From: Terry Reilly
Sent: Friday, January 03, 2020 8:03:57 AM (UTC-06:00) Central Time (US & Canada)
Subject: FI Morning Grain Comments 01/03/20

PDF attached


US airstrike near Baghdad’s airport killing a top Tehran general is widely affecting global markets. Gold and most energies were up sharply. 




selected winter wheat crop ratings: (see expanded table in wheat section)

Kansas: 40% G/E vs. 44% at the end of November

Oklahoma: 40% G/E vs. 52% at the end of November

Nebraska: 70% G/E vs. 74% at the end of November

South Dakota: 73% G/E vs. 78% at the end of November





America weather will be mixed with some concern about drying in northern Argentina, Paraguay and southern Brazil, but the odds seem to favor some timely rain in these areas especially in the Jan. 10-16 period and as long as that evolves production potentials
will not be changed. Weather in southern Argentina and the remainder of Brazil should be favorable with temporary improvements in northeastern Brazil.

the meantime, recent rain in southern Sumatra and western and central Java and has been improving soil moisture for better oil palm production potentials in 2020. The rain must be sustainable over multiple weeks and it looks like that may be the case.

Africa crop weather will remain varied offering some timely rainfall to many areas, but frequent follow up rain will be needed to seriously change crop moisture and development potential. Some areas may not get enough rain to counter evaporation in the next
two weeks while many others will.

will get some additional rain in the east today benefiting some winter crops. Timely precipitation has occurred in many other areas and more is expected next week to support good yields.

crops in China and Europe are semi-dormant and mostly in good shape. Rain in China this weekend into early next week will help to improve soil moisture for better winter rapeseed establishment prior to reproduction in the spring.

Late season farming activity in the United States will not advance very well for a while, but that is no change from recent weeks.

Overall, weather today will provide a neutral bias to market mentality.


in the U.S. hard red winter wheat production region last weekend bolstered topsoil moisture for improved wheat establishment in the spring. Additional moisture will be needed periodically through the winter to ensure the best crop development potential.

rain in the U.S. Midwest and southeastern Canada over the next couple of weeks will maintain wet and in some cases snow covered conditions which should be good for crops in the spring.

crop conditions in China will improve if precipitation falls as expected this weekend and early next week. The moisture will fall in areas that were a little dry in the autumn. Improvements in wheat establishment prior to reproduction cannot occur until warmer
weather comes along in the spring, but the moisture should still be available to crops unless a warm and dry finish to winter and start to spring takes place.

India wheat production areas will receive some welcome precipitation over the next week to ten days further ensuring high yields this winter.

in Europe and the western CIS are dormant and mostly in fair to good shape. Dryness in the autumn left many crops in southeastern Europe, including Ukraine, and Kazakhstan with poor emergence and establishment. Timely rain and seasonable temperatures will
be needed in the spring. Until then, snow is needed to protect poorly established crops from any harsh or extreme weather that suddenly evolves. There is no threat of damaging cold for the next two weeks

North Africa wheat is in fair to good shape. Crops in southwestern Morocco are not well established and need timely rain in the next few weeks to induce better establishment prior to reproduction.

harvesting was disrupted by rain recently and additional precipitation is expected late this weekend, but good field working conditions should occur into Saturday to get some of the remaining wheat and barley crop harvested.

weather today will likely provide a bearish bias to market weather mentality.

World Weather Inc. and FI


World Weather Inc. and FI


World Weather Inc. and FI


Ag Calendar

Jan. 3:

  • USDA
    weekly crop net-export sales for corn, soybeans, wheat, 8:30am
  • EIA
    U.S. weekly ethanol inventories, production, 11am
  • ICE
    Futures Europe weekly commitments of traders report on coffee, cocoa, sugar positions ~1:30pm (~6:30pm London)

JAN. 6:

  • USDA
    weekly corn, soybean, wheat export inspections, 11am
  • EU
    weekly grain, oilseed import and export data
  • Ivory
    Coast cocoa arrivals

JAN. 7:

  • New
    Zealand global dairy trade auction

JAN. 8:

  • Conab
    releases 4th estimate for Brazil’s soy, corn crops

JAN. 9:

  • USDA
    weekly crop net-export sales for corn, soybeans, wheat, 8:30am
  • Port
    of Rouen data on French grain exports
  • United
    Nation’s FAO Food Price Index
  • Australia’s
    Bureau of Meteorology releases climate statement
  • New
    Zealand commodity price

JAN. 10:

  • USDA’s
    monthly World Agricultural Supply and Demand (WASDE) report, noon
  • Malaysia
    end-2019 palm oil stocks, production, export numbers; Jan. 1-10 palm oil export data from AmSpec, Intertek and SGS
  • U.S.
    winter wheat seeding forecast
  • USDA
    quarterly wheat, barley, corn, soybean stocks, noon
  • 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

