FI Morning Grain Comments 12/18/20

PDF attached

 

Morning. 

 

Quiet
start for the end of the week.  There were no major trade developments.  January soybeans topped $12.15 overnight, and soybean oil traded above 40 cents.  This morning soybeans and meal are higher while light selling kept soybean oil near unchanged.  Corn
is mixed with bull spreading a feature, leaving nearby March near a 2-week high.  Wheat is lower on light technical selling for KC and Chicago.  MN is higher on follow through buying over demand for high protein wheat.  It was mostly dry across Brazil overnight
and Argentina picked up some light rain across western Cordoba and BA.  Southern Brazil will see good rain over the next week while Argentina will see good rain but will be on the lighter side for northeastern Buenos Aires, southern Entre Rios, and southwestern
La Pampa. 

 

 

 

Schedule
Change: Weekly Export Sales Report

Because
federal government agencies will be closed on Thursday, December 24, the scheduled Export Sales Report for the week ending December 17 will be published on Wednesday, December 23, at 8:30 a.m. EST.

 

Weather

In
Argentina, significant rain will still impact a large portion of the region Friday. The rain will likely be greatest in San Luis, Cordoba, northeastern La Pampa, southwestern Buenos Aires, southern Santa Fe, northern Entre Rios, and into Corrientes and Misiones.
Amounts will likely be disappointing is areas such as northeastern Buenos Aires, southern Entre Rios, and southwestern La Pampa. This event will mostly miss the far northwestern part of Argentina’s production region. The rain will cause some temporary reduction
in dryness concerns; though, dryness in week 2 of the outlook will then lead to some increase in crop stress, especially in the pockets that miss out from much rain Friday.

           
In Brazil, conditions are still expected to be favorable for crop development in most of the nation. There will also still be some pockets that are drier than preferred though, such as southern Rio Grande do Sul, northeastern Bahia, and possibly some of western
Mato Grosso do Sul; however, the bottom line remains good for much of the crops.

Source:
World Weather Inc. and FI

 

 

Bloomberg
Ag Calendar

Friday,
Dec. 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
• U.S.
  Cattle on Feed

Monday,
Dec. 21:

• USDA
  weekly corn, soybean, wheat export inspections, 11am
• Ivory
  Coast cocoa arrivals

Tuesday,
Dec. 22:

• U.S.
  cold storage stocks of poultry, pork, beef; poultry slaughter, 3pm

Wednesday,
Dec. 23:

• China
  customs publishes data on imports of corn, wheat, sugar and cotton
• USDA
  weekly crop net-export sales for corn, soybeans, wheat, cotton, pork, beef, 8:30am
• EIA
  U.S. weekly ethanol inventories, production, 10:30am
• USDA
  hogs and pigs inventory, red meat production, 3pm

Thursday,
Dec. 24:

• Port
  of Rouen data on French grain exports

Friday,
Dec. 25:

• Christmas
  Day
• NOTE:
  Commitments of Traders reports for both ICE Futures Europe and CFTC will be delayed to Monday, Dec. 28
• China
  customs publishes country-wise soybean and pork import data

Source:
Bloomberg and FI

 

 

 

 

HIS
Markit US update via trade sources:

2020
U.S. corn yield 174.1, down from 175.7 in Nov and compares to 175.8 USDA

2020
U.S. corn production 14.404 billion bushels, down 103 from USDA.

 

2020
U.S. soybean yield 50.4, down from 50.8 in Nov and compares to 50.7 USDA

2020
U.S. soybean production 4.146 billion bushels, down 24 from USDA

 

2021
US acreage:

Corn:
91.2, down 583,000 from Nov

Beans:
89.4, up 370,000 from Nov

All
Wheat: 45.4, down 565,000 from Nov

Cotton:
13.1, up 40,000 from Nov

 

 

 

Macros

Canadian
Retail Sales (M/M) Oct: 0.4% (est 0.0%; prev 1.1%)

Canadian
Retail Sales Ex-Auto (M/M) Oct: 0.0% (est 0.1%; prev 1.0%)

 

 

Corn.

• Corn
  is mixed with bull spreading a feature, leaving nearby March near a 2-week high.  Quiet start for the end of the week.  There were no major tender developments.  Argentina corn registrations increased overnight with a combined 250,000 tons booked for Jan and
  Jul shipment. 
• US
  EPA reported November RIN generation ethanol (D6) blending credits at 1.14 billion, down from 1.15 billion in October.
  

