From: Terry Reilly
Sent: Monday, July 16, 2018 3:59:18 PM (UTC-06:00) Central Time (US & Canada)
Subject: FI Evening Grain Comments 07/16/18

PDF attached


Weather and crop conditions

USDA Crop Progress

·         Corn down 3. We dropped our US corn yield by 2.0 bu/ac and lowered production by 175 million.

·         Soybeans down 2. We dropped our US soybean yield by 0.3 bu/ac and lowered production by 28 million.

·         WW Harvest @ 74 vs. 63 LW

·         Spring unchanged (good up 1 & exc. down 1)

·         Subsoil moisture levels are now below a year ago



·         IRI ENSO Forecast per Columbia University shows the change of El Nino during the November, December and January period at 71 percent, up from 63 percent forecast in mid-June.

·         Rain over the weekend was about as expected and cooling will start to set in after warm Monday temperatures. Nighttime low temperatures will be down into the 50s and 60s during mid-week, lasting through July 26. The southern U.S. Plains and lower Delta will remain hot during this period.

·         Several waves of rain are forecast across the northern and central Plains, Midwest, Delta and southeastern states through July 31.

·         The U.S. Pacific northwest and northwestern U.S. Plains will be dry or mostly dry during the next ten days

·         Net drying will continue across the southwestern Corn Belt and the southern Plains.

·         The Delta and southeastern states will see a mix of rain and sunshine.

·         The northwestern Plains will see an increase of net drying.

·         We are hearing lack of corn tasseling across WI. Feedback is welcome.

·         The Canada Prairies will see net drying across the southern crop areas. Western and northern Alberta will be wettest.

·         East-central China will continue to see net drying this week but the Northeast Provinces will improve with rain.

·         Frequent rain will fall from eastern Europe through the western CIS this week.

·         Western Europe will trend wetter this week.

Source: World Weather Inc. and FI




                                WEST CORN BELT                             EAST CORN BELT              

Tdy-Tue               5-15% daily cvg of up

                                to 0.30” and locally

                                more each day;                                

                                wettest south

Tue-Wed                                                                             Mostly dry with a few

                                                                                                insignificant showers

Wed-Fri                80% cvg of up to 0.75”

                                and local amts to 1.50”

                                with a few bands of

                                1.50-3.0”; far SE and

                                far NW driest

Thu-Sat                                                                                85% cvg of up to 0.75”

                                                                                                and local amts to 2.0”

Sat                          Mostly dry with a few

                                insignificant showers

Sun                                                                                        20% cvg of up to 0.25”

                                                                                                and locally more;

                                                                                                wettest east 

Sun-Jul 24            60% cvg of up to 0.60”

                                and local amts to 1.30”

 Jul 23-25                                                                               60% cvg of up to 0.50”

                                                                                                and local amts to 1.10”

Jul 25                     15% cvg of up to 0.20”

                                and locally more

Jul 26                                                                                     15% cvg of up to 0.20”

                                                                                                and locally more

Jul 26-27               55% cvg of up to 0.70”                    

                                and locally more                              

Jul 27-29                                                                               65% cvg of up to 0.75”

                                                                                                and locally more 

Jul 28-30               40% cvg of up to 0.60”                   

                                and locally more



                         DELTA                                                    SOUTHEAST

Tdy-Wed             75% cvg of up to 0.70”                    85% cvg of up to 0.75”

                                and local amts to 1.50”;                 and local amts to 1.50”

                                far north and far south                  with a few bands of

                                driest                                                    1.50-3.0”; wettest


Thu                                                                                        20% cvg of up to 0.75”

                                                                                                and local amts to 1.50”;

                                                                                                wettest SE

Thu-Fri                  40% cvg of up to 0.50”

                                and local amts to 1.30”;

                                wettest north

Fri-Sat                                                                                   75% cvg of up to 0.75”

                                                                                                and local amts to 1.75”;

                                                                                                driest west

Sat-Jul 23             Up to 15% daily cvg of

                                up to 0.20” and locally

                                more each day; some

                                days may be dry

Sun-Jul 23                                                                            10-25% daily cvg of

                                                                                                up to 0.35” and locally

                                                                                                more each day; Va.

                                                                                                and Carolinas wettest   

Jul 24-25               40% cvg of up to 0.50”                    60% cvg of up to 0.75”

                                and local amts to 1.10”                   and local amts to 1.50”                                  

Jul 26-27               10-25% daily cvg of

                                up to 0.30” and locally

                                more each day

Jul 26-28                                                                               15-35% daily cvg of

                                                                                                up to 0.60” and locally

                                                                                                more each day

Jul 28-30               50% cvg of up to 0.60”

                                and locally more

Jul 29-31                                                                               60% cvg of up to 0.75”

