From: Terry Reilly
Sent: Wednesday, September 12, 2018 8:21:47 AM (UTC-06:00) Central Time (US & Canada)
Subject: FI Morning Grain Comments 09/12/18

PDF attached






Bloomberg estimates for September USDA reports

US supply

                |———-Survey Results———–|USDA

2018-19 Crop:  |    Avg    |    Low    |   High    |   Aug.

Corn            |     14,516|     14,225|     14,750|     14,586

Corn Yield      |      177.6|      174.0|      180.0|      178.4

Soybeans        |      4,643|      4,523|      4,781|      4,586

Soybean Yield   |       52.3|       50.9|       53.8|       51.6

         Analyst         |——-Corn——–|Soybean

       Estimates:        |  Output  | Yield  |  Output  | Yield

Futures Int’l            |    14,351|   175.5|     4,523|   50.9


US ending stocks

                 |———-Survey Results———–|USDA

  2018-19 Crop:  |    Avg    |    Low    |   High    |   Aug.

Corn             |      1,614|      1,210|      1,785|     1,684

Soybeans         |        828|        722|      1,000|       785

Wheat            |        949|        885|      1,077|       935

  2017-18 Crop:  |

Corn             |      2,022|      1,953|      2,154|     2,027

Soybeans         |        426|        397|        506|       430

                    |                  2018-19|2017-18

Analyst Estimates: | Corn  | Soybeans |Wheat | Corn |Soybeans |

Futures Int’l       |  1,538|       722|   910| 2,024|      400|


World stocks

                 |———-Survey Results———–|USDA

2018-19 Ending  |           |           |           |

     Stocks:     |    Avg    |    Low    |   High    |   Aug.

Corn             |      154.3|      152.0|      159.0|     155.5

Soybeans         |      107.3|      104.0|      111.1|     105.9

Wheat            |      257.4|      252.0|      261.4|     259.0

2017-18 Ending  |

     Stocks:     |

Corn             |      192.0|      188.0|      193.8|     193.3

Soybeans         |       95.5|       94.0|       97.2|      95.6


       Analyst       |                  2018-19|2017-18

     Estimates:      | Corn  | Soybean | Wheat | Corn  |Soybean

Futures Int’l        |  152.5|    104.0|  256.0|  193.0|    96.5

Source: Bloomberg and FI


Weather and crop conditions


  • Florence’s prediction path shifted south and encumbrances a wider destruction area.
  • The GFS models for the storm are converging with the European models with the system very close to the North Carolina coast Thursday and then slowly shifts south to near the South Carolina coast by Sunday.
  • Pockets of heavy rain is forecast for most parts of China’s northeast and north Wednesday-Thursday.
  • The North China Plains and east central China crop areas are still experiencing drought conditions, increasing maturity rates and yield losses for summer grains.  If the drought continues, it could impact winter wheat seedings.
  • Alberta, Canada will experience a couple of cold air shots from mid- to late-week this week resulting in snow and freezing temperatures.
  • Australia will see limited rainfall with exception of the coastal areas this week.
  • Rain this week will be limited from France to Poland. France, Italy, southern Germany, Australia and Czech Republic all have an opportunity for rain next week.
  • The lower Volga River Basin needs additional rain.
  • This week a large portion of the Midwest will dry down. It will remain wet across the northern spring wheat states into the upper WBC. HRW wheat states will see very little rain.
  • Argentina will be wet this week while southern Brazil turns wet mid-week into next week.


cone graphic



                        WEST CORN BELT              EAST CORN BELT  

          -Wed                                                                             Mostly dry with a few

                                                                                                insignificant showers

Wed                      15% cvg of up to 0.75”

                                and local amts to 1.35”;

                                far NW wettest

Thu-Sat                10-20% daily cvg of

                                up to 0.30” and locally                   

                                more each day;

                                wettest NW

Thu-Mon                                                                             5-20% daily cvg of up

                                                                                                to 0.25” and locally         

                                                                                                more each day;

                                                                                                wettest east

Sun-Sep 18         80% cvg of up to 0.75”

                                and local amts to 1.50”

