From: Terry Reilly
Sent: Wednesday, March 04, 2020 8:15:22 AM (UTC-06:00) Central Time (US & Canada)
Subject: FI Morning Grain Comments 03/04/20

PDF attached




to Hike Tax on Soy Products With Corn and Wheat Spared






South America weather outlook remains a concern today. Argentina will continue to progressively become too dry while a net drying trend impacts some western and southern Brazil locations. Argentina will see excessive heat as well while temperatures in Brazil
are more seasonable. Some relief advertised for central Argentina early next week would be extremely well timed in limiting the amount of serious crop stress that has occurred. Wet weather will continue in Goias, Minas Gerais and Tocantins.

situation in South America may not be critical enough to move markets in a big manner, but there might be some bullish influence from the weather amidst a huge array of other market concerns that may counter any influence from the weather.

and China’s winter crop outlooks are still good and improvement has occurred in recent weeks across parts if Europe. South Africa’s weather has not changed from that of late last week and the U.S. outlook has shifted the greatest rainfall out of the lower
Midwest, northern Delta and Tennessee River Basin for this week and shifted it farther south. The southward shift will lead to delays in early season corn planting.



than usual crop development is expected for many production areas around the world, but as long as there is no threatening cold coming up the situation is not likely to be significant. Huge crops are still expected from India and China will end up with a big
crop as well. North Africa production is destined to be low based mostly on dryness in Morocco and northwestern Algeria. Europe winter crops are in mostly good shape, although rain is still needed in the southeast.

wheat is expected to remain in favorable shape, but greening and early season development in the southern Plains could be aggressive for a while due to unusually warm weather.

weather today may produce a neutral bias on market mentality.

World Weather Inc. and FI




Ag Calendar


  • EIA
    U.S. weekly ethanol inventories, production, 10:30am
  • New
    Zealand commodity price
  • Abares
    agriculture outlook conference
  • CNGOIC’s
    monthly supply/demand report on China soy, corn


  • FAO
    world food price index, 4am
  • Day
    1 of three-Day National Coffee Association USA Annual Convention
  • Intertek
    Malaysia palm oil export data for March 1-5
  • USDA
    weekly crop net-export sales for corn, soybeans, wheat, 8:30am
  • Port
    of Rouen data on French grain exports


  • 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


  • China
    soybean import volume data

Bloomberg and FI







USD was higher by 27 points as of 7:31 am CT.   

US ADP Employment Change Feb 183K (est 170K; prev 291K)

Lufthansa To Ground 150 Aircraft Due To The Coronavirus – Company Sources




Corn futures eased in the non expiring positions on light technical selling.  China was rumored to be looking for corn, sorghum and DDG’s on Tuesday.  The USDA 24-hour system reported 110,000 tons of sorghum was sold to China. 

WTI crude was up $0.69 as of 7:33 am CT. 

The 6-10 day for the US still looks wet. 

CNGOIC warned 2019-20 China corn consumption could drop 3 million tons due to the reduction in chicken inventories. 

A Bloomberg poll looks for weekly US ethanol production to be down 8,000 at 1.046 million barrels from the previous week and stocks to increase 89,000 barrels to 24.807 million.






Solvent Extractors’ Association of India (SEA) estimated India rapeseed production at 7.8 million tons versus 7.5MMT year earlier. 

Offshore values are leading CBOT soybean oil 33 points higher and meal $0.60 higher.

Rotterdam vegetable oils this morning were up 1 euro for nearby soybean oil positions and up around 10 euros for rapeseed oil. Rotterdam meal when imported from SA were mixed (mostly higher). 


China cash crush margins as of this morning, using our calculation, were 139 cents per bushel, up 4 cents from the previous day, and compares to 126 cents a week ago and negative 35 cents around this time
last year. 

Malaysian palm markets:

IEG Vantage: Brazil 128 million tons for 2019 soybeans and 55 million tons for Argentina, according to floor traders.  EU 2020 rapeseed production reduced 1.25 million tons to 17.5 million (0.5MMT above their
2019 forecast). Meanwhile FC Stone estimated the Brazil soybean crop at 124.2 million tons, up 200,000 from their previous projection.  Mato Grosso was noted to be in great shape while RGDS had some problems.

Brazil raised the B11 mandate to B12. The higher use should result in lower soybean oil exports during 2020.  


Export Developments



US wheat futures

USD was higher by 32 points earlier this morning.

May Paris wheat futures were down 1.00 at 183.50 euros as of early this morning.

Yesterday US PNW wheat basis collapsed by 30-38 cents from Monday to around $6.00/bu.



  • Tunisia seeks 117,000 tons of optional origin soft wheat and 50,000 tons of feed barley on March 5 for shipment during March-May and May-June,
  • SK yesterday bought 85,000 tons of US wheat.  This was already in the market. 
  • Japan in an SBS import tender received no offers for 120,000 tons of feed wheat and 200,000 tons of feed barley for arrival in Japan by
    Aug 7. 
  • Japan bought 117,389 tons of food wheat late Wednesday. 

  • Japan in an SBS import tender seeks 120,000 tons of feed wheat and 200,000 tons of feed barley for arrival in Japan by Aug 27, on March
  • Jordan seeks 120,000 tons of wheat on March 10.  Sep-Oct shipment. 
  • Offers received: Jordan seeks 120,000 tons of feed barley on March 4.  No prices were provided. 
  • Morocco seeks 354,000 tons of US durum wheat on March 5 for arrival by May 31.
  • Turkey seeks 305,000 tons of wheat on March 11 for late March and/or early shipment. 
  • Syria seeks 200,000 tons of wheat from Russia by March 23.  No purchase was made that closed on February 17. 
  • Ethiopia seeks 400,000 tons of wheat on April 7.  IN a separate tender, they seek 200,000 tons of wheat on April 1.  Both
    are optional origin. 



  • None reported


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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