FI Morning Grain Comments 12/06/21

PDF attached

 

Good
morning

 

Private
exporters sold 130,000 MT of soybeans for delivery to China

 

This
morning US equities are mixed, WTI crude up more than $1.80/barrel, USD up 4 points and natural gas lower.  Soybeans and meal are lower. Soybean oil is higher. Grains are selling off. Omicron fears were noted. Trade over the weekend circled around wheat import
tenders. China cut bank reserve rates.  Keep an eye on southern Brazil where it has been dry and will remain dry early this week. 

 

Weather

 

 

                                                                                                                    

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR DECEMBER 6, 2021

• Parts
  of Argentina and southern Brazil along with Uruguay and Paraguay will experience net drying conditions for the next ten days to two weeks.
  
• That
  will lead to some crop moisture stress as time moves along and soil conditions dry out.
  
• Center
  west into northern center south and northeastern crop areas of Brazil will experience a good mix of weather.
  
• In
  India, Tropical Cyclone Jawad dissipated near the coast east of Cuttack during the weekend.
  
• No
  crop damaging conditions resulted from the storm, although heavy rain is expected into Tuesday in Bangladesh and West Bengal, India.
  
• Eastern
  Australia weather is expected to improve over the coming week to ten days with less frequent and less significant rain expected. That will lead to better small grain and oilseed and maturation conditions while supporting more field progress in Queensland and
  New South Wales’ summer crop areas. 
• Western
  and Southern Europe are still advertised to be wet this week and alternating periods of light rain, snow and sunshine will impact northeastern Europe, the western Commonwealth of Independent States and China.
  
• India
  will dry down in the south for a little while late this week into next week.
  
• Southeast
  Asia weather will be good and the same is true for West Africa coffee, cocoa and sugarcane areas.
  
• There
  is need rain in Morocco while other North Africa crop areas are getting along alright
• There
  is need for more rain in northwestern Algeria and interior crop areas of both Algeria and Tunisia.
  
• South
  Africa weather will be favorably mixed to support its summer crops. 
• Mostly
  good Brazil weather is expected in coffee, cocoa and sugarcane areas, although this first week of the outlook will allow more drying to occur
• Rain
  will start increasing this weekend

 

 

Bloomberg
Ag Calendar

Monday,
Dec. 6:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• CNGOIC
  monthly report on Chinese grains and oilseeds
• Ivory
  Coast cocoa arrivals
• New
  Zealand Commodity Price
• U.S.
  Purdue Agriculture Sentiment, 9:30am
• Sucden
  coffee briefing
• HOLIDAY:
  Thailand

Tuesday,
Dec. 7:

• China’s
  first batch of November trade data, including soybean, edible oil and meat imports
• Abares’
  quarterly agricultural commodities report
• French
  agriculture ministry’s monthly crop production estimate
• New
  Zealand global dairy trade auction
• EU
  weekly grain, oilseed import and export data

Wednesday,
Dec. 8:

• EIA
  weekly U.S. ethanol inventories, production
• Fitch
  ESG Outlook Conference Asia Pacific, day 1
• FranceAgriMer’s
  monthly grains report

Thursday,
Dec. 9:

• USDA’s
  monthly World Agricultural Supply and Demand (WASDE) report, noon
• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• China
  farm ministry’s monthly crop supply-demand report (CASDE)
• Brazil’s
  Conab report on yield, area and output of corn and soybeans
• Fitch
  ESG Outlook Conference Asia Pacific, day 2
• Port
  of Rouen data on French grain exports

Friday,
Dec. 10:

• 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
• Malaysian
  Palm Oil Board’s data on November palm oil reserves, output and exports
• Malaysia’s
  Dec. 1-10 palm oil exports
• HOLIDAY:
  Thailand

Source:
Bloomberg and FI

 

 

 

 

CFTC
Commitment of Traders

The
funds for the week ending November 30 did not sell as much as expected contracts for corn, soybeans and wheat.  They sold a more than expected soybean meal. 

 

 

 

Macros

(Reuters)
– Oil prices rose by more than $2 a barrel on Monday after top exporter Saudi Arabia raised prices for its crude sold to Asia and the United States, and as indirect U.S.-Iran talks on reviving a nuclear deal appeared to hit an impasse.

 

Corn

·        
CBOT corn is lower following soybeans and wheat futures.    

·        
US equities are mixed, WTI crude up more than $1.80/barrel, USD up 5 points and natural gas lower.

·        
Keep an eye on southern Brazil where it has been dry and will remain dry early this week. 

·        
China’s statistics bureau pegged corn output up 4.6% in 2021 to 272.6 million tons. China’s 2021 corn planting acreage was up 5% from the previous year at 650 million mu (43.32 million hectares).

 

Export
developments.

·        
None reported

 

Soybeans

·        
Soybeans
and meal are lower while SBO was higher at the electronic break in part to higher Malaysian palm overnight and strength in China vegetable oils.   

·        
Last week it was thought China bought 25-30 cargoes of soybeans.

·        
The trade is expecting an announcement from the EPA soon over biofuel mandates.

·        
US/China political tensions increased over the weekend after the US threatened to boycott the Olympics. This was talked about before and we don’t read too much into this but something to keep an eye on. 

·        
The trade is expecting an announcement from the EPA soon over biofuel mandates. 

·        
Offshore values are leading soybean oil 71 points lower and meal $5.00 short ton lower.

·        
Rotterdam meal values were 2-10 euros higher from Friday morning and Rotterdam oil mixed.

·        
Malaysia

·        
China crush margins on our analysis was last $2.00, versus $2.22 at the end of last week and compares to $0.93 a year ago.

·        
China

 

November
MPOB estimates via Reuters

 

Export
Developments

·        
Private exporters reported the following:

-130,000
metric tons of soybeans to China during the 2021/2022 marketing year

 

Wheat

·        
US wheat is mostly lower to start on lack of fresh news and gradual improvement to the eastern Australian weather outlook over the next 10 days. 

·        
March Matif Paris wheat was 1.25 euros lower at 288.75.

·        
China’s statistics bureau pegged wheat production at 136.9 million tons.

·        
Russia may impose a grain export quota for the February 15- June 30 period at 14 million tons, including 9 million tons of wheat.

 

Export
Developments.

·        
Saudi Arabia bought 689,000 tons of wheat at an average $365.14/ton
for
arrival between May and July 2022.
That amount was more than expected.

·        
Jordan seeks another 120,000 tons of wheat on Dec 9 and seeks 120,000 tons of barley on Dec 8. 

·        
Bangladesh seeks 50,000 tons of milling wheat on Dec. 8. 

 

Rice/Other

·        
South Korea seeks 22,000 tons of rice from the US on December 9 for arrival in South Korea from May 2022 and from August 2022.