Global Ag News for June 14
TODAY —- EXPORT INSPECTIONS, CROP PROGRESS
Wheat prices overnight are down 19 1/4 in SRW, down 20 1/2 in HRW, down 25 1/4 in HRS; Corn is down 26 1/2; Soybeans down 37 1/2; Soymeal down $0.52; Soyoil down 2.67.
Markets finished last week with wheat prices down 17 1/2 in SRW, down 10 1/2 in HRW, down 39 1/2 in HRS; Corn is down 17; Soybeans down 33 1/2; Soymeal down $0.03; Soyoil down 3.98.
For the month to date wheat prices are down 3/4 in SRW, up 4 3/4 in HRW, up 12 1/2 in HRS; Corn is up 37 3/4; Soybeans up 28 1/2; Soymeal down $3.20; Soyoil up 2.25.
China markets are closed for holiday. Malaysian palm oil prices overnight were down 294 ringgit (-8.03%) at 3369 as soy markets slumped and worries about rising production and weaker Chinese demand further dented sentiment.
Midwest corn, soybean and winter wheat forecasts: West: Mostly dry Monday-Tuesday. Isolated showers Wednesday-Thursday, south Friday. Temperatures near to above normal Monday, near normal Tuesday-Wednesday, near to above normal Thursday, near to below normal Friday. East: Isolated showers Monday. Mostly dry Tuesday-Wednesday. Isolated showers Thursday, south Friday. Temperatures near normal Monday, below normal Tuesday-Thursday, near normal Friday. 6 to 10 day outlook: Isolated showers Saturday-Wednesday. Temperatures near to below normal Saturday-Monday, near to above normal Tuesday-Wednesday.
The player sheet for 6/11 had funds: net sellers of 3,000 contracts of SRW wheat, sellers of 15,000 corn, sellers of 15,000 soybeans, buyers of 2,000 soymeal, and sellers of 25,000 soyoil.
Preliminary changes in futures Open Interest as of June 11 were: SRW Wheat up 9,752 contracts, HRW Wheat down 552, Corn up 11,467, Soybeans down 2,991, Soymeal up 4,245, Soyoil down 261.
There were no changes in registrations. Registration total: 20 SRW Wheat contracts; 16 Oats; 0 Corn; 13 Soybeans; 868 Soyoil; 442 Soymeal; 1,249 HRW Wheat.
- FEED WHEAT PURCHASE: South Korea’s Major Feedmill Group (MFG) purchased about 65,000 tonnes of animal feed wheat which can be sourced from optional origins in a tender that closed on Friday, European traders said in initial assessments.
- WHEAT TENDER CANCELED: The Ethiopian government canceled an international tender to buy about 400,000 tonnes of milling wheat, European traders said.
- WHEAT TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 tonnes of milling wheat.
- WHEAT BRAN TENDER: Jordan’s state grains buyer issued an international tender to purchase 20,000 tonnes of wheat bran.
- FEED WHEAT AND BARLEY 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 Sept. 30 and arrive in Japan by Nov. 25, via a simultaneous buy and sell (SBS) auction that will be held on June 16.
- WHEAT TENDER: Jordan’s state grain buyer issued international tenders to buy a total 120,000 tonnes of milling wheat which can be sourced from optional origins.
Biden considers giving refiners relief from U.S. biofuel laws, sources say – Reuters News
NEW YORK, June 11 (Reuters) – President Joe Biden’s administration, under pressure from labor unions and U.S. senators including from his home state of Delaware, is considering ways to provide relief to U.S. oil refiners from biofuel blending mandates, three sources familiar with the matter said.
The issue pits two of the administration’s important political constituencies against each other: blue-collar refinery workers and farmers who depend on biofuel mandates to prop up a massive market for corn.
It could prompt an about-face for the administration, which had been rolling back former President Donald Trump’s dramatic expansion of waivers for U.S. refiners from the Renewable Fuel Standard.
