FI Morning Grain Comments 07/13/21

PDF attached

 

Good
morning.

 

Day
after the USDA report and we find variable Board prices along with another round of fresh wheat import tenders.  Grains are mixed on stabilizing US crop conditions (MN up on dry weather).  Soybean oil is up more than 190 points on follow through strength in
global vegetable oil prices and Canadian canola production concerns.

ICE
FUTURES U.S.: CANOLA FUTURES DAILY PRICE LIMIT EXPANDS TO $60.00 PER TONNE, EFFECTIVE JULY 13 – Reuters News

 

 

Weather

 

WORLD
WEATHER INC.

WORLD
WEATHER HIGHLIGHTS FOR TUESDAY, JULY 13, 2021

• Warmer
  and drier weather is expected in a part of the western Corn Belt during the weekend and next week.
  
• This
  is part of the repeating pattern we have been talking about for the past few weeks suggesting the last ten days of July would be next round of excessive heat for the Plains and western Corn Belt.
  
• In
  the meantime, extremely warm and dry weather will be prevailing in Canada’s Prairies, North Dakota and northern Minnesota where very serious crop stress is expected and production cuts will be accelerating for just about all crops.
  
• World
  Weather, Inc. continues to watch drying in Russia’s Southern Region and western Kazakhstan.
  
• Some
  drying will also occur in western Russia, but timely rain should evolve in the last ten days of July.
  
• France
  and Germany will receive some heavy rain for a while along with Belgium
• Heavy
  rain continues to plague parts of China with regional flooding. 
• India’s
  monsoon will perform better for a while, but rain amounts will continue lighter than usual in many areas.
  
• No
  frost or freeze is expected in Brazil coffee, citrus or sugarcane areas anytime soon. 
• Argentina
  still has need for greater rain in some wheat areas, although crops are in better shape than last year at this time
• Far
  southern Brazil will get some rain periodically
• Australia’s
  weather will be favorably mixed in many areas, but greater rain is needed in South Australia, northwestern Victoria and parts of Queensland
• Recent
  rain has been improving Thailand soil and crop conditions
• Improving
  rainfall is expected in Vietnam, Cambodia and Philippines over the next couple of weeks
• No
  tropical cyclones are present in the world today
• Ivory
  Coast and Ghana rainfall will continue lighter than usual for the next couple of weeks

 

Bloomberg
Ag Calendar

Tuesday,
July 13:

• China
  customs to publish 1H trade data, including imports of soy, edible oils, meat and rubber
• FranceAgriMer
  monthly grains report
• European
  Cocoa Association to release quarterly cocoa processing figures
• EU
  weekly grain, oilseed import and export data
• Brazil’s
  June Coffee Exports
• New
  Zealand Food Prices

Wednesday,
July 14:

• EIA
  weekly U.S. ethanol inventories, production
• Brazil
  Unica cane crush, sugar production (tentative)
• Malaysia
  2Q cocoa grinding data (tentative)
• HOLIDAY:
  France

Thursday,
July 15:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• China
  2Q pork output and inventory levels
• Malaysia
  July 1-15 palm oil export data
• Malaysia
  crude palm oil export tax for August (tentative)
• Port
  of Rouen data on French grain exports
• Barry
  Callebaut 9-month key sales figures

Friday,
July 16:

• 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
• Cocoa
  Association of Asia releases 2Q cocoa grinding data

Source:
Bloomberg and FI

 

 

 

 

USDA
inspections versus Reuters trade range                                                    

Wheat                 
424,327                 versus   240000-450000  range

Corn                     
993,974                 versus   950000-1350000                range

Soybeans           
200,933                 versus   100000-300000  range

 

Selected
China commodity imports

China
Jan-June crude oil imports down 3% at 261 mln tons

China
Jan-June soybean imports up 8.7% at 48.96 mln tons

China
Jan-June natural gas imports up 23.8% at 59.82 mln tons

China
Jan-June iron ore imports up 2.6% at 561 mln tons

China
Jan-June wheat imports up 60.1% at 5.37 mln tons

China
Jan-June corn imports up 318.5% at 15.3 mln tons

China’s
June iron ore imports lowest since May 2020

 

Macros

US
CPI (Y/Y) Jun: 5.4% (est 4.9%; prev 5.0%)

US
CPI Ex-Food, Energy (Y/Y) Jun: 4.5% (est 4.0%; prev 3.8%)

US
CPI (M/M) Jun: 0.9% (est 0.5%; prev 0.6%)

US
CPI Ex- Food, Energy (M/M) Jun: 0.9% (est 0.4%; prev 0.7%)

US
Real Avg Weekly Earnings (Y/Y) Jun: -1.4% (prevR -2.6%; prev -2.2%)

US
Real Avg Hourly Earnings (Y/Y) Jun: -1.7% (prevR -2.9%; prev -2.8%)

 

Corn

• US
  corn
  is higher but gains are limited on an improvement in the US national corn rating.  But some states posted a good decline. IL was down 5, CO down 5, and NE off 5.  IA was up 4. 
  
• China
  imported 15.3 million tons of corn during the January through June period, 318% increases from a year earlier. 
  
• China
  imported 743,000 tons of meat in June, down 17% from the same month a year earlier.  January through June meat imports were 5.08 million tons.
• US
  corn conditions increased one point to 65 percent, in line with expectations.  We left out yield unchanged at 177.8 bushels per acre. 
  
