FI Morning Grain Comments 08/07/20

PDF attached

 

Under
the 24-hour reporting system, private exporters reported to the U.S. Department of Agriculture export sales of 456,000 tons of soybeans for delivery to China during the 2020/2021 marketing year.  USD was 50 higher and WTI 41 cents lower and equities lower. 
The CBOT ag futures are seeing little direction on thin news.  Tender business was quiet.  286 meal were delivered and 63 soybean oil receipts were cancelled.  Malaysian palm fell 7 points while cash palm was unchanged.  Early June Malaysian regional palm
oil production data is indicating an already expected sharp decline from the previous year.  China traded higher for soybeans and vegetable oils.  CBOT soybean oil is under pressure presumably from end of week profit taking. Lack of direction is leaving a
slightly negative trade for corn and soybeans.  Wheat is slightly higher on technical buying.  Jan-Jun China soybean imports are 18 percent higher than the same period year ago to 55.2 MMT.  July imports were a large 10.1 million tons, up from 8.63 MMT for
June 2019 and down from 11.16 MMT for June 2020.  China imported 956,000 tons of vegetable oils in July, down 6.1% from the previous month.  For Monday we look for US crop conditions to improve one point for corn, soybeans, and spring wheat. 

 

 

 

 

 

 

 

Weather
and Crop Progress

 

 

 

7
Day Precipitation Outlook

 

Bloomberg
Ag Calendar

FRIDAY,
August 7:

• China’s
  foreign trade data for July, including imports of soybeans and meat
• ICE
  Futures Europe weekly commitments of traders report, 1:30pm (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,
August 10:

• USDA
  weekly corn, soybean, wheat export inspections, 11am
• U.S.
  crop conditions for soybeans, corn, cotton; wheat harvesting progress, 4pm
• ISO
  webinar on Covid-19/macro outlook for sugar
• Malaysian
  Palm Oil Board data on July end-stockpiles, production, exports
• Malaysia
  palm oil export data for August 1-10
• EU
  weekly grain, oilseed import and export data
• Ivory
  Coast cocoa arrivals
• Brazil
  Unica cane crush, sugar production (tentative)
• HOLIDAY:
  Japan, Singapore

TUESDAY,
August 11:

• Brazil
  Conab releases area, production and yield data for corn, soybeans
• EARNINGS:
  Wilmar

WEDNESDAY,
August 12:

• USDA’s
  monthly World Agricultural Supply and Demand (Wasde) report, noon
• China
  CASDE monthly crop supply and demand report
• Vietnam
  data on coffee, rice and rubber exports in July
• EIA
  U.S. weekly ethanol inventories, production, 10:30am
• U.S.
  soybean, corn acreage, noon
• EARNINGS:
  BRF, Marfrig
• HOLIDAY:
  Thailand

THURSDAY,
August 13:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• Port
  of Rouen data on French grain exports
• New
  Zealand Food Prices
• EARNINGS:
  JBS, Olam

FRIDAY,
August 14:

• ICE
  Futures Europe weekly commitments of traders report, 1:30pm (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
• EARNINGS:
  Golden Agri-Resources

SATURDAY,
August 15:

• Malaysia
  palm oil export data for Aug 1-15 from AmSpec

Source:
Bloomberg and FI

 

 

 

Macros

·        
US Change In Nonfarm Payrolls Jul: 1763K (est 1480K; prevR 4791K; prev 4800K)

·        
US Unemployment Rate Jul: 10.2% (est 10.6%; prev 11.1%)

·        
US Average Hourly Earnings (M/M) Jul: 0.2% (est -0.5%; prevR -1.3%; prev -1.2%)

·        
US Average Hourly Earnings (Y/Y) Jul: 4.8% (est 4.2%; prev 5.0%)

·        
US Change In Private Payrolls Jul: 1462K (est 1200K; prevR 4737K; prev 4767K)

·        
US Change In Manufacturing Payrolls Jul: 26K (est 255K; prevR 357K; prev 356K)

·        
US Gvt Payrolls: 301K (prevR 54K; prev 33K)

·        
US Average Weekly Hourly All Employees Jul: 34.5 (est 34.4; prev 34.5)

·        
US Labour Force Participation Rate Jul: 61.4% (est 61.8%; prev 61.5%)

·        
US Underemployment Rate Jul: 16.5% (prev 18.0%)

 

·        
Canadian Net Employment Change Jul: 418.5K (est 380K; prev 952.9K)

·        
Canadian Unemployment Rate Jul: 10.9% (est 11.0%; prev 12.3%)

·        
Canadian Full Time Employment Change Jul: 73.2K (prev 488.1K)

·        
Canadian Part Time Employment Change Jul: 345.3K (prev 464.8K)

·        
Canadian Hourly Wage Rate Permanent Employees (Y/Y) Jul: 5.7% (est 5.4 %; prev 6.8%)

·        
Canadian Participation Rate Jul: 64.3% (est 64.5%; prev 63.8%)

 

 

Corn.

