FI Morning Grain Comments 02/18/21

PDF attached

 

Morning.

 

 

USDA
Agriculture Outlook Forum

USDA
comments/speeches from the annual agriculture outlook forum will trickle out over the next week.  Follow it on Twitter

https://twitter.com/usda_oce

https://twitter.com/hashtag/AgOutlook?src=hashtag_click 

NASS
is due out Friday with their initial 2021-22 US S&D statistical estimates.  Those will be available to everyone early Friday. 
https://www.usda.gov/oce/ag-outlook-forum

 

US
area:

Corn
92

Soybeans
90

Cotton
12 (that is higher than National Cotton Council)

 

Average
$

Corn
$4.20

Soybeans
$11.25

Wheat
$5.50

Cattle
115.00

Hogs
50.50

 

Chief
Economist Seth Meyer: drought impacted the size of the crop this year, but events such as the Derecho had a significant impact

Chief
Economist Seth Meyer: China imports have been very corn focused

Chief
Economist Seth Meyer: if one assumes we have normal planting weather, we would have an increase in total planted acres. But that’s entirely dependent on the weather

USDA
SEES FISCAL 2021 U.S. FARM EXPORTS AT $157 BLN

USDA
SEES U.S. FARM EXPORTS TO CHINA AT $31.5 BLN IN FY 2021

 

 

 

 

 

 

 

With
China back from holiday some traders will be looking for import tenders to resume.  Futures in China for meal were up 0.1% and soybean oil jumped 2.8% while soybeans were up 0.5%.  Malaysia will keep its crude palm oil export tax unchanged at 8%.  Palm futures
declined a large 143 points and cash fell $27.50/ton.  Offshore values are leading soybean oil 6 points higher and soybean meal $0.30 higher.  Turkey saw offers for at least 25,000 tons of sunflower oil on Feb 18 for shipment between Feb. 26 and March 20.
Lowest offer for crude sunflower oil was $1,394 per ton c&f.  Egypt saw offers at least for at least 10,000 tons of sunflower oil for April 1-15 arrival.  They are also in for 30,000 tons of soybean oil.  Lowest offers for soybean oil was $1,084/ton c&f for
soybean oil and $1,419/ton c&f for sunflower oil. South Korea’s MFG bought 55k optional origin feed wheat.  Pakistan is in for wheat and Japan bought wheat.  Tunisia seeks milling wheat, durum and barley on Thursday.  A Bloomberg poll looks for weekly US ethanol
production to be down 17,000 barrels (875-942 range) from the previous week and stocks up to 48,000 barrels to 23.844 million.

 

 

Weather

 

 

 

 

Source:
World Weather Inc. and FI

 

Bloomberg
Ag Calendar

Thursday,
Feb 18:

• EIA
  weekly U.S. ethanol inventories, production
• USDA
  Net Export Sales, 8:30am
• USDA
  Corn, Cotton, Soybean, Wheat Acreage Outlook, 8:30am
• Sime
  Darby Plantation earnings
• Port
  of Rouen data on French grain exports

Friday,
Feb 19:

• 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
• FranceAgiMer
  crop conditions report
• USDA
  Corn, Cotton Soybean, Wheat End Stock Outlook, 7am
• U.S.
  Cattle on Feed, 3pm

Source:
Bloomberg and FI

 

 

 

 

 

Macros

US
Initial Jobless Claims Feb 13 861K (est 765K; prevR 848K; prev 793K)

–
US Continuing Claims Feb 6 4.494 Mln (est 4.413 Mln; prevR 4.558 Mln; prev 4.545 Mln)

US
Housing Starts Jan 1.580 Mln (est 1.658 Mln; prevR 1.680 Mln; prev 1.669 Mln)

–
US Building Permits Jan 1.881 Mln (est 1.678 Mln; prevR 1.704 Mln; prev 1.709 Mln)

US
Import Price Index (M/M) Jan 1.4% (est 1.0%; prev 0.9%)

–
US Import Price Index Ex. Petroleum (M/M) Jan 0.9% (est 0.4%; prev 0.4%)

–
US Import Price Index (Y/Y) Jan 0.9% (est 0.4%; prev -0.3%)

–
US Export Price Index (M/M) Jan 2.5% (est 0.8%; prev 1.1%)

–
US Export Price Index (Y/Y) Jan 2.3% ( prev 0.2%)

Canada
ADP Employment Change Jan -231.2K (prevR 338.0K; prev -28.8K)

 

 

Corn.

