FI Morning Grain Comments 03/03/21

PDF attached

 

Morning.

 

There
is talk today the movements in SA currencies are starting to influence CBOT agriculture futures.  The Brazil real is weaker today and like yesterday chatter of a pickup in producer selling in producer (Brazil) could emerge.  Soybeans, corn and wheat futures
are lower not only on this talk, but lower outside markets aside from higher WTI crude.  Note the USD is higher, and equities are choppy.  The weather situation remains largely unchanged.  Algeria seeks 30,000 tons of corn.  Results are awaited on Algeria
seeking 50,000 tons durum wheat and Iran’s SLAL seeking up to 400,000 tons of animal feed barley.  Jordan passed on wheat.  Japan bought food wheat.  The USDA Attaché pegged the Argentina soybean crop at 47.5 million tons. 

 

 

 

Weather

 

 

 

World
Weather Inc.

WEATHER
THAT MATTERS MOST TODAY

• U.S.
  hard red winter wheat areas are still expecting rain Thursday into Friday with areas from eastern Colorado through central Kansas to north-central Oklahoma wettest
• Rainfall
  of 0.20 to 0.80 inch will be common with a few totals to 1.25 inches or more possible in a part of western and south-central Kansas and north-central Oklahoma
• 06z
  GFS model run today was too wet in hard red winter wheat areas for late next week and again March 14-16
• Both
  of these storm systems were too intense on the latest model run
• However,
  there will be opportunities for some precipitation in the region during each period
• The
  southwestern high Plains region will receive only light and somewhat sporadic precipitation while the greater amounts of moisture is possible in northern and eastern crop areas
• U.S.
  central Plains wheat will benefit from the next ten days of moisture and sunshine, but there will still be need for more precipitation especially in the southwest where rainfall will likely be lightest
• Moisture
  and mild temperatures is needed to induce new tillering and to stimulate some crop recovery and improvement in production potentials after dryness last autumn and the bitter cold event of February
• U.S.
  northern Plains and extreme southeastern parts of Canada’s Prairies will have a good opportunity for some needed moisture Monday night into Wednesday morning
• Moisture
  totals will vary from 0.10 to 0.50 inch with a few amounts to nearly 1.00 inch possible
• Minnesota
  and far southeastern Manitoba will be wettest
• The
  precipitation will be most welcome in drought-stricken areas of the northwestern Plains and southern Canada’s Prairies, but much more precipitation will be needed to make a more serious dent in the drought
• Temperatures
  will be unusually warm in these areas through the weekend
• Argentina’s
  rainfall outlook is not very good and many areas in the nation will experience net drying over the coming week, despite some periodic showers of varying significance
• Most
  of the precipitation will not counter evaporation for a while
• World
  Weather, Inc. sees some changes in the upper air wind pattern evolving in the second week of the forecast that may help to bring a little better opportunity for rain periodically
• But,
  confidence is still low on how much relief might occur
• Crop
  stress will remain a serious concern for many summer crops in Argentina until a generalized soaking rain evolves
• Temperatures
  will continue too warm to hot to allow scattered showers of light intensity to change the drying trend during this next seven days
  
• Some
  cooling is expected next week, but temperatures will remain above average
• Brazil’s
  weather has not changed overnight and for the next two weeks most of the nation will be impacted by alternating periods of rain and sunshine
• The
  moisture will be mostly near normal except in the northeast where drier than usual conditions are expected
• A
  few locations in southern Rio Grande do Sul may also receive a more limited amount of rain
• Field
  progress advanced favorably in some areas last week with 25% of the soybean harvest complete compared to 40% a year earlier
• That
  was an advancement of 10% over the previous week
• Mato
  Grosso had 52% of its soybeans harvested compared to 84% done last year
• Greater
  rain frequency in this current week will slow field progress again
• Flooding
  continues, although is beginning to ease today in Kentucky and neighboring areas of Tennessee and West Virginia following excessive rainfall during the weekend
• The
  region will not see much additional precipitation through the early part of next week resulting in improving conditions
• Much
  of the U.S. Midwest will be dry into early next week and what little moisture occurs in the north is not likely to create a problem as the region’s snow cover continues to melt
• Rain
  in the southeastern U.S. Tuesday was greatest from southeastern Mississippi to southern Georgia and far northern Florida where 0.60 to 2.20 inches resulted through midnight CST
  