The credits, known as RINs, are currently at their highest price in the program’s 13-year history, and refiners have said the policy threatens to bankrupt fuel makers already slammed by sinking demand during the pandemic.
Renewable fuel credits traded down 15% on Friday morning after the news. Credits RIN-D6-US traded at $1.70 each, down from $2.00 on Thursday, traders said. Prices later traded at $1.85 each. (Full Story)
Democratic senators Chris Coons and Tom Carper of Delaware have held at least two discussions in recent weeks with Michael Regan, head of the U.S. Environmental Protection Agency, to discuss providing relief for refiners, according to the three sources.
Coons and Carper were seeking to help the state’s lone refinery, a plant in Delaware City with a capacity of about 180,000 barrels per day. Their requests added to a chorus of pleas from other states hosting refineries, including Pennsylvania, Texas and Louisiana.
In the meetings, Regan and the senators discussed options like a nationwide general waiver exempting the refining industry from some obligations, lowering the amount of renewable fuel refiners must blend in the future, creating a price cap on compliance credits, and issuing an emergency declaration, two of the sources said.
Nick Conger, an EPA spokesperson, confirmed Regan had met with the senators but did not comment further on the discussions or confirm whether the agency was looking at ways to provide relief to refiners.
NOPA May U.S. soy crush seen at 165.120 million bushels -survey – Reuters News
U.S. soybean processors likely crushed 2.6% fewer beans in May than they did in the same month a year ago as maintenance downtime at some facilities restricted production, analysts said ahead of a National Oilseed Processors Association (NOPA) report due Tuesday.
- NOPA members, which handle about 95% of all soybeans processed in the United States, were estimated to have crushed 165.120 million bushels of soybeans in May, according to the average of estimates from eight analysts.
- That compares with a crush of 160.310 million bushels in April and a May 2020 crush of 169.584 million bushels.
- Estimates for the May 2021 crush ranged from 160.000 million to 170.380 million bushels, with a median of 165.650 million bushels.
- Soyoil supplies at the end of May were projected at 1.713 billion pounds, based on the average of estimates from six analysts. If realized, that would be up slightly from 1.702 billion at the end of April but down from 1.880 billion pounds at the end of May 2020.
- Stocks estimates ranged from 1.630 billion to 1.830 billion pounds, with a median of 1.714 billion.
Alberta Crop Emerges at Fast Clip of 91% After Heat and Rains
Plant emergence in the Canadian Prairie province is ahead of the five-year average of 82% for this time of year, the Alberta government said in a weekly report Friday.
- Spring wheat development leads the way with 94% emerged
- 87% of canola and barley is above ground
- Seeding is 100% complete on major crop acres, with small amounts of barley and oats left to plant
- Soil moisture conditions improved slightly due to rain and heat
- 6% rated poor, 23% fair, 55% good, 15% excellent and 1% excessive
- Parts of province experiencing dry conditions that occur every 12 to 25 years
- Two weeks of rain and heat improved hay and pasture growth
- 6% of pasture is rated poor, 27% fair, 60% good and 7% excellent
Ukraine Corn Crop to Rise Y/y, Russia Wheat Crop to Fall: StoneX
Ukraine is expected to harvest 38.2m tons of corn this year, up from 30.3m tons last year, according to results of a StoneX client survey.
- Wheat crop pegged at 29m tons, up from 25.4m tons
- Russia’s wheat crop seen at 83.5m tons, down from 85.4m tons
SovEcon Raises Russian Wheat Crop Estimate on Ample May Rainfall
Russia’s 2021 wheat harvest is now seen at 82.4m tons, up 1.5m tons from a prior estimate, consultant SovEcon said in an emailed note.
