FI Morning Grain Comments 08/26/20

PDF attached

 

Morning. 

 

Tropical
storm Laura was upgraded to be a catastrophic Category 4 hurricane.  Laura will touch land late Wednesday/early Thursday, impacting US Gulf shipments and creating localized  flooding which will threaten the lower Delta/SW unharvested crops.

 

Much
of the soybean complex is higher.  Bloomberg reported China may purchase about 40 million tons of US soybeans in 2020, a calendar year record.  That would be about 25% more than in 2017 and 10% greater than the record set in 2016.  We heard China bought at
least 6 cargoes of US beans out of the US Gulf and PNW for shipment between October and November.  Products are finding limited upside as offshore values this morning were leading CBOT soybean oil 36 lower and meal $1.60 lower. 

 

Grains
are lower on technical selling.  Corn open interest was down 42,800 on Tuesday.  Yesterday the funds bought an estimated net 30,000 contracts.  A Bloomberg poll looks for weekly US ethanol production to be down 2,000 at 924,000 barrels (900-940 range) from
the previous week and stocks to decrease 126,000 barrels to 20.144 million. Turkey bought about 390,000 tons of red milling wheat.  Japan received no offers for 80,000 tons of feed wheat and 100,000 tons of feed barley (SBS) for November 30 loading.  The tropical
storm ready to slam the US Gulf will not be good for unharvested crops. 

 

 

 

Weather
and Crop Progress

 

 

 

 

 

Source:
World Weather Inc. 

 

Bloomberg
Ag Calendar

WEDNESDAY,
August 26:

• EIA
  U.S. weekly ethanol inventories, production, 10:30am

THURSDAY,
August 27:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• International
  Grains Council monthly report
• Port
  of Rouen data on French grain exports
• EARNINGS:
  Sime Darby Plantation

FRIDAY,
August 28:

• 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
• U.S.
  agricultural prices paid, received, 3pm

Source:
Bloomberg and FI

 

 

 

 

Macros

US
Durable Goods Orders Jul P: 11.2% (est 4.7%; prevR 7.7%; prev 7.6%)

 

 

Corn.

• December
  corn futures are lower this morning on technical selling.   Corn open interest was down 42,800 on Tuesday.  Yesterday the funds bought an estimated net 30,000 contracts. 
  
• December
  corn appears it could fill the $3.4550-$3.4800 gap before moving back high on US crop production concerns. 
  
• Tropical
  storm Laura was upgraded to be a catastrophic Category 4 hurricane.  Laura will touch land late Wednesday/early Thursday, impacting US Gulf shipments and creating localized  flooding which will threaten the lower Delta/SW unharvested crops.
  
• USD
  was up 29 points and WTI crude down 17 cents as of around 7:50 AM CT. 
• The
  EU lowered their corn import tariff to 0.26 euros ($0.31) per ton, from 5.48 euros previously. 
  
• A
  Bloomberg poll looks for weekly US ethanol production to be down 2,000 at 924,000 barrels (900-940 range) from the previous week and stocks to decrease 126,000 barrels to 20.144 million.
  
• A
  Reuters poll for South Africa’s corn production came in at 15.386 million tons for 2019-20, down from 15.545 estimated by the CEC in July.  That includes 8.954MMT white and 6.432 million tons of yellow. 
  
• China
  plans to auction off 10,000 tons of pork from reserves on August 28.  More than 500,000 tons had been sold so far this year. 
  

 

Corn
Export Developments

• Tunisia
  may have bought 75,000 tons of barley for Sep-Oct shipment.  The barley was believed to have been bought in three 25,000-ton consignments at $206.67 a ton c&f, $208.17 a ton c&f and $209.17 a ton c&f. 
  

 

</