FI Morning Grain Comments 11/27/20

PDF attached includes Monday report estimates, China cash, & USDA export sales

(shortened text comments)

 

Morning. 
It appears a lower trade might be warranted for the hard open Friday as rains fell across northern Argentina into southern Brazil on Thursday and mixed outside markets, but export developments may support grains.  WTI crude oil down $0.46. 
The USD was 11 lower.  Equity futures were higher.  Offshore values are leading soybean oil 3 points lower and meal $0.70 lower.  However, or two day period palm oil futures traded a combined 53 points higher and cash up $12.50.  Soybeans in China are 2.1
percent higher over the two day period.  EU soybean meal was 2-6 euros lower over the past two days.  South Korea bought 60,000 tons of US corn and 47,630 tons of Australian wheat. Egypt bought 175,000 tons of Russian wheat.  Today is December position day. 
Export sales were a marketing year low for soybeans and well above expectations for wheat.  USDA announced 302,160 tons of corn sold to Mexico.  India cut their import tax on crude palm oil to 27.5% from 37.5%. 

 

Opening
Calls:

Soybeans
2-5 lower

Soybean
meal $1.00-$2.50 lower

Soybean
oil steady to 10 lower (2-sided trade not ruled out on product spreading)

Corn
1-2 lower (look for a 2-sided trade on good USDA sales announcements)

Chicago
wheat steady 

 

 

Weather

 

Below
are Thursday only maps

 

 

 

 

 

Source:
World Weather Inc. and FI

 

Bloomberg
Ag Calendar

Friday,
Nov. 27:

• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• ICE
  Commitments of Traders report, 1:30pm ET (6:30pm London)
• NOTE:
  CFTC Commitments of Traders report, usually released on Fridays, will be issued on Monday, Nov. 30, due to Thanksgiving holiday
• FranceAgriMer
  weekly update on crop conditions

Source:
Bloomberg and FI

 

 

 

 

 

 

 

See
export sales highlights after the wheat section

 

Macros

 

Corn.

• CBOT
  corn may open lower but look for a two-sided trade.  There was large drop in open interest on Wednesday indicating the bulls are taking profits. 
  
• USDA
  announced 302,160 tons of corn were sold to Mexico under the 24-hour announcement system. 
  
• USDA
  export sales were above expectations at 1.666 million tons.
• USD
  is slightly lower and WTI crude $0.37 lower at the time this was written. 
  
• CBOT
  corn open interest fell 32,697 contracts to 1.68 million contracts. 
• FND
  delivery estimates in corn are expected to be zero.  
• China
  reported an outbreak of H5N8 bird flu in Shanxi. 

 

Corn
Export Developments

• USDA
  announced 302,160 tons of corn were sold to Mexico under the 24-hour announcement system. 
  
• South
  Korea KOCOPIA bought 60,000 tons of US corn. 

 

Soybean
complex.  

• CBOT
  soybeans are expected to open lower along with soybean meal while soybean oil could gain over meal on a higher two-day trade in Malaysian palm futures. 
  
• India
  cut their import tax on crude palm oil to 27.5% from 37.5%.   
• USDA
  export sales were a marketing year low for soybeans, of 768,100 tons. Product sales were on the lower side. 
  
• CBOT
  registrations are 175 for soybeans, 196 for meal and 1,658 for soybean oil.  We think meal deliveries will be zero and soybean oil 0-200. 
  

• Offshore
  values this morning were leading CBOT soybean oil 3 lower and meal $0.70 lower.  
  
• Rotterdam
  soybean oil values were about unchanged, rapeseed oil 10 lower, and Rotterdam meal 2-6 euros higher from this time previous session. 
  
• China
  cash crush margins were 75 cents on out our calculation (80 previous), compared to 89 last week and 166 year ago. 
  
• Malaysian
  palm:  53 higher over the past two days and cash $12.50 higher. 

 

 

Oilseeds
Export Developments

• Results
  awaited: South Korea’s Agro-Fisheries seeks 75,000 tons of non-GMO soybeans on November 24 for Jan-Jun 2022 arrival. 
  
