TODAY – EXPORT SALES, WASDE SUPPLY/DEMAND REPORT, CROP PRODUCTION
Wheat prices overnight are down 1 3/4 in SRW, down 2 in HRW, up 2 1/4 in HRS; Corn is down 1/2; Soybeans down 7; Soymeal down $0.20; Soyoil down 0.03.
For the week so far wheat prices are up 4 1/4 in SRW, up 2 1/2 in HRW, down 1 in HRS; Corn is up 2 1/4; Soybeans down 3 3/4; Soymeal down $0.32; Soyoil up 0.30.
For the month to date wheat prices are up 24 1/2 in SRW, up 35 3/4 in HRW, up 10 1/2 in HRS; Corn is up 13 1/2; Soybeans down 16 1/4; Soymeal up $0.60; Soyoil down 1.47.
Chinese Ag futures (SEP 21) Soybeans up 8 yuan ; Soymeal down 34; Soyoil up 128; Palm oil up 230; Corn up 22 — Malasyian Palm is down 32. Malaysian palm oil prices overnight were down 32 ringgit (-0.71%) at 4479 after hitting an contract high earlier in the session with weakening demand outweighed supply tightness in the second-biggest grower Malaysia.
Midwest corn, soybean and winter wheat forecasts: West: Isolated to scattered showers through Thursday, south Friday. Mostly dry Saturday-Sunday. Temperatures above normal through Thursday, near normal Friday, near to below normal Saturday-Sunday. East: Isolated to scattered showers through Friday. Mostly dry Saturday-Sunday. Temperatures above normal through Thursday, near to above normal Friday, near to below normal Saturday-Sunday. 6 to 10 day outlook: Mostly dry Monday-Tuesday. Isolated showers Wednesday-Friday. Temperatures near to above normal northwest and near to below normal southeast Monday, near to above normal Tuesday-Friday.
The player sheet for Aug. 11 had funds: net sellers of 1,500 contracts of SRW wheat, buyers of 5,500 corn, sellers of 2,000 soybeans, sellers of 2,000 soymeal, and buyers of 4,000 soyoil.
Preliminary changes in futures Open Interest as of August 11 were: SRW Wheat down 3,566 contracts, HRW Wheat down 2,456, Corn up 4,972, Soybeans down 2,692, Soymeal up 156, Soyoil down 1,269.
There were changes in registrations (-37 Soyoil ). Registration total: 0 SRW Wheat contracts; 0 Oats; 0 Corn; 0 Soybeans; 298 Soyoil; 155 Soymeal; 1,288 HRW Wheat.
TENDERS
- SOYBEAN SALE: Private exporters reported the sale of 132,000 tonnes of soybeans to China for delivery in the 2021/22 marketing year, the U.S. Agriculture Department said.
- WHEAT TENDER: Jordan’s state grain buyer the trade ministry has made no purchase in an international tender to buy 120,000 tonnes of milling wheat. A new tender is expected to be issued closing on Aug. 18.
- WHEAT, BARLEY TENDER UPDATE: A group of importers in the Philippines is believed to have rejected all offers and made no purchase in a tender for 120,000 tonnes of animal feed wheat and 120,000 tonnes of feed barley due to high prices.
- CORN TENDER: South Korea’s Major Feedmill Group (MFG) purchased some 207,000 tonnes of corn an international tender which closed on Wednesday.
PENDING TENDERS
- WHEAT TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 tonnes of milling wheat
- WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) said it will seek 80,000 tonnes of feed wheat and 100,000 tonnes of feed barley to be loaded by Nov. 30 and arrive in Japan by Jan. 27, via a simultaneous buy-and-sell (SBS) auction that will be held on Aug. 18.
- SOYBEAN TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp has issued an international tender to purchase around 3,700 tonnes of soybeans free of genetically-modified organisms. The deadline for submission of price offers is Aug. 19.
- WHEAT TENDER: A government agency in Pakistan issued an international tender to purchase and import 400,000 tonnes of wheat
- DURUM TENDER: Morocco’s state grains agency ONICL has issued a tender to import around 363,000 tonnes of U.S.-origin durum wheat under a preferential tariff import quota. The deadline for submission of price offers is Aug. 24.
GRAIN EXPORT SURVEY: Corn, Soy, Wheat Sales Before USDA Report
Estimate ranges are based on a Bloomberg survey of five analysts; the USDA is scheduled to release its export sales report on Thursday for week ending Aug. 5.
- Corn est. range 250k – 1,000k tons, with avg of 603k
- Soybean est. range 300k – 950k tons, with avg of 660k
DOE: U.S. Ethanol Stocks Fall 1.6% to 22.276M Bbl
According to the U.S. Department of Energy’s weekly petroleum report.
- Analysts were expecting 22.617 mln bbl
- Plant production at 0.986m b/d, compared to survey avg of 1.01m
Global Wheat Crop Outlook Cut 14M Tons on Bad Weather: Strategie
World wheat production in the 2021-22 season is now seen at 750.3m tons, 14m tons below a prior estimate, consultant Strategie Grains said in a report.
- Cites significant harvest reductions in North America and Russia, additional losses in Kazakhstan and Turkey, and excess rain in Europe
- Stocks-to-use ratio across major exporters seen “sharply” lower and is likely to boost wheat prices, particularly high-protein varieties
- “Wheat effectively needs potential demand to transfer onto other grains, especially corn”
- In the EU, wet weather at harvest has spurred disappointing wheat yields in France and Germany, and heat has pared Polish output
- Quality varies widely, with specific weights at lower end of milling requirements and declining falling numbers
- Proportion of feed wheat will exceed last year
- Lower quality won’t be “major constraint” for exports and estimate raised to 32.7m tons, 5m tons higher y/y
French Wheat Quality Suffers, With Low Specific Weight: Soufflet
After heavy rains in France, there is a strong degradation in the specific weight of this year’s soft-wheat harvest, a key measure of crop quality, Francois Berson, collection director at Soufflet Agriculture, said in a video posted Thursday.
