Global Ag News for Nov 10th
TODAY – EIA WEEKLY PETROLEUM STATUS
Wheat prices overnight are up 3/4 in SRW, unchanged in HRW, up 6 1/4 in HRS; Corn is up 3 1/4; Soybeans down 1; Soymeal down $0.09; Soyoil up 0.48.
For the week so far wheat prices are up 12 3/4 in SRW, up 14 3/4 in HRW, up 24 1/4 in HRS; Corn is up 5; Soybeans up 5 1/2; Soymeal up $0.89; Soyoil up 0.17.For the month to date wheat prices are up 6 1/2 in SRW, up 7 3/4 in HRW, down 13 1/2 in HRS; Corn is down 10 1/4; Soybeans down 38 1/2; Soymeal up $9.00; Soyoil down 2.32.
Chinese Ag futures (JAN 22) Soybeans up 131 yuan ; Soymeal up 34; Soyoil down 2; Palm oil up 30; Corn up 16 — Malasyian Palm is up 128.
Malaysian palm oil prices overnight were up 128 ringgit (+2.67%) at 4920 advancing the most in four weeks, countering a bearish inventory report, as investors anticipate a brighter export outlook this month and weaker production in second-largest grower Malaysia.
There were no changes in registrations. Registration total: 1,180 SRW Wheat contracts; 2 Oats; 2 Corn; 1,318 Soybeans; 233 Soyoil; 1 Soymeal; 108 HRW Wheat.
Preliminary changes in futures Open Interest as of #N/A Requesting Data… were: SRW Wheat up 1,070 contracts, HRW Wheat down 2,302, Corn down 8,303, Soybeans up 4,449, Soymeal up 1,915, Soyoil down 4,852.
Brazil Grains & Oilseeds Forecast: Rio Grande do Sul and Parana Forecast: Isolated to scattered showers north through Thursday. Mostly dry Friday. Temperatures near normal through Saturday. Mato Grosso, MGDS and southern Goias Forecast: Scattered showers through Saturday. Temperatures near normal through Saturday.
Argentina Grains & Oilseeds Forecast: Cordoba, Santa Fe, Northern Buenos Aires Forecast: Isolated showers west through Friday. Scattered showers Saturday. Temperatures near to above normal through Saturday. La Pampa, Southern Buenos Aires Forecast: Isolated showers west through Friday. Scattered showers Saturday. Temperatures near to above normal through Saturday.
Midwest corn, soybean and winter wheat forecasts: West: Mostly dry Tuesday. Scattered showers Wednesday-Thursday. Snow north Friday. Scattered showers Saturday night. Temperatures above normal through Thursday, near to below normal Friday-Saturday. East: Isolated showers Tuesday-Wednesday. Scattered showers Thursday. Isolated showers Friday-Saturday. Temperatures above normal through Thursday, near to above normal Friday, near to below normal Saturday. 6 to 10 day outlook: Scattered showers Sunday-Monday. Mostly dry Tuesday. Scattered showers Wednesday-Thursday. Temperatures near to below normal Sunday-Tuesday, near to above normal Wednesday-Thursday.
The player sheet for Nov. 9 had funds: net buyers of 8,500 contracts of SRW wheat, buyers of 4,000 corn, buyers of 17,500 soybeans, buyers of 9,000 soymeal, and buyers of 3,000 soyoil.
- FEED WHEAT SALE: An importer in the Philippines is believed to have bought around 50,000 tonnes of Australian-origin animal feed wheat in a private deal late last week
- SOYBEAN TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp has issued international tenders to purchase around 115,000 tonnes of soybeans free of genetically-modified organisms (GMOs)
- WHEAT TENDER: Japan’s Ministry of Agriculture is seeking to buy a total of 157,987 tonnes of food-quality wheat from the United States, Canada and Australia in a regular tender that will close late on Thursday.
- WHEAT TENDER: The United Nations agency has issued an international tender to purchase about 110,000 tonnes of milling wheat for supply to Ethiopia
- WHEAT TENDER: The Ethiopian government issued an international tender to buy about 300,000 tonnes of milling wheat
- VEGOIL TENDER: Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), said on Monday it was seeking vegetable oils in an international purchasing tender for arrival Jan. 5 – 25.
- CORN TENDER: Turkey’s state grain board TMO has issued an international tender to purchase about 325,000 tonnes of animal feed corn
- WHEAT TENDER: An Ethiopian government agency issued a new international tender to buy about 400,000 tonnes of milling wheat
- CORN TENDER: South Korea’s Major Feedmill Group (MFG) has issued an international tender to purchase up to 140,000 tonnes of animal feed corn
ETHANOL: U.S. Weekly Production Survey Before EIA Report
Output and stockpile projections for the week ending Nov. 5 are based on seven analyst estimates compiled by Bloomberg.
- Production seen lower than last week at 1.097m b/d
- Stockpile avg est. 20.368m bbl vs 20.129m a week ago
- Would be the highest in nine weeks
- Soybeans surprise: The U.S. crop isn’t a record anymore after the USDA caught some traders off guard and unexpectedly trimmed yields, prompting the biggest price surge in weeks.
