FI Morning Grain Comments 04/13/22

PDF attached

 

Good
morning.

 

Corn
futures are mixed with nearby lower earlier this morning and back months higher in part to follow through buying after the White House Administration will allow for E15 ethanol blending during the summer driving months, June 1 through September 15. Soybeans
and meal are lower. USD is higher. WTI crude oil was up more than $1.50 by 7:45 am CT. Wheat is mostly lower on lack of direction and slow US export announcements. Lots of information to digest today.

 

 

 

Weather

 

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR APRIL 13, 2022

• Too
  much  cold and wet biased weather is impacting the northern U.S. Plains and  Canada’s Prairies resulting in delays to farming activity
  
• Most
  of the wet bias is in Manitoba and southeastern Saskatchewan for this week
• Cold
  temperatures in the  southwestern Prairies could be viewed as a blessing since it will restrict planting in the driest areas of the  Prairies and that will force producers to delay fieldwork for a little long which should help get their crops closer to the
  drought relief that is expected late this spring and summer
• Limited
  spring planting will  occur from  North Dakota to Manitoba and southeastern Saskatchewan now because of this week’s storm, but fieldwork will advance in May
• U.S.
  lower eastern Midwest, Delta and Tennessee River Basin areas will continue a little wetter than desired, but some spring fieldwork will advance between storms 
  
• field
  progress will be limited, though, due to mild temperatures holding back the best drying rates between storms keeping the ground wetter than desired for a while longer
• West
  Texas cotton areas will  continue to deal with dryness for the next ten days
• South
  Texas dryness is also expected to prevail for much of the next week to ten days
• U.S.
  hard red winter wheat areas are still being advertised to see a larger storm system impact the  region after April 22, but confidence in getting moisture in the  high Plains region remains very low
• U.S.
  southeastern states (Georgia and Florida to the eastern Carolinas) will see below average precipitation for an extended period of time, although recent bouts of rain and cool temperatures have helped promote some fieldwork and early crop development
• Mato
  Grosso to southern Goias Safrinha corn and cotton are still  not advertised to get abundant rainfall and topsoil moisture is already lacking in the region 
  
• Some
  rain will fall briefly in the  region today into Friday, but drying should resume during the weekend and continue most of  next week 
• Crop
  moisture stress will result and the impact could be negative on yields in May if there is not some rain between now and then 
• Far
  southern Brazil’s soil moisture is abundant to excessive and needs to dry down; some of that drying is expected to evolve during the next week to ten days
• Argentina
  weather will be drier biased in the coming week and that should translate into better crop maturation and harvest conditions
  
• cotton
  in the north has been  damaged by excessive rainfall this year and sunny and warm weather is needed to try and reverse some of the damage to fiber quality
• Central
  Europe will experience net drying which will promote fieldwork and some winter crop development
• eastern
  Romania may get some relief from dryness in the second week of the outlook
• Spain,
  Portugal, southern France and areas into northwestern Africa will  experience some  good crop weather in the next two weeks
• Western
  Russia will remain wet and mild to cool keeping spring fieldwork on the “slow to begin list” like portions of the  U.S. and Canada
• China
  weather still looks mostly good and eastern Australia’s summer crops are anticipating a good crop maturation and harvest period over the next week to ten days
• South 
  Africa needs to dry out
• Coffee,
  cocoa, sugarcane, rice and cotton in central Africa will benefit from increasing rain frequency and coverage during the next ten days
• East-central
  Africa coffee areas will experience a good mix of weather in the next ten days with Ethiopia breaking from its dry season
• Indonesia,
  Malaysia and Philippines weather will continue wet biased for a while

Source:
World Weather Inc.

