FI Morning Grain Comments 05/11/21

PDF attached

 

Good
morning.

 

Private
exporters reported to the U.S. Department of Agriculture export sales of 680,000 metric tons of corn for delivery to China during the 2021/2022 marketing year. 

 

CBOT
agriculture futures traded lower overnight with most markets rebounding by morning on bottom picking and technical buying. The central US will see good rain over the next week bias WCB and southwestern growing areas.  There were no surprises in USDA’s crop
progress report.  SK passed on a cargo of corn and Japan is in for food wheat this week.  Traders will be watching out for additional China buying of US corn.  FI’s US soybean complex S&D’s are attached. 

 

 

 

 

 

 

 

 

 

 

Weather

 

Next
7 days

 

World
Weather, Inc.

Greater
rainfall is expected in the southern U.S. Plains where cotton, corn and sorghum planting will benefit greatly over the next ten days. Some southern wheat areas may get a little wet. The northern U.S. Plains, Upper Midwest and neighboring areas of Canada’s
Prairies are going to continue dealing with less than usual precipitation and ongoing dryness. Weather in Brazil and Argentina is not advertised differently today with the only Safrina corn production state to get rain being Parana. Coffee, Cocoa and sugarcane
areas of Indonesia, Malaysia, Vietnam, Thailand and West Africa will continue to get lighter than usual rainfall, but the moisture will still occur in many production areas.

Source:
World Weather, Inc.

 

Bloomberg
Ag Calendar

Tuesday,
May 11:

• Agrana
  full-year earnings
• France
  agriculture ministry monthly crops outlook

Wednesday,
May 12:

• China
  farm ministry’s CASDE outlook report
• FranceAgriMer
  monthly grains report
• USDA’s
  monthly World Agricultural Supply and Demand (WASDE) report, 12pm
• EIA
  weekly U.S. ethanol inventories, production
• Conab’s
  data on yield, area and output of corn and soybeans in Brazil
• Brazil’s
  Unica data on cane crush and sugar output (tentative)

Thursday,
May 13:

• New
  Zealand April food prices, 10:45am local
• Port
  of Rouen data on French grain exports
• USDA
  net-export sales for corn, soy, wheat, cotton, pork, beef, 8:30am
• HOLIDAY:
  Indonesia, Malaysia, Singapore, India, Dubai, France, Germany

Friday,
May 14:

• ICE
  Futures Europe weekly commitments of traders report, 6:30pm London
• FranceAgriMer
  weekly update on crop conditions
• CFTC
  commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
• HOLIDAY:
  Indonesia, Malaysia, Dubai

Source:
Bloomberg and FI

 

 

 

 

USDA
inspections versus Reuters trade range                                                    

Wheat                 
545,587                 versus   375000-600000  range

Corn                     
1,707,142             versus   1100000-2200000             range

Soybeans           
236,918                 versus   100000-300000  range

 

Macro

China
producer price index (PPI) rose 6.8% in April from a year earlier – National Bureau of Statistics, versus 6.5% Reuters poll and a 4.4% rise in March.

Consumer
price index (CPI) rose by 0.9% on year.

 

 

Corn

• CBOT
  corn is higher after opening lower overnight.  July broke 32 cents from its absolute high established Friday to its overnight low, but this morning we find July up about 8.50 cents.  US plantings were about expected and by the end of this week corn plantings
  should be over 75 percent complete and soybeans over 55 percent done. Weather in Brazil and Argentina is not advertised differently today, second corn production state of Parana will see rain.
  
• France
  sees a 10 percent decrease in the corn planted area to 1.44 million hectares from 1.61 million in 2020.  The spring barley area was estimated at 593,000 hectares, down 25% from last year. 
  
• US
  corn plantings were 67% complete, as expected and above 52% average.  IN corn plantings were 46% complete, IL 74% and IA 86%. 
  
• The
  USD was down about 14 points as of 8:00 am CT. 
• USDA
  US corn export inspections as of May 06, 2021 were 1,707,142 tons, within a range of trade expectations, below 2,211,277 tons previous week and compares to 1,407,281 tons year ago. Major countries included Mexico for 342,412 tons, China for 342,056 tons, and
  Japan for 334,529 tons.
• The
  European Union granted imports licenses for 224,000 tons of corn imports, bringing cumulative 2020-21 imports to 12.715 MMT, 29 percent below same period year ago
• Conab
  will release their production updates for Brazil corn and soybeans on Wednesday. A Bloomberg poll looks for Brazil corn production down 7.9 million tons Conab’s April estimate to 101.1 million tons.  The lowest estimate was 94.4 million tons.  Soybean production
  was seen rising to 136.1 million tons vs 135.5 million tons in April. 

 

Export
developments.

• South
  Korea’s KFA was believed to have passed on 69,000 tons of corn due to high prices.  Lowest offer was $347.80/ton for arrival around September 5. 
  

 

 

Soybeans

• CBOT
  soybeans and meal are higher on technical buying.  SBO is trending lower on spreading.  100 soybean oil was cancelled out of Volga, SD, leaving total registrations at 1,055.  Egypt saw some offers for vegetable oils. 
  
