FI Morning Grain Comments 09/14/20

 

File attached

 

Morning. 

 

USDA
reported additional corn and soybean sales this morning. Agriculture markets were higher at the electronic pause on follow through buying.  Fundamental news was light.  USD was down 31 points earlier and WTI crude oil down about $0.30. 
We
heard China bought at least 4 cargoes of US Gulf soybeans since Friday and at least 3 cargoes out of the PNW. 
Palm
oil was very strong on Monday, up 3 percent, on renewed fund buying.  Saudi Arabia bought wheat, Jordan seeks wheat and Taiwan is in for corn.  US crop conditions are expected to be unchanged to little changed when reported this afternoon.  US temperatures
will be drier and warmer this week, facilitating harvesting progress.  We will get a US national corn harvest progress figure this afternoon. 

 

 

 

 

 

 

 

 

Weather
and Crop Progress

 

MARKET
MOVING WEATHER ISSUES

•            
Eastern Australia winter and spring crop areas will get rain this week

•            
Western Australia will continue dry out

•            
Western Argentina dryness will prevail

•            
U.S. southeastern crops will be vulnerable to Tropical Storm Sally Tuesday into Friday

•            
Drought will prevail from Ukraine to Kazakhstan and Russia’s Southern Region

•            
Drought will continue in southeastern Europe

•            
Brazil may experience a boost in pre-monsoonal showers and thunderstorms in center west and center south crop areas after Sep. 20; the GFS may be a little too aggressive, but scattered showers are expected Sep 20-27

•            
Western Europe will get some needed rain this weekend into next week

•            
China’s greatest rains will diminish, but alternating periods of rain and sun will continue

Source:
World Weather Inc. 

 

 

Bloomberg
Ag Calendar

MONDAY,
Sept. 14:

• USDA
  weekly corn, soybean, wheat export inspections, 11am
• U.S.
  crop conditions report, 4pm
• Vietnam
  Customs data on exports of coffee, rice and rubber
• Monthly
  MARS bulletin on crop conditions in Europe
• Heilongjiang
  Soy Association holds a summit in Harbin
• EU
  weekly grain, oilseed import and export data
• Ivory
  Coast cocoa arrivals
• International
  Palm Oil Sustainability Conference, Sept 14-22
• HOLIDAYS:
  Costa Rica, Nicaragua, Venezuela

TUESDAY,
Sept. 15:

• Australia’s
  Abares releases quarterly agricultural commodities report
• Malaysia
  palm oil export data for Sept. 1-15
• France’s
  agriculture ministry to publish crop estimates
• World
  Agri-Tech Innovation Summit, Sept. 15-16
• New
  Zealand global dairy trade auction
• HOLIDAYS:
  El Salvador, Guatemala, Honduras, Nicaragua

WEDNESDAY,
Sept. 16:

• EIA
  U.S. weekly ethanol inventories, production, 10:30am
• FranceAgriMer
  supply and demand estimates
• Future
  Food-Tech conference, Sept. 17-18
• HOLIDAYS:
  Malaysia, Mexico

THURSDAY,
Sept. 17:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• USDA
  total milk production for August, 3pm
• Port
  of Rouen data on French grain exports
• Biosev
  SA 1Q 2021 earnings

FRIDAY,
Sept. 18:

• 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

Source:
Bloomberg and FI

 

 

 

 

 

 

CFTC
Commitment of Traders

No
surprises in the traditional fund position estimates versus actual like what we saw last week in corn.  Traders were again adding onto long futures and options managed money long positions in corn and soybeans, along with meal.  We see no or little impact
on prices per the outcome of this report. 

 

 

 

 

 

STATSCAN
CANADA 2020 STATISTIVAL PRODUCTION ESTIMATES BASED ON SATELLITE DATA

·        
2020 ALL-WHEAT OUTPUT SEEN 5.6% TO 34.1 MLN TONNES VS 32.3 MLN TONNES IN 2019 – STATSCAN

·        
2020 DURUM WHEAT OUTPUT SEEN +23.2% TO 6.1 MLN TONNES VS 5.0 MLN TONNES IN 2019

·        
2020 CANOLA OUTPUT SEEN -0.4% TO 19.4 MLN TONNES VS 19.5 MLN TONNES IN 2019

·        
2020 BARLEY OUTPUT SEEN -1.2% TO 10.3 MLN TONNES VS 10.4 MLN TONNES IN 2019

·        
2020 OATS OUTPUT SEEN +6.5% TO 4.5 MLN TONNES VS 4.2 MLN TONNES IN 2019

 

Macros

 

Corn.

• CBOT
  corn traded
  higher Monday to its highest level since mid-March. 
• Japan
  joined China and South Korea for countries placing a ban on Germany pork imports. 
  
