FI Morning Grain Comments 06/11/21

PDF attached

 

Good
morning.

 

Lower
trade to start on improving US weather and end of week positioning.  Central WI, southern IL and northeastern NE saw rain yesterday.  Central WCB should see rain today.  Canada’s Prairies saw favorable rain yesterday bias eastern Alberta, Saskatchewan, and
Manitoba.  Good rains fell across parts of the Dakotas overnight bias northwestern North Dakota. Rain in central North Dakota has ranged from 0.20 to 0.67 inch while the Red River Basin has received nearly 2 inches, according to World Weather, Inc.  Maps of
rainfall below. 

o         
Williston 3.76 inches

o         
Stanley 2.56 inches

o         
Lansford 1.95 inches

 

Reuters
in a story said the U.S. EPA was considering ways to provide relief to U.S. oil refiners from biofuel blending mandates. RIN offers crashed (current off 15%) after this story was published.  Traders think this story is pressuring SBO and energy futures. 

 

 

 

 

Weather

Current
radar

 

 

Past
7 days

 

World
Weather, Inc.

WORLD
WEATHER HIGHLIGHTS FOR JUNE 11, 2021

• Rain
  has impacted a part of the northern U.S. Plains and Canada’s Prairies overnight and more rain will fall today mostly in Manitoba and eastern Saskatchewan, Canada.
  
• The
  heart of the U.S. Midwest is not likely to see much rain during the next couple of weeks, although scattered showers of light intensity will occur. Net drying is expected, though.
  
• A
  tropical cyclone in the Gulf of Mexico late next week may move into the U.S. Gulf of Mexico coast at some point in time, but the storm will likely thwart Gulf of Mexico moisture from getting into the Midwest reinforcing the drier bias for those areas. 
  
• Landfall
  has been predicted for the central Gulf of Mexico coast June 18-19
• Areas
  from the upper Texas coast through Louisiana to western parts of Florida’s Panhandle will be closely monitored for landfall
• Some
  changes in the outlook are possible and the situation will be closely monitored
• Remnants
  of the storm will stay in southern United States and will not likely bring needed rain to the Midwest
• Flooding
  in the U.S. Delta remains serious today and some crop damage has likely occurred from this week’s 3.00 to more than 10.00 inches of rain
• Areas
  from southern Arkansas into central and interior northern Mississippi were most impacted
• West
  Texas will continue in a net drying mode, but temperatures will trend a little cooler and there will be a few showers in the coming week
• Brazil,
  Argentina, Australia, Europe and the western parts of Russia have seen no change in weather expectations overnight.
  
• China
  is also expecting a good general weather pattern to prevail.
• India
  will see excessive rain in the coming week from a monsoon depression that moves from Odisha into Madhya Pradesh
  
• Russia’s
  New Lands look wetter in the second week outlook today than advertised Thursday
• Sukhovei
  potential remains for next week in southern Russia and Kazakhstan, but the odds are low that much crop stress or damage will occur outside of western Kazakhstan
  

Source:
World Weather, Inc.

 

Source:
World Weather, Inc.

 

Bloomberg
Ag Calendar

Friday,
June 11:

• 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

Monday,
June 14:

• USDA
  export inspections – corn, soybeans, wheat, 11am
• U.S.
  crop condition — corn, cotton, soybeans, wheat, 4pm
• EU
  weekly grain, oilseed import and export data
• Ivory
  Coast cocoa arrivals
• HOLIDAY:
  Australia, China, Hong Kong

Tuesday,
June 15:

• FT
  Commodities Global Summit, day 1
• Malaysia
  June 1-15 palm oil export data
• Malaysia
  CPO export tax for July (tentative)
• New
  Zealand Food Prices
• New
  Zealand global dairy trade auction

Wednesday,
June 16:

• EIA
  weekly U.S. ethanol inventories, production
• FT
  Commodities Global Summit, day 2
• Australia’s
  Abares to release agricultural commodities report
• Brazil’s
  Unica may release cane crush, sugar production data (tentative)
• CNGOIC
  oilseed conference, Chengdu, China, Day 1

Thursday,
June 17:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• Port
  of Rouen data on French grain exports
• Itau
  webinar on agribusiness outlook, Sao Paulo, Brazil
• CNGOIC
  oilseed conference, Chengdu, China, Day 2

Friday,
June 18:

• 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
• China
  customs to publish trade data, including imports of corn, wheat, sugar and pork
• World
  coffee market report by USDA’s Foreign Agricultural Service, 3pm
• FranceAgriMer
  weekly update on crop conditions
• USDA
  Total Milk Production

Source:
Bloomberg and FI

 

 

 

 

Macros

Mexican
Industrial Production SA (M/M) Apr: -0.2% (est 0.3%; prev 0.7%)

Mexican
Industrial Production NSA (Y/Y) May: 36.6% (est 37.6%; prevR 1.7%)

Mexican
Manufacturing Production NSA (Y/Y) Apr: 52.0% (est 53.2%; prevR 6.3%; prev 6.2%)

 

Corn

• Corn
  were leading the CBOT ags lower but SBO dropped like a rock after a bearish Reuters article citing the White House is looking into relief for oil refiners that struggle with biofuel blending requirements.  Argentina’s corn harvest advanced to 38 percent complete
  and that country may see a rush in short term exports amid speculation the government will increase export taxes.  BA Grains Exchange increased their production outlook yesterday. 
  
