FI Evening Grain Comments 03/07/22

PDF Attached

 

WK
settles @ limit up, per the CME exec order, WK will see expanded limits tomorrow 130 cents.  The usual rule of 2 months consecutive does not apply if WK settles limit up.  Full CME notice:
https://www.cmegroup.com/content/dam/cmegroup/notices/ser/2022/03/SER-8946.pdf

 

 

US
corn and soybean acreage is expected at be a combined record for 2022 by FI.

Day
12. Higher trade in most commodities. News was slow since this morning. 

 

 

Private
exporters reported sales of 132,000 metric tons of soybeans for delivery to China. Of the total, 66,000 metric tons is for delivery during the 2021/2022 marketing year and 66,000 metric tons is for delivery during the 2022/2023 marketing year.

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR MARCH 7, 2022

• North
  Africa and Spain have reported some bouts of rain since late last week improving topsoil moisture in many winter and spring crop areas.
• More
  moisture is needed, and more is expected with the next greatest rain coming late this weekend into early next week. 
  
• Central
  and northeastern Europe will dry down for a while, but cool temperatures will prevent any area from becoming too dry.
  
• Cooling
  in Russia will bring in some bitter cold temperatures during mid- to late-week this week, but snow cover should protect most winter crops.
  
• China
  is warming up and a little rapeseed and southern wheat development is possible.
  
• Soil
  moisture is favorable for crop development as well .
• India’s
  weather will be relatively tranquil for a while
• South
  Africa will see frequent bouts of rain over the next week to ten days.
• Eastern
  Australia rainfall will be greatest along the coast while only light precipitation occurs inland leaving cotton fiber quality unaffected.
• Ivory
  Coast, Ghana and other west-central Africa coffee and cocoa areas will continue to receive periodic rainfall over the next ten days
  
• Indonesia
  and Malaysia get frequent rain of significance that may lead to some local flooding.
  
• The
  same is true for the Philippines.
• South
  America weather will remain very good for late full season and Safrinha crops in Argentina and Brazil.
  
• In
  the U.S., hard red winter wheat areas will get some rain and snow, but not enough moisture to change drought status.
  
• The
  southeastern U.S. will get some needed moisture later this week
• The
  Delta will remain moist
• Parts
  of the lower eastern Midwest and Tennessee River Basin may continue too wet for a while
• Minimal
  precipitation is expected in West and South Texas and California – for at least a week. 

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

Monday,
March 7:

• China’s
  1st batch of Jan.-Feb. trade data, incl. soybean, edible oil, rubber and meat & offal imports
• USDA
  export inspections – corn, soybeans, wheat, 11am
• Bursa
  Malaysia Palm Oil Conference, day 1
• Vietnam’s
  customs to publish Feb. coffee, rice and rubber export data
• Ivory
  Coast cocoa arrivals
• HOLIDAY:
  Russia

Tuesday,
March 8:

• EU
  weekly grain, oilseed import and export data
• U.S.
  National Coffee Association Virtual Convention, day 1
• Bursa
  Malaysia Palm Oil Conference, day 2
• HOLIDAY:
  Russia, Ukraine

Wednesday,
March 9:

• USDA’s
  monthly World Agricultural Supply and Demand (WASDE) report, 12pm
• China’s
  agriculture ministry (CASDE) releases monthly report on supply and demand for corn and soybeans
• U.S.
  National Coffee Association Virtual Convention, day 2
• FranceAgriMer
  monthly French grains outlook
• EIA
  weekly U.S. ethanol inventories, production, 11am
• Bursa
  Malaysia Palm Oil Conference, day 3
• HOLIDAY:
  South Korea

Thursday,
March 10:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Malaysian
  Palm Oil Board’s monthly data for output, exports and stockpiles
• U.S.
  National Coffee Association Virtual Convention, day 3
• Malaysia’s
  March 1-10 palm oil export data
• Brazil’s
  Unica may release cane crush and sugar output data (tentative)

Friday,
March 11:

• ICE
  Futures Europe weekly commitments of traders report, ~1:30pm
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• FranceAgriMer
  weekly update on crop conditions
• New
  Zealand Food Prices