 

USDA
Scheduled Release Dates for Agency Reports and Summaries

https://www.usda.gov/media/agency-reports

 

2022
CME Globex Trading Schedule

https://www.cmegroup.com/tools-information/holiday-calendar.html

 

Bloomberg
Ag Calendar

Wednesday,
April 13:

• EIA
  weekly U.S. ethanol inventories, production, 10:30am
• China’s
  first batch of March trade data, incl. soybean, edible oil, rubber and meat imports
• FranceAgriMer
  report; monthly French grains outlook
• New
  Zealand food prices
• Holiday:
  Thailand

Thursday,
April 14:

• USDA
  weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• May
  ICE white sugar contract expiry
• HOLIDAY:
  Argentina, India, Thailand

Friday,
April 15:

• ICE
  Futures Europe weekly commitments of traders report
• U.S.
  green coffee stockpiles data released by New York-based National Coffee Association
• FranceAgriMer
  weekly update on crop conditions
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• HOLIDAY:
  Major markets closed due to Good Friday holiday

Source:
Bloomberg and FI

 

 

 

 

Macros

US
MBA Mortgage Applications Apr 8: -1.3% (prev -6.3%)

US
MBA Mortgage 30 Year Rate Apr 8: 5.13% (prev 4.90%)

US
PPI Final Demand (M/M) Mar: 1.4% (est 1.1%; prev 0.8%)

US
PPI Ex Food And Energy (M/M) Mar: 1.0% (est 0.5%; prev 0.2%)

US
PPI Ex Food And Energy (Y/Y) Mar: 9.2% (est 8.4%; prev 8.4%)

US
PPI Final Demand (Y/Y) Mar: 11.2% (est 10.6%; prev 10.0%)

 

Corn

·        
Corn futures are mixed with nearby three contracts lower earlier this morning and back months unchanged to moderately higher in part to follow through buying after the White House Administration will allow for E15 ethanol blending
during the summer driving months, June 1 through September 15.

·        
Anec: Brazil April corn exports seen at 850,000 tons, up from 60,000 previous estimate.

·        
The USDA Attaché looks for new-crop Brazil corn production to reach 118 million tons, up from 115 million tons for this year as they have plantings expanding to 22.5 million hectares from 21.5 million for 2021-22. Conab is at
115.6 million tons for 2021-22. USDA official is at 114 million tons.  The report (link below) is a good read, especially for a brush up on Brazil fertilizer information.

https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Grain%20and%20Feed%20Annual_Brasilia_Brazil_BR2022-0021

·        
Germany’s association of farm cooperatives estimated the Germany 2022 corn crop at 4.31 million tons, down 2.8 percent from 2021.

·        
A Reuters article pointed out covid restrictions across the northeastern proveniences have not allowed for many city dwellers that take on temporary jobs, to return to rural areas for annual spring grain plantings, threatening
a delay to corn and soybean sowings. Transportation restrictions have already slowed distribution of key inputs such as fertilizer. China is working on the problem. Jilin officials said nearly 100,000 farmers had returned to rural areas. 

·        
A Bloomberg poll looks for weekly US ethanol production to be down 1,000 barrels to 1.002 million (0.900-1.025 range) from the previous week and stocks down 203,000 barrels to 25.700 million.

 

Export
developments.

·        
None reported 

 

 

 

Soybeans

·        
Soybeans are lower led by weakness in soybean meal. Soybean oil turned higher. WTI crude oil was higher earlier this morning. USD was up about 11 points.

·        
China March soybean imports were 6.35 million tons, down 18 percent from 7.77 million tons year ago. January through March imports total 20.28 million tons, down 4.2$ from same period last year. March supplies were tight, but
meal demand was down from a year ago.  Poor hog margins and negative crush margins slowed crushing.  In addition, China started selling soybeans out of reserves.

·        
China’s vegetable oil imports during March were only 307,000 tons, down 61 percent from a year ago and January through March vegetable oil imports were 1.047 million tons, off 63 percent from same period last year.

·        
Anec: Brazil April soybean exports seen at 12.023 million tons, up from 11.117 previous estimate.

·        
Anec: Brazil April soybean meal exports seen at 2.070 million tons, up from 1.900 previous estimate.

·        
Argentina truck drivers remain on strike and plant/port grain/soybean arrivals has nearly grinded to a halt. About 85% of Argentina’s grain is transported around the country by truck. Talks are underway. Some speculate ports/plants
may not see a resumption in deliveries until early next week.

