Global Ag News for Nov 1.23

TOP HEADLINES

Fall armyworm control efforts safeguard China’s grain output, protect neighbors

China’s sweeping efforts to control fall armyworm, a destructive pest that affects a wide range of crops but mainly infests corn, have helped secure the country’s grain output and reduced the risk of the pest spreading to neighboring Southeast Asian countries, an official said on Tuesday.

Wu Kongming, president of Chinese Academy of Agricultural Sciences, said the Chinese government had attached great importance to controlling fall armyworm, which originated in the Americas and was first discovered in China in December 2018.

“Four years of State-led control efforts have yielded preliminary success,” he said at the FAO Global Symposium on Sustainable Fall Armyworm Management, which opened in Beijing on Tuesday.

The event was organized by the Food and Agriculture Organization of the United Nations and CAAS. The UN agency initiated a Global Action for Fall Armyworm Control in 2020, with Chinese researchers, including a number from CAAS, having been active participants.

China had amassed experience in tackling the pest during the process, creating a new mechanism to curb them with integrated control techniques, Wu said.

He called fall armyworm a shared global challenge and said he intended to use the symposium to bolster exchanges of expertise and create a plan that would allow the world’s food producers to control the pest in a concerted fashion.

FUTURES & WEATHER

Wheat prices overnight are up 5 in SRW, up 7 1/4 in HRW, up 1 1/4 in HRS; Corn is up 1; Soybeans down 1 1/2; Soymeal down $2.40; Soyoil down 0.02.

For the week so far wheat prices are down 14 1/4 in SRW, down 6 1/2 in HRW, down 9 1/4 in HRS; Corn is down 1; Soybeans down 10 1/2; Soymeal down $13.80; Soyoil down 0.87.

For the month to date wheat prices are up 5 in SRW, up 7 1/4 in HRW, up 1 1/4 in HRS; Corn is up 1; Soybeans down 1 1/2; Soymeal down $2.40; Soyoil down 0.02.

Year-To-Date nearby futures are down 29.1% in SRW, down 28.3% in HRW, down 24.3% in HRS; Corn is down 29.3%; Soybeans down 15.4%; Soymeal down 10.4%; Soyoil down 19.4%.

Chinese Ag futures (JAN 24) Soybeans up 9 yuan; Soymeal up 1; Soyoil up 18; Palm oil down 24; Corn up 7 — Malaysian Palm is up 11.  Malaysian palm oil prices overnight were up 11 ringgit (+0.30%) at 3690.

There were changes in registrations (-3 Soymeal). Registration total: 3,005 SRW Wheat contracts; 735 Oats; 4 Corn; 598 Soybeans; 62 Soyoil; 52 Soymeal; 400 HRW Wheat.

Preliminary changes in futures Open Interest as of October 31 were: SRW Wheat up 5,477 contracts, HRW Wheat down 801, Corn up 6,661, Soybeans up 1,499, Soymeal up 5,847, Soyoil up 5,708.

Brazil: Several systems moving through southern areas this week will produce heavy precipitation, which will continue to create problems with flooding and limit developing corn and soybeans as well as damaging remaining wheat. Southern areas will catch a dry spell this weekend into early next week, but it may be too short with more showers moving through mid-late next week. Central areas will see improved precipitation which will help with soybean planting and establishment in most areas, as well as keeping temperatures from getting too hot.

Argentina: Scattered showers that increased over the weekend continue through Thursday, favoring remaining filling winter wheat and developing corn as well as producing better soil moisture for early soybean planting. However, colder temperatures are also moving in with the rain, which may produce some limited frosts over southern areas throughout the week. After a break this weekend, showers should move through with another system next week.

Northern Plains: Heavy snow that fell across northern areas last week will take some time to melt and keep temperatures low through most of the week. The pattern will stay fairly active with occasional light showers, including some snow, for the next couple of weeks. The colder and wetter conditions will continue to make remaining fieldwork difficult to accomplish, especially north.

Central/Southern Plains: Scattered showers went through the region over the weekend, including accumulating light snow across the north. That included heavier rain in the southeast that should help to ease drought. Cold temperatures will make for widespread frosts and freezes for the next few days, slowing growth for winter wheat.

Midwest: Rounds of showers went through this weekend, including some snow in the northwest and heavier rain across the south and east. Recent good rainfall should help to ease drought on a widespread basis, but are delaying the remaining fieldwork. Cold temperatures will be in place for most of the week, with widespread frosts and freezes. In addition, a burst of light snow will continue through the region with a disturbance on Tuesday. Temperatures will moderate this weekend, but the pattern will stay active with additional showers possible this weekend and next week at times.