                                                                                                               and locally more

Source: World Weather Inc. and FI


Bloomberg weekly agenda


  • Japan on holiday; no rubber trading on Tokyo Commodity Exchange
  • Cargo surveyors AmSpec and Intertek release their respective data on Malaysia’s July 1-15 palm oil exports, 11pm ET Sunday (11am Kuala Lumpur Monday); SGS data during same period, 3am ET Monday (3pm local time Monday)
  • European Cocoa Association 2Q cocoa grind data, 2am ET (7am London)
  • German Confectionery Industry 2Q cocoa grind data, 2am ET (7am London)
  • USDA weekly corn, soybean, wheat export inspections, 11am
  • USDA weekly crop progress report, 4pm
  • EU weekly grain, oilseed import and export data
  • Ivory Coast weekly cocoa arrivals


  • New Zealand dairy auction on Global Dairy Trade online market starts ~7am ET (~noon London, ~11pm Wellington)


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


  • Nicaragua on holiday
  • USDA weekly net-export sales for corn, wheat, soy, cotton, 8:30am
  • USDA red meat production for June, 3pm
  • National Confectioners Association North America 2Q cocoa grind, ~4pm
  • Port of Rouen data on French grain exports
  • Buenos Aires Grain Exchange weekly crop report
  • Bloomberg weekly survey of analysts’ expectations on grain, sugar prices


  • Colombia on holiday
  • Cocoa Association of Asia is set to release 2Q cocoa grind data
  • ICE Futures Europe commitments of traders weekly report on coffee, cocoa, sugar positions, ~1:30pm ET (~6:30pm London)
  • USDA milk production for June, 3pm
  • USDA cattle on feed for June, 3pm
  • CFTC commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
  • FranceAgriMer weekly updates on French crop conditions

Source: Bloomberg and FI


USDA inspections versus Reuters trade range                                            

Wheat       469,523     versus  200,000-400,000         range

Corn          1,217,233  versus  900,000-1,500,000      range

Soybeans   635,429     versus  300,000-800,000         range



                  REPORTED IN WEEK ENDING JUL 12, 2018

                            — METRIC TONS —


                                                   CURRENT     PREVIOUS 

             ———– WEEK ENDING ———-  MARKET YEAR  MARKET YEAR

  GRAIN      07/12/2018  07/05/2018  07/13/2017    TO DATE     TO DATE  


BARLEY             73           0          98          880        5,319 

CORN        1,217,233   1,467,222   1,122,852   48,445,001   50,846,879 

FLAXSEED            0           0         343           24        2,742 

MIXED               0           0           0           24           24 

OATS                0           0         399        1,098        1,297 

RYE                 0           0           0            0            0 

SORGHUM           552      14,283      61,318    4,785,928    5,198,304 

SOYBEANS      635,429     668,014     299,639   50,978,252   53,316,326 

SUNFLOWER           0         335           0          335          383 

WHEAT         469,523     268,221     594,705    2,220,533    3,938,258 

Total       2,322,810   2,418,075   2,079,354  106,432,075  113,309,532 









·         There was some talk of some corn failing to tassel across some northwestern Corn Belt states. WI was one of them. Corn generally tassels about 20 days before the kernels are ready to harvest, so there is still some time. Feedback is welcome.





Export Developments

·         South Korea’s FLC bought 66,000 tons of optional origin corn at $203.99/ton c&f for arrival around December 25. Last week MFG, KFA and NOFI bought corn.

·         China sold about 52-53 million tons of corn out of reserves this season.


China domestic cash corn prices vs. the import price of corn are widening

Source: Reuters and FI


Soybean complex.

·         Soybeans finished 10.75-12.50 higher (light bear spreading), meal up $2.90-$6.10 (bear spreading) and soybean oil down 30-33 points.

·         After briefly hitting a contract low overnight, September soybean futures opened higher and rallied by nearly 10 cents within the first 30 minutes of trading, then traded 15 higher by mid-morning. The USDA inspections report showed a cargo for China. The rally in soybeans was thought to be weather related. The Delta saw hot and dry conditions over the weekend. With no premium built into this market, bull traders are searching for any bullish piece of news on US crop development. Selected field reports for northwestern IA point out patches of poor crops in low lying areas. There was also some talk of some corn failing to tassel across some northwestern Corn Belt states.

·         Soybean meal rallied as well, and found additional support after NOPA reported record soybean meal exports for the month of June.

·         Soybean oil futures were under pressure from lower WTI crude oil and high global vegetable oil stocks. Malaysian vegetable oil stocks at the end of June were up from the end of May.  Indonesian stocks at the end of May were higher than April. NOPA did report a slightly friendly end of June soybean oil stocks.

·         Funds bought an estimated net 6,000 soybean contracts, bought 6,000 meal and sold 3,000 soybean oil.

  • USDA soybean conditions fell 2 points to 69, 1 point below the trade average.

·         NOPA updated their US monthly crush.  June was a record for the month at 5.31 bushels per day crush, or 159.2 million bushels, 0.4 million below an average trade guess. US end of June soybean oil stocks were reported at 1.766 billion pounds, 41 million below a Reuters trade guess, 90 million below last month, and 63 million above a year ago. US NOPA soybean meal exports were 857,000 short tons, a record for the month of June, below 905,000 short tons last month and above 563,000 short tons a year ago. The soybean meal yield decreased to 47.56 versus 47.58 last month.  The soybean oil yield of 11.52 pounds per bushel was unchanged from last month. Typically, the soybean oil yield decreases at this time of year.

