FI Morning Grain Comments 05/14/21

PDF attached

 

Good
morning.

 

Under
the 24-hour announcement system, US exporters sold 1,360,000 tons of corn for delivery to China during the 2021-22 marketing year. (same amount, destination, and crop-year that was reported May 7, FYI). 

 

Prices
are rebounding this morning on a lower USD, strength in WTI crude oil and higher US equities.  Some think the selloff yesterday was overdone and others are downplaying the disruption in barge movement. 
Trade
may know as early as the end of this weekend when barges can start passing the closed section of the of the Mississippi River near Memphis after the physical inspection of the bridge is complete, IMO.  Offshore values, currency adjusted, are giving the trade
little lead again this morning.  EU wheat futures were 2 euros higher and July canola 2.30 Canadian dollars lower.  The Great Plains are expected to see rain through early next week.  Rains return to the Delta Monday and Tuesday of next week.  Brazil’s forecast
is wetter for late next week.  Parts of the Black Sea will see hot temperatures on and off over the next couple of weeks. 

 

 

As
we learned last week, most CME/CBOT pits are now permanently closed.  Link provided takes us back what they used to look like.
https://www.youtube.com/watch?v=a25jc54YFzo

 

 

Weather

 

Next
7 days

 

Last
7 days

 

World
Weather, Inc.

Today’s
World Weather Highlights

• CANADA
  WEATHER STILL UP FOR DEBATE
• European
  forecast model further downplays rain in the eastern Canada Prairies through May 23, although it is not completely dry
• European
  model presents significant rain in Alberta, Canada and far western Saskatchewan Thursday through Saturday of next week with 1.00 to 2.00 inches and locally more especially in Alberta
• GFS
  model suggests showers of lighter intensity impacting most of Canada’s Prairies Wednesday into Friday of next week, but no heavy rainfall in Alberta
• GFS
  suggests greater rain for Saskatchewan May 23-25
• Northern
  Plains rainfall potential is not very great, although a few showers are suggested
• Stormy
  weather pattern is still expected in the central and southern Plains and parts of the lower Midwest over the coming ten days
• Upper
  Midwest rainfall potential greatest late next week and into the following weekend
• Frost
  and freezes were noted this morning in far southern Rio Grande do Sul and from far northeastern Rio Grande do Sul into southeastern most Santa Catarina
• This
  was outside all major crop areas
• Russia’s
  New Lands are expected dry and warm biased conditions over the next ten days drying some spring wheat and sunseed areas out
• Brazil’s
  Safrinha corn areas will be dry in this first week of the outlook, but showers are expected May 21-23 impacting many crop areas with light rainfall
• Europe
  and the western CIS are still advertised to be wet in the coming week to ten days
• Western
  Australia is advertised a little wetter today for the end of next week, although the precipitation is expected to be light
• China’s
  flooding rainfall problems in the Yangtze River Basin will persist over the next week to ten days and a close watch on that region is warranted
• Some
  timely rain is still expected in the North China Plain and Yellow River Basin, although Hebei, Shandong and Liaoning do not get much rain until the second weekend of the forecast
• Gujarat
  India and Pakistan will be threatened by Tropical Cyclone 1A that is forming quickly off the west coast of India and landfall is possible during the middle part of next week.
  

Source:
World Weather, Inc.

 

Bloomberg
Ag Calendar

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

Monday,
May 17:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• U.S.
  crop plantings – soybeans, cotton; winter wheat condition, 4pm
• U.S.
  Green Coffee Association releases monthly green-coffee stockpiles
• EU
  weekly grain, oilseed import and export data
• Ivory
  Coast cocoa arrivals
• Malaysia
  crude palm oil export tax for June (tentative)

Tuesday,
May 18:

• China
  customs to publish trade data, including imports of corn, wheat, sugar and cotton
• New
  Zealand global dairy trade auction
• Brazil’s
  Conab releases cane, sugar and ethanol production data
• International
  Sugar Organization and Datagro to hold New York sugar & ethanol conference

Wednesday,
May 19:

• EIA
  weekly U.S. ethanol inventories, production
• BMO
  Farm to Market Conference, day 1
• International
  Sugar Organization and Datagro to hold New York sugar & ethanol conference
• HOLIDAY:
  Hong Kong

Thursday,
May 20:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• China
  customs to release trade data, including country breakdowns for commodities such as soybeans
• BMO
  Farm to Market Conference, day 2
• Black
  Sea Grain conference
• Port
  of Rouen data on French grain exports
• Malaysia
  May 1-20 palm oil export data
• USDA
  total milk, red meat production, 3pm
• EARNINGS:
  Suedzucker

Friday,
May 21:

• 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
• Black
  Sea Grain conference
• U.S.
  Cattle on Feed, 3pm

Source:
Bloomberg and FI

 

 

 

 

 

Macro

US
Retail Sales Advance (M/M) Apr: 0.0% (est 1.0%; prevR 10.7%; prev 9.8%)

US
Retail Sales Ex-Autos (M/M) Apr: -0.8% (est 0.6%; prevR 9.0%; prev 8.4%)

US
Retail Sales Ex-Autos, Gas Apr: -0.8% (est 0.3%; prevR 8.9%; prev 8.2%)

US
Retail Sales Control Group Apr: -1.5% (est -0.2%; prevR 7.6%; prev 6.9%)

US
Import Price Index (Y/Y) Apr: 10.6% (est 10.2%; prev 6.9%)

