Global Ag News for Aug 16th
TODAY – EXPORT INSPECTIONS, NOPA, CROP PROGRESS
Wheat prices overnight are up 7 3/4 in SRW, up 4 in HRW, up 6 3/4 in HRS; Corn is down 2; Soybeans up 3 1/4; Soymeal up $0.03; Soyoil down 0.09.
For the month to date wheat prices are up 69 in SRW, up 74 3/4 in HRW, up 45 1/4 in HRS; Corn is up 25 3/4; Soybeans up 19; Soymeal up $6.80; Soyoil up 0.15.
Markets finished last week with wheat prices up 56 3/4 in SRW, up 45 1/2 in HRW, up 40 3/4 in HRS; Corn is up 17 1/4; Soybeans up 38 1/2; Soymeal up $0.13; Soyoil up 3.17.
Chinese Ag futures (JAN 22) Soybeans up 53 yuan ; Soymeal up 75; Soyoil up 176; Palm oil up 50; Corn up 25 — Malasyian Palm is up 54. Malaysian palm oil prices overnight were up 54 ringgit (+1.20%) at 4565 amid a global oilseed supply shortage and weakness in the Malaysian currency.
Midwest corn, soybean and winter wheat forecasts: West: Mostly dry through Wednesday. Isolated showers south Thursday. Scattered showers Friday. Temperatures above normal north and near to below normal south Monday, near to above normal Tuesday-Friday. East: Isolated showers east through Friday. Temperatures near normal Monday, near to above normal Tuesday-Friday. 6 to 10 day outlook: Scattered showers Saturday. Mostly dry Sunday. Isolated showers Monday-Wednesday. Temperatures near to above normal Saturday-Wednesday.
The player sheet for Aug. 13 had funds: net buyers of 6,000 contracts of SRW wheat, sellers of 1,000 corn, buyers of 10,000 soybeans, buyers of 1,000 soymeal, and buyers of 6,000 soyoil.
Preliminary changes in futures Open Interest as of August 13 were: SRW Wheat up 3,763 contracts, HRW Wheat down 4,627, Corn down 10,052, Soybeans up 10,751, Soymeal up 5,155, Soyoil up 3,401.
There were changes in registrations (-76 Soymeal). Registration total: 0 SRW Wheat contracts; 0 Oats; 0 Corn; 0 Soybeans; 298 Soyoil; 79 Soymeal; 1,288 HRW Wheat.
- SOYBEAN SALES: The U.S. Department of Agriculture confirmed private sales of 126,000 tonnes of U.S. soybeans to China and 326,000 tonnes to unknown destinations, both for shipment in the 2021/22 marketing year.
- BARLEY, CORN TENDER: A state agency in North Cyprus issued a tender to buy about 30,000 tonnes of animal feed barley and 5,000 tonnes of corn
- WHEAT TENDER: Jordan’s state grain buyer has issued a tender to buy 120,000 tonnes of milling wheat which can be sourced from optional origins
- 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.
- WHEAT TENDER: Algeria’s state grains agency is seeking 50,000 tons of soft wheat for 2H September shipment.
CROP SURVEY: U.S. July Soybean Crush Seen at 159.2M Bushels
Projections are based on a survey of six analysts conducted by Bloomberg News on Aug. 12-13.
- Soybean crush seen 7.8% lower vs July of last year, and an increase of 4.5% vs a month ago
- Oil stocks at the end of last month seen at 1.522b lbs vs 1.619b a year earlier
Adverse Weather Hurts Alberta Crop Quality as Harvest Advances
Just 18% of the Canadian Prairie province’s crops are in good or excellent condition, down sharply from the five-year average of 69%, Alberta government says Friday.
- ~20% of spring wheat is in good to excellent condition, along with 19% of durum, 17% of barley, 19% of oats and 15% of canola
- Harvest has advanced with 62% of fall rye in the bin, as well as 44% of winter wheat, 32% of lentils, 19% of dry peas and 14% of durum
- Average yields are low in all regions with spring wheat at ~30 bu/acre and canola at 25 bu/acre, vs compiled five-year yield index at 59%
- Low to moderate amounts of moisture were received in the past two weeks, but likely too late to help most annual crops
- Pasture is poor with some so “burnt” from hot and dry conditions that recent rains did not benefit them
- Rainfall before autumn is needed to ensure average growth next year
- There will not be a second hay cut in many areas due to little re-growth
Brazil 2022 Soy Exports Seen at 90m Tons: Safras
Estimate is 5% higher than the 86m tons expected for 2021, consulting firm Safras & Mercado says in emailed report.
- Soy crushing seen at 48.5m tons in 2022, an 4% increase compared to 2021 estimate of 46.7m tons
- Soy-meal and soy-oil production expected to rise 4% each, to 37.3m tons and 9.8m tons respectively
- Soy imports seen at 400,000 tons in 2022, 53% drop y/y
- Total soy supply seen up 5% to 147.4m tons in 2022
- Demand seen rising 4% to 142.1m tons
- Ending stocks expected to increase 11% to 5.3m tons
Ukraine harvests 39.5 mln tonnes of crop – Ukraine General Newswire
Since the beginning of the harvesting campaign as of August 13, Ukrainian farmers have harvested 39.5 million tonnes (a rise of 7.3 million tonnes per week from August 6 to August 13) of grain, legumes and oilseeds from an area of 9 million hectares (56% of the forecast).
According to the information and analytical portal of the agro-industrial complex of Ukraine, in the context of crops, the following crops were threshed: 28.7 million tonnes of wheat from an area of 6.2 million hectares (88% of the total area under this crop), 9.42 million tonnes of barley from 2.3 million hectares (92%), 2.6 million tonnes of rapeseed from 0.95 million hectares (94%), 0.54 million tonnes of peas from 0.23 million hectares (96%).