- Winter-wheat conditions have improved due to ample rain in May in the south, the key growing and exporting region
- Spring wheat in the Urals and Siberia has suffered from drought
- Corn crop estimate raised to 15.6m tons, up 1.2m tons, on higher plantings and favorable conditions
- Ukraine’s corn harvest is now pegged at 36.8m tons, up 0.2m tons, and the wheat crop is seen at 28.9m tons, up 0.3m tons, due to good weather
- With bumper Black Sea crops, “wheat from Russia and Ukraine will be a serious threat to European wheat again,” said Andrey Sizov, head of SovEcon
- A record Ukrainian corn crop will mean tough export competition with U.S. supply to China
U.S. Beef Production Up 23.2% This Week, Pork Rises: USDA
U.S. federally inspected beef production rises to 546m pounds for the week ending June 12 from 443m in the previous week, according to USDA estimates published on the agency’s website.
- Cattle slaughter up 23.6% from a week ago to 665m head
- Pork production up 23.3% from a week ago, hog slaughter rises 23.5%
Britain’s wheat imports running above last season
Britain’s wheat imports slowed in April but are still running well above last season’s pace, customs data showed on Friday.
- Wheat imports for the month totalled 155,832 tonnes, down from 187,044 tonnes in March.
- Estonia was the largest supplier in April, shipping 32,020 tonnes followed by Denmark with 27,059 tonnes.
- Cumulative imports since the start of the 2020/21 season, which began on July 1, 2020, totalled 2.04 million tonnes, up from 916,801 tonnes in the same period a year earlier.
- Germany remains Britain’s largest supplier so far in the 2020/21 season with shipments of 515,535 tonnes.
- Imports are expected to climb this season after the nation’s wheat harvest totalled just 9.66 million tonnes last summer, a drop of 40.5% from the previous year.
India’s Palm Oil Imports Rise 9.7% to 4-Month High in May: Group
Purchases by the world’s biggest palm oil importer climbed to 769,602 tons, from 701,795 tons in April, according to the Solvent Extractors’ Association of India.
- Soybean oil imports increased to 267,781 tons from 144,020 tons
- Purchases of sunflower oil fell to 175,759 tons from 184,097 tons
- Total vegetable oil imports, including non-edible oil, rose to 1.25m tons from 1.05m tons
- Edible oil stockpiles on June 1 totaled 1.96m tons, compared with 1.81m tons at the start of last month
Soybean imports surge in line with the recovery of pig population
China’s soybean imports increased significantly in the first five months of the year, in line with a recovery in the domestic hog population, but domestic demand for the crop looks to be more modest in the coming months amid rising commodity prices.
It bought a total of 38.23 million tonnes of soybeans from January to May.
The world’s largest soybean importer spent US$19.35 billion on the crop, up 44.2 per cent from the same period last year, according to Chinese customs data last week. Its biggest suppliers were the United States and Brazil, and soybean imports from those countries during the five-month stretch were up 12.8 per cent, year on year.
CORN/CEPEA: Nearness of the harvesting presses down values in the Brazilian spot market
With the nearness of the harvesting of the second 2020/21 crop, corn prices are dropping in the spot market of most Brazilian regions surveyed by Cepea.
Purchasers are postponing deals, expecting prices to decrease as the harvesting advances. Sellers are cautious about making large volumes available in the market, since inventories are low and many of them are still uncertain about crops productivity. In this scenario, liquidity has been low in Brazil.
In São Paulo State, purchasers put pressure on values, and the ESALQ/BM&FBovespa Index for corn (Campinas) dropped by 3.5% between June 2 and 10, closing at 95.21 BRL/60-kilo bag on June 10.
On the average of the regions surveyed by Cepea, the prices paid to corn farmers (over-the-counter market) decreased by 0.5%; in the wholesale market (deals between processors), prices dropped by 0.5% too.
SOYBEAN/CEPEA: Estimates for higher world inventories press down values in Brazil and in the United States
In light of that, between June 2 and 10, the ESALQ/BM&FBovespa Index Paranaguá (PR) dropped by 1.3%, closing at 170.63. BRL (33.70 USD)/bag on Thursday, 10, the lowest nominal level since March 24. In the same period, the CEPEA/ESALQ Index Paraná decreased by 1.2%, to 165.94 BRL (32.77 USD)/bag, also the lowest level, in nominal terms, since April 8.
