From: Terry Reilly
Sent: Wednesday, March 18, 2020 8:09:41 AM (UTC-06:00) Central Time (US & Canada)
Subject: FI Morning Grain Comments 03/18/20

PDF attached


sold an estimated net 105,000 corn contracts over the past 5 business days. Real surged to 5.1604 earlier, yet CBOT soybeans are higher.  Corn continues to decline on demand destruction while wheat is higher on an increase in global import business. 






weather will not provide much bullish support except from the United States where a wet bias will continue in the Delta and Tennessee River Basin as well as in parts of central and eastern crop areas of Texas. South Texas moisture will be welcome and dry conditions
in the far southeastern U.S. will support planting.

America weather is still advertised to be mostly good for Argentina and southern Brazil, although the distribution of rain over the next two weeks will have much to say about late season corn, soybean and peanut production.

Africa rainfall will be good for production and drier weather in eastern Australia will be supportive of early season sorghum and other coarse grain and oilseed crops.

winter crops are still poised for excellence this year and drier weather will be needed in late March and especially April to protect crop quality.         

winter weather has spring planting prospects looking very good. Rain in Spain and Portugal will improve spring planting potentials and support improved winter crop conditions.

is still needed throughout Southeast Asia, but mostly in the mainland areas and in some of the northern palm oil and coconut production areas.

weather today will maintain a neutral to bearish bias to market mentality



in southern Russia and southern Ukraine this week will help keep winter crop development in check after recent greening. Winter crop development potential in China remains very good and India is experiencing some fine filling conditions after a successful
reproductive season. Europe wheat small grain production potential continues to improve and rain in North Africa and Spain this week may bring on some improvement for those areas as well.

winter crops are in mostly good shape, although drier weather is needed in the Delta. Southeastern Canada and the heart of the Midwest also need some drier weather.

weather today will maintain a neutral to bearish bias to market mentality.

World Weather Inc. and FI


World Weather Inc. and FI


World Weather Inc. and FI



Ag Calendar


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


  • USDA
    weekly crop net-export sales for corn, soybeans, wheat, cotton, 8:30am
  • Port
    of Rouen data on French grain exports
  • USDA
    total milk, red meat production, 3pm


  • 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
  • AmSpec,
    Intertek, SGS release palm oil export data for March 1-20
  • U.S.
    cattle on feed, 3pm

Bloomberg and FI








USD is higher, stocks lower and WTI below $25/barrel.   

The active strike mkts this AM are July $15 crude puts

US Housing Starts Feb: 1599K (est 1500K ; prevR 1624K ; prev 1567K)

US Housing Starts (M/M) Feb: -1.5% (est -4.3% ; prevR 1.4% ; prev -3.6%)

US Building Permits Feb: 1464K (est 1500K ; prevR 1550K ; prev 1551K)

US Building Permits Feb: -5.5% (est -3.2% ; prev 9.2%)

Canadian CPI NSA (M/M) Feb: 0.4% (est 0.4% ; prev 0.3%)

Canadian CPI (Y/Y) Feb: 2.2% (est 2.1% ; prev 2.4%)

Canadian CPI Core – Median (Y/Y) Feb: 2.1% (est 2.2% ; prev 2.2%)

Canadian CPI Core – Common (Y/Y) Feb: 1.8% (est 1.8% ; prev 1.8%)

Canadian CPI Core – Trim (Y/Y) Feb: 2.0% (est 2.1% ; prev 2.1%)




Corn prices hit their lowest level since 2016. Port strikes loom in Brazil but have not received conformation they have or will start. 

Corn futures are lower on US demand destruction.    One analyst believes US corn plantings will be larger than USDA’s forecast, citing profitability and decline in fertilizer prices.  SX0/CZ0 ratio suggests otherwise. 

University of Illinois: Schnitkey, G., C. Zulauf, K. Swanson, J. Coppess and N. Paulson. "2020 Planting Decisions in the Face of COVID-19."
farmdoc daily (10):49,  Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, March 17, 2020.

South Korea was active again overnight picking up a couple cargos. 

  • According
    to Reuters, the corn processor basis fell by 10 cents at Decatur, Illinois, and by 11 cents at Blair, Nebraska.  Toledo, Ohio, corn basis fell 15 cents and was weaker at river locations as well.  For CIF basis, corn for March loadings dropped to 44 cents a
    bushel over CBOT May futures, down 6 cents from Monday. April FOB corn export premiums were 5 cents lower at 65 cents over May futures.
  • Funds
    sold an estimated net 105,000 corn contracts over the past 5 business days. 

We are hearing some US ethanol plants are shutting down and/or ethanol producers have been unwinding hedges in corn since Friday, another sign of slowing down. 

A Bloomberg poll looks for weekly US ethanol production to be down 2,000 at 1.042 million barrels (1.030-1.058 range) from the previous week and stocks to increase 18,000 barrels to 24.352 million.



  • Algeria
    seeks 40,000 tons of corn from Argentina on March 19 for FL April shipment.

  • We
    heard Vietnam bought corn for May-July arrival. 
  • South
    Korea’s KOCOPIA bought 60,000 tons of corn at $206.98/ton c&f for June 10 arrival. 
  • South
    Korea’s MFG bought 69,000 tons of corn at $1929.99/ton c&f for August 21 arrival. 
  • Yesterday
    South Korea’s NOFI bought 60,000 tons of corn at $190.23/ton c&f for August 15 arrival. 
  • Yesterday
    South Korea’s FLC bought 66,000 tons of corn at $199.98/ton c&f for July 15 arrival. 



Rotterdam vegetable oils this morning were unchanged to 8 euros higher. Rotterdam meal when imported from SA were 2-7 euros higher. 


China cash crush margins as of this morning, using our calculation, were 135 cents per bushel (132 previous), and compares to 128 cents a week ago and negative 28 cents around this time last year. 

Indonesia cancelled their rule to require national ships for palm oil exports.

Malaysian palm markets:
exempted palm plantations from the shutdown order. 


Export Developments



US wheat
mostly higher on bottom picking and increase in global import demand.  

Egypt will temporarily suspend wheat inspections until March 31. 

May Paris wheat futures were up 2.00 euros as of early this morning to 181.25 euros.



  • 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. 



  • South Korea seeks 73,664 tons of rice on March 25 for arrival around end of Sep. to Oct 31. 


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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