The player sheet for Oct. 31 had funds: net sellers of 4,000 contracts of SRW wheat, buyers of 2,000 corn, sellers of 2,000 soybeans, buyers of 4,000 soymeal, and  sellers of 2,000 soyoil.

TENDERS

• VEGOILS TENDER: Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), said on Tuesday it was seeking vegetable oils in an international purchasing tender for arrival Jan. 1-20, 2024 and/or Jan. 21 to Feb 10, 2024. GASC said traders should submit bids for payment at sight. The deadline for offers is Nov. 2.
• SOYBEAN SALE: The U.S. Department of Agriculture (USDA) confirmed private sales of 239,492 metric tons of U.S. soybeans for delivery to Mexico in the 2023/24 marketing year that began Sept. 1.
• FOOD WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is seeking to buy a total of 113,506 metric tons of food-quality wheat from the United States, Canada and Australia in a regular tender that will close on Nov. 2.
• FEED WHEAT PURCHASE: South Korea’s Major Feedmill Group (MFG) purchased about 55,000 metric tons of animal feed wheat which can be sourced from optional origins in an international tender on Tuesday.
• FEED CORN PURCHASE: South Korea’s Major Feedmill Group (MFG) purchased an estimated 132,000 metric tonnes of animal feed corn to be sourced from optional origins in an international tender on Tuesday.
• SOFT WHEAT, BARLEY PURCHASES: Tunisia’s state grains agency is believed to have purchased about 100,000 metric tons of soft wheat and 75,000 tons of animal feed barley to be sourced from optional origins in an international tender on Tuesday.

PENDING TENDERS

• CORN TENDER: The Korea Feed Association (KFA) has issued an international tender to purchase up to 136,000 metric tons of animal feed corn to be sourced from optional origin
• WHEAT TENDER: Jordan’s state grain buyer has issued an international tender to buy up to 120,000 metric tons of milling wheat which can be sourced from optional origins
• RICE TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp issued an international tender to purchase an estimated 50,100 metric tons of rice largely from the United States
• CORN TENDER: Iranian state-owned animal feed importer SLAL issued an international tender to purchase about 180,000 metric tons of animal feed corn.
• WHEAT TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 metric tons of milling wheat.

TODAY

ETHANOL: US Weekly Production Survey Before EIA Report

Output and stockpile projections for the week ending Oct. 27 are based on seven analyst estimates compiled by Bloomberg.

• Production seen higher than last week at 1.047m b/d
• Stockpile avg est. 21.402m bbl vs 21.398m a week ago

CROP SURVEY: US Soybean Crush and Corn for Ethanol

The following is from a Bloomberg survey of six anlaysts.

• Soybean crush seen at 173.2m bu in Sept., a 3.4% rise from a year ago
• Crude and once-refined soybean-oil reserves at end of September seen at 1.6b lbs, down from 1.991b
• Corn used in ethanol production seen up 7.4% y/y to 411.8

BrasilAgro has mixed progress planting soy in top grower Mato Grosso

Brazilian listed farm group BrasilAgro AGRO3.SA has advanced soy planting in some parts of Mato Grosso state but has seen slower progress in others due to irregular rains, an executive said on Tuesday.

The company has managed to sow 90% of its soy fields at the Jataí farm, in the northeast of Brazil’s biggest grain state. But in towns like Querencia, in the east, and Comodoro, closer to the western border with Rondonia state, the work has not advanced as quickly, according to management.

BrasilAgro’s planting speed disparities highlight how the El Nino weather pattern, which has brought dry weather to Brazil’s north and extremely wet conditions in the south, has disrupted sowing work and may continue to do so.

“All forecasts show rainfall slightly below normal in the first 15 days of November,” said BrasilAgro’s Operations Director Wender Vinhadelli.

The company cultivates around 30,000 hectares (74,131 acres) of soybeans in Mato Grosso, with Jataí accounting for a total of 12,690 hectares.

Average yields at Jataí are expected to reach 62 60-kilo bags per hectare this harvest, helping BrasilAgro reach its goal of producing 248,470 metric tons of soybeans in the 2023/24 harvest, Vinhadelli said.

If confirmed, that would mark a 21% increase for BrasilAgro’s output compared to last season.

Given hotter and drier weather at this time in the season, farmers who planted their beans early may have to re-do the work in Mato Grosso, Vinhadelli said.

But this is not the case with BrasilAgro, he noted, adding the company’s soy area grew by 14% this year from the last.

Despite the effects of El Nino, most forecasters expect Brazil, the world’s biggest soy supplier, will reap a record between 162 and 164 million metric tons of the oilseed in the 2023/24 cycle.

