Global Ag News for Dec 7.22
China’s Nov soybean imports drop on logistics hurdles
China’s November imports of soybeans fell 14% on the year to 7.35 million tonnes, customs data showed on Wednesday, as logistics woes in top supplier the United States helped confound expectations for a significant rise.
After slower loading of shipments and longer customs clearance time, the smaller-than-expected number followed October’s plunge in arrivals to just 4.1 million tonnes, the lowest level since 2014.
FUTURES & WEATHER
Wheat prices overnight are up 9 3/4 in SRW, up 7 1/4 in HRW, up 1/2 in HRS; Corn is down 1/4; Soybeans up 7; Soymeal up $0.42; Soyoil up 0.10.
For the week so far wheat prices are down 27 in SRW, down 36 1/2 in HRW, down 23 1/4 in HRS; Corn is down 9 3/4; Soybeans up 20 1/2; Soymeal up $2.51; Soyoil down 3.39.
For the month to date wheat prices are down 56 3/4 in SRW, down 62 1/2 in HRW, down 46 1/2 in HRS; Corn is down 30; Soybeans down 7 1/2; Soymeal up $34.10; Soyoil down 9.18.
Year-To-Date nearby futures are down -8% in SRW, up 6% in HRW, down -8% in HRS; Corn is up 5%; Soybeans up 10%; Soymeal up 9%; Soyoil up 14%.
Chinese Ag futures (MAR 23) Soybeans down 28 yuan; Soymeal up 25; Soyoil down 2; Palm oil up 60; Corn down 24 — Malaysian palm oil prices overnight were down 125 ringgit (-3.05%) at 3969.
There were changes in registrations (-1 Oats, ). Registration total: 3,056 SRW Wheat contracts; 3 Oats; 308 Corn; 121 Soybeans; 689 Soyoil; 291 Soymeal; 505 HRW Wheat.
Preliminary changes in futures Open Interest as of December 6 were: SRW Wheat up 6,512 contracts, HRW Wheat up 962, Corn down 7,211, Soybeans down 11,715, Soymeal up 4,231, Soyoil down 6,383.
Brazil Grains & Oilseeds Forecast: Scattered showers will continue in central and northern Brazil as is typical for this time of year. Southern areas will dry out over the next day or two with only periodic showers through the weekend. A front moving through early next week will provide some better precipitation but then clear the region out later next week. Corn in the far south may be seeing some stress developing as temperatures increase this week. Soybeans are generally in good condition across the country.
Argentina Grains & Oilseeds Forecast: Showers will return in isolated fashion this week, but very high temperatures in the region will cause further stress and potential damage to developing corn and soybeans. Planting is also very delayed and this week will not promote much progress. Models do bring through a couple of cold fronts this weekend with more showers and will push out the high temperatures for next week. The showers that come with the fronts are not expected to be widely scattered or heavy. Overall, conditions continue to be poor for corn and soybeans until precipitation becomes more consistent.
Northern Plains Forecast: Some light snow will drift through the region through Wednesday. Near- to below-normal temperatures will be in the region for the next week and may drop behind a cold front moving through this weekend.
Central/Southern Plains Forecast: Some isolated showers will pass through eastern areas early this week, but a system will form in Texas on Wednesday night and push northeast on Thursday. Precipitation will be most likely over eastern areas but cannot rule out some showers for the drought areas in the west. Temperatures will remain well above normal through this weekend.
Midwest Forecast: A system will push through on Thursday and Friday with more consistent and widespread precipitation, especially south. Temperatures may be a little more on the mild side until another system comes through early next week.
The player sheet for Dec. 6 had funds: net sellers of 5,000 contracts of SRW wheat, sellers of 4,000 corn, sellers of 6,000 soybeans, buyers of 5,000 soymeal, and sellers of 5,000 soyoil.
- SOYBEAN SALES: The U.S. Department of Agriculture confirmed private sales of 264,000 tonnes of U.S. soybeans to China and another 240,000 tonnes to unknown destinations, all for delivery in the 2022/23 marketing year that began Sept. 1.
- CORN PURCHASE: South Korea’s Feed Leaders Committee (FLC) purchased about 130,000 tonnes of animal feed corn expected to be sourced from South America in an international tender.
- FEED WHEAT PURCHASE: South Korea’s Major Feedmill Group (MFG) purchased about 60,000 tonnes of animal feed wheat expected to be sourced from Australia in a private deal without issuing an international tender.
- WHEAT PURCHASE: A group of South Korean flour mills bought around 50,000 tonnes of milling wheat to be sourced from the United States in an international tender on Tuesday.
