From: Terry Reilly
Sent: Saturday, February 15, 2020 11:54:49 AM (UTC-06:00) Central Time (US & Canada)
Subject: FI Evening Grain Comments 02/14/20

PDF attached



is on holiday Monday.  Positioning seen today.  Covid-19 continues to hang over the grain markets. 


released its 2020:

Agriculture projections

Agriculture Baseline Database




US GDP was estimated at 1.9% versus 2.5% in 2019


US Acreage: (table 4)

Corn 94.5 versus 89.9 in 2019

Soybeans 84.0 versus 76.5 in 2019

All-Wheat 45.0 versus 45.2 in 2019


US carryout

Corn 2.754 billion versus USDA Feb. WOB of 1.892 billion for 2019-20

Soybeans 518 million versus USDA Feb. WOB of 425 for 2019-20

All-Wheat 950 million versus USDA Feb. WOB of 940 for 2019-20




much has changed overnight. Favorable soil moisture is present in Argentina, Brazil, South Africa, India and some eastern Australia locations which should support crop development.  There is still some concern over harvest conditions in early season soybean
areas of Goias and southwestern Minas Gerais which may lead to more delay in second season corn planting, but progress is being made every day and it looks as though the pace is not far from the five year average even though much slower than last year. Good
field working conditions have been occurring in other areas and that should minimize the amount of crop that will be later planted.

Too much rain in northeastern South Africa in the past week has resulted in some flooding. Crop damage has not been assessed, but the region impacted is a minor production region in eastern Limpopo and northeastern Mpumalanga. Other areas in South Africa have
ideal crop development conditions.

rain will fall this week in northern and eastern Europe and from there to Ukraine and that will improve early season crop development potentials for areas that were too dry last autumn.

winter crops are still rated favorably with a big potential for improving rapeseed conditions in the early weeks of spring after recent weeks of rain.

winter crops are still poised to perform quite favorably, despite a drier biased outlook for the next ten days.

Asia crops are still rated well, despite erratically distributed rainfall in recent weeks.

Australia sorghum conditions have improved, but drought remains in key production areas and much more rain will be needed before winter planting of canola begins in late April. Summer crop development has improved, but it will still be a very small crop.

Today’s weather will have a mixed influence on market mentality.



of the winter crop areas in the world that experienced poor crop establishment because of dryness last autumn have seen some timely precipitation in recent weeks. The moisture should help improve winter crop establishment prior to reproduction this spring.
There has also been very little winterkill this year and that should be supporting larger crops. With that said there may have been some damage in a few minor wheat areas in central Nebraska Thursday morning when temperatures fell near slightly below zero
Fahrenheit while snow cover was minimal. Today’s bitter cold in the Midwest occurred in mostly snow covered areas.

biggest dry concern today is in North Africa and in particular southwestern Morocco where durum wheat and barley production has been cut. There is potential for larger small grain production losses from North Africa if improved rainfall does not occur soon.
Spain and Portugal are also drying out, but have adequate subsoil moisture for now. The outlook leaves most of these areas dry or mostly dry for the next ten days and perhaps longer.

weather today will continue to provide a mixed influence on market mentality.

World Weather Inc. and FI



Ag Calendar

FEB. 14:

  • ICE
    Futures Europe weekly commitments of traders report on coffee, cocoa, sugar positions ~1:30pm (~6:30pm London)
  • CFTC
    commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
  • FranceAgriMer
    crop conditions – French crops office expected to resume crop-conditions reports after winter break
  • New
    Zealand food prices
  • Biosev
    holds analyst conference call to discuss 4Q earnings.

FEB. 17:

  • MARS
    bulletin – monthly report on Europe crop conditions
  • EU
    weekly grain, oilseed import and export data
  • Ivory
    Coast cocoa arrivals
  • Cosan
    Earnings Conference Call, Sao Paulo
    U.S. (President’s Day)

FEB. 18:

  • Australian
    crop report from Abares, Canberra
  • USDA
    weekly corn, soybean, wheat export inspections, 11am
  • New
    Zealand global dairy trade auction

FEB. 19:

  • EIA
    U.S. weekly ethanol inventories, production, 10:30am

FEB. 20:

  • USDA
    Agricultural Outlook – corn, wheat, soy, cotton acreage, 8:20am
  • USDA
    milk, read meat production, 3pm
  • Malaysia’s
    Feb. 1-20 palm oil exports data

FEB. 21:

