FI Morning Grain Comments 11/10/21

PDF attached

 

Good
morning

 

Mixed
trade this morning.  USD is up 37 points and WTI crude reversing to trade 8 cents higher.  US equities are pointing towards a lower open.  Soybean oil is higher tracking palm oil (good early Nov palm shipment data) and higher lead in offshore values.  Meal
and soybeans revered losses on rumors of Chinese buying. Corn is seeing follow through buying while wheat is mostly higher.  We see no major weather issues over the short term for the US and SA although some rain will fall across the Midwest crop areas that
are expected to delay harvesting today through Sunday.  A Bloomberg poll looks for weekly US ethanol production to be down 10,000 barrels (1012-1120 range) from the previous
week and stocks up 239,000 barrels to 20.368 million.

 

 

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR NOVEMBER 10, 2021

•  Weather
  is unlikely to have a big influence on market trade today.
• South
  America conditions will remain good with timely rainfall for Brazil and Argentina support a bearish influence since it does not look like there will be much threat of crop problems over the next two weeks.
  
• In
  the United States and Canada, a snowstorm Thursday into Friday will bury some agricultural areas from eastern Saskatchewan and Manitoba into northeastern North Dakota and northern Minnesota.
  
• Travel
  disruptions are expected and late season farming activity will be halted. Livestock stress is expected.
  
• The
  lower U.S. Midwest will experience some rain today in the west and Thursday into Friday in the east with some rain in the Delta and southeastern states, as well. After this period, though precipitation is expected to be less frequent and light for the following
  week allowing late season farming activity to continue.
• No
  rain is expected in the west half of U.S. hard red winter wheat areas through the next ten days and West Texas will be dry as well.
•  Australia’s
  wet weather pattern will continue into Friday and then much drier weather is expected which will protect unharvested winter crops from a quality decline.
  
• The
  moisture will be good for summer crop planting and advancing early season crop development.
  
• South
  Africa will stay dry in western summer crop areas. 
• Europe
  weather will remain tranquil for a while with a little storminess in the Mediterranean region only
• Good
  farm progress is likely
• Dry
  conditions will prevail from Ukraine into the middle Volga River Basin in Russia, but winter crops are dormant or semi-dormant and will have very little need for moisture until spring
• Southern
  India will be facing a weak tropical cyclone today and Thursday bringing some heavy rain to the lower east coast and inducing some local flooding, but very little crop damage is anticipated

 

Bloomberg
Ag Calendar

Wednesday,
Nov. 10:

• EIA
  weekly U.S. ethanol inventories, production
• Vietnam’s
  customs department publishes October commodity trade data
• Malaysian
  Palm Oil Board’s data on October output, exports, and stockpiles, 12:30pm Kuala Lumpur
• Malaysia’s
  Nov. 1-10 palm oil export numbers by cargo surveyors
• FranceAgriMer
  monthly grains report

Thursday,
Nov. 11:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, and beef, 8:30am
• Port
  of Rouen data on French grain exports
• Brazil’s
  Conab releases data on yield, area and output of corn and soybeans (tentative)
• New
  Zealand Food Prices
• HOLIDAY:
  France

Friday,
Nov. 12:

• 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

 

 

 

 

 

Macros

US
CPI (M/M) SA Oct: 0.9% (est 0.6%; prev 0.4%)

–
CPI (Y/Y) NSA Oct: 6.2% (est 5.9%; prev 5.4%)

–
Core CPI (M/M) SA Oct: 0.6% (0.4%; prev 0.2%)

–
Core CPI (Y/Y) NSA Oct: 4.6% (4.3%; prev 4.0%)

US
Initial Jobless Claims 6 Nov: 267K (est 260k; prev 269k; prevR 271k)

–
Continuing Jobless Claims 30 Oct: 2.160M (est 2.050M; prev 2.105M; prevR 2.101M)

 

 

Corn

·        
Corn futures are higher on follow through technical buying and higher wheat.

• French
  growers group Arvalis expects France to realize a record corn yield of 11 tons per hectare from favorable weather. 
  
• Germany
  reported another bird flu (H5N1) case, this one in north Germany, affecting about 39,000 ducks. 
  

·        
Argentina producers sold 44.1 million tons of corn for the 2020-21 season, 4.3 million tons greater than this time last season. 

·        
A Bloomberg poll looks for weekly US ethanol production to be down 10,000 barrels (1012-1120 range) from the previous week and stocks up 239,000 barrels to 20.368 million.

 

Export
developments.

• South
  Korea’s MFG bought 137,000 tons of SAS and/or South African.  The corn was bought in two consignments, the first of 69,000 tons at $317.00 a ton c&f.  Another 68,000 tons was bought at $317.15 a ton. 
  
• Turkey
  seeks 325,000 tons of corn on November 15 for shipment sought between Dec. 20 and Jan. 20.

