FI Morning Grain Comments 11/22/21

PDF attached

 

Good
morning

 

USD
is 27 points higher and WTI crude down about 50 cents.  CBOT grains and soybean complex are higher this morning led by strength in wheat amid record contract highs in Paris. Global wheat demand remains robust. The Philippines bought a cargo of feed wheat.
Bangladesh is seeing offers for wheat.  South Korea’s MFG seeks corn and soybean meal on Tuesday. Argentina is on holiday. La Nina strengthened over the past month. The northern US should see net drying bias WCB this week. South American weather looks good
through the end of the month but there is concern over potential net drying across Argentina and southern Brazil through January.  It appears the southern US will see restricted rain over the next week.

 

CANADIAN
NATIONAL RAILWAY SEES REPAIRS TO B.C. LINES CONTINUING AT LEAST INTO NEXT WEEK – REUTERS NEWS

CANADIAN
PACIFIC RAILWAY CP.TO ESTIMATES IT WILL RESTORE B.C. SERVICE SEVERED BY FLOODS BY MID-WEEK – STATEMENT – REUTERS NEWS

 

 

 

Weather

 

 

 

World
Weather Inc.

WORLD
WEATHER HIGHLIGHTS FOR NOVEMBER 22, 2021

• Argentina
  and Brazil are still advertised to get some timely rainfall this week and next week, but if some of the rain advertised fails to occur as abundantly as advertised there may be some greater drying and the development of crop stress for a few of the driest areas.
  
• For
  now, soil moisture is still quite favorable.
• Brazil’s
  coffee, citrus and sugarcane crop remains favorably rated with little change likely.
  
• Southern
  India will continue too wet this week and in need of drying.
• Some
  weekend rain in west-central and southern India raised a little concern over unharvested crop quality.
  
• Australia’s
  wheat harvest will be delayed again this week in New South Wales, Queensland and portions of both northern Victoria and eastern South Australia because of rain.
  
• Some
  of these same areas in Australia reported rain during the weekend.
• U.S.
  weather will remain dry biased in hard red winter wheat country as well as the northern Plains, California and the southwestern desert region.
  
• Rain
  will fall periodically in the lower and eastern Midwest, Delta and a part of the southeastern states. Europe and the western Commonwealth of Independent States will see precipitation increase during the weekend and next week.
  
• South
  Africa should start getting improved rainfall to benefit its crops and China weather will be relatively quiet except for today’s snowstorm in the northeast. 

 

Bloomberg
Ag Calendar

Monday,
Nov. 22:

• Monthly
  MARS bulletin on crop conditions in Europe
• USDA
  export inspections – corn, soybeans, wheat, 11am
• U.S.
  winter wheat condition, cotton harvest data, 4pm
• Ivory
  Coast cocoa arrivals
• Malaysia’s
  Nov. 1-20 palm oil exports
• U.S.
  cold storage data — pork, beef and poultry, 3pm
• HOLIDAY:
  Argentina

Tuesday,
Nov. 23:

• EU
  weekly grain, oilseed import and export data
• Brazil’s
  Conab releases sugar and cane production data (tentative)
• Council
  of Palm Oil Producing Countries online webinar
• U.S.
  poultry slaughter, 3pm
• HOLIDAY:
  Japan

Wednesday,
Nov. 24:

• EIA
  weekly U.S. ethanol inventories, production
• USDA
  red meat production, 3pm

Thursday,
Nov. 25:

• Malaysia’s
  Nov. 1-25 palm oil exports
• Port
  of Rouen data on French grain exports
• HOLIDAY:
  U.S.

Friday,
Nov. 26:

• 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
• USDA
  weekly net- export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am
• FranceAgriMer
  weekly update on crop conditions

Source:
Bloomberg and FI

 

CFTC
Commitment of Traders

The
CFTC Commitment of Trader report showed no major surprises this week as the traditional net positions came in near trade expectations.  The net long position for corn of nearly 400,000 contracts was roughly 150,000 below record long and after today, stands
at around 343,000 contracts.  The soybean meal traditional net long fund position is around 44,000 contracts. Around mid-October funds were net short meal. 

 

 

 

 

 

 

 

 

Macros

US
Chicago Fed National Activity Index Oct: 0.76 (est 0.10; prev -0.13; prevR -0.18)

Canada
Oct Wholesale Trade Most Likely Rose 1.4% – StatsCan Flash Estimate

 

Corn

·        
CBOT corn is higher following sharply higher wheat prices. News is light for the corn market.  

·        
The December options expire Friday.

