FI Morning Grain Comments 03/09/22

PDF attached

 

Good
morning.

 

Private
exporters reported the following activity:

-100,000
metric tons of corn for delivery to Colombia during the 2021/2022 marketing year

-20,000
metric tons of soybean oil for delivery to unknown destinations during the 2021/2022 marketing year

 

Day
14.  USD was down 69 points and WTI off $6.60 at the time this was written. US equities are higher. The US is looking into opening up new markets to import crude oil.  Wheat is lower but losses limited from higher EU wheat and lower USD. Corn is lower. Soybeans
extended gains on tight global supplies. Palm futures hit a record overnight.

 

 

 

 

 

Weather

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR MARCH 9, 2022

• An
  impressive amount of rain will fall next week in Spain, Portugal, southern France, Morocco and parts of Algeria while many other areas in Europe experience limited precipitation.
  
• The
  moisture will be a boon to wheat and barley development that had been threatened by a dry winter.
  
• Corn,
  citrus and a host of other fruits and vegetable crops will benefit from the moisture.
  
• Rain
  is also still advertised from the Middle East through cotton areas of Uzbekistan, Kazakhstan, Tajikistan and Kyrgyzstan into the mountains of western Xinjiang, China during the next two weeks.
  
• This
  moisture will be great for future cotton planting and for irrigation of many crops, including cotton. 
  
• U.S.
  hard red winter wheat areas will receive snow and some rain later today into Friday morning with some welcome moisture for a part of the production region.
  
• Some
  livestock stress and travel delay is expected, but the snow will protect wheat from bitter cold temperatures Friday and Saturday. 
  
• Frost
  and freezes are also expected in the southeastern United States this weekend bringing freezes back to northern Florida, as well as the Carolinas, Georgia and Alabama. 
  
• Fruit
  and vegetables will be most negatively impacted. 
• West
  Texas will see limited rainfall for a while as will be the case in California and across the northwestern U.S. Plains. 
  
• Southern
  Argentina will be dry for ten days, but good subsoil moisture will carry crops favorably.
  
• Rain
  and sunshine elsewhere in Brazil and Argentina will be good for developing crops, but may delay fieldwork.
  
• Bitter
  cold in Russia should not harm winter crops because of sufficient snow cover. 
  
• China
  will remain very warm for a while and rain is expected next week in many areas. 

Source:
World Weather Inc.

 

Bloomberg
Ag Calendar

Wednesday,
March 9:

• USDA’s
  monthly World Agricultural Supply and Demand (WASDE) report, 12pm
• China’s
  agriculture ministry (CASDE) releases monthly report on supply and demand for corn and soybeans
• U.S.
  National Coffee Association Virtual Convention, day 2
• FranceAgriMer
  monthly French grains outlook
• EIA
  weekly U.S. ethanol inventories, production, 11am
• Bursa
  Malaysia Palm Oil Conference, day 3
• HOLIDAY:
  South Korea

Thursday,
March 10:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• Malaysian
  Palm Oil Board’s monthly data for output, exports and stockpiles
• U.S.
  National Coffee Association Virtual Convention, day 3
• Malaysia’s
  March 1-10 palm oil export data
• Brazil’s
  Unica may release cane crush and sugar output data (tentative)

Friday,
March 11:

• ICE
  Futures Europe weekly commitments of traders report, ~1:30pm
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• FranceAgriMer
  weekly update on crop conditions
• New
  Zealand Food Prices

Source:
Bloomberg and FI

 

 

 

 

 

 

 

 

 

 

 

Macros

 

Corn

·        
CBOT corn futures
are lower following weakness in wheat.

·        
USD was down 63 points and WTI off $4.20 at the time this was written. US equities are higher. The US is looking into opening up new markets to import crude oil.

·        
China in their monthly CASDE report left their soybean and corn balances unchanged from last month.

·        
China looks to buy 38,000 tons of frozen pork for state reserves on March 10.  They bought pork last week, making the March 10 tender second for the crop year. 

·        
A Bloomberg poll looks for weekly US ethanol production to be up 6,000 barrels to 1.003 million (980-1024 range) from the previous week and stocks down 3,000 barrels to 24.930 million.

 

Export
developments.

• Results
  awaited: Iran’s SLAL seeks up to 60,000 tons of feed barley, 60,000 tons of feed corn and 60,000 tons of soymeal for March and April shipment.

 

 

Soybeans

·        
Soybeans extended gains on tight global supplies. Offshore values are leading SBO 168 points higher and meal $0.60 short ton higher. Malaysian palm futures (hit a record) and cash were sharply higher in part on renewed concerns
over Indonesia limiting palm exports after Indonesia’s Trade Minister Muhammad Lufti reaffirmed their stance to keep cooking oils affordable. Indonesian companies must sell 30% of planned exports at home for 6 months.