Sep 18-19                                                                            40% cvg of up to 0.35”

                                                                                                and locally more

Sep 19                   20% cvg of up to 0.35”

                                and local amts to 0.80”;

                                wettest south

Sep 20                   15% cvg of up to 0.20”                    15% cvg of up to 0.20”

                                and locally more                               and locally more

Sep 21-22            75% cvg of up to 0.75”

                                and locally more

Sep 21-23                                                                            80% cvg of up to 0.75”

                                                                                                and locally more

Sep 23-25            10-25% daily cvg of up

                                to 0.40” and locally                         

                                more each day

Sep 24-25                                                                            10-25% daily cvg of

                                                                                                up to 0.40” and locally   

                                                                                                more each day



                        DELTA                                   SOUTHEAST

        -Wed             50% cvg of up to 0.40”                    70% cvg of up to 0.75”

                                and local amts to 1.0”;                    and local amts to 2.0”;

                                wettest south                                   east-central and NE

                                                                                                Ms. to north Ala. driest

Thu-Sat                10-25% daily cvg of

                                up to 0.35” and locally

                                more each day;

                                wettest south

Sun-Sep 18         Up to 20% daily cvg of                    5-20% daily cvg of up

                                up to 0.30” and locally                    to 0.30” and locally

                                more each day; some                    more each day

                                days may be dry

Thu-Mon                                                                             45% cvg of 5.0-12.0”

                                                                                                with a few bands of

                                                                                                12.0-20.0” and locally

                                                                                                more in central and

                                                                                                east N.C. and SE Va.

                                                                                                with up to 2.50” and

                                                                                                locally more elsewhere;

                                                                                                Rain is from

                                                                                                Hurricane Florence

Sep 18-20                                                                            5-20% daily cvg of

                                                                                                up to 0.30” and locally

                                                                                                more each day

Sep 19-20            30% cvg of up to 0.50”

                                and locally more;

                                wettest north

Sep 21-25            Up to 20% daily cvg of                    5-20% daily cvg of up                     

                                up to 0.30” and locally                    up to 0.30” and locally   

                                more each day                                  more each day

Source: World Weather and FI


Bloomberg weekly agenda


  • Malaysian Palm Oil Board (MPOB) data on stockpiles, exports, production for August, 12:30am ET (12:30pm Kuala Lumpur)
  • Cargo surveyor SGS data on Malaysia’s Sept. 1-10 palm oil exports, 3am ET (3pm Kuala Lumpur)
  • EIA U.S. weekly ethanol inventories, output, 10:30am
  • USDA releases monthly World Agricultural Supply and Demand Estimates (WASDE) report, noon
  • FranceAgriMer updates estimates for grain crops


  • USDA weekly net-export sales for corn, wheat, soy, cotton, 8:30am
  • U.S. National Weather Service’s Climate Prediction Center updates its monthly forecast for El Nino, 9am
  • Strategie Grains monthly report on European market outlook
  • 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
  • EARNINGS: Fonterra Co-operative Group


  • ICE Futures Europe commitments of traders weekly report on coffee, cocoa, sugar positions, ~1:30pm ET (~6:30pm London)
  • CFTC commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
  • FranceAgriMer weekly updates on French crop conditions
  • Malaysia to announce crude palm oil export tax for October

Source: Bloomberg and FI








The CME Group increased margins for hog and Brazilian real futures.



         US stocks are lower, USD lower, WTI crude higher, and gold lower, at the time this was written.

         US PPI Final Demand (Y/Y) Aug: 2.8% (est 3.2% ; prev 3.3%)

          US PPI Final Demand (M/M) Aug: -0.1% (est 0.2% ; prev 0.0%)

          US PPI Ex-Food/Energy (Y/Y) Aug: 2.3% (est 2.7% ; prev 2.7%)

          US PPI Ex-Food/Energy (M/M) Aug: -0.1%  (est 0.2% ; prev 0.1%)

          US PPI Ex-Food/Energy/Trade (Y/Y) Aug: 2.9% (prev 2.8%)

          US PPI Ex-Food/Energy/Trade (M/M) Aug: 0.1% (prev 0.3%)

         Canada Capacity Utilization Q2: 85.5% (est 86.9% ; prevR 83.7% ; prev 86.1%)



         Baltic Dry Index is last 1,439 down 43 points or 2.9% from last session.