  • USDA
    outlook — corn, soy, wheat cotton end-stockpiles
  • USDA
    weekly crop net-export sales for corn, soybeans, wheat, 8:30am
  • ICE
    Futures Europe weekly commitments of traders report on coffee, cocoa, sugar positions ~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
  • U.S.
    Cattle on Feed, 3pm
    Pilgrim’s Pride

Bloomberg and FI




US Retail Sales Advance (M/M) Jan: 0.3% (est 0.3% ; prevR 0.2% ; prev 0.3%)

US Import Price Index (M/M) Jan: 0.0% (est -0.2% ; prevR 0.2% ; prev 0.3%)

US Industrial Production (M/M) Jan: -0.3% (est -0.2% ; prevR -0.4% ; prev -0.3%)

US Capacity Utilization Jan: 76.8% (est 76.8% ; prevR 77.1% ; prev 77.0%)

US Manufacturing (SIC) Production Jan: -0.1% (est -0.1% ; prevR 0.1% ; prev 0.2%)

US Univ. Of Michigan Sentiment Feb P: 100.9 (est 99.5; prev 99.8)

Univ. Of Michigan Conditions Feb P: 113.8 (est 114.0; prev 114.4)

Univ. Of Michigan Expectations Feb P: 92.6 (est 90.0; prev 90.5)

Univ. Of Michigan 1-Year Inflation Feb P: 2.5% (est 2.4%; prev 2.5%)

Univ. Of Michigan 5-10 Year Inflation Feb P: 2.3% (prev 2.5%)

Canadian Existing Home Sales (M/M) Jan: -2.9% (est -0.1% ; prev 0.9%)



March corn futures ended 1.75 lower, in a quiet trade, on waning US export demand. China was a big buyer of Ukraine corn this week.

March corn traded in a 3-penny range by mid-morning and ended up in a 5.25 cent range for the day.

$3.80 March corn traded at least once over the last 12 sessions. 

Reuter reported cargos of US chicken bound for China have been rerouted to nearby countries because of the coronavirus outbreak. 

High water levels for lower Midwestern rivers are slowing barge traffic. 

1500+ deaths and nearly 66,500 cases of coronavirus were recorded as od Sat. morning.

The Baltic Dry Index increased 4 points on Friday to 425.  Capesize remains negative at 294.


China sold 1.32 million tons of reserve corn to feed users across the southern provinces last week.   

China’s state reserve held an auction on Friday to sell 20,000 tons of frozen pork.
They apparently sold 14k.



Soybeans trended lower on Friday, taking a breather after rallying mid-week.  Soybean meal was leading soybeans lower during the session on Friday but ended off $0.80-$1.00 short ton, while soybean oil, in
a two-sided trade, finished 9-15 points lower, despite the rebound in palm oil and talk of US domestic soybean oil end user demand by biofuel companies.  Pricing of soybean oil was evident late in the trading week.  COT didn’t appear to have any major surprises. 
Traders should watch the short positions as positioning could kick in from now until early March, ahead of northern hemisphere planting decisions. 

China cash crush margins as of this morning, using our calculation, were 147 cents per bushel (150 previous), compared to 139 cents more than a week ago and 40 cents around this time last year. 


Export Developments

  • None





Chicago wheat prices tried to rally early Friday on technical buying but finished lower. Back month KC and MN were unchanged to higher. March settled 1.50 lower for Chicago, 0.50 lower for KC and 1.25 cent
lower for Minn.  

USD was higher. 

News was light and lack of US export developments sent a negative undertone to the grain markets. 

March Paris wheat futures increased 1.25 at 194.00 euros.

France began planting barley with 16 percent complete by Feb 10, above last year and average. 



  • A
    Thailand feed mill bought a cargo of feed wheat at around $244.50/ton for May shipment.  Origin was optional. 
  • Syria
    seeks 200,000 tons of wheat from Russia on February 17 for shipment within 60 days of contract signing. 
  • Turkey
    seeks 25,000 tons of barley on Feb. 18 for 2/26-3/15 loading. 
  • Jordan
    seeks 120,000 tons of wheat, optional origin, on Feb 18.
  • Jordan
    seeks 120,000 tons of feed barley on Feb 19. Possible shipment periods are May 1-15, May 16-31, June 1-15 and June 16-30.



Results awaited: Mauritius has delayed the deadline for to buy up to 6,000 tons of long grain white rice to Feb. 10, for delivery between May 1 and July 31.

Results awaited: Turkey’s TMO seeks 20,000 tons of rice on Feb. 12 for shipment between Feb. 19 and April 6.



Terry Reilly

Senior Commodity Analyst – Grain and Oilseeds

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

W: 312.604.1366

AIM: fi_treilly


Skype: fi.treilly


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