 

 

Soybeans

·        
CBOT soybean
complex is mixed with soybean oil trading higher following palm oil.  Soybeans turned higher on China buying rumors which in turn paired most losses in soybean meal. 

·        
We are hearing China bought a few US PNW soybean cargoes and few boats out of Brazil, both for December. 

·        
China soybean futures were up 2.1%, meal 1.1% higher, SBO near unchanged, and palm up 0.3%. Offshore values are favoring SBO over CBOT soybean meal. 

·        
MPOB released Malaysian palm data and October stocks, production, exports, and imports were near expectations.  Stocks at the end of October increased 4.4% to 1.834 million tons, but well below normal for this time of year.  Malaysian
palm production was 1.726 million tons, a 13-month high. Exports were 1.418 million tons, down 12% from September and 15% from year ago. Imports fell 32.7% to 50,540 tons from the previous month.  

·        
Cargo surveyor AmSpec reported Malaysian palm oil exports for the November 1-10 period at 543,944 tons, an 8.7% increase from the same period month earlier. 

·        
ITS reported an 8 percent increase to 571,450 tons. 

·        
Malaysian palm was up 128 ringgit, rebounding from a 5-week low, and cash palm increased $25/ton to $1257.50/ton.  Yesterday the futures market was down 103. 

·        
China soybean futures were up 2.1%, meal 1.1% higher, SBO near unchanged, and palm up 0.3%.

·        
Argentina producers sold 33.6 million tons of soybeans for the 2020-21 season, behind 34.8 million tons last season. 

·        
Malaysia

·        
Rotterdam meal values were 4-9 euros higher and vegetable oils 10-30 euros higher. 

·        
Offshore values are leading soybean oil about 52 points higher and meal $2.20 short ton higher. 

·        
China crush margins on our analysis was last $2.51/bu (2.57 previous), compared to $2.30 at the end of last week and compares to $0.85 a year ago.

·        
China

 

Export
Developments

• Egypt
  cancelled their vegetable oil import tender.  They received offers for vegetable oils for arrival Jan. 5-Jan. 25.  Lowest offer for 11,500 tons of sunflower oil was $1,440.00 per ton c&f.  The lowest offer for 30,000 tons of soyoil was $1,444.00 per tons c&f.
  
• South
  Korea is in for 115,000 tons of GMO-free soybeans on November 17 for arrival in South Korea in 2023. 
  

 

Wheat

·        
US wheat futures are mostly higher on good global demand.  KC was on the defensive earlier on improving US weather. 

·        
Russia is looking to adjust its way to calculate its grain export tax in case of significant price increases.  They are also looking into setting grain export quotas.  They also plan to roll out tax-free quotas for beef and pork
imports. 

·        
FranceAgriMer lowered its 2021-22 forecast of French soft wheat exports for outside the European Union to 9.4 million tons from 9.6 million estimated in October.  Soft wheat sales within the EU 27 was estimated at 7.8 million
tons from 8.0 million seen last month. 

·        
Paris December wheat was up 1.50 euros by around 7:25 am CT at 287.50/ton.

·        
The US weather forecast calls for a follow up snowstorm to fall across the northern Plains and upper Midwest this weekend.  Snowfall of 2 to 6 inches will occur from northwest to southeast across North Dakota and 2 to 5 inches
in northeastern South Dakota, southern Minnesota, and areas east into southern Michigan, according to World Weather Inc. 

·        
Australia will see active weather for a few more days.  Drier weather is seen this weekend into early next week which will be good for the wheat crop. 

·        
Ukraine is still in need of more precipitation. 

 

Export
Developments. 

·        
Tunisia passed on 100,000 tons of soft wheat. Lowest offer was $380.30 a ton c&f, optional-origin.  No announcement has yet been made on them in for 75,000 tons of durum.    The wheat was sought for shipment between Dec. 1, 2021
and Jan. 15, 2022.  The barley was sought for shipment between Dec. 15, 2021 and Jan. 20, 2022.

·        
Jordan saw offers from 3 participants for their import tender for 120,000 tons of barley for shipment combinations of March 1-15, March 16-31, April 1-15 and April 16-30. 

·        
Japan’s AgMin in a SBS import tender seeks 80,000 tons of feed wheat and 100,000 tons of feed barley for arrival by February 24. 

·        
Japan seeks 157,987 tons of food wheat this week from the US, Canada, and Australia. 

·        
Results awaited: The UN is in for 110,000 tons of milling wheat for Ethiopia.  40,000 tons was for delivery between Dec. 20, 2021, and Jan. 5 2022, another 20,000 tons for delivery between Jan. 5–20, 2022, and 50,000 tons also
for delivery between Jan. 5–20, 2022. 

·        
Results awaited: Separate import tender.  Ethiopia seeks 300,000 tons of milling wheat on November 9.

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

 

Rice/Other

·        
None reported