• The
  CCC seeks 8,660 tons of packaged vegetable oils for various locations on December 1 for Jan-FH Feb shipment. 
  

 

Wheat

• US
  wheat futures may open steady to higher after USDA export sales exceeded expectations at 795,800 tons.   
  
• Paris
  (Matif) March wheat was 1.25 euro higher at 211.50 euros. 

 

Export
Developments.

• South
  Korean millers bought 47,630 tons of Austrian wheat. 
• Egypt
  bought 175,000 tons of Russian wheat. 
• Jordan
  seeks 120,000 tons of feed barley on Dec 1. 
• Qatar
  seeks 100,000 tons of feed barley on December 8, optional origin. 

 

Rice/Other

·        
Lowest offer for Bangladesh in for 50,000 tons of rice was $416.00/ton.  Separate import tender below. 

·        
Bangladesh seeks 50,000 tons of rice on December 2 for shipment within 40

·        
Syria seeks 25,000 tons of white rice on December 2. 

 

Export Sales Highlights 

This summary is based on reports from exporters for the period November 13-19, 2020.

 

Wheat:  Net sales of 795,700 metric tons (MT) for 2020/2021–a marketing-year high–were up noticeably from the previous week and up 74 percent from the prior 4-week average.  Increases primarily for China (333,000
MT, including 130,000 MT switched from unknown destinations), Japan (109,900 MT), unknown destinations (69,800 MT), Nigeria (63,000 MT), and the Philippines (62,400 MT), were offset by reductions for Italy (4,800 MT).  Exports of 343,200 MT were up 27 percent
from the previous week, but down 1 percent from the prior 4-week average.  The destinations were primarily to Mexico (75,700 MT), China (63,000 MT), Nigeria (49,000 MT), Guatemala (33,500 MT), and the Philippines (32,400 MT).  

 

Optional Origin Sales:  For 2020/2021, the current outstanding balance of 10,000 MT, all Spain.

 

Corn:  Net sales of 1,665,600 MT for 2020/2021 were up 53 percent from the previous week, but down 4 percent from the prior 4-week average.  Increases were primarily for Mexico (555,000 MT, including decreases
of 1,000 MT), unknown destinations (524,400 MT), Colombia (147,200 MT, including 135,000 MT switched from unknown destinations and decreases of 27,800 MT), South Korea (132,700 MT), and China (75,900 MT).  Exports of 871,100 MT were up 3 percent from the previous
week and 15 percent from the prior 4-week average.  The destinations were primarily to Mexico (339,300 MT), China (200,900 MT), Colombia (155,200 MT), Japan (116,100 MT), and Guatemala (17,000 MT).  

 

Optional Origin Sales:  For 2020/2021, new optional origin sales of 134,000 MT were reported for South Korea.  Decreases totaling 130,000 MT were reported for Japan.  The current outstanding balance of 1,454,600
MT is for South Korea (769,000 MT), Taiwan (205,000 MT), unknown destinations (167,600 MT), Vietnam (130,000 MT), China (65,000 MT), Ukraine (60,000 MT), and Japan (58,000 MT).  

 

Barley:  No net sales were reported for the week.  Exports of 600 MT were to Japan.

 

Sorghum:  Net sales of 355,800 MT for 2020/2021 were up noticeably from the previous week and up 97 percent from the prior 4-week average.  Increases were reported for China (300,800 MT, including 61,200 MT switched
from unknown destinations and decreases of 6,500 MT) and unknown destinations (55,000 MT).  Exports of 120,900 MT were down 53 percent from the previous week, but up 1 percent from the prior 4-week average.  The destination was China.  

 

Rice:  Net sales of 69,500 MT for 2020/2021 were up 23 percent from the previous week and 17 percent from the prior 4-week average.  Increases primarily for Japan (52,000 MT), Mexico (7,400 MT), Saudi Arabia
(4,300 MT), Canada (2,400 MT), and Israel (1,800 MT), were offset by reductions primarily for Brazil (1,100 MT), New Zealand (900 MT), and El Salvador (400 MT).  Exports of 145,600 MT–a marketing-year high–were up 70 percent from the previous week and 94
percent from the prior 4-week average.  The destinations were primarily to Mexico (57,800 MT), Venezuela (29,300 MT), Brazil (27,200 MT), Guatemala (11,100 MT), and Saudi Arabia (5,300 MT).