·         The NOPA report was neutral for soybeans, neutral meal and slightly friendly for soybean oil, in our opinion.

·         The CBOT crush traded unchanged to 8 cents lower. August settled at $1.98, down 8 cents. May 2019 was unchanged at $1.45.

  • USDA US soybean export inspections as of July 12, 2018 were 635,429 tons, within a range of trade expectations, below 668,014 tons previous week and compares to 299,639 tons year ago. Major countries included Mexico for 130,161 tons, Indonesia for 81,417 tons, and China T for 81,396 tons.
  • 2.0 million bushels or nearly 55,000 tons of soybeans were inspected for China.
  • July soybean inspections are on track to hit 2.6 million tons, down from 2.996 million tons in June.

  • China’s AgMin noted hot margins are improving, which should allow for domestic soybean meal demand to recover.

·         Cargo surveyor SGS reported July 1-15 Malaysian palm exports at 454,524 tons, down 43,748 tons or 9% from the same period a month ago and down 161,147 tons from the same period a year ago (26% decrease).  AmSec shows a 2.7% decrease at 486,609 tons.

·         India imported 1.8% less palm oil in June from May, at 487,147 tons, a 4-1/2-year low (lowest volume since February 2014). Crude palm oil import tax was lifted to 44 percent in March from 30 percent and refined tax to 54 percent from 40 percent. Total India vegetable oil imports in June were 1.04 million tons, down 22.4 percent from June 2017.

·         Brazil’s Santos Port increased its draft, allowing for up to 10 percent more in shipping capacity, or about 30,000 tons of soybeans per month. The Captaincy last Thursday approved the increase to 30.50 meters versus 13.20 previously.

·         We last heard IL soybean oil at around 75 under, East at option, West 100 under and Gulf 230 over. Argentina was 220 over fob and Brazil 225 over nominally.





Export Developments

  • The CCC seeks 12,500 tons of soybean meal for Honduras, opened until July 18, for early October shipment.
  • South Korea seeks 1,500 tons of non-GMO soybeans on July 25 for September-December delivery.
  • China will offer 61,000 tons of rapeseed oil on July 17.

·         China sold 832,302 tons of soybeans out of reserves so far, this season.

  • Results awaited: Iran seeks 30,000 tons of sunflower oil on July 10.
  • Results awaited: Iran seeks 30,000 tons of palm olein oils on July 10. 
  • Iran seeks 30,000 tons of soybean oil on August 1.


China hog margins are starting to recover.

Source: Reuters and FI




·         US wheat futures were lower led by Chicago amid fund selling and improving global weather. September Chicago was down 8.50 cents, September KC off 7.25 cents and September MN down 3.50 cents.

·         Funds today sold an estimated net 6,000 SRW wheat contracts.

·         Problems for major producing countries still exist but rain prospects increase this week for Rain in western Russia, Belarus, Poland and western Ukraine. Dry and warm weather for the northwestern US Plains, PNW, and Canadian southern Prairies are threatening yields. Wheat establishment for east-central Australia is of concern.

·         Agritel pegged the German wheat crop at 21.5 million tons, down 12 percent from a 2017 and 16 percent below a 5-year average.

  • December Paris wheat was up 0.50 euros to 186.00 euros. 
  • USDA US all-wheat export inspections as of July 12, 2018 were 469,523 tons, above a range of trade expectations, above 268,221 tons previous week and compares to 594,705 tons year ago. Major countries included Philippines for 122,313 tons, Japan for 117,357 tons, and Mexico for 72,739 tons.
  • Russian wheat export prices are at a 4-week high.
  • July 2017 through June 2018 Russia wheat exports totaled 40.388 million tons. Of that total, 21.5 percent were for Egypt and 11.7 percent for Turkey.





Export Developments.

·         Saudi Arabia bought 625,000 (595,000 tons sought) of wheat at an average $256.57/ton C&F.

·         Results awaited: Saudi Arabia seeks 1,740,000 million tons of fodder barley during the period September-October 2018.

  • China sold 1,709 tons of imported wheat from state reserves at auction at an average price of 1709 yuan/per ton or $360.45/ton, 0.09 percent of what was offered.

·         Jordan seeks 120,000 tons of barley for Oct/Nov shipment on July 17.

  • Japan in a SBS import tender seeks 120,000 tons of feed wheat and 200,000 tons of barley on July 18 for arrival by December 28. 

·         Jordan seeks 120,000 tons of wheat on July 19 for Oct-Nov shipment.

  • Bangladesh seeks 50,000 tons of optional origin milling wheat on July 25 for shipment within 40 days of contract signing.



  • China sold 63,079 tons of rice from state reserves at auction at an average price of 2604 yuan/per ton or $388.98/ton, 6.15 percent of what was offered.

·         Results awaited: Mauritius seeks 6,000 tons of white rice for Sep 1-Nov 30 shipment.

  • Thailand seeks to sell 120,000 tons of raw sugar on July 18.





7/16/18. Trading ranges:



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

ICE IM:  treilly1

Skype: fi.treilly


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