FI Morning Grain Comments 01/29/21

PDF attached

 

Morning.
End of month but positive news can curb selling. 

 

EXPORTERS
SELL 132,000 METRIC TONS OF SOYBEANS FOR DELIVERY TO CHINA DURING 2021/2022 MARKETING YEAR- USDA

EXPORTERS
SELL 2,108,000 METRIC TONS OF CORN FOR DELIVERY TO CHINA DURING THE 2020/2021 MARKETING YEAR -USDA

 

China
overtakes Mexico as top US corn buyer. 
We are seeing gains in soybeans, corn and wheat this morning on the same news…China demand and harvest delays in Brazil.  The USD is slightly lower.  Soybean meal is seeing pressure on light product spreading after palm oil futures climbed more than 100 points
after a one day holiday.  The SA weather is mostly unchanged.  Argentina weather looks good over the next week.  Taiwan bought 85,340 tons of wheat.  South Korea’s MFG bought 60,000 tons of soybean meal. 

 

Weather

 

 

Source:
World Weather Inc. and FI

 

Bloomberg
Ag Calendar

Friday,
Jan. 29:

• 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
• U.S.
  agricultural prices paid, received
• U.S.
  cattle inventory

Sunday,
Jan. 31:

• Malaysia
  Jan 1-31 palm oil export data from Intertek

Monday,
Feb 1:

• USDA
  weekly corn, soybean, wheat export inspections, 11am
• EU
  weekly grain, oilseed import and export data
• Malaysia
  Jan 1-31 palm oil export data from AmSpec (tentative)
• China
  starts trading peanut futures on Zhengzhou Commodity Exchange
• U.S.
  DDGS production, soybean crush, 3pm
• Australia
  Commodity Index
• Ivory
  Coast cocoa arrivals
• HOLIDAY:
  Malaysia

Tuesday,
Feb 2:

• U.S.
  Purdue Agriculture Sentiment
• New
  Zealand global dairy trade auction
• U.S.
  corn for ethanol, 3pm

Wednesday,
Feb 3:

• EIA
  weekly U.S. ethanol inventories, production, 10:30am
• New
  Zealand Commodity Price

Thursday,
Feb 4:

• FAO
  World Food Price Index; cereals supply/demand brief
• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• Port
  of Rouen data on French grain exports

Friday,
Feb 5:

• 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
• China’s
  CNGOIC to publish soybean and corn reports
• Statcan
  reports on wheat, soy, durum, canola and barley stockpiles in Canada

Source:
Bloomberg and FI

 

 

 

 

Macros

Canada
Q4 GDP Up c.1.9% Vs. Q3 – StatsCan Flash Estimate

2020
GDP Down 5.1% Versus 2019

 

US
Employment Cost Index Q4: 0.7% (est 0.5%; prev 0.5%)

US
Personal Income Dec: 0.6% (est 0.1%; prev -1.1%)

US
Personal Spending Dec: -0.2% (est -0.4%; prev -0.4%)

US
Real Personal Spending Dec: -0.6% (est -0.6%; prev -0.4%)

US
Core PCE Deflator (M/M) Dec: 0.3% (est 0.1%; prev 0.0%)

US
Core PCE Deflator (Y/Y) Dec: 1.5% (est 1.3%; prev 1.4%)

US
PCE Deflator (M/M) Dec: -0.4% (est 0.3%; prev 0.0%)

US
PCE Deflator (Y/Y) Dec: 1.3% (est 1.2%; prev 1.1%)

 

 

 

Corn.

• March
  corn is higher but failed to see a fresh absolute high overnight.  5.5050 is the contract high and we could see that taken out if China continues to book US corn. 
  
• The
  USD is slightly lower, WTI up 45 cents, gold higher and US stocks lower. 
    
• Ukraine
  grain exports are running 20% lower since the start of the marketing year to 28.7 million tons. Traders sold 12.99 million tons of wheat, 10.37 million tons of corn and 3.9 million tons of barley.  The government has said exports could decline to 45.4 million
  tons in 2020/21 because of a weaker harvest. (Reuters)

 

Corn
Export Developments

·        
WASHINGTON, January 29, 2021–Private exporters reported to the U.S. Department of Agriculture the follow activity:

–Export
sales of 2,108,000 metric tons of corn for delivery to China during the 2020/2021 marketing year

 

 

 

 

Soybean
complex.  

• CBOT
  soybeans
  are higher in part to strength in soybean oil but lower meal maybe capping gains.  Corn appears to be the leader amount the CBOT ag futures.  Malaysian palm was up more than 100 points overnight after coming back from a one day holiday and cash palm was up
  $25/ton.  Argentina will see good weather over the next week.  Northeastern Brazil will continue to see dry conditions.   
  
• Offshore
  values are leading the CBOT products higher. 
• Malaysian
  palm oil futures:  back from one day holiday

• China
  cash crush margins were 171 cents on our calculation, (163 previous) compared to 190 at the end of last week and to 84 year ago.
  
• China

 

Oilseeds
Export Developments

·        
South Korea’s MFG bought about 60,000 tons of soybean meal at $501.95/ton c&f for arrival around Aug. 

·        
WASHINGTON, January 29, 2021–Private exporters reported to the U.S. Department of Agriculture the follow activity:

–Export
sales of 132,000 metric tons of soybeans for delivery to China during the 2021/2022 marketing year.

 

 

 

Wheat

• US
  wheat futures are higher on technical buying following higher corn and soybeans.  US wheat might be the next headliner if China decides to stockpile the commodity.     
  
• EU
  March milling wheat was down 1.75 at 228 euros.
• SovEcon
  raised its forecast for Russia’s 2020-21 wheat exports by 1.6 million tons to 37.9 million tons.  This could be in part to a last min attempt to get wheat out before higher taxes kick in.  They said Russia’s January wheat exports may reach 3.3 million tons,
  up 57% year on year.

 

Export
Developments.

• Taiwan
  Flour Millers’ Association bought 85,340 tons of milling wheat to be sourced from the United States.  First consignment for shipment between March 22 and April 5 involved 21,645 tons of U.S. dark northern spring wheat of 14.5% protein content bought at $291.36
  a ton FOB U.S. Pacific Northwest coast.  It involved 13,675 tons of hard red winter wheat of 12.5% protein bought at $291.10 a ton FOB and 7,070 tons of soft white wheat of 9% protein bought at $300.18 a ton FOB. Second consignment for shipment between April
  8 and April 22 involved 23,260 tons of dark northern spring wheat of 14.5% protein content bought at $287.68 a ton FOB U.S. Pacific Northwest coast and included 14,075 tons of hard red winter wheat of 12.5% protein content bought at $291.10 a ton FOB and 5,615
  tons of soft white wheat of 9% protein bought at $290.97 a ton FOB.
• Jordan
  is in for another 120k wheat on Feb 3 and 120k barley on Feb 2. 

 

Rice/Other

·        
Iraq seeks 30,000 tons of rice on Feb 3, valid until Feb 10, optional origin. 

·        
Syria is in for 25,000 tons of rice on February 9.