• Ukraine
  has exported 9.2 million tons of grain so far in the July 2020-June 2021 season compared to 10.3 million tons at the same point during the previous season

 

Corn
Export Developments

• USDA
  24-hour announced private exporters reported the following activity:
• Export
  sales of 350,000 metric tons of corn for delivery to China during the 2020/2021 marketing year
• Export
  sales of 106,000 metric tons of corn for delivery to Japan during the 2020/2021 marketing year
• (revision)
  Program Announcement FAS-ESR-088-20, issued at 9:00 a.m. on August 27, 2020, which announced export sales of 140,000 metric tons of corn for delivery to unknown destinations during the 2020/2021 marketing year has been corrected to reflect a change in destination.
  The corrected announcement is as follows:  Private exporters reported to the U.S. Department of Agriculture export sales of 140,000 metric tons of corn for delivery to China during the 2020/2021 marketing year.
• Taiwan
  seeks up to 65,000 tons of corn from the US, Brazil, Argentina, and/or South Africa, on Sep 16 for Nov-Dec shipment.
  

 

Soybean
complex.

• CBOT
  November soybeans
  surpassed the $10 mark overnight, first time in two years.  China demand for US soybeans is the main driver. 
  
• Soybean
  meal was slightly lower on product spreading with SBO 44-50 points higher. 
  
• USD
  was down 31 points earlier and WTI crude oil down about $0.30. 
• We
  heard China bought at least 4 cargoes of US Gulf soybeans since Friday and at least 3 cargoes out of the PNW. 
  
• The
  European Union is looking into renewing tariffs on biodiesel from the U.S. to help EU-based producers counter alleged unfair trade.
• Meanwhile,
  the Trump Administration is looking into aid for refiners denied exemption on biofuel waivers.  Last week the Administration asked the EPA to deny dozens of biofuel waiver requests. 
  

• Offshore
  values this morning were leading CBOT soybean oil 29 higher and meal $5.70
  lower. 
• Rotterdam
  soybean oil values were about up 19-22 euros, rapeseed oil 12 higher in the benchmark positions, and Rotterdam meal mostly 3-7 euros higher from this time previous session. 
  
• China
  cash crush margins as of this morning, using our calculation, were 97 cents per bushel and compares to 84 cents a week ago and 96 cents around this time last year.
  

• Malaysian
  palm surged more than 3 percent on Monday after trading down 0.85% all last week.
  November
  closed up 82 ringgit, or 2.92%, at 2,893 ringgit ($698.12) a ton.

 

Oilseeds
Export Developments

• USDA
  24-hour announced private exporters reported the following activity:
• Export
  sales of 129,000 metric tons of soybeans for delivery to China during the 2020/2021 marketing year
• Export
  sales of 318,000 metric tons of soybeans for delivery to unknown destinations during the 2020/2021 marketing year

 

Wheat

• Wheat
  is rebounding (higher) on a lower USD and strength in soybeans and corn. 
  The
  cash market that continues to provide the support.
• US
  winter plantings for now remain on course, but some deciding to wait for rains to press further.
  
• Paris
  (Matif) December wheat was down 0.25 at 189.00 euros.
• Russia
  sent 50,000 tons of wheat to North Korea. 
• US
  Wheat Associates US crop progress report

https://www.uswheat.org/wp-content/uploads/2020/09/HR_2020-9-11.pdf

 

Export
Developments.

• Saudi
  Arabia SAGO bought 745,000 tons of wheat for delivery between November and January. 
  
• Some
  60,000 tons of wheat of 11% protein was bought at $245.37 a ton for November delivery
• 685,000
  tons of 12.5% protein wheat was also bought at the average price of $251.13 a ton for  November and January delivery.
• Iran
  seeks to export 700,000 tons of barley by Friday. 
• Jordan
  seeks 120,000 tons of wheat on Sep 16 for LH October shipment.
• Turkey
  seeks 500,000 tons of milling wheat (min 12.5%) on September 15 for Sep 23-Oct 16 shipment. 
  
• Ethiopia
  seeks about 80,000 tons of milling wheat on Sept. 30.
• Ethiopia
  seeks 400,000 tons of wheat by October 13.

 

Rice/Other

·        
South Korea’s Agro-Fisheries & Food Trade Corp. seeks 113,999 tons of rice on Sep 16 for arrival in South Korea between Jan. 31, 2021, and June 30, 2021.

·        
Syria is in for 39,400 tons of white rice on September 30. 

 

 

 

Terry Reilly

Senior Commodity Analyst – Grain and Oilseeds

Futures International │190 S LaSalle St., Suite 410│Chicago, IL  60603

W: 312.604.1366

treilly@futures-int.com

AIM: fi_treilly

ICE IM: 
treilly1

Skype: fi.treilly

 

 

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