Source:
Bloomberg and FI

 

 

 

 

 

 

USDA
inspections versus Reuters trade range

Wheat                 
343,463                 versus   300000-500000  range

Corn                     
1,582,167             versus   1000000-1650000             range

Soybeans           
766,250                 versus   400000-1475000                range

 

 

 

 

GRAINS
INSPECTED AND/OR WEIGHED FOR EXPORT

                 
REPORTED IN WEEK ENDING MAR 03, 2022

                 
          — METRIC TONS —

————————————————————————-

                                                  
CURRENT     PREVIOUS 

             ———–
WEEK ENDING ———-  MARKET YEAR  MARKET YEAR

 
GRAIN      03/03/2022  02/24/2022  03/04/2021    TO DATE     TO DATE  

 

BARLEY             
0           0           0       10,010       31,023 

CORN       
1,582,167   1,555,227   1,682,172   24,780,431   27,925,277 

FLAXSEED           
0           0           0          324          509 

MIXED              
0           0           0            0            0 

OATS               
0           0         600          400        3,617 

RYE                
0           0           0            0            0 

SORGHUM      
204,845     146,516     191,103    3,225,925    3,777,199 

SOYBEANS     
766,250     738,266     665,547   41,375,206   52,774,084 

SUNFLOWER          
0           0           0          432            0 

WHEAT        
343,463     429,984     523,205   15,852,189   18,667,969 

Total      
2,896,725   2,869,993   3,062,627   85,244,917  103,179,678 

———————————————————————–

CROP
MARKETING YEARS BEGIN JUNE 1 FOR WHEAT, RYE, OATS, BARLEY AND

FLAXSEED; 
SEPTEMBER 1 FOR CORN, SORGHUM, SOYBEANS AND SUNFLOWER SEEDS.

INCLUDES
WATERWAY SHIPMENTS TO CANADA.

 

Macros

Livesquawk
– Shell Is Limiting Supplies Of Heating Oil In Germany

Some
analysts are looking for a sharp increase in energy prices. 

 

Corn

·        
CBOT corn futures
ended higher led by old crop following the surge in wheat futures, which hit a record basis Chicago.  News was light for corn.

·        
China aims to expand summer grain plantings to ensure food security. If successful, we look for grain imports to decline from 2021.  Soybean imports for the Jan-Feb period exceeded expectations. 

·        
China looks to buy 38,000 tons of frozen pork for state reserves on March 10.  They bought pork last week, making the March 10 tender second for the crop year. 

 

Export
developments.

• None
  reported

 

USDA
Attaché : China Livestock and Products Semi-Annual

https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Livestock%20and%20Products%20Semi-Annual_Beijing_China%20-%20People%27s%20Republic%20of_CH2022-0026.pdf

 

U
of I: International Benchmarks for Corn Production

Langemeier,
M. and L. Zhou. “International Benchmarks for Corn Production.” farmdoc daily (12):29, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, March 4, 2022.

https://farmdocdaily.illinois.edu/2022/03/international-benchmarks-for-corn-production-6.html

 

 

Updated
3/3/22

May
corn is seen in a $6.50 and $8.50 range 

December
corn is seen in a wide $5.50-$7.50 range

 

Soybeans

·        
CBOT
soybeans, meal and soybean oil traded two-sided. Strength in wheat and higher energy prices limited losses. 

·        
South American rains improved and that should limit additional downside risk for estimated 2022 Argentina and southern Brazil soybean crop estimates going forward.  Latest estimates for Brazil and Argentina soybean production
suggest USDA is 6+ million tons too high, combined, and we could see a 50 million bushel cut to US ending stocks when updated this week (higher US exports).  This could prompt a reversal in the SX2/CX2 ratio, currently favoring corn over soybean plantings
for the Northern Hemisphere. 

·        
AgRural – 122.8 MMT Brazil soybeans, down from 128.5 previous.

·        
China: January – February soybean imports reached 13.94 million tons, above expectations and 4.1% above year earlier.  Trade flows suggested 12.2 million tons, suggesting non-commercials were active in buying for domestic use. 
March and April imports are expected to decline from the previous year. 

