PDF Attached

 

Hogs
and Pigs reported supportive for corn, bearish for hogs.  USDA export sales for soybeans, soybean oil and wheat were within expectations. 

 

 

 

Weather
and Crop Progress

MARKET
WEATHER MENTALITY FOR CORN AND SOYBEANS:  U.S. weather is expected to be nearly ideal over the coming two weeks with periodic showers and thunderstorms intermixing with periods of sunshine and warm temperatures over this first week while drying and warming
occurs in the second week. Crop development will advance aggressively. Some pockets of dryness will remain, and the second week of the forecast will trend a little drier and warmer making the second and third weeks in July important to watch.

           
Summer crops in Europe may trend drier in the west, but some rain will return in early July to prevent dryness from becoming a big issue. Eastern Europe and the western CIS will continue favorably moist throughout the next two weeks. Most of China’s summer
coarse grain and oilseed crops will also stay in good shape along with much of India’s crops. Some dryness remains north of the Yellow River in China, but that area will get some needed rain soon. Northeast China is a little too wet, but the impact on corn
and soybeans should be low.

           
Drying in Russia’s Southern Region will continue a concern with some expansion into eastern Ukraine now advertised as well.

            Canola
production potential in Australia is looking good, but rapeseed in China has suffered from too much moisture this year. Europe’s winter rapeseed has likely yielded a little poorly, but summer crops are poised to perform well. Canada’s canola crop will be improving
over the next two weeks.

           
Brazil Safrinha corn is maturing relatively well and harvesting in Argentina has gone well also.

            The
bottom line will lead to a bearish bias for market mentality today.

 

MARKET
WEATHER MENTALITY FOR WHEAT:  Weather conditions in U.S. hard red winter wheat in the Plains and soft red wheat areas in the Midwest will remain favorable as rain frequency slowly subsides and better drying conditions emerge. This change is already under way
in the Plains, but the Midwest will be slow to dry down.

           
Canada’s wheat will remain in good condition in Ontario and Quebec while varying from fair to good condition in the Prairies. Dryness remains a concern from eastern Montana and the western Dakotas into southwestern Manitoba and eastern Saskatchewan where some
relief is possible late this weekend into next week.

            Wheat
conditions in Europe vary greatly with some concern over crop conditions in parts of France, Germany and the United Kingdom from dryness earlier this year. Some rain in southeastern Europe has improved winter crop production potentials as well as in Ukraine
and southwestern Russia. Rain this week in the eastern CIS New Lands should translate into improved soil moisture for better spring wheat development near the Kazakhstan border. Drying from eastern Ukraine into Russia’s Southern Region will raise concern for
late season crop development.

           
Argentina wheat conditions have been improving except in the western parts of the nation where La Pampa, Cordoba, far western Buenos Aires and western Santa Fe need more rain. Brazil wheat conditions are fair to very good with rain needed in the north and
some drying in the south.  Rain in Brazil during the next week to ten days will fix the moisture deficits and may make parts of the south too wet.

            Overall,
weather today may have a mixed influence on market mentality.

Source:
World Weather Inc. and FI

 

 

 

 

 

 

Bloomberg
Ag Calendar

THURSDAY,
June 25:

  • USDA
    weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
  • International
    Grains Council monthly report
  • Port
    of Rouen data on French grain exports
  • Malaysia’s
    palm oil export data for June 1-25
  • USDA
    hogs and pigs inventory, red meat production, 3pm

FRIDAY,
June 26:

  • ICE
    Futures Europe weekly commitments of traders report, 1:30pm (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

 

 

 

 

 

USDA
export sales

for soybeans, soybean oil and wheat were within expectations.  Corn was at the lower end of the trade and soybean meal sales were below expectations.  Shipments of meal of nearly 300,000 tons were ok and soybean oil shipments were robust at 52,200 tons. 

·        
China booked a cargo of corn. 

·        
China booked 172,500 tons of 2019-20 soybeans, and 393,000 tons of new-crop.

·        
Sorghum sales showed net reductions of 1,000 tons.

·        
Pork sales were 24,100 tons.

