FI Morning Grain Comments 09/14/21

PDF attached

 

Good
morning.

 

No
24-hour announcements.  StatsCan Canadian production estimates are viewed as supportive.  Prices were initially higher on the decline in the corn rating, talk of Chinese buying soybeans, higher soybean oil, and cut in the French soft wheat production by the
AgMin coupled with dry weather across the central US Great Plains. 
(7:57 am CT) WTI was 59 cents higher, USD 33 points lower, and stock markets leaning towards a higher open.  US corn conditions declined by one point and soybeans were unchanged.  However, based on our October versus final trend yield analysis and higher US
harvested area, we boosted our corn and soybean production estimates. 

 

 

 

 

 

Weather

 

5-day

 

Bloomberg
Ag Calendar

Tuesday,
Sept. 14:

• EU
  weekly grain, oilseed import and export data
• France
  agricultural ministry crop production estimate
• Ros
  Agro capital markets day
• Abares’
  agricultural commodities — September quarter 2021

Wednesday,
Sept. 15:

• EIA
  weekly U.S. ethanol inventories, production
• FranceAgriMer
  monthly grains report
• Malaysia
  Sept. 1-15 palm oil exports
• Brazil’s
  Unica releases cane crush and sugar output data (tentative)

Thursday,
Sept. 16:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• Port
  of Rouen data on French grain exports
• HOLIDAY:
  Malaysia

Friday,
Sept. 17:

• 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

Source:
Bloomberg and FI

 

 

 

 

USDA
inspections versus Reuters trade range                                                    

Wheat                 
547,943                 versus   200000-500000  range

Corn                     
138,189                 versus   250000-600000  range

Soybeans           
105,368                 versus   75000-300000                     range

 

Macros

US
CPI (M/M) Aug: 0.3% (est 0.4%; prev 0.5%)

US
CPI Ex-Food, Energy (M/M) Aug: 0.1% (est 0.3%; prev 0.3%)

US
CPI (Y/Y) Aug: 5.3% (est 5.3%; prev 5.4%)

US
CPI Ex-Food, Energy (Y/Y) Aug: 4.0% (est 4.2%; prev 4.3%)

US
Real Avg Hourly Earnings (Y/Y) Aug: -0.9% (prev -1.2%)

US
Real Avg Weekly Earnings (Y/Y) Aug: -0.9% (prevR -0.9%; prev -0.7%)

Canadian
Manufacturing Sales (M/M) Jul: -1.5% (est -1.0%; prev 2.1%)

China
To Sell 7.38Mln Barrels Of Crude From Reserve September 24

 

Corn

·        
US corn futures are higher on technical buying and one point drop in US crop conditions.  US harvest progress could slow during the last half of this week from the tropical storm in the Gulf.  WTI crude oil is higher and USD is
sharply lower. 

·        
Both November soybeans and corn held above their 200-day MA’s so far this week. 

·        
China corn futures hit a 12-mont low. 

·        
Bloomberg) — China’s national oil reserve center has announced the trading of 7.38m barrels of oil reserve on September 24, the National Food and Strategic Reserves Administration says in statement.  

 

·        
USDA US corn export inspections as of September 09, 2021 were 138,189 tons, below a range of trade expectations, below 278,294 tons previous week and compares to 939,113 tons year ago. Major countries included Mexico for 133,446
tons, Taiwan for 4,305 tons, and Hong Kong for 318 tons.

·        
USDA export inspections were lowest in 8-1/2 years. 

 

Export
developments.

·        
None reported. 

 

 

Soybeans

·        
Soybeans are higher on a bullish Canadian canola production estimate, higher soybean oil, and strength in wheat and corn.  China buying of soybeans at a large premium for October shipment was also seen supportive. 

·        
StatsCan reported the Canadian canola production at 12.782 million tons, 13% below their August survey and 34 percent below 2020.  This rallied canola prices over $27/ton post report. 

·        
China was thought to have bought up to 8 cargoes of soybeans from Brazil for October shipment and 2 off the PNW.  Perhaps the USDA inspections report showing zero shipments out of the Gulf for two consecutive weeks caught their
eye.  We heard they paid a hefty 425 over the November for the Brazilian soybeans. 

·        
Yesterday Bloomberg noted there is a House plant to introduce a credit of $1.25 to $1.75/gallon for sustainable aviation fuels. That would not include biodiesel producers.  The draft might be marked up this week by the House Ways
and Means Committee. 

·        
Offshore values are leading SBO 28 points lower and meal $1.00/short ton higher. 

·        
Malaysian palm oil

·        
China cash crush margins were last positive 140 cents on our analysis (137 previous) versus 139 cents late last week and 97 cents around a year ago. 

·        
China

 

·        
USDA US soybean export inspections as of September 09, 2021 were 105,368 tons, within a range of trade expectations, above 90,603 tons previous week and compares to 1,634,646 tons year ago. Major countries included China for 63,959
tons, Mexico for 27,308 tons, and Vietnam for 3,574 tons.

 

 

Export
Developments

• No
  developments

 

Wheat

·        
Wheat is higher downgrades in the Canadian and French wheat  production estimates.

·        
StatsCan reported the Canadian all-wheat production at 21.715 million tons, 5.4% below their August estimate and 38 percent below 2020.  Spring wheat was 15.321 million tons, a 5% reduction from August and 41% below 2020.  This
report incorporated satellite data. 

·        
Tropical  storm Nicholas will dump more than 20 inches of rain as it reaches landfall in Texas.  This is more of a wheat export problem, not as much for corn and soybeans. 

·        
Ukraine winter grain planting progress reached 5 percent complete on the expected 7.84 million hectares projected by the AgMin. 

·        
December Paris wheat was up 3.50 at 242.50 euros. 

·        
The USD was 33 points lower as of 7:57 am CT.

·        
USDA US all-wheat export inspections as of September 09, 2021 were 547,943 tons, above a range of trade expectations, above 412,649 tons previous week and compares to 694,154 tons year ago. Major countries included Mexico for
153,794 tons, Philippines for 111,059 tons, and China for 68,871 tons.

 

Export
Developments. 

·        
Japan seeks 118,771 tons of food wheat this week.

·        
Turkey seeks 260,000 tons of feed barley on September 21 for October 8-October 31 shipment. 

·        
Jordan seeks 120,000 tons of wheat on September 15 for last half December through first half February shipment. 

·        
Japan’s Ministry in their regular SBS import tender seeks 80,000 tons of feed wheat and 100,000 tons of feed barley for arrival in Japan by Feb. 24, 2022, set to close on Sept. 15.

·        
Bangladesh’s state grains buyer seeks another 50,000 tons of milling wheat on September 16. 

·        
Jordan seeks 120,000 tons of feed barley on September 16 for Dec/Jan/Feb shipment. 

·        
Pakistan issued a new import tender for 500,000 tons of wheat set to closed on September 20. 

·        
Mauritius seeks 47,000 tons of wheat flour, optional origin, on Sept. 21 for various 2022 shipment.

·        
Morocco seeks 363,000 tons of US wheat on September 21 for arrival by the end of the year. 

 

Rice/Other

·        
Bangladesh seeks 50,000 tons of rice on September 23.