 

USDA
Attaché : India Oilseed and Products Update

https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Oilseeds%20and%20Products%20Update_New%20Delhi_India_IN2022-0018.pdf

 

 

Export
Developments

• South
  Korea’s NOFI passed on 60,000 tons of soybean meal for June 30 arrival due to high prices. Lowest offer was a high $640/ton c&f, up from $548.50/ton paid by NOFI late January. 
  
• Private
  exporters reported sales of 132,000 metric tons of soybeans for delivery to China. Of the total, 66,000 metric tons is for delivery during the 2021/2022 marketing year and 66,000 metric tons is for delivery during the 2022/2023 marketing year.

 

 

Updated
3/1/22

Soybeans
– May $15.75-$18.25

Soybeans
– November is seen in a wide $12.50-$16.00 range

Soybean
meal – May $425-$520

Soybean
oil – May 72.00-80.00

 

Wheat

·        
Record high was posted for Chicago wheat.  Tuesday will be a 130 cent limit for Chicago and KC. We see a top in this market soon but will have to wait to see if funds cool down on buying.  Note KC and MN didn’t follow Chicago
limit higher basis the May.  Wheat cannot be replaced like other feedgrains, so traders are more than ever cautious when looking at global trade.

·        
May Paris wheat futures were up 25 euros at 396.50 euros, a record high, but well off the session high of 424.

·        
Iraq is looking to boost reserves of wheat by sourcing 3 million tons. 

·        
China warned that domestic winter wheat conditions could be “worst in history” but no figures were provided.  Some plots could see a 20 percent loss. A bumper summer grain crop could offset such losses that would be used for feed
use. 

·        
There was rumor Mexico bought French wheat.  Some question US completeness over French wheat but a reminder import interest has picked up.  Taiwan seeks US PNW wheat. 

·        
Several countries announced they have enough grain reserves for domestic consumption.

·        
India was in a good place to export wheat after the surge in global wheat prices and three consecutive years of a bumper crop.  They may export more than 7 million tons, a large amount to help alleviate the Black Sea supply shortage. 
They have already supplied over 6.6 million tons for export. 

·        
Algeria said they have enough wheat reserves to last until end of this year. 

·        
Romania said they have enough grain reserves to “weather” the Ukraine invasion. They will be exporting wheat in the meantime. 

·        
China last week, on March 2, sold 526,254 tons of wheat from state reserves at an average price of 3,054 yuan per ton ($483.32/ton), well above 2,753 average price recoded February 23. 

·        
Sudan received 20,000 tons of wheat (aid) on Sunday from Russia.

 

Export
Developments.

·        
Tunisia seeks 125,000 tons of soft wheat and 100,000 tons of barley, optional origin, on Tuesday. Shipment is for March through May. 

·        
Taiwan seeks 50,000 tons of US PNW milling wheat on March 11 for April 23-May 7 shipment. 

·        
Algeria seeks 50,000 tons of soft milling wheat, optional origin, on March 8, opening until the 9^th, for May shipment. 

·        
Iraq seeks two million tons of wheat to provide a strategic reserve.  Iraq looked for offers from international companies over the weekend.

·        
Jordan’s state grains buyer seeks 120,000 tons of milling wheat on March 9.  Shipment is between LH May and LH July.

·        
Jordan’s state grains buyer seeks 120,000 tons of feed barley on March 15.  Shipment is between July 16-31, Aug. 1-15, Aug. 16-31 and Sept. 1-15.

·        
Bangladesh seeks 50,000 tons of milling wheat on March 16 for shipment within 40 days of contract signing. 

 

Rice/Other

·        
(Bloomberg) — U.S. 2021-22 cotton ending stocks seen at 3.37m bales, 127,000 bales below USDA’s previous est., according to the avg in a Bloomberg survey of seven analysts.

               
-Estimates range from 3.1m to 3.65m bales

               
-Global ending stocks seen unchanged at 84.31m bales

 

Updated
3/3/22

Chicago
May $8.50 to $13.50 range

KC
May $8.50 to $13.50 range

MN
May $9.25‐$14.00