 

Exports for Own Account:  For 2020/2021, the current exports for own account outstanding balance is 100 MT, all Canada. 

 

Soybeans:  Net sales of 768,100 MT for 2020/2021–a marketing-year low–were down 42 percent from the previous week and 47 percent from the prior 4-week average.  Increases primarily for China (578,700 MT, including
330,000 MT switched from unknown destinations and decreases of 2,500 MT), Egypt (167,700 MT, including 55,000 MT switched from China and decreases of 2,500 MT), Germany (125,400 MT), Indonesia (100,800 MT, including 68,000 MT switched from unknown destinations
and decreases of 100 MT), and Thailand (75,500 MT, including 66,000 MT switched from unknown destinations), were offset by reductions primarily for unknown destinations (738,900 MT).  Exports of 2,412,200 MT were down 4 percent from the previous week and 11
percent from the prior 4-week average.  The destinations were primarily to China (1,668,000 MT), Mexico (126,000 MT), Germany (125,400 MT), Indonesia (99,500 MT), and Egypt (87,700 MT).  

 

Optional Origin Sales:  For 2020/2021, the current outstanding balance of 63,000 MT, all China.

 

Exports for Own Account:  For 2020/2021, new exports for own account totaling 25,200 MT were to  Canada.  The current exports for own account outstanding balance is 54,900 MT, all Canada.

 

Export Adjustment:  Accumulated export of soybeans to the Netherland were adjusted down 68,651 MT for week ending November 5th and 56,763 MT for week ending November 12th.  The correct destination for these shipments
is Germany and is included in this week’s report.  

 

Soybean Cake and Meal:  Net sales of 138,100 MT for 2020/2021, resulting in increases primarily for Canada (52,400 MT, including decreases of 700 MT), Mexico (22,700 MT), Guatemala (16,500 MT, including decreases
of 500 MT), Colombia (11,000 MT, including 15,000 MT switched from unknown destinations and decreases of 7,800 MT), and Morocco (11,000 MT), were offset by reductions primarily for unknown destinations (16,900 MT).  Exports of 263,200 MT were primarily to
Spain (52,200 MT), Mexico (45,800 MT), Japan (33,500 MT), the Dominican Republic (31,300 MT), and the Philippines (23,200 MT).  

 

Soybean Oil:  Net sales of 26,300 MT for 2020/2021, increases were primarily for South Korea (9,600 MT), Colombia (8,500 MT), Venezuela (4,000 MT), the Dominican Republic (2,000 MT), and Canada (1,200 MT).  For
2021/2022, total net sales of 600 MT were for Canada.  Exports of 1,400 MT were primarily to Mexico (700 MT) and Canada (600 MT).

 

Cotton:  Net sales of 354,700 RB for 2020/2021 were up noticeably from the previous week and up 84 percent from the prior 4-week average.  Increases primarily for Vietnam (169,500 RB, including decreases of 13,200
RB), Bangladesh (89,400 RB), Turkey (28,700 RB), China (28,000 RB, including 900 RB switched from Hong Kong and decreases of 63,900 RB), and Pakistan (10,500 RB), were offset by reductions for Hong Kong (900 RB) and Costa Rica (400 RB).  For 2021/2022, net
sales of 38,500 RB were for China (37,000 RB), Mexico (1,100 RB), and Costa Rica (400 RB).  Exports of 183,000 RB were down 34 percent from the previous week and 32 percent from the prior 4-week average.  Exports were primarily to China (89,500 RB), Vietnam
(20,900 RB), Pakistan (19,700 RB), Mexico (16,700 RB), and Bangladesh (8,400 RB).  Net sales of Pima totaling 26,900 RB were up noticeably from the previous week and up 45 percent from the prior 4-week average.  Increases primarily for China (10,400 RB), Vietnam
(4,900 RB), India (4,500 RB, including decreases of 100 RB), Peru (2,900 RB), and Hong Kong (2,600 RB), were offset by reductions for Bangladesh (1,000 RB) and Switzerland (400 RB).  Exports of 21,700 RB were up 14 percent from the previous week and 11 percent
from the prior 4-week average.  The destinations were primarily to India (6,700 RB), Bangladesh (5,000 RB), China (4,300 RB), Vietnam (1,900 RB), and Pakistan (1,900 RB).    