US
Import Price Index (M/M) Apr: 0.7% (est 0.6%; prevR 1.4%; prev 1.2%)

US
Import Price Index Ex-Petroleum (M/M) Apr: 0.7% (est 0.5%; prev 0.9%)

US
Export Price Index (Y/Y) Apr: 14.4% (est 14.0%; prev 9.1%)

US
Export Price Index (M/M) Apr: 0.8% (est 0.8%; prevR 2.4%; prev 2.1%)

Canadian
Manufacturing Sales (M/M) Mar: 3.5% (est 3.3%; prev -1.6%)

Canadian
Wholesale Trade Sales (M/M) Mar: 2.8% (est 1.0%; prev -0.7%)

 

 

Corn

• CBOT
  corn is rebounding this morning on a lower USD, strength in WTI crude oil and higher US equities.  China bought 1.36 million tons of new-crop corn per USDA.  Some think the selloff yesterday was overdone and others are downplaying the disruption in barge movement. 
  Trade may know as early as the end of this weekend when barges can start passing the closed section of the of the Mississippi River near Memphis after the physical inspection of the bridge is complete, IMO. 
  
• Traders
  should monitor the Miss. River barge traffic flow after the US Coast Guard closed a section of the river on Wednesday after finding a crack in a major roadway bridge. 
  
• The
  USD was down about 34 points as of 8:05 am CT. 
• China’s
  sow herd expanded 1.1% in April from the previous month and rebounded 23% over a year earlier. The sow herd in April stood at 97.6% of the end-2017 level, according to Reuters.  Newborn piglets up 58.8% from last year.  China has 180,000 large pig farms, up
  from 161,000 at the beginning of last year, according to the AgMin. 
• FranceAgriMer
  reported the French corn planting progress at 95% complete as of May 10, up from 89% the previous week and 88% a year ago.
• Ukraine
  planted about 74% percent of their planned corn area, or about 3.9 million tons.  Ukraine early spring plantings are near complete with more than 1.9 million hectares sowed as of May 13.  The area included 1.33 million hectares of barley, 229,600 hectares
  of peas, 186,800 hectares of oats and 174,700 hectares of spring wheat. 
  

 

EIA:
In 2020, U.S. exports of fuel ethanol fell for the second consecutive year

https://www.eia.gov/todayinenergy/detail.php?id=47956&src=email

 

 

Export
developments.

• Under
  the 24-hour announcement system, US exporters sold 1,360,000 tons of corn for delivery to China during the 2021-22 marketing year.
  

 

Soybeans

• CBOT
  soybeans are higher on technical buying and strong world cash prices.  The NOPA report due out early next week indicates a good amount of US crush downtime during the month of April and that should remain the same theme for this month.  Rationing is part of
  the reason for some areas of the US while if crushers can source soybeans in other areas, they are taking advantage of the good margins.  One of our brokers noted July beans have completed an almost perfect 50% retracement of the $1.77 runup.  US weather looks
  good for plantings and emergence but some areas across the northern Midwest are in need of rain where drought conditions expanded since the beginning of the month.  Rains return to the Delta Monday and Tuesday of next week.  Brazil’s forecast is wetter for
  late next week.  Parts of the Black Sea will see hot temperatures on and off over the next couple of weeks. 
  
• News
  is fairly light. 
• The
  products are higher  led by soybean meal.  Offshore values, currency adjusted, are giving the trade little lead again this morning. 
  
• The
  USD is lower, WTI crude oil higher and US equities higher. 
• A
  Reuters poll calls for the April US soybean crush to end up near 168.7 million bushels, compared 178.0 million during March and down from 171.8 million during April 2020.  End of April soybean stocks were estimated at 1.785 billion pounds, up from 1.771 billion
  at the end of March but down from 2.111 billion pounds at the end of April 2020.
• Offshore
  values were leading CBOT SBO 27 points lower (25 lower for the week) and meal $9.00 higher ($2.70 lower for the week). 
  
• Rotterdam
  vegetable oil values were 5-10 euros higher and meal $14 to $24 euros lower from two days ago (holiday yesterday). 
  
• China
  cash crush margins on our analysis were negative 20 cents (negative 4 previous) vs. 214 cents late last week and compares to 77 cents year earlier. 
  
• China:
  

• Malaysian
  palm oil: (uses settle price).
  

ON
HOLIDAY

 

 

Export
Developments

• 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 fund buying, higher corn and some concern over hot temperatures projected over the next 2 weeks across parts of the Black Sea growing areas that are already experiencing some drought conditions.  The USD is lower.   The Great Plains
  are expected to see rain through early next week. 
• September
  Paris wheat market basis September was up 5.25 euro at $221.25.   
• French
  wheat conditions for the week ended May 10 at 79% good or excellent condition, unchanged from the previous week, according to FranceAgriMer, up from 55% year ago. The winter barley and durum wheat were also unchanged on the week, at 76% and 69% respectively. 
  Spring barley conditions improved to 85% from 82%.
• FranceAgriMer
  reported the French corn planting progress at 95% complete as of May 10, up from 89% the previous week and 88% a year ago.

 

Export
Developments.

• Japan
  bought 122,180 tons of food wheat from the US, Canada, and Australia this week.  Original details as follows:
  

• Results
  awaited:  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.
• Japan
  seeks 80,000 tons of feed wheat and 100,000 tons of feed barley on May 19 for arrival by October 28. 
  

 

Rice/Other

·        
Results awaited:  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.