PDF Attached

 

Lower
trade on long liquidation, recent two-week improvement over SA weather, and higher USD. 

 

 

Weather

Wetter
(noon update) for the US over the 7-day period…

 

EARLY
MORNING WEATHER UPDATE

MOST
IMPORTANT WEATHER OF THE DAY

  • Southern
    Argentina will see the least frequent and least significant rainfall in South America for a while
    • Buenos
      Aires still has some favorable subsoil moisture, but it is drying out
    • La
      Pampa, San Luis and southern Cordoba are already drying out and will experience crop stress first
    • Temperatures
      will be a little warmer than usual keeping evaporation rates high enough raise concern about future crop development in the already driest areas
  • Argentina’s
    north and some central crop areas will get timely rainfall to support crop needs, although the greatest rain in central Argentina occurs in the second week of the outlook leaving the potential for reduced precipitation in future forecasts
  • Brazil’s
    rainfall over the next ten days will be least significant in Bahia and southeastern Piaui, but there will be some occasionally rainfall in a few west-central and southwestern Bahia locations to benefit cotton, corn and soybeans
    • Eastern
      cocoa and coffee production areas will not get much rain for a while
  • Brazil
    rainfall will also be a little light in northern Mato Grosso, southeastern Bolivia and some immediate neighboring areas, but there will be at least some rain in these areas periodically to prevent a complete absence of moisture
  • GFS
    model continues to exaggerate some of the rain expected in Minas Gerais, Brazil during the coming two weeks, but all models agree it will be the wettest state in the nation and some local flooding will eventually develop as multiple inches of rain evolves
    • Most
      of the rain in Minas Gerais will be spread out over time helping to limit the potential for serious flooding
  • Eastern
    Australia rain potentials have been diminished through Saturday, although a few showers are expected
    • Greater
      rain will occur Sunday through next week in southeastern Queensland and northeastern New south Wales with some heavy rain expected near the coast to causing some flooding
      • Sugarcane
        will be most impacted, although some eastern cotton areas will get at least some rain
        • No
          flooding is expected in cotton production areas
        • Western
          cotton areas in Queensland and New South Wales will remain too dry throughout the next ten days
    • Temperatures
      in eastern Australia will be much cooler than they have been especially once rain increases late this weekend next week
  • Australia’s
    winter crop harvest in the south should be winding down soon and it has been a good harvest season
  • South
    Africa will be favorably mixed with periods of rain and sunshine impacting summer grain, oilseed and cotton production areas
    • Planting
      progress should advance favorably around periods of rain
    • Dryness
      is of most concern today in central and western Free States and eastern Northern Cape
  • Eastern
    China weather has improved recently with less rain allowing rapeseed and southern wheat production areas a chance to dry down after being too wet earlier this season
  • China’s
    weather over the next two weeks will keep most winter crops dormant or semi-dormant and precipitation will concentrate on the Yangtze River Basin where a wintry mix of precipitation types is expected late this weekend into next week
    • Winter
      crops are well established and poised to perform well in the spring
    • Sugarcane
      harvesting in the south will advance relatively well for a while due to expected dry weather
  • India’s
    wet bias in the south will abate in the next two days giving way to some much needed drying
    • Too
      much rain recently has delayed summer crop maturation and harvesting in Tamil Nadu and southern Andhra Pradesh where some cotton, rice and groundnut quality concerns have evolved recently
      • Drying
        will get harvest progress back on the right track
  • Central
    and far northern India showers next week will benefit a few winter crops, but greater rain will be needed in the heart of the nation
    • Most
      winter crops are favorably rated, however, with little change likely
  • Southern
    Vietnam and Cambodia will trend wetter than usual late this week and into the weekend with some of that moisture reaching far southern Thailand as well late in the period
    • The
      moisture will delay harvest progress for many crops, but no serious crop quality changes are likely
    • Some
      additional rain will fall along the central and lower Vietnam coast for a while next week and some additional rain will be possible in southern Cambodia and a few areas in the Malay Peninsula
  • Routinely
    occurring precipitation is expected in Philippines, Indonesia and Malaysia over the next two weeks
  • Russia’s
    Southern Region had eastern Ukraine will continue missing precipitation for the next ten days leaving dormant winter crops in need for greater soil moisture to be used in the spring
    • Winter
      crops are still not as well established as they should be
  • Greece,
    Bulgaria, eastern and southern Romania, Moldova and western Ukraine will all receive significant moisture late this weekend into early next week bolstering topsoil moisture for better winter crop establishment and growth potential in the spring
  • Portions
    of the U.K., France and the Iberian Peninsula will also receive periodic rainfall during the next two weeks along with Italy and the eastern Adriatic Sea region where some flooding will be possible due to heavy rain over areas that are already wet
  • North
    Africa rainfall will be greatest in northern Algeria and coastal areas of Tunisia during the coming ten days. The moisture will be welcome
    • Some
      moisture will also reach into far north-central Morocco, but there is need for more rain in the remainder of that nation and in particular the southwest
      • Morocco
        continues trying to recover from last year’s drought
  • U.S.
    weather was mostly dry and mild to warm Monday; temperatures were well above average in a part of the north-central states and in neighboring areas of Canada
  • U.S.
    storm late this week will impact areas from eastern Texas, eastern Oklahoma, Arkansas and Missouri to Michigan and New York with rain and some snow
    • Heavy
      snow once predicted for the upper Midwest earlier this week was shifted southward to impact areas from Kansas and southern Nebraska to Michigan late this week into the weekend
      • The
        event will likely be changed additionally over the next couple of days, but parts of Iowa to Michigan will get significant snowfall
    • An
      active weather pattern in the Dec 16-22 period will bring another storm to the Midwest, Delta and middle and northern Atlantic Coast States during the middle to latter part of next week followed by one more farther to the east during the Dec. 22-24 period.
    • Temperatures
      over the next seven days will be warmer than usual in much of the nation, but close to normal in the southeastern states
  • Mexico
    precipitation will be quite limited over the coming week except in the northwest Wednesday night and Thursday when a storm system brings moisture to Sonora, Baja California, Sinaloa, northwestern Durango and Chihuahua
    • Rainfall
      of 0.20 to 0.75 inch and local totals to 1.25 inches will result disrupting summer crop harvesting, but benefiting winter crops
      • The
        precipitation event has been diminished relative to that of Monday
    • Southern
      areas will only receive light rainfall from scattered showers and harvesting will advance favorably
  • Portions
    of Central America will continue to receive periodic rainfall over the next couple of weeks, but the intensity and frequency will be low enough to support some farming activity
    • Costa
      Rica will be wettest this workweek