 

Exports for Own Account:  For 2020/2021, new exports for own account totaling 20,200 RB were to China (19,400 RB) and Vietnam (800 RB).  The current exports for own account outstanding balance of 31,900 RB is
for China (29,800 RB), Bangladesh (1,000 RB), Vietnam (800 RB), and Indonesia (300 RB).

 

Hides and Skins:  Net sales of 367,100 pieces for 2020 were up 34 percent from the previous week, but down 1 percent from the prior 4-week average.  Increases primarily for China (259,100 whole cattle hides,
including decreases of 10,400 pieces), South Korea (46,900 whole cattle hides, including decreases of 3,700 pieces), Mexico (29,600 whole cattle hides, including decreases of 700 pieces), Thailand (15,500 whole cattle hides, including decreases of 200 pieces),
and Cambodia (11,600 whole cattle hides), were offset by reductions primarily for Indonesia (500 pieces) and Taiwan (400 pieces).  For 2021, net sales of 111,800 pieces were reported for China (95,900 whole cattle hides), South Korea (14,100 whole cattle hides),
and Vietnam (1,800 whole cattle hides).  Additionally, total net sales reductions of 500 kip skins were for Belgium.  Exports of 356,700 pieces reported for 2020 were down 24 percent from the previous week and 11 percent from the prior 4-week average.  Whole
cattle hides exports were primarily to China (257,700 pieces), South Korea (40,100 pieces), Mexico (30,100 pieces), Thailand (7,100 pieces), and Cambodia (6,000 pieces). In addition, exports of 5,100 kip skins were to Belgium.  

 

Net sales of 59,500 wet blues for 2020 were down 27 percent from the previous week, but up 2 percent from the prior 4-week average.  Increases were primarily for China (26,700 unsplit), Thailand (20,000 unsplit),
Vietnam (10,000 unsplit, including decreases of 200 unsplit), Mexico (2,100 unsplit and 700 grain splits), and India (2,600 unsplit).  For 2021, net sales of 6,100 wet blues reported for Italy (6,000 grain splits and 1,500 unsplit), the Dominican Republic
(1,600 unsplit), and Brazil (1,000 unsplit), were offset by reductions for China (4,000 unsplit).  Exports of 55,400 wet blues for 2020 were down 58 percent from the previous week and 67 percent from the prior 4-week average.  The destinations were reported
to Vietnam (20,900 unsplit and 1,800 grain splits), China (14,800 unsplit), Thailand (7,000 unsplit), Brazil (4,200 grain splits and 2,400 unsplit), and Mexico (3,500 grain splits and 900 unsplit).  Net sales of 99,500 splits were reported for Vietnam (57,800
pounds, including decreases of 28,600 pounds), Taiwan (40,000 pounds), and China (1,600 pounds, including decreases of 500 pounds).  For 2021, total net sales reductions of 46,900 splits were for Vietnam.  Exports of 404,900 pounds were to Vietnam (277,500
pounds) and China (127,400 pounds).

 

Beef:  Net sales reductions of 15,500 MT reported for 2020–a marketing-year low–were up noticeably from the previous week and from the prior 4-week average.  Increases primarily for China (2,000 MT, including
decreases of 100 MT), Japan (1,800 MT, including decreases of 2,700 MT), Kuwait (100 MT), Singapore (100 MT), and Italy (100 MT), were more than offset by reductions primarily for South Korea (10,800 MT), Mexico (3,300 MT), Hong Kong (2,100 MT), and Taiwan
(1,500 MT).  For 2021, net sales reductions of 1,500 MT were primarily for Japan (1,000 MT), Taiwan (800 MT), and Vietnam (300 MT), were more than offset by reductions for South Korea (3,200 MT).  Exports of 20,200 MT were down 10 percent from the previous
week, but up 9 percent from the prior 4-week average.  The destinations were primarily to South Korea (5,300 MT), Japan (5,100 MT), China (2,900 MT), Mexico (2,300 MT), and Hong Kong (1,700 MT).