Argentina looks to reroute $300 mln from IDB to ease pain of Parana river drought
Argentina’s government said on Friday it would seek to redirect a loan from the Inter-American Development Bank for $300 million to contain the effects of a devastating drought on the Paraná River, a key waterway for trade and power generation and a source of drinking water.
The Parana, the country’s main conduit for grains, is at its lowest level in 77 years, due to a severe drought upriver in Brazil. Ships sailing from top grains port Rosario are loading 18% to 25% less cargo than normal due to the shallow water, officials have said.
Brazil’s BRF says China suspended pork imports from one of its plants due to problems with frozen cargo
Brazil’s BRF SA told a press briefing on Friday that the motivation for China to suspended pork imports from its Lucas do Rio Verde plant in Brazil was an issue with a frozen cargo originating at that facility.
CEO Lorival Luz said BRF is working with Chinese and Brazil authorities to reverse ban imposed earlier this month, which has nothing to do with the facility itself. (Full Story) Poultry exports to China from that same plant were not affected by the ban, Luz said.
India’s Palm Oil Imports Drop to 5-Month Low in July, Group Says
Purchases by the world’s biggest palm oil importer slump about 21% m/m to 465,606 tons in July, the lowest level in five months, according to the Solvent Extractors’ Association of India.
- Soybean oil imports rose to 379,892 tons from 206,262 tons in June
- Purchases of sunflower oil plummeted to 71,838 tons from 175,702 tons m/m
- Total vegetable oil imports, including non-edible oil, dropped to 917,336 tons from 969,431 tons in June
- Edible oil stockpiles on Aug. 1 totaled 1.7m tons, compared with 1.99m tons at the start of July
Malaysia’s Aug 1-15 Palm Oil Exports 540,853 Tons: AmSpec
Shipments fall 21% m/m from 684,615 tons exported during July 1-15, according to AmSpec Agri on Monday.
Russian Wheat Exports Fall 20% So Far This Season: Agency
Wheat shipments for the 2021-22 season totaled 3.8m tons as of Aug. 12, the Federal Center of Quality and Safety Assurance for Grain and Grain Products said on its website, citing inspections before exports.
- That means wheat exports totaled about 1m tons in the week to Aug. 12, compared with about 1.1m tons a week before
- Exports of all grains are at 4.6m tons so far this season
Ukraine’s Kernel Aims to Almost Double Grain Exports by 2025
Kernel, Ukrainian sunflower oil producer, grain and sunflower oil exporter, seeks to export 15m tons of grains a year from Ukraine by 2025, according to a statement on the company’s Telegram channel.
- NOTE: Kernel exported 8m tons of grains from Ukraine in the year ending June 30
CORN/CEPEA: Lower supply abroad and in Brazil limit prices drops
The downward trend of corn prices, which had been observed in many regions surveyed by Cepea, weakened in the last days, reflecting the estimates released this week confirming lower supply in Brazil and abroad. In Brazil, data show that the drought and frosts reduced the productivity of second crops. In the United States, the drought in some areas hampered production too.
Thus, deals have been sporadic in the national spot market. Purchasers are waiting for some batches to be delivered and/or the harvesting to advance, closing deals in the spot market only when necessary. Sellers are focused on both crops and the productivity decrease, cautiously supplying corn to the market, aiming to take advantage of the current price levels.
SOYBEAN/CEPEA: Firm demand and lower inventories push up prices in Brazil
Soybean prices continue to rise in the Brazilian market, influenced by the high demand from the international market, higher demand from Brazilian processors and expectations for lower ending stocks in South America. Besides, with Paraná River (which crosses Brazil, Paraguay and Argentina) at low levels, agents are worried about fluvial exports in Argentina, largely from the ports of Rosário and San Lourenzo. It is worth to mention that this situation is not expected to change in the short and mid-terms.
Consumption in Brazil is estimated at 49.4 million tons, a record. In Argentina, consumption is forecast at 48.7 million tons, 6.7% more than that in the previous season.
Thus, ending stocks in Brazil are estimated at 26.1 million tons until the end of September/21, 0.9% down from that reported in July. In Argentina, ending stocks are forecast at 25.3 million tons by the end of March/22, 0.78% down in the same comparison.
SOYBEAN MEAL – With higher international demand for soybean meal, the USDA revised up the volume to be exported by Brazil, by 7.5% compared to that previously reported, to 17.2 million tons. Argentina is forecast to export 28.5 million tons of the by-product, 0.88% up from that estimated in July.
Indonesia Projects Higher Rice, Corn Output in 2022 State Budget
Southeast Asia’s largest economy estimates rice output for 2022 at 57.5m tons, rising from 55.8m tons this year, according to the 2022 fiscal note handbook Monday.
- Corn output is projected to rise to 26m tons in 2022 from 23m tons in 2021
- President Joko Widodo’s administration pledges for better food import policy by increasing the accuracy of production data and import allocation
- Indonesia estimates the output of beef and buffalo carcass in 2022 at 590,000 tons
India Cumulative Monsoon Rainfall 8% Below Normal as of Aug. 15
India has so far received 539.8 millimeters of rains during the current monsoon season, which runs from June through September, compared with a normal of 586.7 millimeters, according to data published by the India Meteorological Department on Aug. 15.
- The central region got 12% below normal rains
- Rainfall in the southern peninsular region was at 4% above normal
- Cumulative seasonal rainfall data is compiled by the IMD
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.