FI Morning Grain Comments 03/17/21

PDF attached

 

Morning.
 

 

Nearby
corn futures are higher again, near a three week high on speculation China will buy more corn.  The CBOT soybean complex is seeing a setback led by soybeans and meal.  US wheat futures are also under pressure on lack of news.  The morning weather sentiment
appears to show improvements for the US and SA.  The US Great Plains will see additional precipitation through Thursday bias eastern, central and southern areas.  Brazil rains will favor the western areas through Sunday, but slow harvesting of soybeans is
expected across Mato Grosso.  Argentina will see rain across SE BA today and NE Cordoba later this week.

 

 

 

 

 

 

 

 

 

 

Weather

 

ac

Bloomberg
Ag Calendar

Wednesday,
March 17:

• EIA
  weekly U.S. ethanol inventories, production
• Brazil’s
  Unica may release cane crush, sugar production data (tentative)

Thursday,
March 18:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• Port
  of Rouen data on French grain exports
• China
  customs to publish trade data, including import numbers for corn, wheat, sugar and pork
• USDA
  total milk production

Friday,
March 19:

• 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
• FranceAgriMer
  weekly update on crop conditions
• U.S.
  cattle on feed

Saturday,
March 20:

• China
  3rd batch of Jan.-Feb. trade data, including country breakdowns for energy and commodities. No timing

Source:
Bloomberg and FI

 

 

 

 

 

Macros

US
Expected To Impose Additional Sanctions On Russia; May Sanction Individuals Close To Putin – CNN

US
Housing Starts Feb 1.421 Mln (est 1.560 Mln; prevR 1.584 Mln; prev 1.580 Mln)

–
US Building Permits Feb 1.682 Mln (est 1.750 Mln; prevR 1.886 Mln; prev 1.881 Mln)

Canadian
CPI (M/M) Feb 0.5% (est 0.7%; prev 0.6%)

–
Canadian CPI (Y/Y) Feb 1.1% (est 1.3%; prev 1.0%)

Canadian
Core CPI – Common (Y/Y) Feb 1.3% (est 1.4%; prev 1.3%)

–
Canadian Core CPI – Median (Y/Y) Feb 2.0% (est 2.0%; prev 2.0%)

–
Canadian Core CPI – Trim (Y/Y) Feb 1.9% (est 2.0%; prev 2.0%)

–
Canadian BoC Core CPI (M/M) Feb 0.3% (prev 0.5%)

–
Canadian BoC Core CPI (Y/Y) Feb 1.2% (prev 1.6%)

 

Corn

• Corn
  futures are
  higher in the nearby contracts and lower in the back months.  Talk of China needing additional corn for 2021 delivery is supportive, but this might be overshadowed by rising US/Russia geopolitical tensions and a higher USD.  WTI was down 59 cents as of around
  7:20 am CT. 
• China
  may have auctioned off corn yesterday from Jilin.  An estimated 32 percent was talked about overnight at an average price of 2,880/yuan per ton ($11.25/bu or $443/ton).  This price is higher than the average China northern cash price we show of $10.78/bu. 
  On December 22, China sold 103,455 tons of corn out of auction at an average price of 2,491 yuan per tons. 
  
• Bloomberg
  in an article overnight cited a senior analyst with a Chinese futures firm, estimating China could import 40 million tons of corn this year, up from 11 million in 2020. 
  
• Renewable
  fuel (D6) credits for 2021 traded at $1.43 each on Monday, highest since at least 2013, according to Refinitiv. Biomass-based (D4) credits traded at $1.50 each, highest since at least 2014. They were both slightly lower on Tuesday. (Reuters)
• A
  Bloomberg poll looks for weekly US ethanol production to be up 8,000 barrels (930-960 range) from the previous week and stocks up to 86,000 barrels to 22.156 million.
  

 

Export
developments.

• Taiwan’s
  MFIG bought about 65,000 tons of corn, optional origin (likely Argentina) for May 27-June 15 shipment
  at
  an estimated premium of 264.12 cents a bushel c&f over the Chicago September contract.
  

