From: Terry Reilly
Sent: Monday, June 01, 2020 7:39:38 AM (UTC-06:00) Central Time (US & Canada)
Subject: FI Morning Grain Comments 06/01/20

PDF attached

 

Morning.
China asked state owned companies to halt purchases of US soybeans and pork.  There was also talk China may cancel pork purchases.  Many countries in Europe are on holiday.  US protests over the weekend have shut down many business centers across the country. 
US weather looks good this week.  Black Sea region will see more rain. 

 

 

 

Weather

 

UNITED
STATES

  • Drier
    biased conditions are expected in many areas over the coming week with temperatures warmer than usual

    • Totally
      dry weather is unlikely, but many areas will experience net drying
  • A
    possible tropical cyclone may evolve from near the Yucatan Peninsula and move northward toward the U.S. later this week and during the weekend

    • Today’s
      three global models favor Texas landfall next week, but the 00z  GFS Ensemble favors the southeastern U.S.
    • There
      is limited confidence in today’s solution, although with more agreement in the forecast models that may be changing; however, until the storm actually evolves predicting where it will go will still be a difficult challenge
    • There
      is potential that if the tropical cyclone moves into Texas the moisture from that system will feed up into the Midwest to help enhance rainfall next week
  • Next
    week’s weather will also trend a little cooler in the U.S. for a little while

 

EUROPE/BLACK
SEA REGION

  • Rain
    will continue to impact many areas across Europe and the western CIS maintaining a favorable environment for crop development

    • There
      has been a little too much cool air over eastern Europe and the western CIS recently and crops need more sunny and warm weather
  • Northwestern
    Europe is still advertised to receive some showers this week, but the amount of rain that falls in northwestern France and the U.K. will be limited, some relief to dryness is expected. Northwestern France may be least likely to get rain for a while

 

EASTERN
RUSSIA NEW LANDS

  • Showers
    will be limited and temperatures mild during the next ten days maintaining a greater need for rainfall in some of the driest sunseed and spring wheat areas near the northeastern Kazakhstan border

    • The
      situation is not a crisis, but if temperatures were to suddenly trend warmer than usual it would not take long for moisture stress to have a negative impact on some crops in the region
    • A
      little rainfall is expected this week along with some colder temperatures for a little while late this week and into the weekend; that should translate into some temporary improvement, but more rain will be needed and is not likely to come for a while

 

CHINA

  • Net
    drying is still expected from areas between the Yellow and Yangtze Rivers northwest across the Central Yellow River Basin to western Inner Mongolia for another week

    • Temperatures
      will also be quite warm to hot in this region and additional drying will further stress unirrigated crops
  • Rain
    is possible during the middle part of next week that will prove to be extremely important in perking up crop and soil conditions for a little while. The drier bias is expected to resume again later in the week next week and into the following weekend
  • Southern
    China will remain excessively wet this week after some flooding rain occurred during the weekend
  • Northeast
    China will continue to experience periodic showers and seasonable temperatures

 

SOUTH
AMERICA

  • No
    big changes from Sunday’s forecasts were noted overnight, although a little more rain occurs a little farther to the northeast from southern Mato Grosso to Goias and Sao Paulo in today’s model run for later this week and that was overdone.

Source:
World Weather Inc. and FI

 

Source:
World Weather Inc. and FI

 

Source:
World Weather Inc. and FI

 

Seven-day
outlook:

 

Bloomberg
Ag Calendar

MONDAY,
June 1:

  • International
    Coffee Organization to hold virtual meeting of International Coffee Council, June 1-5
  • USDA
    weekly corn, soybean, wheat export inspections, 11am
  • U.S.
    crop progress — corn, soybean plantings, winter wheat conditions, 4pm
  • International
    Cotton Advisory Committee releases monthly market balance outlook
  • USDA
    soybean crush, DDGS production, corn for ethanol, 3pm
  • Honduras
    and Costa Rica May Coffee Exports
  • Malaysia
    palm oil export data for May 1-31
  • Australia
    Commodity Index
  • Ivory
    Coast cocoa arrivals
  • Brazil
    soybean exports
  • HOLIDAY:
    Germany, Italy, Belgium, New Zealand

TUESDAY,
June 2:

  • U.S.
    Purdue Agriculture Sentiment, 9:30am
  • New
    Zealand global dairy trade auction
  • EU
    weekly grain, oilseed import and export data (delayed because of holiday)

WEDNESDAY,
June 3:

  • EIA
    U.S. weekly ethanol inventories, production, 10:30am
  • China’s
    CNGOIC to publish monthly forecast on crop output, supply and demand
  • EARNINGS:
    Tereos

THURSDAY,
June 4:

  • USDA
    weekly crop net-export sales for corn, soybeans, wheat, cotton, 8:30am
  • FAO
    world food price index, 4am
  • Port
    of Rouen data on French grain exports
  • New
    Zealand commodity price

FRIDAY,
June 5:

  • ICE
    Futures Europe weekly commitments of traders report on coffee, cocoa, sugar positions
  • CFTC
    commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
  • FranceAgriMer
    weekly update on crop conditions
  • Malaysia’s
    palm oil export data for June 1-5

Source:
Bloomberg and FI

 

 

 

 

 

Commitment
of Traders

 

Traditional
funds in corn posted a record net short position as of May 26 at 220,075 contracts.  Managed money funds for corn were net short 276,203 contracts, short of the record 322,215 contracts April 2019. 

 

 

 

 

 

 

As
of Friday:

 

 

 

Macros

 

 

Corn.

·        
Corn futures

are lower on fears the Phase One trade deal between US and China could be in jeopardy.

  • CFTC
    Commitment of Traders Report showed that corn speculators increased their net short position by 22,355 contracts to 312,459 for the week ending May 26.