Brazil’s Paranagua port berth to resume ops on Nov. 4 – shipping agent

Shipping agent Cargonave said on Tuesday Berth 201 on the West Corridor of Brazil’s Paranagua port would tentatively resume operations on Saturday, according to a note to clients citing information received from the local port authority.

Previously, Cargonave had said operations would resume on Thursday, a decision that the port authority “revoked”, according to an updated statement from the shipping agent.

The port authority declined to give a specific date for resumption of operations at the berth, which were disrupted by a fire on a conveyor belt over the weekend.

In a statement, the port authority reiterated Berth 201 was operating “using direct loading and unloading mode”, which means moving products including fertilizers, cereals and general cargo “without the use of belts and shiploaders”.

The automated boarding system should be normalized “in the coming days”, it said.

The authority added two ships that were scheduled for Berth 201 had been redirected to another berth at Paranagua, while another eight vessels were expected to move to Berth 201 via a terminal operated by Bunge BG.N.

The U.S. grain trader did not have an immediate comment.

Paranagua is a key hub for exports of grains and sugar, as well as for imports of fertilizer.

The fire at the berth added to logistics problems in Brazil, where waiting times to load grains or sugar shipments have surpassed 40 days in the busiest terminals amid record or near record corn, soy and sugar crops at the start of the rainy season.

Since the fire, Cargill has redirected three vessels to the port’s East Corridor, Cargonave said in a note.

Cargill said the fire at one third-party terminal used by the company at Paranagua had not seriously damaged cargo stored there.

Loading of an unspecified cargo that was underway at the time of the fire could be completed safely, Cargill said, declining to comment further.

EU Soft-Wheat Exports Drop 24% in Season Through Oct. 29

The European Union’s soft-wheat exports in the season that began July 1 declined to 9.6 million tons as of Oct. 27, compared with 12.6m tons in a similar period a year earlier, the European Commission said on its website.

• Leading destinations include Morocco, at 1.6m tons; Nigeria, 1.1m tons; and Algeria, with 844K tons
• Barley exports are at 2.4m tons, down 10% y/y
• Corn imports are at 5.6m tons, down 41% y/y

Ukrainian Winter Crop Planting Continues With Wheat up 6% Y/y

Ukrainian farmers planted winter grains across 4.2m hectares as of Oct. 31, similar to what was sowed at this time last year, the Agriculture Ministry said on its website.

• The total includes:
  • 3.7m hectares of wheat, up 6% y/y
  • 403k hectares of barley, down 20% y/y
• Rapeseed planting is completed at 1.14m hectares
• Five Ukrainian regions – western Ivano-Frankivsk, Volyn and Zakarpattya, as well as central Poltava and southeastern Zaporizhzhia have finished 2023 winter crops sowing

Soybean oil use for US biofuels production fell to 1.197 bln lbs in August -EIA

Soybean oil used to produce biofuels in the United States fell to 1.197 billion (not 278 million) lbs used in August.

In July, soyoil used in biodiesel production was 1.273 billion (not 296 million) lbs. Soybean oil remains the largest U.S. biodiesel feedstock.

Export duty on Russian wheat drops 14.1% to 4,923.4 rubles/tonne as of Nov 1 – Agriculture Ministry

The export duty on Russian wheat has dropped 14.1% to 4,923.4 rubles per tonne as of November 1 from 5,297.7 rubles per tonne the previous seven-day period, the Agriculture Ministry said in a statement.

The duty on barley is zero for the second consecutive week, and the duty on corn has declined to 1,618 rubles per tonne from 2,218.1 rubles per tonne.

The duties are based on indicative prices of $253.20 per tonne for wheat compared to $252.60 per tonne the previous seven-day period, $164.70 per tonne for barely versus $162.10 per tonne, and $191.60 per tonne for corn against $195.80 per tonne.

Owing to the long weekend at the beginning of November, the new rates will be valid through November 8, Wednesday. The rates published on November 3 will be valid November 9-14, through Tuesday, the Agriculture Ministry told Interfax.

As reported, the Agriculture Ministry on June 1, 2023, hiked the baseline price for calculating the export duty on wheat, the so-called cut-off price, to 17,000 rubles per tonne from 15,000 rubles per tonne, and raised the baseline price on barley and corn to 15,875 rubles per tonne from 13,875 rubles per tonne.

The government on June 2, 2021, introduced a grain damper mechanism that stipulates floating duties on exports of wheat, corn, and barley, as well as returning the funds received from the duties in order to subsidize agricultural producers. The duties are calculated weekly on the basis of price indicators based on the value of export contracts registered on the Moscow Exchange.

The Russian government on June 30, 2022, adopted a resolution to convert the duties into rubles as of July 2022. The duty totals 70% of the difference between the baseline price and the indicative price.

 

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