·        
AgRural reported first crop corn planting in Brazil reached 91% in the center-south region, compared with 85% in the previous week and the same 91% a year earlier. (Reuters)

·        
Safras calls for a 25.7 million ton Brazil summer corn crop, unchanged from their August estimate. 

·        
USDA Cattle on Feed report showed November 1 on feed at expectations (down slightly from last year), placements slightly higher than expected and fed cattle marketed down slightly from a Reuters trade guess. The report is seen
neutral for corn.

 

Export
developments.

·        
South Korea’s MFG seeks 8,000 to 16,000 tons of soybean meal and 48,500 to 58,500 tons of corn on Tuesday, for arrival around April 25.

 

 

Soybeans

·        
CBOT soybeans and soybean oil are higher while meal is down slightly. Soybeans are likely getting a lift from strength in wheat and weather concerns. Offshore values were mixed. India import margins for veg oils still favor soybean
oil over palm

·        
La Niña strengthened in the last month.  The IRI noted a 97 percent probability of La Nina over the Nov through January period. 

·        
South American weather looks ok through the end of the month but there is concern over potential net drying across Argentina and southern Brazil through January.

·        
AgRural estimated Brazil planted 86% of its soybean crop, up 8 points from the previous week and higher than the 81% planted at the same point in 2020-21. (Reuters)

·        
China imported 3.3 million tons of Brazilian soybeans in October, down 22% from 4.233 million tons in the previous year.  Total October soybean imports were 5.11 million tons, down 41% from a year earlier and lowest level since
March 2020.

·        
China soybean futures were down 0.6%, meal 0.6% lower, SBO down 1.3%, and palm up down 0.2%.  Hog futures increased slightly in China.    

·        
Malaysian February palm futures were down 34 ringgit and cash was down $5.00 at $1,257.50/ton. 

·        
ITS reported Malaysian November palm oil exports up 18.1% from the same period month earlier to 1.130 million tons. 

·        
AmSpec reported November 1-20 Malaysian palm oil exports up 9 percent to 1.067 million tons from 978,917 tons previous period last month.  Malaysia

·        
Rotterdam meal values were unchanged to 8 euros higher and vegetable oils unchanged to 3 euros lower. 

·        
Offshore values are leading soybean oil 81 points higher and meal $0.40 short ton lower. 

·        
China crush margins on our analysis was last $2.31/bu, compared to $2.30 at the end of last week and compares to $0.75 a year ago. 

·        
China

 

Export
Developments

·        
South Korea’s MFG seeks 8,000 to 16,000 tons of soybean meal and 48,500 to 58,500 tons of corn on Tuesday, for arrival around April 25.

·        
Turkey seeks 6,000 tons of sunflower oil on November 23 for December shipment.

 

Wheat

·        
US wheat futures are up sharply on North American and Australian weather concerns, increase in China demand and fresh record Matif wheat contract highs. 

·        
Russia/Ukraine political tensions are not helping wheat bear traders.  The ruble is lower this morning. 

·        
March Matif Paris wheat was 7.00 euros higher at 304.00 as of 7.45 am CT.

·        
Global wheat demand remains robust. The Philippines bought a cargo of feed wheat. Bangladesh is seeing offers for wheat. 

·        
Ukraine grain exports so far this season are up 20.2% from the comparable period year ago at 23.8 million tons, including 14 million tons of wheat, 4.9 million tons of barley and 4.6 million tons of corn. Argentina is on holiday.

·        
Ukraine reported 25.9 million tons of grain stocks as of November 1, 5.5 million tons above this time year ago, and includes 11.9 million tons of wheat.

·        
The northern US should see net drying bias WCB this week. It appears the southern US will see restricted rain over the next week.

 

Export
Developments.

·        
The Philippines bought (confirmed) about 40,000 tons of Australian wheat (for February loading, according to AgriCensus, at around $353.50/ton. This is on top of 38,000 bought last week.  

·        
Bangladesh is seeing offers for 50,000 tons of milling wheat. $431.83/ton was lowest offer.

·        
Japan’s AgMin in a SBS import tender seeks 80,000 tons of feed wheat and 100,000 tons of feed barley for arrival by February 24.

·        
Turkey seeks 370,0000 (320,000 previous) tons of feed barley on November 23 for January shipment. 

·        
Jordan seeks 120,000 tons of feed barley on November 24.

·        
Jordan seeks 120,000 tons of wheat on November 25 for shipment between March 16-31, April 1-15, April 16-30 and May 1-15.

·        
Turkey seeks 385,000 tons of wheat on November 25.

·        
Iraq seeks 500,000 tons of wheat starting in December for an unknown shipment period. 

 

Rice/Other

·        
None reported