vegetable Oil Producers’ Association Says Malaysia’s Import Share Rose To 45% In 2020/21 From 21% In 2019/20

·        
Indian Vegetable Oil Producers’ Association Says Exemption On Palm Olein Imports Until Dec 2021 Should Not Be Extended Further

 

Oct
18 (Reuters) – GAPKI:

Indonesia’s
crude palm oil exports in 2021 are expected to fall 54.4% from a year earlier.  Crude palm oil (CPO) exports from Indonesia are forecast to reach 3.27 million tons this year, compared with 7.17 million tons in 2020.  They had earlier estimated exports of 7.5
million tons.

GAPKI
cut its forecast as India opted for refined palm products that were more economical compared to CPO, which jumped to record highs throughout the year.

Total
palm oil exports in 2021 are expected to rise to 34.42 million tons from last year’s 34.01 million tons, driven by a likely 21.2% jump in refined palm exports. Earlier, GAPKI had expected palm oil exports of 37.5 million tons. 

 

Export
Developments

·        
Egypt seeks 30,000 tons of soybean oil and 10,000 tons of sunflower oil on Wednesday for arrival during December 5-25.

 

Wheat

·        
US wheat futures prices this morning were lower to mixed. 

·        
Paris wheat reached another contract high but fell 2.25 euros by around 7:45 am CT.  The USD was 6 points higher as of 7:54 am CT. 

·        
The Great Plains will see light showers across eastern NE Tuesday and central TX Thursday.  Wheat futures prices this morning were lower to mixed. 

·        
China plans to start a new round of wheat auctions from state reserves, starting October 20. 

·        
Egypt said they have five months of wheat reserves. 

 

Export
Developments. 

·        
Ethiopia seeks 400,000 tons of wheat on November 30. 

·        
Jordan seeks 120,000 tons of wheat on October 20.

·        
Jordan seeks 120,000 tons of feed barley on October 21 for FH January through FH March shipment.

·        
Pakistan seeks 90,000 tons of wheat on October 25. 

·        
Last week Pakistan passed on 90,000 tons wheat. 

·        
Turkey seeks 300,000 tons of wheat on Oct. 21 for shipment between Dec. 10 and Dec. 31. 

·        
Ethiopia seeks 300,000 tons of milling wheat on November 9.

 

Rice/Other

·        
Maldives seeks 25,000 tons of parboiled rice with offers due by October 28. 

·        
Mauritius seeks 6,000 tons of white rice on October 26 for January 1-March 31 shipment.