·        
West-central Africa will experience erratic rain through the next ten days favoring crop areas close to the coast

·        
East-central Africa rain will be erratic and light in Ethiopia, Kenya and Uganda while rainfall will be greatest over Tanzania

·        
New Zealand rainfall will be erratically distributed over the next ten days benefiting most areas

    • Much
      of the rain will be lighter than usual
    • Temperatures
      will be a little cooler than usual

Source:
World Weather Inc. and FI

 

Source:
World Weather Inc. and FI

 

SA Week 1 Accum Precipitation (mm) Forecast

 

 

Bloomberg
Ag Calendar

Tuesday,
Dec. 8:

  • Australia’s
    Abares releases quarterly agricultural commodities report
  • French
    agriculture ministry to publish crop estimates
  • UkrAgroConsult
    Black Sea Grain conference
  • BRF
    Day
  • Brazil
    Unica cane crush, sugar production (tentative)
  • National
    Grain & Feed Association Country Elevator Conference, 10am

Wednesday,
Dec. 9:

  • EIA
    U.S. weekly ethanol inventories, production, 10:30am
  • National
    Grain & Feed Association Country Elevator Conference, 10am

Thursday,
Dec. 10:

  • China’s
    agriculture ministry (CASDE) releases monthly report on supply, demand, 10am local
  • Malaysian
    Palm Oil Board releases data on November stockpiles, exports, production, 12:30pm local
  • FranceAgriMer
    monthly crop report
  • Agroinvestor
    Russian agriculture conference
  • Port
    of Rouen data on French grain exports
  • Conab’s
    data on area, output and yield of soybeans and corn in Brazil, 7am
  • National
    Grain & Feed Association Country Elevator Conference, 10am
  • USDA
    weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
  • USDA’s
    monthly World Agricultural Supply and Demand (WASDE) report, 12pm
  • HOLIDAY:
    Thailand

Friday,
Dec. 11:

  • ICE
    Futures Europe weekly commitments of traders report
  • HOLIDAY:
    Thailand

Source:
Bloomberg and FI

 

 

 

 

 

 

 

Bloomberg
Trade Estimates:

 

 

Macros

US
Nonfarm Productivity Q3 F: 4.6% (est 4.9%; prev 4.9%)

US
Unit Labour Costs Q3 F: -6.6% (est -8.9%; prev -8.9%)

Brazil
IBGE Inflation IPCA (M/M) Nov: 0.89% (est 0.78%; prev 0.86%)

Brazil
IBGE Inflation IPCA (Y/Y) Nov: 4.31% (est 4.20%; prev 3.92%)

Eurozone
GDP SA (Q/Q) Q3 F: 12.5% (est 12.6%; prev 12.6%)

Eurozone
GDPA SA (Y/Y) Q3 F: -4.3% (est -4.4%; prev -4.4%)

S.Africa
GDP Annualised (Q/Q) Q3: 66.1% (est 54.4%; prevR -51.7%; prev -51.0%)

S.Africa
GDP (Y/Y) Q3: -6.0% (est -7.5%; prevR -17.5%; prev prev -17.1%)

 

Corn.