• USDA
  US corn export inspections as of July 08, 2021, were 993,974 tons, within a range of trade expectations, below 1,236,243 tons previous week and compares to 917,968 tons year ago. Major countries included China for 477,638 tons, Mexico for 215,479 tons, and
  Japan for 191,524 tons.

 

Export
developments.

• Jordan
  seeks 120,000 tons of feed barley on July 28 for Nov/Dec shipment. 

 

 

Soybeans

• CBOT
  soybeans rallied late in the electronic session in part from another leg up in soybean oil.  Soybean meal was lower on product spreading.  Some of the US state ratings dropped by a more than expected amount.  IL was down 7 and Kansas off 8.  OH was down 2. 
  
• Canada
  canola gapped higher this morning but is nowhere currently up the expanded $60/ton limit it hit overnight.  It’s up about 20 percent over the past five days. 
  
• China
  soybean imports in June rose 11.6% from May to 10.72 million tons, up from 9.61 million tons in May, third-highest on record, and were below 11.16 million tons year earlier.  In the first six months of 2021 China imported 48.96 million tons, up 8.7% from the
  same period a year earlier.
• We
  are hearing Canadian canola production between 17 and 19.5 million tons.  We are at 19.5MMT. 
  
• US
  soybean conditions were unchanged at 59 points, one point below expectations.  We left our US soybean yield unchanged at 50.9. 
  
• Malaysian
  palm oil increased 114 points and cash was up $15 at $1010/ton. 
• China
  soybean futures were 0.2% higher and meal up 0.7%.  Palm oil increased slightly and soybean oil was up 0.6%. 
  
• Offshore
  values are leading SBO 89 points lower and meal $1.70 lower. 
• Rotterdam
  rapeseed and soybean oil prices were 5-40 euros higher and meal mixed.
• China:
  

• Malaysian
  palm oil:  

• USDA
  US soybean export inspections as of July 08, 2021, were 200,933 tons, within a range of trade expectations, below 208,136 tons previous week and compares to 483,429 tons year ago. Major countries included Indonesia for 70,226 tons, Spain for 29,308 tons, and
  Mexico for 27,875 tons.

 

 

Export
Developments

• South
  Korea’s Agro-Fisheries & Food Trade Corp. seeks around 7,600 tons of GMO-free soybeans on July 21 for arrival in South Korea between Aug. 20 and Oct. 20.

 

Source:
Reuters

 

Wheat

• US
  wheat is
  mixed with Chicago and KC lower on US harvesting pressure and MN higher on unfavorable US and Canadian spring wheat weather. 
  
• September
  Paris wheat were up 0.25 at 199.25 euros. 
• Russia
  will harvest 124-126 million tons of grain this year according to the head of science at state weather forecaster Hydrometcentre. Winter wheat was expected between 55-57 million tons and spring wheat crop  22-24 million tons.
  
• Sovecon
  lowered its estimate of the Russia 2021 wheat crop by 2.3 million tons to 82.3 million tons due to lower-than-expected yields. 
  
• FranceAgriMer
  looks for French soft wheat exports and stocks in the 2021-22 season to rebound from last year.  Soft wheat exports outside the 27-country EU were forecast to reach 10.5 million tons in 2021-22, up 40% compared with 7.50 million in the previous season.  Soft
  wheat stocks were expected to reach 3.7 million tons, up nearly 39% from 2.7 million last season. 
  
• US
  spring wheat conditions were unchanged on a national level but fell using out adjusted rating.  At 16 percent good/excellent, they were at expectations.  We made a large downward revision to our other spring and durum production estimates but remain above
  USDA. 
• 59
  percent of the US winter wheat crop had been collected. 
• A
  heat wave is sweeping across the far western US and parts of Canada this week, further stressing crops.  We expect spring wheat rating west of the Dakota’s to deteriorate this week. 
  
• USDA
  US all-wheat export inspections as of July 08, 2021, were 424,327 tons, within a range of trade expectations, above 361,811 tons previous week and compares to 659,727 tons year ago. Major countries included Japan for 71,777 tons, Mexico for 54,330 tons, and
  Nigeria for 47,424 tons.

 

Export
Developments. 

• Taiwan
  Flour Millers’ Association seeks 55,000 tons of million wheat from the United States on July 16 for shipment from the U.S. Pacific Northwest coast between Aug. 31 and Sept. 14.
  
• The
  Philippines rejected all offers in a tender for up to 200,000 tons of animal feed wheat due to high prices.  They were in for 150,000 tons of feed wheat and 50,000 tons of milling wheat with shipment from in September, October and November.
• Japan’s
  AgMin seeks 118,911 tons of food-quality wheat from the United States and Canada.

• Japan
  seeks 80,000 tons of feed wheat and 100,000 tons of barley on July 14
• Iran’s
  GTC seeks 60,000 tons of milling wheat for August and September shipment on Wednesday, July 14.
• Turkey’s
  TMO started buying wheat with about 200,000 tons initially purchased.  They were in for up to 395,000 tons.
• Bangladesh’s
  seeks 50,000 tons of milling wheat on July 15.
• Bangladesh’s
  seeks 50,000 tons of milling wheat on July 18.

• Ethiopia
  seeks 400,000 tons of wheat on July 19. 

• Pakistan’s
  TCP seeks 500,000 tons of wheat on July 27.  200,000 tons are for August shipment, and 300,000 tons are for September shipment.

 

Rice/Other

• South Korea seeks 91,216 tons of rice from China, the United
  States and Vietnam for arrival in South Korea between Oct. 31, 2021, and April 30, 2022. 
  
• Bangladesh seeks 50,000 tons of rice on July 18, not on the
  July.  They delayed it.