 

Export Adjustments:  Accumulated export of beef to Japan were adjusted down 314 MT for week ending November 5th.  This shipment was reported in error. 

 

Pork:  Net sales of 18,800 MT reported for 2020 were down 35 percent from the previous week and 47 percent from the prior 4-week average.  Increases primarily for Mexico (9,400 MT, including decreases of 600
MT), Japan (3,900 MT, including decreases of 200 MT), China (2,500 MT, including decreases of 600 MT), Canada (1,000 MT, including decreases of 400 MT),  and the Dominican Republic (800 MT), were offset by reductions primarily for South Korea (800 MT).  For
2021, net sales of 6,600 MT were primarily for South Korea (2,200 MT), Canada (1,900 MT), Colombia (1,000 MT), Australia (600 MT), and China (500 MT).  Exports of 40,900 MT were up 6 percent from the previous week and 8 percent from the prior 4-week average. 
The destinations were primarily to China (14,400 MT), Mexico (11,800 MT), Japan (5,500 MT), Canada (2,100 MT), and South Korea (2,000 MT). 

 

U.S. EXPORT SALES FOR WEEK ENDING 11/19/2020 

  

	CURRENT MARKETING YEAR						NEXT MARKETING YEAR
COMMODITY	NET SALES	OUTSTANDING SALES		WEEKLY EXPORTS	ACCUMULATED EXPORTS		NET SALES	OUTSTANDING SALES
		CURRENT YEAR	YEAR AGO		CURRENT YEAR	YEAR AGO
	THOUSAND METRIC TONS
WHEAT
HRW	155.9	1,532.8	1,223.7	190.3	4,836.5	4,714.0	0.0	22.0
SRW	20.0	419.7	544.7	13.2	967.9	1,401.5	0.0	100.0
HRS	114.6	1,510.4	1,237.2	63.9	3,441.7	3,279.4	0.0	45.0
WHITE	501.9	2,485.3	860.6	48.0	2,304.2	2,293.2	0.0	20.0
DURUM	3.4	177.4	211.3	27.9	369.8	461.6	0.0	0.0
TOTAL	795.7	6,125.5	4,077.5	343.2	11,920.1	12,149.8	0.0	187.0
BARLEY	0.0	30.4	34.9	0.6	12.4	24.2	0.0	0.0
CORN	1,665.6	27,621.1	8,219.8	871.1	9,300.6	5,849.6	0.0	747.0
SORGHUM	355.8	3,230.8	804.5	120.9	1,061.8	102.6	0.0	327.0
SOYBEANS	768.1	27,296.8	10,770.7	2,412.2	24,633.9	14,489.8	0.0	69.0
SOY MEAL	138.1	3,256.5	3,213.4	263.2	1,680.8	1,589.5	0.0	18.1
SOY OIL	26.3	315.9	189.6	1.4	71.6	131.9	0.6	0.6
RICE
L G RGH	3.6	267.2	390.7	127.8	460.6	466.3	0.0	0.0
M S RGH	0.0	19.6	16.9	0.0	9.3	13.9	0.0	0.0
L G BRN	0.0	10.6	13.8	0.1	11.3	14.9	0.0	0.0
M&S BR	-0.5	17.6	56.5	1.7	32.6	1.8	0.0	0.0
L G MLD	5.9	79.9	213.0	5.9	149.4	370.4	0.0	0.0
M S MLD	60.4	207.4	189.5	10.2	122.3	166.3	0.0	0.0
TOTAL	69.5	602.3	880.4	145.6	785.7	1,033.5	0.0	0.0
COTTON		THOUSAND RUNNING BALES
UPLAND	354.7	5,636.8	7,470.4	183.0	3,951.3	2,932.6	38.5	630.1
PIMA	26.9	255.7	163.9	21.7	223.4	125.5	0.0	0.7