• Corn
  futures are lower in part to weakness in soybeans, but a lower USD and higher WTI market might be limiting losses.  Two-sided trade could occur after USDA reported a less than expected 92 million area US corn planting outlook for 2021 (92.9 Reuters guess). 
  News is light.  Some traders are waiting out to see what the extent of the damage had from the recent US cold temperatures and heavy snow prompting reports of forces majeures for exports.  We are hearing logistic problems started easing yesterday.  Texas ranchers,
  home to about 13 million cattle, are still working around the clock to save animals from the cold weather and lack of fresh water.
  
• March
  support over the short term is seen at $5.47. 
• The
  USDA Broiler Report showed eggs set in the United States down 1 percent and chicks placed down 2 percent.  Cumulative placements from the week ending January 9, 2021 through February 13, 2021 for the United States were 1.12 billion. Cumulative placements were
  down 2 percent from the same period a year earlier. 
• Bloomberg 
  – Feb. 1 herd seen rising y/y to 12.038m, seventh straight y/y expansion since June of last year.  January placements seen down 0.2%.
• A
  Bloomberg poll looks for weekly US ethanol production to be down 17,000 barrels (875-942 range) from the previous week and stocks up to 48,000 barrels to 23.844 million.
  

 

Corn
Export Developments

·        
None reported

 

 

Soybean
complex.  

• CBOT
  soybean futures are lower in the front contracts despite Brazil harvest delays. Soybean meal is lower.  Soybean oil turning higher on spreading. 
  
• Brazil
  is seeing one of the largest shipping line-ups in history.  MD Commodities said Brazil is now seen shipping 3.2 million tons of soybeans this month, down from a previous forecast of 6.5 million tons. 
  
• Net
  drying will continue across Argentina through next Wednesday. Much of Brazil will see improving conditions, but Mato Grosso and Tocantins through Espirito Santo and northern Rio de Janeiro will see harvest delays from too much rain. 
  
• Earlier
  ICE canola futures are 1.90 higher at 755.50/ton.
• Agriculture
  and Agri-Food Canada sees the 2020-21 Canadian canola ending stocks at 700,000 tons, down 42 percent from their previous estimate of 1.2 million tonos and compares to 3.1 million tons at the end of last year. 
  
• Offshore
  values are leading soybean oil 6 points higher and soybean meal $0.30 higher. 
  
• China
  cash crush margins on our analysis increased to 170 cents from 146 cents mid last week and compare to 159 cents around this time last year. 
  
• China
  is back from holiday

• Malaysia
  will keep its crude palm oil export tax unchanged at 8%. 
• Malaysian
  palm oil:

 

Soybean
Export Developments

• Turkey
  saw offers for at least 25,000 tons of sunflower oil on Feb 18 for shipment between Feb. 26 and March 20. Lowest offer for crude sunflower oil was $1,394 per ton c&f.
• Egypt
  saw offers at least for at least 10,000 tons of sunflower oil for April 1-15 arrival.  They are also in for 30,000 tons of soybean oil. 
  Lowest
  offers for soybean oil was $1,084/ton c&f for soybean oil and $1,419/ton c&f for sunflower oil.
  

 

Wheat

• Wheat
  futures are higher on light technical buying and concerns the US spring and durum wheat areas will end up lower than initial indications based on price relationships.  This is also true for Canada as one analyst noted the spread between canola and spring wheat
  is at its widest level since 2012. 
• US
  current snow overage: 71% (73% previous) versus 32% month ago.  
• EU
  March milling wheat was up 6.25 at 235.00 euros. 

 

Export
Developments.

• South
  Korea’s MFG bought 55,000 tons of animal feed wheat, optional origin, at an estimated $309.38 ton c&f for arrival around July 10. 
  
• Pakistan
  seeks 300,000 tons of wheat on March 2.  They about over 1.6 million tons since August. 
  
• Tunisia’s
  ODC seeks 100,000 tons of milling wheat, 92,000 tons of durum wheat, and 100,000 tons of feed barley on February 19.  Shipment is spread across March 15-April 25, depending on the origin.
  
• Japan
  bought 82,393 tons of food wheat from the US.  Original details as follows:
  

• Results
  awaited: Algeria also seeks 50,000 tons of feed barley for LH March shipment. 
  
• Syria
  seeks 200,000 tons of wheat for shipment within 60 days of contract signing. 
  
• Jordan
  seeks 120,000 tons of barley on February 23.

 

Rice/Other

·        
Mauritius seeks 4,000 tons of long grain white rice, optional origin, on March 2, for delivery between April 15 and June 15.