 

 

Soybeans

• CBOT
  soybean complex is lower on improving SA weather and risk off following weakness in energy markets and higher USD.  China and the US meet this week in Alaska and some think this could generate Chinese buying of US agriculture products. 
  
• The
  SA weather forecast for the second week of the outlook is wetter. 
• Rotterdam
  vegetable oil prices were unchanged to 5 euros higher and meal mostly unchanged to 3 euros lower. 
  
• Offshore
  values are leading CBOT SBO 30 points lower and meal $1.00 short ton higher.
  
• China
  cash crush margins on our analysis were 184 cents, (182 previous) up from 178 cents late last week and compares to 168 cents year earlier. 
  

China
futures:

• Malaysian
  palm oil futures basis the June contract rose for the 11th consecutive day.  May was lower yesterday.  Malaysia kept its April export tax for crude palm oil at 8%, and at current values, is profitable for India to import the vegetable oil.  The Southern Peninsula
  Palm Oil Millers’ Association forecast a large increase in March 1-15 production in Malaysia while Indonesia’s output is also expected to rise, a Kuala Lumpur-based trader said.
• Indonesia
  Palm Oil Association (GAPKI) reported January palm exports was up about 20% from the previous year to 2.86 million tons but down 18% from the previous month from slowing demand from China.

Malaysian
palm oil:

• Brazil’s
  Abiove sees 2021 soybean exports at a record 84 million tons and production at 134.8 million tons. 
  

 

Export
Developments

• Iran
  seeks 30,000 tons of sunflower oil and 30,000 tons of soybean oil on March 18 for March and April shipment. 
  

 

Wheat

• US
  wheat futures are lower on technical selling and easing Black Sea cash prices earlier this week after Russia said they might be open to stepping back on export restrictions.  Lack of offers by major importers pressure Black Sea wheat cash prices by up to $10/ton
  from late last week. 
• US
  weather looks good for the wheat emerging from dormancy and we look for improved crop conditions in coming weeks. 
  
• EU
  May milling wheat is trying to snap a 6 straight down trend by trading 0.25 higher at 222.25 euros as of 7:15 am CT. 
  

 

Export
Developments.

• Tunisia’s
  state grains agency seeks 42,000 tons of optional origin durum wheat, 117,000 tons of soft wheat and 75,000 tons of animal feed barley on March 18. The durum is sought in one consignment of 25,000 tons and one of 17,000 tons for shipment between April 15 and
  May 5. The soft wheat is sought in four 25,000 ton consignments and one of 17,000 tons for shipment between April 10 and May 25.  The barley is sought in three 25,000 ton consignments for shipment between April 15 and May 25. (Reuters)
• Algeria’s
  ONAB seeks 40,000 tons of animal feed barley on March 18 for April 15-30 shipment.
• Jordan
  is back in for feed barley on March 23. Possible shipment combinations are Oct. 1-15, Oct. 16-31, Nov. 1-15 and Nov. 16-30. 
  

• Japan
  seeks 135,603 tons of food wheat from the US, Canada and Australia. 

• Awaited:
  Pakistan seeks 300,000 tons of wheat for April-August shipment and lowest offer was $285.97/ton c&f for August shipment.  April was thought to be $323.97/ton. 
  

 

Rice/Other

·        
(new 3/16) Syria seeks 39,400 tons of white rice on April 19.  Origin and type might be White Chinese rice or Egyptian short grain rice.

·        
Bangladesh seeks 50,000 tons of rice on March 18.

·        
South Korea’s Agro-Fisheries & Food Trade Corp. seeks 208,217 tons of rice, on March 25 for arrival in South Korea in 2021 between May 1 and Oct. 31.  64,444 tons of non-glutinous brown rice is sought from the United States. 
Rest from Thailand, China, Australia and Vietnam.

·        
Bangladesh also seeks 50,000 tons of rice on March 28.

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