• U.S.
  southeastern states will see less frequent and less significant rain in the coming week resulting in needed drying and some spring planting
• U.S.
  weather will become more active next week with three waves of precipitation to move across the Midwest that will also impact “parts” of the Great Plains, northern Delta and northern portions of the southeastern states
• One
  storm will occur during the early to middle part of next week
• Another
  system is expected in the following weekend
• A
  third storm will impact these areas March 14-17
• Sufficient
  amounts of moisture will occur to have the ground saturated during much of the period and there may be local areas of flooding
• Unseasonably
  warm temperatures in the central U.S. will send temperatures into the 50s and 60s Fahrenheit later this week as far north as Montana, southwestern North Dakota and South Dakota
• Normal
  highs in the northern Plains should be in the 30s and 40s followed by lows in the teens and 20s
• The
  warm up in the northern Plains should set the stage for some needed moisture to fall when colder weather returns next week
• Drought
  remains a serious concern across the Dakotas, eastern Montana and areas north into the Canada Prairies
• Temperatures
  in the 50s and lower 60s might also reach into southern Saskatchewan and southern Alberta, Canada
  
• Unusual
  warmth in the central Plains and light precipitation may also stimulate some new wheat development soon
• Soil
  temperatures are already rising and some greening has begun in the southern Plains
• Southern
  U.S. spring planting is getting off to a slow start in southern Texas due to dryness in unirrigated areas, but it has begun
• Slow
  planting has also occurred near the central Gulf of Mexico coast from Louisiana to northern Florida and Georgia because of wet fields, but some fieldwork has likely evolved recently
  
• Some
  wet field and rain delay is expected in the lower Delta and southeastern states for a little while this week, but conditions will soon improve for planting
• Canada’s
  central and southwestern Prairies will remain drier than usual through the next ten days
  
• Precipitation
  elsewhere is expected to be infrequent and light limiting the potential for increasing soil moisture
• Temperatures
  will be near to above average
• Southeast
  Canada will experience a seasonable mix of precipitation and sunshine with temperatures a little cooler than usual
• North
  Africa rainfall will improve this week with many areas from northern Morocco through northern Tunisia getting rain at one time or another lifting topsoil moisture for future crop development
• Showers
  Tuesday were erratic and light and mostly confined to northeastern Morocco
• Winter
  crops are semi-dormant, but expected to resume development soon
• Ivory
  Coast, Ghana, Benin and southern Nigeria will experience a boost in rainfall for a while late this week into next week favoring coffee and cocoa flowering
  
• East-central
  Africa rainfall will continue greatest in Tanzania this week and probably next week, as well
• A
  more erratic and light precipitation pattern is expected elsewhere with net drying in Ethiopia, northern Uganda and in a few southwestern Kenya locations
• South
  Africa will experience an erratic rainfall pattern through the next two weeks with temperatures mostly in a seasonable range with a slight warmer bias in the west
• Showers
  will be greatest in Natal and Eastern Cape
• Net
  drying will occur in many other areas
• Summer
  crop conditions will remain favorably rated, although there will be a growing need for showers by mid-March
• India
  was mostly dry Tuesday
• Very
  little rainfall is expected over the next week to ten days and temperatures will be seasonably warm
• Showers
  will occur in the far north, extreme south and far east
• Some
  mild crop stress is expected resulting in some minor yield loss
• Rain
  is needed to support the best potential yields before filling ends this month
• China
  reported most dry conditions Tuesday, although a few showers occurred in the Yangtze River Basin
  
• Temperatures
  were seasonable
• China
  weather over the coming week will include seaacsonably warm temperatures  and near to above average precipitation in the south
• The
  greatest precipitation relative to normal will be in the Yangtze River Basin and areas to the south
• Rainfall
  near and south of the Yangtze River will vary from 1.00 to more than 5.00 inches except in the coastal provinces where amounts will be less than 1.00 inch
• Local
  flooding is possible
• Yunnan
  will remain dry and produces 3% of the corn crop and quite a bit of rice and sugarcane
• Australia
  precipitation Tuesday was minimal except in Western Australia where winter crop areas received another 0.10 to 1.77 inches of rain with local totals over 3.00 inches;
  
• The
  moisture improved soil conditions, but no planting is expected prior to late April
• Australia
  weather in the coming week is expected to bring on restricted amounts of precipitation in key sorghum, cotton and other summer crop areas in the east while temperatures are seasonable
• A
  few showers are expected, but resulting rainfall will be erratic and light
• Mexico
  drought conditions are still prevailing, although the impact on winter crops is low due to irrigation
• Water
  supply is low in some areas and a notable improvement in rainfall is needed, but not very likely
• Dryland
  winter crops are stressed and will yield poorly
• Freeze
  damage is common in northern parts of the nation due to a couple of cold surges this winter
• Rain
  in the coming week will be mostly confined to the east coast and temperatures will be seasonable with a slight warmer bias in the driest areas
• Central
  America precipitation will continue greatest along the Caribbean Coast and in Guatemala while the Pacific Coast is relatively dry
• Southeast
  Asia rainfall will occur relatively normally over the next two weeks
• Mainland
  areas will experience few showers periodically in the next week to ten days
• The
  resulting rainfall will be sporadic and light with net drying probably continuing in many areas for a while longer
• Philippines
  rainfall will be scattered and mostly light to moderate until late next week when a boost in precipitation is expected
• Indonesia
  and Malaysia weather during the next two weeks will bring rain to most crop areas maintaining a very good outlook for crop development
• A
  boost in precipitation is expected and will be welcome
• Sumatra,
  Peninsular Malaysia and western parts of Borneo have been drying out recently and greater rain is needed especially in Peninsular Malaysia
• New
  Zealand weather over the next ten days will include a mix of sunshine and rain while temperatures are a little cooler than usual
  