China Cuts 2020-21 Soy Import Estimate on Crushing Margin
China cuts estimate for 2020-21 soybean imports by 1.84m tons to 98.6m tons, according to China Agricultural Supply & Demand Estimates (CASDE).
- Inventories of imported soybeans have risen to highest level of this crop year as crushing volume has fallen since July on weaker margins, the agriculture ministry’s outlook committee said
- Importers may delay purchases on expectations that soybean prices will drop amid higher U.S. yields
- Forecasts of soybean crushing cut by 3m tons to 95m tons
- Cotton:
- Committee raises 2020-21 cotton import estimate by 200,000 tons to 2.8m tons
- Purchases have already exceeded 2.5m tons
- Import quotas of 700k tons were awarded to textile companies
- Vegetable Oils:
- 2020-21 production forecast revised down by 520k tons to 28.51m tons on expectations of lower crushing
- Sesame production in Henan was hit by a flood in July; limited impact seen on overall vegetable oil output
Europe’s Soggy Wheat Fields Drive Paris Futures to 8-Year High
- Fieldwork has been delayed in France, Germany on heavy rain
- USDA likely to downgrade stocks outlook in report on Thursday
Harvests have been delayed by heavy rain, with swathes of France and Germany seeing double or more of the normal rainfall in the past 30 days. About a third of the French crop is still to be collected, at a time when it was wrapping up last year. Drier weather ahead should aid fieldwork, though the moisture is expected to have lowered crop quality.
Wheat prospects are also dwindling in producers from Canada to Russia due to drought and heatwaves. Analysts expect the U.S. Department of Agriculture to downgrade its global stockpiles outlook for the 2021-22 season to 287.1 milliontons in a monthly report due Thursday, leaving inventory below the prior year.
“EU production may see changes as the delays to harvest in western Europe potentially cause yield penalties, somewhat offset by higher production in eastern Europe,” Rabobank analysts said in a note. “Quality is looking poor in water-logged areas and food-wheat volumes, including those for export, may turn out to be lower than expected.”
Major Corn Exporter Brazil Boosts Imports as Crops Wilt
Brazil, usually the world’s biggest soybean exporter and the No. 2 shipper of corn, is looking abroad for supplies of both. That’s because a severe drought followed by the worst frost in decades has shriveled domestic crops and sent prices surging in the South American country. Driven mostly by orders from the meat and vegetable-oil industries, corn imports have reached the highest in 21 years so far in 2021, while shipments of soybeans into Brazil were the highest since 2003, according to the nation’s trade ministry data.
India Will Produce Record 309M Tons of Food Grains in 2020-21
India’s food grain production is set to climb to a record 308.65 million tons from 297.5 million tons in 2019-20, the farm ministry said in a statement late Wednesday.
- Rice output seen at all-time high of 122.27m tons vs 118.87m a year earlier, according to the fourth advance estimates by the ministry
- Cotton production may ease to 35.38m bales of 170 kg each vs 36.07m bales a year earlier
Palm Oil Imports by India Seen Dropping to 5-Month Low in July
India’s palm oil purchases probably declined 23% from a month earlier to 453,000 tons in July, as traders trimmed imports in anticipation of a cut in duty by top producer Indonesia, according to G.G. Patel, managing partner of GGN Research.
- Lower local prices than overseas levels also prompted Indian traders and refiners to reduce buying: Patel
- The avg price difference in July estimated at 1,500 rupees/ton
- Est. soybean oil imports 379,000 tons in July vs 206,262 tons in June
- Sunflower oil purchases at 72,000 tons vs 175,702 tons
India gets below-average monsoon rains for second straight week
Monsoon rains in India in the week through Wednesday were below average for the second straight week, the weather office said, raising concerns over production of summer-sown crops such as cotton, soybean, corn and rice.
India is the world’s biggest exporter of rice and top importer of edible oils. A drop in production could not only limit rice and cotton exports, but also boost imports of edible oils such as palm oil, sunflower oil and soyoil.
India received 35% less rain than the 50-year average in the week to Aug. 11, with the shortfall as high as 98% in cotton and soybean growing regions in central and western India, data from the India Meteorological Department (IMD) showed on Thursday. While monsoon rains were 10% above average in June, they turned 7% below average in July. Overall rains have been 6% below average so far in the season that began on June 1.
‘Once in 100 years’ drought seen affecting Argentine grains exports into next year
A once-a-century drought has lowered the water level of Argentina’s main grains transport river, reducing farm exports and boosting logistics costs in a trend that meteorologists said will likely continue into next year.
Southern Brazil, source of the Parana River, has been hit by drought for three years. This has reduced water levels in the Argentine ports hub of Rosario, Santa Fe province, where about 80% of the country’s agricultural exports are loaded.
Ships sailing from Rosario are loading 18% to 25% less cargo than normal due to the shallow water, said Guillermo Wade, manager of Argentina’s Chamber of Port and Maritime Activities.
Logistics costs are rising as more soy and corn must be trucked to the Atlantic ports of Bahia Blanca and Necochea, in southern Buenos Aires province, where ships make a final stop to be topped off with cargo before heading out to sea.
GIMME SOME WATER
The drying trend in Brazil started in 2019. The next year was drier and 2021 has been the driest of the three years, Hankes said. The effect on the river is cumulative. Over the last 12 months the Parana River basin has gotten only 50% to 75% of normal rainfall.
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