·        
Strong Brazil premiums continue to support CBOT products.

·        
China in their monthly CASDE report left their soybean and corn balances unchanged from last month. China lowered its 2021-22 edible oil import estimate to 8.53 million tons from 9.3 million. 

·        
May Malaysian palm oil settled 658 ringgit higher to 7,074 ringgit. Cash palm was up $175/ton to $1,660/ton.

·        
From this time yesterday morning Rotterdam meal was 18-23 euros higher and vegetable oils 5-50 euros higher.

·        
China May soybeans were up 1.2%, meal up 2.7%, soybean oil up 1.7% and palm 3.1% higher.

·        
Offshore values are leading SBO 168 points higher and meal $0.60 short ton higher.

 

 

Export
Developments

• Results
  awaited: Iran’s state purchasing agency GTC has issued an international tender to purchase about 30,000 tons of soyoil for March and April shipment.
  
• Results
  awaited: Iran’s SLAL seeks up to 60,000 tons of soymeal for March and April shipment.
• Private
  exporters reported the following activity:  20,000 metric tons of soybean oil for delivery to unknown destinations during the 2021/2022 marketing year

 

Wheat

·        
In a risk off trade ahead of the USDA report, US wheat futures losses are limited from a sharply higher EU wheat trade and lower USD. Earlier Chicago was down limit (10^th straight session they made such a move during
the session). 

·        
Black Sea concerns remain in place for grains after Russia announced export bans through the end of the year but the trade remains unclear if that will include agriculture products.

·        
Ukraine’s government announced they banned exports of rye, barley, buckwheat, millet, sugar, salt, and meat until the end of this year.

·        
While Ukrainian ports remain shut, Ukraine did announce yesterday they plan to issue grain export licenses. Ukraine is sitting on about 17 million tons of exportable grain supplies (43MMT/60MMT shipped through Feb 23). 

·        
Russia may ban exports of certain raw material and products until the end of the year.  Unsure if they will include agriculture products. 

·        
May Paris wheat futures were up 15.25 euros at 385.25 euros.

·        
(Reuters) Farm office FranceAgriMer on Wednesday increased sharply its forecast of French soft wheat exports outside the European Union in the 2021/22 season to 9.7 million tons from 8.9 million estimated in February.  In a monthly
supply and demand outlook for major cereal crops, the office reduced its projection of French soft wheat stocks by the end of the 2021/22 season next June to 3.0 million tons from 3.6 million estimated last month.

·        
Bulgaria plans to buy 1.1 million tons of local wheat to increase reserves. 

·        
Iraq’s strategic wheat reserves sufficient until April 2022. Iraq seeks two million tons of wheat to provide a strategic reserve.

·        
Saudi Arabia’s state grains buyer SAGO has approved a raise in the local wheat procurement price to 1,700 riyals ($453.14) per ton for the current season.

·        
Poor growing conditions in China and US Great Plains should be monitored this spring.

·        
US HRW wheat precipitation fell well below average and one weather forecaster mentioned it was 3^rd driest on record, behind 2006 and 1904.

 

Export
Developments.

·        
Iran saw offers for 60,000 tons of milling wheat with United States included as a possible origin for rapid shipment in March and April.

·        
Jordan cancelled their 120,000 ton wheat import tender. Shipment is between LH May and LH July.

·        
Japan’s AgMin in a SBS import tender on March 16 seeks 80,000 tons of feed wheat and 100,000 tons of feed barley for arrival by Aug. 25. 

·        
Results awaited: Algeria seeks 50,000 tons of soft milling wheat, optional origin, on March 8, opening until the 9^th, for May shipment. 

·        
Taiwan seeks 50,000 tons of US PNW milling wheat on March 11 for April 23-May 7 shipment. 

·        
Jordan’s state grains buyer seeks 120,000 tons of feed barley on March 15.  Shipment is between July 16-31, Aug. 1-15, Aug. 16-31 and Sept. 1-15.

·        
Bangladesh seeks 50,000 tons of milling wheat on March 16 for shipment within 40 days of contract signing. 

 

Rice/Other

·        
(Bloomberg) — U.S. 2021-22 cotton ending stocks seen at 3.37m bales, 127,000 bales below USDA’s previous est., according to the avg in a Bloomberg survey of seven analysts.

               
-Estimates range from 3.1m to 3.65m bales

               
-Global ending stocks seen unchanged at 84.31m bales