Export Developments

         China will sell another 8 million tons of corn September 13 and 14. China sold about 75.3 million tons of corn out of reserves this season.




Soybean complex.

         China’s CASDE showed a large reduction in soybean imports to reflect the trade war by 10.2MMT to 83.65 (USDA Aug 95/Attaché 94/CNGOIC 86), and at the same time widened the deficit in ending stocks to negative 3.57MMT from negative 0.25MMT).

  • Traders will be monitoring Hurricane Florence that will impact the Carolina’s, affecting several unharvested summer crops including cotton.

         Malaysia is back holiday and futures basis the November fell 29MYR to 2237, and cash was off $6.25 or 1.1% to $566.25/ton.

         MPOB stocks came in much higher after August palm exports were reported much lower than trade expectations.

         Cargo surveyor SGS reported month to date September 10 Malaysian palm exports at 415,275 tons, 127,774 tons above the same period a month ago or up 44%, and 18,603 tons above the same period a year ago or up 5%.

         Rotterdam oils were lower and SA soybean meal when imported into Rotterdam $2.00-$4.00/ton lower. 

         China cash margins were last 116 cents/bu on our analysis, and compares to 98 cents late last week, and 74 cents last year.

         China January soybean futures were down 39 yuan or 1.0%, meal up 5 or 0.2%, soybean oil up 2 or 0.1% and palm down 12 yuan (0.2%). 

         Offshore values were suggesting a higher lead for US soybean meal by $0.30 and higher lead for soybean oil by 29 points.




Export Developments

         China sold 59,740 tons of soybeans out of auction at an average price of 3,080 yuan per ton ($447.75/ton), 60% out of the 100,000 tons offered.

  • China sold about 2.29 MMT of soybeans out of reserves this season.

         Iran seeks sunflower oil.

         Egypt’s General Authority for Supply Commodities (GASC) this Thursday seeks at least 30,000 tons of soyoil and 10,000 tons of sunflower oil. The agency will also accept offers of at least 10,000 tons of soyoil and 5,000 tons of sunflower oil in Egyptian pounds. It’s for arrival Oct. 16-31.

         The CCC seeks 1540 tons of fully refined vegetable oil on September 18 for carious countries for Oct/Nov delivery.

  • Iran seeks 30,000 tons of sunflower oil on September 24.



         US wheat is higher on fund short covering and the potential for USDA to lower global production later this morning. 

         US winter wheat planting progress was reported at 5 percent complete, a point below expectations.

         Russia’s Grain Union sees the wheat crop at 68MMT, down from 85.9MMT year ago.



Export Developments.

  • Egypt seeks wheat for October 25-November 4 shipment. Lowest offer was $222.70/ton for Russian wheat.
  • Algeria seeks 50,000 tons of wheat for November shipment.
  • Japan in a SBS import tender bought 1,000 tons of barley for arrival by late February.  They passed on feed wheat.
  • Japan in a SBS import tender seeks 120,000 tons of feed wheat and 200,000 tons of barley on September 19 for arrival by late February. 
  • Jordan received offers for feed barley.
  • Jordan seeks 120,000 tons of wheat September 13.
  • Syria’s General Establishment for Cereal Processing and Trade (Hoboob) seeks 200,000 tons of soft bread wheat from Russia, Romania or Bulgaria, with shipment sought between Oct. 15 and Dec. 15. The deadline is Sept. 17 and requires payment in Syrian pounds.
  • Ethiopia seeks 200,000 tons of milling wheat on September 18 for shipment two months after contract signing.
  • Morocco seeks 336,364 tons of US durum wheat on September 28 for arrival by December 31.



         The Philippines seeks an extra 250k tons of rice for Q4 and Q1 2019 shipment.

         Iraq seeks 30,000 tons of rice from India on October 9 for LH October / FH November shipment.





Terry Reilly

Senior Commodity Analyst C 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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