On the average of the regions surveyed by Cepea, the prices paid to soybean farmers (over-the-counter market) in Brazil dropped by 0.6%; in the wholesale market (deals between processors), quotes decreased by 0.5%. The US dollar dropped by 0.5%, closing at 5.064 BRL on June 10.
Indonesia’s May Palm Oil Exports Rise 8.2% M/m: Intertek
Exports rose to 2.96m tons in May from 2.73m tons in April, according to cargo surveyor Intertek Testing Services in an emailed statement.
- May shipments by grade:
- 262,675 tons of crude palm oil
- 1,088,310 tons of RBD palm olein
- 762,320 tons of RBD palm oil
- May versus April sales by destination:
- European Union at 744,950 tons vs 509,353 tons
- India and subcontinent at 626,422 tons vs 717,414 tons
- China at 470,113 tons vs 534,922 tons
Indonesia’s April Palm Oil Stockpile Falls to 3.14M Tons: Gapki
Indonesia’s palm oil stockpile fell to 3.14 million tons in April, from 3.27 million tons in previous month, Indonesian Palm Oil Association, known as Gapki said in an emailed statement in Monday.
- Exports declined to 2.64m tons in April vs 3.23m tons in March
- Output was 4.1m tons in April vs 4.02m tons in March
- Domestic consumption in April at 1.59m tons, little changed from March
- Gapki sees output increasing in May through November due to oil palm tree’s cyclical pattern
- Gapki urges members to maintain productivity as output and price are set to remain high
Palm Oil Yields in World’s Top Grower Seen Climbing to Record
- Indonesian output to rise 2 million tons this year: Astra Agro
- India’s Covid crisis could hurt palm oil demand in second half
The world’s top palm oil grower Indonesia is set to churn out a record crop this year as favorable rains boost yields, according to PT Astra Agro Lestari, the country’s biggest-listed planter.
Production may climb by 2 million tons to reach 53.6 million tons in 2021, with output of fresh fruit bunches seen gradually rising to a peak in the months of September through November, President Director Santosa said in an interview. The nation grows more than half of global supplies.
The recovery in Indonesia’s production, after a 1.1% drop in 2020, is largely down to the La Nina weather phenomenon which brought beneficial rains to the country’s key palm-growing regions from September through March, according to Santosa, who goes by one name. While the wetter weather may have temporarily disrupted harvesting during that period, it will boost yields over the next nine to 12 months, he said.
Palm oil exports in the second half will hinge on India’s Covid crisis, Santosa said, adding that the key buying period for the top importer is usually ahead of the Diwali festival in November. While new daily infections and deaths have fallen from their peak, India is still struggling to curb the spread of the virus and accelerate the pace of vaccination to guard against another wave.
Although India is still buying palm oil for the food industry, exporters are concerned about the logistical complications, Santosa said.
India Cumulative Monsoon Rainfall 25% Above Normal as of June 13
India has so far received 64.8 millimeters of rains during the current monsoon season, which runs from June through September, compared with a normal of 52 millimeters, according to data published by the India Meteorological Department on June 13.
- Rainfall in the central region was at 69% above normal
- The eastern and northeastern region got 8% below normal rains
Tim Hortons and Burger King owner sees ‘significant inflation’ for beef and mayo
The owner of Burger King and Popeyes sees prices for key ingredients like beef, mayonnaise and bacon soaring amid higher demand and supply constraints, according to an internal report. Restaurant Brands International Inc. “can see significant inflation across all regions on protein and oils” compared with historical five-year averages, according to a company report on commodities, dated May 17, that was viewed by Bloomberg News. “Price inflation across the protein market complex has far exceeded even our most bullish forecasts,” the company said in the report.