·        
Germany’s association of farm cooperatives estimated the Germany 2022 rapeseed crop at 3.88 million tons (3.90 estimated in March), up 11.1 percent from 2021.

·        
India palm oil imports during the month of March reached 539,793 tons, up 19 percent from February. Soybean oil imports were 299,421 tons, down from 376,594 tons in February. Sunflower oil imports were 212,484 tons, up from 152,220
tons previous month. 

·        
June Malaysian palm oil settled 42 ringgit lower to 6,135. Cash palm was down $5 at $1,560 per ton.

·        
China May soybeans decreased 0.4 percent, meal was up 0.2 percent, palm up 0.9 percent and palm up 2.2 percent. 

·        
Rotterdam vegetable oil prices were about unchanged to 45 euros higher for the April/July positions and meal unchanged t o2 euros lower.

·        
Offshore values were leading soybean oil 53 points lower and meal $2.00 lower.

 

Reuters
published the following graph

 

NOPA
will release its March crush report this Friday.

 

Export
Developments

·        
Three South Korean groups bought a combined 121,000 tons of soybean meal, likely sourced from South America for shipment between May 20 to June 20 with arrival around July 30. MFG bought 60,000 tons at an estimated $595.50 a ton
c&f. KFA and FLC jointly bought 61,000 tons at an estimated $596.99 a ton c&f.

·        
China plans to auction off another 500,000 tons of soybeans later this week.

 

Wheat

·        
US wheat is lower led by nearby KC wheat as Black Sea exports, at least out of Russia, continue to flow. Lack of US export developments and favorable precipitation across selected Great Plains areas are also weighing on prices. 
The USD is higher.

·        
The trade is waiting for results on Egypt’s import tender. Russia and Bulgaria were cheapest on a C&F basis. They passed on their previous two import tenders. They last bought 180,000 tons of wheat on February 17, all Romanian,
at $338.55/ton C&F. Note at the end of February, when Egypt passed, lowest offer for that tender was $389.92/ton FOB.

·        
Ukraine’s AgMin said Ukraine could export 2 million tons of wheat by the end of the current season.

·        
China’s AgMin said they saw an improvement in the winter wheat conditions. “The percentage of first and second grade grain was on par with normal levels.” Labor shortages and  tight fertilizer supplies remain a problem for the
northeastern growing areas.

·        
Germany’s association of farm cooperatives estimated the Germany 2022 wheat crop at 22.70 million tons (22.61 million estimated in March), up 6.2 percent from 2021.

·        
Earlier May Paris wheat futures were up 3.75 euros at 403.75 euros, highest since March 7.

·        
FranceAgriMer lowered its non-EU soft wheat export forecast to 9.5 million tons from 9.7 million estimated in March. Within the EU the AgMin looks for wheat exports to reach 8.1 million tons, up from 7.8 million previous. Stocks
were left unchanged at 3 million tons. 

 

Brazil
looks to be less dependent on wheat imports by increasing plantings.

 

India
is expected to see a sixth consecutive bumper wheat production

https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Grain%20and%20Feed%20Annual_New%20Delhi_India_IN2022-0027

 

Export
Developments.

·        
The trade is waiting for results on Egypt’s import tender. Russia and Bulgaria were cheapest on a C&F basis. Shipping was sought from 20-31 May for FOB, and C&F arrival offers will be from 1-15 June.

·        
Jordan passed 120,000 tons of milling wheat for LH May and/or through July shipment.

·        
Algeria bought 80,000 to 100,000 tons of wheat at around $460/ton c&f. The wheat is sought for shipment in several periods from the main supply regions including Europe: May 1-10, May 11-20, May 21-31, June 1-10, June 11-20 and
June 21-30.

·        
Japan seeks 70,000 tons of feed wheat and 40,000 tons of feed barley on April 20 for arrival by September 29.

·        
Japan seeks 114,645 tons of food wheat later this week.

 

Rice/Other

·        
None reported

 

https://apps.fas.usda.gov/newgainapi/api/Report/DownloadReportByFileName?fileName=Grain%20and%20Feed%20Annual_Brasilia_Brazil_BR2022-0021