Bloomberg and FI






monthly Brazil commodity exports:

December 2019     November 2019     December 2018

KG BAG)              3,161,900         3,293,500         4,099,399

OIL (TNS)                8,721,100         3,771,700         4,221,900

(LTR)                  146,600,000       181,100,000       107,400,000

(TNS)                 3,439,200         5,157,700         4,070,900

ORE                       24,674,000        27,252,800        33,196,300

ORANGE JUICE (TNS)      32,100            71,700            60,900

ORANGE JUICE (TNS)  203,000           180,500           361,600

RAW (TNS)                1,286,900         1,696,800         1,428,700



USDA Loan Activity: 2019 Crop Sorghum Outstanding 0.988M Cwt

USDA Loan Activity: 2019 Crop Corn Outstanding 511.441M Bu

USDA Loan Activity: 2019 Crop Soybeans Outstanding 112.977M Bu    

USDA Loan Activity: 2019 Crop Wheat Outstanding 51.569M Bu          

USDA Loan Activity: 2019-2020 Cotton Under Loan Up 831,705

– DJ



export sales

were poor all around (holiday week). Soybean oil and all-wheat crop-year to date commitments lost some of its edge to the year ago pace. Soybean oil sales were negative 1,900 tons. Soybean sales were below expectations and a marketing year low.  Soybean meal
sales of less than 100,000 tons were at the low end of expectations.  Corn sales of 531,400 tons were within expectations, lowest since October 31 and well below its previous 4-week weekly average of 938,400 tons.  Corn commitments to Japan and especially
South Korea, are running below their respected 3-year averages.  All-wheat sales of 312,900 tons were down from 715,000 tons previous week.  Pork sales were a marketing year low. 









Corn is lower on lower wheat and lack of US export developments.

Geopolitical tensions will be in focus today as traders assess the impact over the US air strike near Baghdad’s airport killing a top Iranian general and other government official. 

USD was 14 points higher as of 7:51 am CT. 

Baltic Dry index fell 7 percent on Friday to 907 points. Yesterday it was down nearly 10.5 percent. 

Argentina’s Buenos Aires Grain Exchange reported corn planting progress at 75 percent, up from 63 last week, up from 73 last year and 70 average.  Corn conditions were rated 31.5 percent good and excellent,
below 44.6 percent year ago. 

The USDA NASS grain crush showed corn used for ethanol during the month of November at 457 million bushels, above expectations, above 433 million in October and 2 million above November 2018. 

The Broiler Report showed eggs set in the United States up 4 percent and chicks placed up 7 percent.  Cumulative placements from the week ending January 5, 2019 through December 28, 2019 for the United States
were 9.66 billion. Cumulative placements were up 2 percent from the same period a year earlier.



China plans to sell 30k frozen pork from reserves today.

  • India’s
    MMTC delayed their import tender for 50,000 tons of non-GMO corn from Jan 2 to January 7
    for shipment by February 10. Another source put shipment by Jan 22. 





Soybeans and meal are lower this morning on lack of confirmation China bought US soybeans over the past week.  Soybeans are still higher for the week if prices hold from early morning values.  Soybean oil
was near unchanged early.

Soybean export sales were a marketing year low.

SBO longs should be cautious as US end of November stocks ended up above trade expectations, and stocks are catching up to last year’s level. 

USDA NASS US soybean crush for November was 174.6 million bushels, 1.4 million below a Bloomberg trade average and below 178.1 million in November 2018. USDA revised October 0.2 bu lower to 187.0. 

End of November US soybean oil stocks were 1.880 billion pounds, 27 million above an average estimate, above 1.820 billion previous month and compares to 1.900 billion at the end of November 2018. 

Argentina’s Buenos Aires Grain Exchange reported soybean planting progress at 79 percent, up from 70 last week, down from 83 last year and 83 average.  Soybean conditions were rated 61 percent good and excellent,
above 31 percent year ago. 

  • Rotterdam
    vegetable oils this morning were up 7 euros for nearby soybean oil positions and 5 euros lower for rapeseed oil. Rotterdam meal when imported from SA were mostly 1-3 euros lower. 

Offshore values are leading CBOT soybean oil 47 points lower and meal $1.60 lower.  

China cash crush was last 145 cents per bushel (139 prev.), compared to 131 on Friday and 11 cents year ago. 


3-year high: Malaysian palm markets:

USDA Attaché estimated the 2019-20 Brazil soybean crop at 123.5 million tons.  They increased the planted area to 36.8 million hectares.

USDA Attached estimated Malaysia’s palm production for 2019-20 at 20.6 million tons, down 200,000 from their previous estimate.


Export Developments