Malaysia could spend nearly $2 bln on fuel subsidies this year – finance ministry
Malaysia is expected to spend 8 billion ringgit ($1.95 billion) on fuel and cooking oil subsidies this year, more than double the 3.78 billion ringgit originally allocated, the finance ministry said on Saturday.
The announcement comes as Malaysia looks to boost public assistance measures amid fresh coronavirus lockdowns imposed this month.
The costs of retail fuel and cooking oil subsidies were set to increase sharply due to a global rise in commodity prices, Finance Minister Tengku Zafrul Abdul Aziz said in a statement.
Govt to give away more food as granaries bulge
(Hindustan Times) — The Union government’s record buying of vast quantities of food grains from farmers at minimum support prices this year points to a glut of cereals, with stocks breaching previous limits, prompting the government to make additional plans to pare reserves.
Even after distributing subsidised grains to nearly 730 million beneficiaries under the National Food Security Act and additional distribution of 5kg free grains per month per person under the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY), the government will be left with more than it requires to mandatorily keep aside as emergency reserves, known as buffer stock.
Since the government pays higher prices every year to buy large quantities of cereals because of the annual increase in guaranteed rates known as minimum support prices (MSPs), Indian wheat can hardly be exported competitively. It is pricier compared to wheat from other exporting nations.
In the current season, the government has procured over 41 million tonne of wheat, a record. It has so far paid an MSP value of ₹81,000 crore to cereal growers.
Soy food body seeks duty free import of ‘food specialty’ soybeans from US
(IANS) — New Delhi – The Soy Food Promotion & Welfare Association has requested Prime Minister Narendra Modi to allow the soy food processing industry to import 50,000 metric tons of the food specialty soybeans from the US on a ‘zero’ duty under tariff rate quota(TRQ).
In a statement, the industry body said that soy is not a staple food in India, hence the requirement to process and serve the best optimal quality to customers is paramount.
With specialized modern food processing techniques and scientific interventions, soy food companies have improved quality, but due to a lack of affordable, high quality raw ingredients, we feel challenged for new growth opportunities, it added.
Biden Moves to Strengthen Market Protections for Farmers
- USDA chief Vilsack cites concentration of meatpacking industry
- Pandemic, cyber attack on JBS highlighted domination of sectorBy Mike Dorning
The Biden administration announced Friday it will strengthen U.S. regulatory protections for livestock and poultry producers in their dealings with meatpackers after Covid outbreaks and a cyber attack on JBS SA highlighted domination of the industry by a few giant companies.
Out-of-Control Shipping Costs Fire Up Prices From Coffee to Toys
- Zero slack in shipping system to keep freight pricey into 2022
- Economists weigh inflation risk of long period of costly rates
The skyrocketing price of shipping goods across the globe may hit your pocketbook sooner than you think — from that cup of coffee you get each morning to the toys you may want to buy for your kids.
Transporting a 40-foot steel container of cargo by sea from Shanghai to Rotterdam now costs a record $10,522, a whopping 547% higher than the seasonal average over the last five years, according to Drewry Shipping. With upwards of 80% of all goods trade transported by sea, freight-cost surges are threatening to boost the price of everything from toys, furniture and car parts to coffee, sugar and anchovies, compounding concerns in global markets already bracing for accelerating inflation.
Orange Juice Plunges on ‘Surprise’ Upgrade for Florida Crop
- USDA raises it harvest estimate for Florida by about 2%
- Stronger U.S. dollar also pressures commodity markets
Orange juice futures headed for the biggest loss since October after the U.S. government raised its outlook for the crop in Florida, the world’s No. 2 supplier trailing Brazil. Florida’s orange crop will total 52.7 million boxes, the U.S. Department of Agriculture said Thursday. That’s about 2% higher than projected last month. A box weighs 90 pounds, or 41 kilograms. Orange-juice prices had been trading at six-month highs earlier this week amid dry conditions for groves in the state.
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