• Corn
  prices are unchanged in the nearby and slightly lower in the back months on lack of direction. 
  
• USD
  is 50 higher, crude lower and equities mostly lower. 
• China
  corn futures traded lower on Friday and at one point were head for their largest weekly decline since December 2018.  China has been scrambling to find alternative feedgrains to replace expensive corn.  They are sourcing feed wheat for animal use. 
  
• Traders
  are looking for about 150 million bushel increase in new-crop US corn ending stocks and 170 million bu increase in 2020 production from July (180.4 yield). 
  
• FranceAgriMer
  reported as of August 3, the corn crop rating declined to 74% against 77% in the previous week, following a three point decline the previous week.  They compare to 60 percent a year ago. 
  
• Reuters:
  “The Renewable Fuels Association spent $339,676 toward lobbying efforts during the second quarter, according to a U.S. Senate database that tracks lobbying disclosures. That was down 12% from the same time last year and 4% from the prior quarter.”

 

Corn
Export Developments

• None
  reported

 

Soybean
complex.

• US
  soybeans are unchanged to lower on lack of direction but expect a two-sided after USDA announced 465,000 tons of soybeans to China for 2020-21 delivery.  Chinese demand picked up this week from last week.  News is light.  Soybean oil may bounce higher amid
  Chinese vegoil demand. 
• At
  least 12 soybean cargoes traded to China late Thursday.  10-12 from the US (Oct-Nov) and at least 2 from Brazil (March). 
  
• Traders
  are looking for about 100 million bushel increase in new-crop US soybean ending stocks and 123 million bu increase in 2020 production from July (51.3 yield). 
  

·        
Rotterdam values this morning showed soybean oil for the Sep/Oct position was down 3 euros from this time previous session, rapeseed oil down 5 in the nearby, and soybean meal when imported from South America mixed/mostly lower.  

• Offshore
  values this morning was leading CBOT soybean oil 28 lower (91 lower for the week) and meal $0.10 higher ($3.50 higher for the week).  
  
• China
  cash crush margins as of this morning, using our calculation, were 129 cents per bushel (134 previous), lowest since mid-June, and compares to 150 cents a week ago and 79 cents around this time last year.
  

·        
The Malaysian Palm Oil Association forecast crude palm oil production in July fell 6.35% on-month to 1.77 million tons. 

·        
Palm oil:  7 points lower and cash unchanged – lack of direction.  For the week prices are up 3 percent. 

 

Oilseeds
Export Developments

• Under
  the 24-hour reporting system, private exporters reported to the U.S. Department of Agriculture export sales of 456,000 tons of soybeans for delivery to China during the 2020/2021 marketing year. 
  
• Results
  awaited:  South Korea’s Nonghyup Feed Inc. (NOFI) seeks up to 13,000 tons of rapeseed meal from India and a range of other animal feed meals (palm kernel expeller meal, copra meal and corn gluten feed), for arrival around Oct. 20.

 

Wheat

• US
  wheat futures are mostly lower on lack of fresh global import tender business and large Black Sea crop prospects. 
  
• Traders
  are looking for about 5 million bushel increase in new-crop US wheat ending stocks and 9 million bu increase in all-wheat production. 
  
• The
  World Food Program plans to buy and import wheat for Lebanese flour and bakeries amid Beirut explosion. 
  
• France’s
  wheat harvest is nearly complete. 
• Paris
  December wheat was unchanged euros at 179.50.  

 

Export
Developments.

• Jordan
  seeks 120,000 tons of optional origin wheat on August 12 for Nov-Dec shipment. 
  
• Syria
  looks to sell and export 100,000 tons of feed barley with offers by Sep 1. 
  

 

Rice/Other

·        
Reuters: Thai rates little changed at $463-$485 per ton. 

·        
Mauritius seeks 6,000 tons of white rice on August 17 for October through December delivery. 

·        
South Korea’s Agro-Fisheries & Food Trade Corp. seeks 60,556 tons of rice from Vietnam and other origins, on Aug. 19, for arrival in South Korea between Dec. 31, 2020, and February 28, 2021.