• USD
  was 28 points higher as of 7:28 am CT.  
• CBOT
  corn OI was up about 17,500 contracts. 
• Argentina’s
  Grains Exchange raised their corn crop forecast to 48 million tons from 46 million previous.  USDA is at 47 million tons. 
  
• Today
  is the fifth day of the Goldman Roll.
• Reuters
  reported the White House is considering ways to provide relief to U.S. oil refiners from biofuel blending mandates.  Oil Refinery lobby groups have been campaigning for some type of relief from blending credits after RIN prices traded near their 13-year lifespan
  high in recent weeks.  Some refiners threaten they may have to file for bankruptcy.  This morning U.S. renewable fuel credits were offered at $1.95 on Friday morning, down about 2.5% from trades the day before, due to this Reuters report, according to Reuters. 
  Renewable fuel (D6) credits RIN-D6-US for 2021 were offered at $1.95 each on Friday, after trading at $2.00 each on Thursday.
• In
  a Reuters story, it was reported that Mexico is holding up import permits for GMO corn over the government applying a GMO ban used for animal feed, even though the ban does not go into effect for three years. 
  

 

Export
developments.

• Today
  China’s Sinograin offered 11,058 tons of Ukrainian imported corn at auction from reserves. 
  

 

Soybeans

• The
  soybean complex is lower following a drop in outside markets, improving Canadian canola weather, and recent rain across the ECB, but an expected decline in US soybean and corn conditions this upcoming Monday may limit losses. 
  
• Soybean
  oil is down sharply after Reuters put out a story the White House is looking into providing relief to oil refiners impacted by high cost RIN prices amid biofuel blending mandates.  Energy futures broke, then SBO early this morning. 
  
• Malaysian
  palm oil dropped a large 181 MYR to 3,663 and cash was down $42.50/ton to $972.50.  China futures were mixed with soybeans and SBO lower and meal higher. 
  
• Offshore
  values are leading soybean oil 111 points lower (376 lower for the week) and meal $3.20 higher ($8.00 higher for the week). 
  
• Rotterdam
  rapeseed and soybean oil prices were down around 35 euros, and meal unchanged to 3 euros lower. 
  
• China:
  

• Malaysian
  palm oil:

 

Export
Developments

• No
  fresh export developments. 
• USDA
  seeks 1,180 tons of packaged vegetable oil for export donation on June 15 for July 16-Aug 15 shipment. 
  

 

Wheat

• Wheat
  is lower on rain falling across the Dakota’s and upward revisions to Russia’s wheat crop. 
  
• Good
  rains fell across parts of the Dakotas overnight bias northwestern North Dakota. Rain in central North Dakota has ranged from 0.20 to 0.67 inch while the Red River Basin has received nearly 2 inches, according to World Weather, Inc.
  
• Williston
  3.76 inches
• Stanley
  2.56 inches
• Lansford
  1.95 inches
• SovEcon
  sees the Russian wheat crop at 82.1 million tons, up 1.5MMT from previous.   Yesterday IKAR pegged the Russia wheat crop 82 million tons, up 2 million tons from previous and below 85.9 million produced in 2020. 
  
• September
  Paris wheat market basis September was down 1.75 euros at 210.75 at the time this was written.
• 10,000
  Sep 220 calls in Matif wheat traded yesterday 8.1.  Open interest up 7,953 to 16,272. This is the biggest position throughout the entire Matif options. 
  

 

Export
Developments.

• South
  Korea’s MFG bought 65,000 tons of feed wheat at $313.00 for July or August shipment. 
  
• Yesterday
  AgriCensus noted the Philippines bought 50,000 tons of Australian wheat for July shipment.  $321-$324/ton was believed to be the price range. 
  
• Ethiopia
  seeks 400,000 tons of milling wheat on June 14, two lots of 200,000 tons each with delivery within 70 to 90 days of contract date.
  
• Jordan
  seeks 20,000 tons of wheat bran on June 15 for July/August shipment. 
• Japan
  seeks 80,000 tons of feed wheat and 100,000 tons of barley on June 16 under its SBS import system, for arrival in Japan by November 25. 
  
• Jordan
  seeks 120,000 tons of wheat on June 22 for December shipment. 
• Jordan
  is back in for feed barley on June 23 for Nov/Dec shipment. 

 

Rice/Other

·        
None reported