• BAGE
  reported Argentina corn planting progress at 55 percent complete, up 8 points from the previous week and compares to 63 percent year ago. 
  

• China
  will offer 103,431 tons of corn from states reserves stored in the northeast region on Tuesday from the 2014 and 2015 harvests. 
  
• The
  European Commission raised its estimate of 2020-21 usable EU corn production to 62.5 million tons from 60.2 million projected in November.  And they lowered its import forecast for 2020-21 EU corn to 19 million tons from 21 million.
• Japan’s
  Ministry of Agriculture, Forestry and Fisheries reported October usage of corn in animal feed rose to 49.1%, compared with 48.4% in the year-ago period.

 

 

 

Corn
Export Developments

• None
  reported

 

 

Soybean
complex.  

• CBOT
  January soybeans topped $12.15 overnight, and soybean oil traded above 40 cents.  This morning soybeans and meal are higher while light selling kept soybean oil near unchanged.  Argentina planting progress for corn and soybeans are running behind last year’s
  pace.
• It
  was mostly dry across Brazil overnight and Argentina picked up some light rain across western Cordoba and BA.  Southern Brazil will see good rain over the next week while Argentina will see good rain but will be on the lighter side for northeastern Buenos
  Aires, southern Entre Rios, and southwestern La Pampa. 
• Brazil’s
  Parana soybean crop estimated by Deral was seen at 20.38 million tons, down from 20.47 million tons in previous report.
  
• Malaysian
  palm oil jumped about 2.5 percent on Friday, settling 66 higher and cash was up $16.00 per ton. 
  
• Gulf
  fob soybean oil is running near a $87/ton premium to RBD palm oil. 
• China
  cash crush margins improved from Thursday. 
• Marathon’s
  Dickinson, ND, plant is up and running which has a capacity of about 19,000 barrels per day, or 5.8 million pounds of biodiesel per day.  Traders are still waiting for EPA to release biodiesel mandates. 
  
• US
  EPA reported November RIN generation biodiesel (D4) blending credits at 390 million, up from 333 million the month prior.
• APK-Inform
  reported Ukrainian sunflower oil export prices increased $70-$75 per ton so far this week and reached $1,155 to $1,165 FOB Black Sea January-March delivery.  Ukraine exported 6.632 million tons of sunflower oil in the 2019-20 September-August crop year and
  this year is expected to fall to 5.78 million tons. 

• BAGE
  reported Argentina soybean planting progress at 68 percent complete, up 11 points from the previous week and compares to 70 percent year ago. 
  

• Offshore
  values this morning were leading CBOT soybean oil flat (5 higher for the week) and meal $2.90 higher ($0.20 higher for the week).  
  
• Rotterdam
  soybean oil values were about up 10-13 euros, rapeseed oil 6 higher, and Rotterdam meal 7-10 euros higher from this time previous session. 
  
• China
  cash crush margins were 123 cents on our calculation (106 previous), compared to 93 last week and 160 year ago.
  

• Malaysian
  palm oil: 

 

Oilseeds
Export Developments

• None
  reported

 

Wheat

• Wheat
  is lower on light technical selling for KC and Chicago.  MN is higher on follow through buying over demand for high protein wheat. 
  
• Rosario
  Board of Trade estimated Argentina’s 2020-21 wheat production at 16.5 million tons, down 200,000 tons from the previous month.  USDA is at 18 million tons and compares to 19.76 million for 2019-20. 
  
• Western
  EU winter crops are in good shape, according to recent updates from private and government groups this week. 
  
• EU
  March milling wheat was up 1.00 at 208.25 euros.
• Ukraine’s
  state statistical service estimated the 2020 wheat crop at 25.3 million tons (25.1 million projected by the economic service last week), down from 28.33 million tons in 2019.  Ukraine grain exports fell 16 percent so far in 2020-21. 
  
• South
  Africa’s CEC estimated the 2020 wheat crop at 2.147 million tons, down 0.06% from 2.149 million tons projected last month. 
  

 

Export
Developments.

• Jordan
  seeks 120,000 tons of animal feed barley on Dec. 22 for shipment during the April 1-15, April 16-30, May 1-15 and May 16-31 periods. 
  
• Jordan
  seeks 120,000 tons of wheat on December 23 for Jun-Jul shipment. 

 

Rice/Other

• Bangladesh
  seeks 50,000 tons of rice on Dec. 22.  They bought a combined 100,000 tons on Dec. 2 and Nov 26, the country’s first rice purchase in about three years.  Bangladesh plans to import 300,000 tons of rice.