Global Ag News for May 5

TODAY—WEEKLY ETHANOL STATS—

Overnight trade has SRW Wheat up roughly 2 cents; HRW up 3 cents; HRS Wheat up 6, Corn is up 3 to 5 cents; Soybeans up 12 to 9; Soymeal up $5.0 to $2.00, and Soyoil up 20 to 35 points.

Chinese Ag futures are closed for holiday until Thursday.

Malaysian palm oil prices were up 3 ringgit at 4,045 (basis July) at midsession in quiet trade.

U.S. Weather Forecast: Beneficial precipitation is still expected through Sunday from north-central Montana into South Dakota and southwestern North Dakota. Central and northwestern North Dakota and far northeastern Montana will likely miss out from at least some of this notable precipitation. Last evening’s GFS model run was then drier in a large portion of the Northern Plains May 12 – 14 and May 17 – 19.

South America Weather Forecast: Concern remains of dryness in Safrinha corn areas of Brazil. Dryness is likely across most of this area through at least the next ten days to two weeks, especially since the monsoon has ended, and last evening’s GFS model run was similar to the midday GFS model in showing no relief in this part of the nation.  Conditions in Argentina will continue to be very good for late season crops.

The player sheet had funds net buyers of 5,000 contracts of SRW Wheat; bought 22,000 in Corn; bought 9,000 Soybeans; net bought 4,000 Soymeal, and; bought 3,000 Soyoil.

We estimate Managed Money net long 4,000 contracts of SRW Wheat; net long 414,000 Corn; long 180,000 Soybeans; long 50,000t Soymeal, and; net long 107,000 Soyoil.

Preliminary Open Interest saw SRW Wheat futures down roughly 3,000 contracts; HRW Wheat up 2,600; Corn up 1,300; Soybeans down 1,100 contracts; Soymeal up 1,400 lots, and; Soyoil up 2,200.

Deliveries were ZERO Soymeal; 205 Soyoil; 12 Rice; ZERO Corn; ZERO HRW Wheat; ZERO Oats; 31 Soybeans; ZERO SRW Wheat, and; ZERO HRS Wheat.

There were changes in registrations (Soyoil up 201; Rice up 8)—Registrations total 210 contracts for SRW Wheat; 16 Oats; Corn ZERO; Soybeans 66; Soyoil 1,161 lots; Soymeal 175; Rice 1,363; HRW Wheat 1,289, and; HRS 555. 

Tender Activity—Taiwan seeks 89,425t U.S. wheat—Thailand seeks 455,000t optional-origin feed wheat—Philippines bought 60,000t optional-origin wheat—

Wire story reports U.S. farmers are ahead of schedule in planting the 2021 corn and soybean crops to kick off May, the busiest planting month. The weather forecast is not exactly wide open to facilitate seamless planting in the coming weeks, but attractive prices may override those imperfections. The widespread dry soil conditions have been both a blessing and a curse since planting is more efficient, but pressure is higher to receive sufficient moisture down the road. A flip to a wetter pattern right now would help the newly sown crops, and it might not necessarily derail planting plans either, given strong profit potential.

Wire story reports taco shells will be in short supply this summer. Corn tacos will be more difficult to find in grocery stores as demand for corn – a key product in anything from fuel to animal feed, as well as your favorite tacos – paired with supply-chain woes makes the product even more difficult to produce.

• Corn tortillas may be difficult to find this summer, as major corn producers struggle to meet demand.
• Labor shortages and poor weather have decreased corn yields for major producers.
• China is leading a surge in demand as it seeks to replenish its swine herd.

Demand for the grain has surged in recent months. Increased interest from China, as well as a combination of poor weather and labor shortages, has made the key crop an increasingly valuable commodity.

Major corn producers in Brazil and Argentina have been facing difficulty finding people to work the fields amid the COVID-19 pandemic.

• BRAZIL CORN EXPORTS SEEN REACHING 0 TNS IN MAY VERSUS 29,991 TNS IN APRIL – ANEC
• BRAZIL SOY EXPORTS SEEN REACHING UP TO 11.965 MILLION TNS IN MAY VERSUS 15.6 MILLION TNS IN APRIL – ANEC

Brazil’s iron ore export revenues are set to surge 60% this year and displace soybeans as the country’s number one source of foreign exchange earnings for the first time in six years, Brazil’s Foreign Trade Association (AEB) said. The forecast $41.25 billion revenue, together with potential record soybean export volumes, means Brazil is on track to post an overall trade surplus this year of almost $80 billion

Brazil’s largest chicken processor, BRF SA said it will invest 292 million reais ($54 million) to modernize certain facilities in Paraná state through 2022. The company also said it will resume turkey production at its Francisco Beltrão unit, which received authorization in March to export products to Mexico.

Argentina’s 2021/22 wheat crop is expected at 19 million tonnes, equal to the country’s record-setting harvest in the 2018/19 season, the Buenos Aires Grains Exchange said in a preliminary forecast. Sowing of wheat in Argentina will start over the weeks ahead, with harvesting usually ending in January. Last season’s wheat crop was 17 million tonnes.

Argentina’s Parana River, the grains superhighway that takes soy and corn from the Pampas farm belt to the world, has gotten so shallow that it has started “trimming” international shipments just as the country’s export season gets underway. The level of the Parana at the export hub of Rosario, home to some of the biggest soy crushing plants in the world, was a scant 0.92 meters on Tuesday, according to the Coast Guard. Between 1996 and 2020 the median depth of the river at Rosario in April was a much deeper 3.58 meters.

Euronext wheat rose on Tuesday, recouping losses from the previous session as deteriorating corn harvest prospects in Brazil drove Chicago corn futures to an eight-year high. A sharp fall in the euro against the dollar also supported gains on Euronext, traders said. September milling wheat settled up 4.75 euros, or 2.2%, at 220.50 euros ($264.84) tonne. Corn continued to give impetus to wheat as developing drought in southern Brazil threatened to stress corn crops and add to global supply tensions. “It’s all about corn and Brazil. May wheat on Euronext settled up 3.6% at 252.25 euros in more volatile trading before its expiry next week.

Selected highlights from a report issued by the U.S. Department of Agriculture’s Foreign Agricultural Service post in New Delhi:

—FAS New Delhi (post) is lowering its India MY 2021/2022 (April-March) wheat production forecast to 105 million metric tons (MMT) compared to the pre-harvest forecast of 107 MMT. Post is lowering the forecast number due to early harvest reports of lower-than-expected yields in the country’s central and eastern states.

Pakistan government on Monday decided to import four million metric tons of wheat this year to meet the domestic consumption requirements.

Indonesia’s palm oil output is expected to jump 7.1% to 55.69 million tonnes in 2021, on a forecast for more conducive weather conditions, a researcher at the state-owned Indonesia Oil Palm Research Institute (IOPRI) said. Palm oil production in Indonesia was estimated at 52.01 million tonnes last year.