• Southern
  Oscillation Index has been falling and was at +9.71 this morning. The index is expected to continue to fall notably over the next several days
• Warming
  in Europe and the western CIS has been melting some snow
• Snow-free
  conditions are present today in Russia’s Southern Region, much of Ukraine and in many areas across Europe to the west of Ukraine and eastern Poland
  
• There
  is no threatening cold in any winter crop region for the next ten days
• Europe
  weather will be tranquil over the coming week with only brief periods of light precipitation and temperatures close to normal
• A
  boost in precipitation is expected March 11-17
• Western
  CIS temperatures will be seasonable with a slight warmer bias this week in the south and while a little cooler than usual in the north
• Precipitation
  will remain periodic keeping the region plenty moist in snow free areas and some significant runoff is expected in areas warm enough for melting snow
  
• Cooling
  next week will bring some threatening cold air into the western CIS, but snow cover will adequately protect most crops

Source:
World Weather Inc. and FI

 

Bloomberg
Ag Calendar

Wednesday,
March 3:

• EIA
  weekly U.S. ethanol inventories, production
• ANZ
  Commodity Price
• Brazil’s
  Unica to release sugar production, cane crush data

Thursday,
March 4:

• FAO
  World Food Price Index, grains supply and demand reports
• USDA
  weekly crop net‐export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• Port
  of Rouen data on French grain exports
• U.S.
  National Coffee Association hosts annual convention (virtual), March 4‐5

Friday,
March 5:

• ICE
  Futures Europe weekly commitments of traders report (6:30pm London)
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• Malaysia’s
  March 1‐5 palm oil export data
• FranceAgriMer
  weekly update on crop conditions
• China’s
  CNGOIC to publish supply and demand reports on commodities such as corn and soybeans

Source:
Bloomberg and FI

 

 

 

 

Macros

Canada
Building Permits (M/M): 8.2% (est 2.5%, prev -4.1%)

 

 

Corn

• Corn
  futures are sharply lower in part to investors taking longs off the table on uncertainty over a short term decline in commodity prices and unstable South American and US currencies.  The US treasury market should be monitored with recent fluctuation in prices
  as well. 
• WTI
  crude oil is higher and could influence the agriculture markets, limiting downside movement. 
  

 

Export
developments.

Algeria
seeks 30,000 tons of corn, optional origin, on March 4, for shipment by April 15.

 

 

Soybeans

• The
  soybean complex is mostly lower on widespread commodity selling with exception to energy markets.  News is light. 
  
• The
  USD is higher, in part to fluctuating global currencies.  Some investors are rushing back into bitcoin today and gold was down more than $20. 
  
• Offshore
  values are indicating a lower value for SBO and higher trade for SBM CBOT futures. 
  
• China
  cash crush on our analysis was weaker. 

China
futures:

Malaysian
palm oil:

 

Export
Developments

None
reported

 

Wheat

• Wheat
  futures
  are lower despite the flurry of global import tenders that emerged earlier this week after a setback in CBOT prices. 
  
• Algeria
  is in for (corn and) wheat so that could turn around the market if they take a large amount of wheat at a high global price. 
  
• EU
  May milling wheat was down 0.50 euros at 231.50euros.

 

Export
Developments.

• Jordan
  passed on 120,000 tons of wheat. 
• Results
  awaited: Algeria seeks 50,000 tons durum wheat, valid until March 4, for shipment between April 1-15 and April 16-30. 
  
• Results
  awaited: Iran’s SLAL seeks up to 400,000 tons of animal feed barley on Wednesday, March 3, for shipment between March 10 and April 10.
• Japan
  bought 82,937 tons of milling wheat from the United States and Canada for April 21‐May 3 shipment.  Original details as follows:

• The
  Philippines seeks 145,000 tons of milling wheat on March 4 for April and June shipment. 
  
• Taiwan
  seeks 100,410 tons of wheat form the US on March 4 for April 25-May 9 shipment, and May 12-May 26 shipment (2 consignments). 
  

 

Rice/Other

·        
South Korea’s Agro-Fisheries & Food Trade Corp. seeks 38,889 tons of rice from the United States and China, part arrival in South Korea around Sept. 30 from the US. Another 16,667 tons of non-glutinous short grain brown rice from
China is sought for arrival around June 30.

·        
Syria seeks 25,000 tons of white rice on March 29, from China or Egypt.