• Malaysian
  palm oil futures fell 18 MRY and cash was down $2.50 to $1,092.50/ton.
• US
  soybean plantings were 42% complete 2 points above expectations and well above 22 percent average.  IN soybean plantings were 36% complete, IL 57% and IA 67%. 
  
• Offshore
  values were leading CBOT SBO 31 points higher and meal $1.20 short ton higher. 
  
• Rotterdam
  vegetable oil values were mostly unchanged in the front months and Rotterdam meal mostly 1-3 euros higher. 
  
• China
  cash crush margins on our analysis were 108 cents vs. 214 cents late last week and compares to 77 cents year earlier. 
  
• China:
  

• Cargo
  surveyor SGS reported month to date May 10 Malaysian palm exports at 455,285 tons, 111,246 tons above the same period a month ago or up 32.3%, and 101,195 tons above the same period a year ago or up 28.6%.
• Malaysian
  palm oil: (uses settle price).
  

• USDA
  US soybean export inspections as of May 06, 2021 were 236,918 tons, within a range of trade expectations, above 144,348 tons previous week and compares to 535,686 tons year ago. Major countries included Indonesia for 76,885 tons, Mexico for 74,676 tons, and
  Japan for 25,971 tons.
• The
  European Union reported soybean import licenses since July 1 at 12.953 million tons, above 12.700 million tons a year ago. European Union soybean meal import licenses are running at 14.618 million tons so far for 2020-21, below 15.463 million tons a year ago.
  EU palm oil import licenses are running at 4.493 million tons for 2020-21, below 4.935 million tons a year ago, or down 9 percent.
• European
  Union rapeseed import licenses since July 1 were 5.712 million tons, above 5.391 million tons from the same period a year ago.
• ADM
  announced plans to build a new 150,000 bushel/day capacity soybean crush plant in Spiritwood, ND.  They are also expanding capacity to their crush facility in Quincy, Illinois. 
  
• In
  a Reuters poll, US 2021-22 soybean ending stocks were seen at 138 million bushels, and 2020-21 stocks at 117 million bushels from 120 million last month.
  

 

Export
Developments

• Egypt’s
  GASC seeks at least 30,000 tons of soyoil and 10,000 tons of sunflower oil for arrival July 11-31.  Traders should submit bids for payment with 180-day letters of credit and at sight.  They are also in for at least 3,000 tons of domestic soyoil and 1,000 tons
  of sunflower oil for arrival between July 16-August 5.  Overnight traders provided the following offers via Reuters for the international tender:

30,000
tons of soyoil at $1,407 for payment at sight

30,000
tons of soyoil at $1,417 for payment with 180-day LCs

10,000
tons of sunflower oil at $1,599 for payment at sight

10,000
tons of sunflower oil $1,612 for payment with 180-day LCs

• On
  May 18 USDA seeks a total of 4,770 tons of packaged oil for use in Title II, PL480 and the McGovern-Dole Food for Education export programs. Shipment was set for June 16-July 15 (July 1-31 for plants at ports).

 

Wheat

• US
  wheat futures are higher on technical buying despite additional rain relief forecast for the southern US Great Plains over the coming week. Additional precipitation will fall this weekend into next week for both the northern Plains and Canada’s Prairies, providing
  additional relief. 
• Russian
  wheat export prices rose in the first 10 days of May, according to IKAR.  12.5% protein from Black Sea ports was at $278 a ton FOB at the end of last week, up $13 from late April.  Sovecon reported wheat prices rose by $4 to $274 a ton.
  
• September
  Paris wheat was up 2.00 euros to 225.50 as of around 6:45 am CT.
• France
  estimated the French soft wheat area at 4.89 million hectares, up about 15% from last year and slightly above the five-year average.  The rapeseed area was estimate at 989,000 hectares, down 11% on the year and 27% below the five-year average.
  
• US
  winter wheat conditions improved 1 point to 49 percent, one point above expectations and compares to 53 year ago and 54 percent average. 
  

• USDA
  US all-wheat export inspections as of May 06, 2021 were 545,587 tons, within a range of trade expectations, above 532,704 tons previous week and compares to 343,417 tons year ago. Major countries included China for 201,035 tons, Korea Rep for 76,080 tons,
  and Mexico for 64,084 tons.
• The
  European Union granted export licenses for 224,000 tons of soft wheat exports, bringing cumulative 2020-21 soft wheat export commitments to 22.837MMT, well down from 30.587 million tons committed at this time last year, a 25 percent decrease.  Imports are
  down 5% from year ago at 1.827 million tons.

 

Export
Developments.

• Japan
  seeks 122,180 tons of food wheat from the US, Canada, and Australia this week. 
  
• Taiwan
  Flour Millers’ Association seeks 89,425 tons US milling wheat on May 13.  One consignment of 42,505 tons is sought for shipment between July 2 and July 16. A second consignment of 46,920 tons is sought for shipment between July 19 and Aug. 2.

 

Rice/Other

·        
South Korea’s Agro-Fisheries & Food Trade Corp seeks 134,994 tons of rice from Vietnam, China, the United States and Australia, on May 13, for arrival between September 2021 and January 2022.