 

 

 

 

Macros

·        
US GDP Annualized (Q/Q) Q1 F: -5.0% (est -5.0%; prev -5.0%)

·        
US Personal Consumption Q1 F: -6.8% (est -6.8%; prev -6.8%)

·        
US Core PCE (Q/Q) Q1 F: 1.7% (est 1.6%; prev 1.6%)

·        
US Initial Jobless Claims Jun 20: 1480K (est 1320K; prevR 1540K; prev 1508K)

·        
US Continuing Jobless Claims Jun 13: 19522K (est 20000K; prevR 20289K; prev 20544K)

·        
US Durable Goods Orders May P: 15.8% (est 10.5%; prev -17.7%)

·        
US Durable Goods Ex Transportation May P: 4.0% (est 2.1%; prev -7.7%)

·        
US Cap Goods Orders Nondef Ex Air May P: 2.3% (est 1.0%; prev -6.1%)

·        
US Cap Goods Ship Nondef Ex Air May P: 1.8% (est -1.0%; prev -5.7%)

·        
US Wholesale Inventories (M/M) May P: -1.2% (est 0.4%; prev 0.3%)

·        
US Retail Inventories (M/M) May: -6.1% (est -2.0%; prev -3.6%)

·        
US Advance Goods Trade Balance May: -74.3B (est -68.2B; prevR -70.7B; prev -69.7B)

 

Corn.

·        
Corn futures prices could see a partial recovery from the week to date losses, tonight into Friday after the quarterly hogs and pigs inventory showed a large increase from the previous year, meaning
feed demand for corn, meal and other feed ingredients were larger than anticipated last quarter.  We will likely raise our US soybean crush for the soy complex S&D’s and increase feed demand for the summer quarter for corn.  Early next week USDA may indicate
feed demand for corn will likely exceeded our current expectations, if USDA’s H&P inventory is validated.  The USDA hogs and pigs report showed all hogs as of June 1 increased 5.2 percent from a year ago, compared to the trade looking for an increase 3.0 percent
from a year ago.  Kept for breeding was 2.9 percentage points below expectations.  Kept for market came in 2.7 points above trade expectations.

·        
Meanwhile today’s market reaction to the downside reflected widespread selling pressure in global grains and oilseeds continued into Thursday from negative outside markets.
 IMF
revised lower its global GDP forecast to negative 4.9 percent from negative 3.0 percent April estimate.  USA was projected to contract 8.0 percent and EU (“Euro Zone”) by 10.2 percent.  2021 global GDP was projected to rebound 5.4 percent. 

·        
September corn dropped for the fourth consecutive session to a April 29 low, before pairing losses, on favorable US weather, even as we hear up to 7 cargoes of US corn was sold to China yesterday
along with at least 4 cargoes of Ukrainian corn. 

·        
Several option traders took advantage of the pressure, by buying corn calls today.  CQ 360c and CQ 330-360 1×2 were two examples of plays.  Spreading was on fire today and bear spreading eventually
dominated the close. 

·        
China is on holiday for the rest of the week for Dragon Boat Festival June 25–27. 

·        
Funds sold an estimated net 25,000 corn contracts on Thursday.  Previous three days they sold 33,000 contracts, or 58,000 contracts over the combined four days. 

·        
South Africa’s CEC estimated the 2019-20 SAf corn crop at 15.5 million tons, slightly below 15.6 million previous and compares to 11.275 million tons in 2019. 

 

 

Corn
Export Developments

  • None
    reported

 

Top
corn exporting countries, spot USD/ton

Source:
Reuters and FI

 

 

Updated
6/25/
20

September
corn is seen in a $3.10 and $3.45 range over the short term.
 
December lows could reach $2.90 if US weather cooperates. 

 

Soybean
complex
.

  • CBOT
    soybeans
    ended
    lower on increasing coronavirus concerns and lower soybean oil.  A volatile USD and recovery in US equity markets paired most of the losses. 
  • Soybean
    meal ended lower.
  • China
    is on holiday for the Dragon Boat Festival June 25–27. 

·        
Soybean oil had been under pressure all week from weaker palm oil.  Today cargo surveyors reported a significant slowdown in palm exports over the June 20-25 period.

·        
Funds sold an estimated net 3,000 soybeans contracts on Thursday, sold 2,000 meal and sold 2,000 soybean oil.  

  • Anec
    said Brazilian exporters cannot promise China that the soybeans will be coronavirus free.  We agree but if founded coronavirus can be transmitted in or on a soybean seed after a 20-30 day journey across the ocean to any destination, and be detected upon inspection,
    US exporters might have an upper hand in providing the extra paperwork if Chinese buyers are really concerned about the matter. 

·        
ITS: Malaysian palm oil exports for the June 1 – 25 period rose 37.2 percent to 1,390,860 tons from 1,014,000 tons month earlier.  AmSpec reported a 35.5 percent increase to 1,401,996 tons from 1,034,829
tons.  In comparison, SGS reported June 1-20 exports up 50 percent to 1.21 million tons. 

 

Oilseeds
Export Developments