- RICE PURCHASE: Turkey’s state grain board TMO is believed to have purchased around 18,000 tonnes of rice in an international tender for up to 40,000 tonnes which closed on Nov. 25.
- CORN PURCHASE: Taiwan’s MFIG purchasing group bought about 65,000 tonnes of animal feed corn to expected to be sourced from Brazil in an international tender on Wednesday.
- SOYBEAN PURCHASE: South Korea’s state-backed Agro-Fisheries & Food Trade Corp. has bought about 65,000 tonnes of soybeans free of genetically-modified organisms (GMOs) in an international tender for up to 70,000 tonnes which closed on Dec. 5
- WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is seeking to buy 154,957 tonnes of food-quality wheat from the United States, Canada and Australia in regular tenders that will close on Dec. 8.
- RICE TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 tonnes of rice.
- SOYBEAN TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp. has issued new international tenders to purchase around 25,000 tonnes of food-quality soybeans free of genetically-modified organisms (GMOs)
- WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) said on Wednesday that it will seek 70,000 tonnes of feed wheat and 40,000 tonnes of feed barley to be loaded by Feb. 8, 2023 and arrive in Japan by March 9, via a simultaneous buy and sell (SBS) auction that will be held on Dec. 14.
- WHEAT TENDER: The Taiwan Flour Millers’ Association issued an international tender to purchase 42,750 tonnes of grade 1 milling wheat to be sourced from the United States, European traders said. The deadline for submission of price offers in the tender is Dec. 7
US Agriculture Sentiment Unchanged in November: Purdue Univ.
The Purdue University/CME Group’s agricultural sentiment index remained at 102 points in Nov., according to a survey of 400 agricultural producers.
- Current conditions component declined by 3 points from Oct.
- Future expectations up by 2 points
- The following shows results of the survey:
ETHANOL: US Weekly Production Survey Before EIA Report
Output and stockpile projections for the week ending Dec. 2 are based on five analyst estimates compiled by Bloomberg.
- Production seen slightly lower than last week at 1.017m b/d
- Stockpile avg est. 22.884m bbl vs 22.934m a week ago
- The EIA in Washington is scheduled to release the report at 10:30am Wednesday
CROP SURVEY: Brazil 2022-23 Soybean Output Seen at 153.6M Tons
Brazil soybean production seen slightly above the national forecast agency’s previous est. of 153.5m tons, according to the avg in a Bloomberg survey of seven analysts.
- The range of estimates varied from 150.5m tons to 155.1m tons
- Brazil’s corn crop seen 1.4m tons higher at 127.8m tons
- Conab, the Brazilian national supply company, is scheduled to release its latest estimates on Dec. 8 at 9am local time.
EU Soft-Wheat Exports Up 3.5% YoY; Corn Imports More Than Double
EU soft-wheat exports during the season that began July 1 reached 14.5m tons as of Dec. 4, compared with 14m tons in a similar period a year earlier, the European Commission said on its website.
- Leading destinations include Algeria (1.97m tons), Morocco (1.95m tons) and Egypt (1.5m tons)
- EU barley exports were at 2.75m tons, compared with 4.7m tons a year earlier
- EU corn imports at 12.6m tons, against 5.8m tons a year earlier
Paris Milling-Wheat Futures Fall to Lowest Since February
Milling-wheat futures fell as much as 1.3% to €300/ton on the Euronext exchange in Paris, before paring the loss to 0.6%.
- That’s the lowest for a most-active contract since Feb. 25, just after the war erupted in Ukraine
- NOTE: Earlier, Chicago wheat futures traded at their lowest in almost 14 months
- Prices have since steadied
Crop Trader Bunge Sees Stronger Soy-Processing Margins in China
- Easing lockdown restrictions help crop demand, CEO says
- ‘It is hard to imagine demand can get worse’ that it has been
Margins made by processing oilseeds in China are finally turning positive, a sign of improving crop demand that could help boost futures markets, Bunge Ltd.’s Chief Executive Officer Greg Heckman said.
The improvement is a turnaround from earlier this year when tepid demand in China weighed on agricultural trading in Chicago. As the world’s largest commodities importer starts to loosen some Covid-19 lockdowns, demand for grain and oilseeds is expected to rebound and improve margins for crop processors like Bunge, Cargill Inc. and Archer-Daniels-Midland Co..
“It is hard to imagine demand can get worse, and the lighter lockdowns are good for demand,” Heckman said in a presentation Tuesday to investors. “We are starting to see spot margins improving.”
Still, crop markets still face plenty of uncertainty, especially with logistical issues and supply-chain snags.
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