 

Corn
Export Developments

  • South
    Korea’s FLC bought 69,000 tons of corn at $235.95/ton c&f for FH June shipment out of the PNW and/or FH May shipment if from SA. 
  • Taiwan’s
    MFIG seeks 65,000 tons of optional origin corn on Wednesday for February/March shipment. 

 

Natural
gas venting and flaring in North Dakota and Texas increased in 2019

https://www.eia.gov/todayinenergy/detail.php?id=46176&src=email#

 

 

Updated
11/30/20

March
corn is
seen
trading in a $4.15 and $4.40 range. 

 

Soybean
complex
.
 

  • Fundamentals
    and outside commodity markets sent the US CBOT soybean complex lower on Tuesday amid improving SA weather aiding supply growth and slowing US demand (bookings).  January soybeans and meal are trading near the lower end of our trading range projections. 
  • Funds
    sold an estimated net 10,000 soybeans, 5,000 soybean meal and sold 6,000 soybean oil.
  • Soybeans,
    meal and soybean oil all traded lower despite robust soybean export inspections posted yesterday.  Global economic concerns likely limited losses in what was called a “profit taking session,”
  • Brazil’s
    Mato Grosso, Goias, Minas Gerais, and Sao Paulo will see rain through Sat. and Argentina’s BA, Cordoba, and southern Santa Fe later this week.  Traders across the globe remain concerned over the rise in Covid-19 cases and economic stimulus uncertainty. 
  • Products
    were lower initially by weakness in offshore vegetable oil markets, but CBOT meal futures sank about an hour after the day session open which added further pressure to the CBOT crush value.  On Tuesday the Malaysian palm oil 3rd month benchmark
    price fell 26 points and cash was down $6.00/ton. 
  • US
    equities were higher, USD higher, and WTI lower. 
  • We
    heard China bought a few Brazilian soybean cargoes on Monday.  China crush margins were weaker on Tuesday.  Today there were inquiring for nearby shipment. 
  • Oil
    World sees China soybean imports between 101 and 102 million tons in calendar year 2020, up from 88.5 million tons year earlier.  We are at 101.5 million tons for the crop-year (not calendar). 

 

Oilseeds
Export Developments

  • Egypt’s
    GASC seeks at least 30,000 tons of soybean oil and 10,000 tons of sunflower oil on Thursday for arrival from Jan. 28 to Feb. 14.  The picked up local soybean oil in their last two tenders between $888 and $988.50/ton.  Last time they secured sunflower oil
    was back in early October. 
  • Iran’s
    GTC seeks about 30,000 tons of sunflower oil. 
  • USDA
    AMS seeks 17,200 tons of bulk crude degummed soybean oil on December 9 for Mozambique. 

 

USDA
Attaché – Pakistan: Oilseeds and Products Update

MY
2020/21 soybean imports are forecast at 2.4 MMT, up from 1.7MMT during 2019/20.

https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Oilseeds%20and%20Products%20Update_Islamabad_Pakistan_12-01-2020

 

 

Updated
12/02/20

January
soybeans are seen in a $11.40‐$12.10 range

January
soybean meal is seen trading in a $375 and $405 range

January
soybean oil is seen in a 36.00-38.50 cent range.

 

Wheat

 

Export
Developments.

  • South
    Korean flour millers bought around 78,000 tons of milling wheat from the United States for shipment between March 1-31, 2021, and about 28,000 tons for shipment between April 1-30, 2021.
  • Jordan
    passed on 120,000 tons of feed barley on Dec 8 for March-May shipment. 
  • Results
    awaited: Qatar seeks 100,000 tons of feed barley on December 8, optional origin. 
  • Japan
    seeks 131,305 tons of milling wheat on December 9. 

  • Jordan
    seeks 120,000 tons of wheat on Dec 9 for April through FH May shipment. 

 

Rice/Other

·        
None

 

Updated
12/7/20

March
Chicago wheat is seen in a $5.60‐$6.20 range (lowered 10 cents)

March
KC wheat is seen in a $5.25‐$5.70 range (lowered 5 & 10)

March
MN wheat is seen in a $5.35‐$5.65 range (down 5 & 10)

 

Terry Reilly

Senior Commodity Analyst – Grain and Oilseeds

Futures International
One Lincoln Center
18 W 140 Butterfield Rd.

Oakbrook Terrace, Il. 60181

W: 312.604.1366

treilly@futures-int.com

ICE IM: 
treilly1

Skype: fi.treilly

 

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