- China reality check: The outlook for U.S. soybean exports were lowered — not a surprise to those who thought a cut was overdue with sales lagging expectations, especially to China. In turn, USDA also reduced its estimate for the Asian nation’s soybean imports. The prospects for China’s hog feed needs and broader economic outlook remain uncertain.
- Demand time: The market now will forget yields until January and focus on the demand side for U.S. exports and size of South American crops. The outlook for soy in Brazil was unchanged in today’s WASDE, while exports are seen higher as the world’s No. 1 producer may take advantage of lower supplies in the U.S. and Argentina.
- Wheat squeeze: Tight wheat supplies worldwide remain the big story, with U.S. reserves lowered and European wheat inventories running precariously low. Shortfall pressure is even more intense than thought as the USDA is forecasting global exports reaching an all-time high, with Russia, the European Union, India and Ukraine all shipping out more than previously anticipated. That’s not good news for food inflation.
- Food costs: Speaking of inflation, the risk of increased food costs is arguably most directly linked to higher prices of wheat. Today’s gains come on the heels of a new UN report showing that staples from grains to vegetable oils climbed 3% to a fresh decade high in October.
EU Soft-Wheat Exports Up 16% Y/y; Still Missing French Figures
Soft-wheat shipments during the season that began July 1 reached 9.79m tons as of Nov. 7, vs 8.47m tons in a similar period a year earlier, the European Commission said Tuesday on its website.
- NOTE: Figures for France, one of the EU’s top grain exporters, are complete only until July
- NOTE: Data for the prior season include trade for the U.K. until Dec. 31, 2020, when the country departed the EU customs union
- Top soft-wheat destinations were Algeria (1.41m tons), Egypt (1.2m tons) and South Korea (823k tons)
- EU barley exports totaled 2.94m tons, compared with 3.02m tons a year earlier
- China is the top market at 660k tons
- EU corn imports reached 4.39m tons, against 6.07m tons a year earlier
Argentine farmers have sold 33.6 mln tonnes 20/21 soybeans – govt
Argentine farmers have sold 33.6 million tonnes of soybeans from the 2020/21 crop year, the Agriculture Ministry said on Tuesday in a report with information updated through Nov. 3.
The sales pace was behind that of the previous season. At this point last year, growers had sold 34.8 million tonnes of the oilseed, according to official data.
The country’s 2020/21 soybean harvest ended in June at 43.1 million tonnes, according to the Buenos Aires Grains Exchange, which estimated the 2019/20 harvest at 49 million tonnes.
Agricultural export dollars are essential for Argentina’s economy, which is pulling out of a long recession but remains in the grip of inflation running at more than 52% per year.
Regarding 2021/22 soy, planting of which began last month in Argentina, there have already been sales of 2.9 million tonnes, according to official data. The exchange estimates the upcoming soy harvest at 44 million tonnes.
For the 2020/21 corn crop, the government said sales have been registered for 44.1 million tonnes, 4.3 million tonnes more than on the same date in the previous season. The 2020/21 corn harvest was 50.5 million tonnes, according to the exchange.
The government reported that 9.7 million tonnes of corn from the upcoming 2021/22 season had been sold so far. The sowing of corn for the new season is already underway, with the exchange forecasting the harvest at a record 55 million tonnes.
AgriMer Raises French Wheat Inventory on Lower Exports, Feed Use
French soft-wheat stockpiles at the end of the 2021-22 season are now seen at 3.17m tons, up from an October estimate for 2.36m tons, crops office FranceAgriMer said in a report on Wednesday.
Russia’s 2021 grain harvest progress as of Nov. 9
Russia, one of the world’s largest grain exporters, has harvested 122.3 million tonnes of grain before drying and cleaning, data from the agriculture ministry showed on Wednesday. Farmers have already sown winter grains for next year’s crop on 18.1 million hectares compared to 19.1 million hectares on Nov. 10, 2020, the data showed.
Palm Oil Reserves in Malaysia Climb in October as Exports Tumble
Palm oil inventories in Malaysia, the world’s second-largest grower, rose more than expected in October as exports tumbled and production climbed to a 14-month high despite a labor shortage.
Stockpiles grew by 4.4% from September to 1.83 million tons, according to the Malaysian Palm Oil Board on Wednesday, compared to 1.82 million tons estimated in a Bloomberg survey. That’s the highest level since August, and could drag benchmark futures further away from their record of 5,071 ringgit a ton last month.
Crude palm oil production rose 1.3% to 1.73 million tons, the highest since Sept. 2020, compared to estimates of a 0.2% drop. Exports meanwhile plunged 12% to a two-month low of 1.42 million tons, according to board data.
Malaysia Oct. Palm Oil Exports to India -16.8% M/m: Details
Malaysia’s palm oil exports fell 16.8% to 0.31 million tons in Oct. from a month earlier, the Malaysian Palm Oil Board posted on its website.
- Exports to India -16.8% m/m to 310,611 tons, +63.5% y/y
- Exports to China +4.1% m/m to 243,984 tons, +28.4% y/y
- Exports to EU -21.9% m/m to 106,082 tons, -11.5% y/y
Malaysia’s Nov. 1-10 Palm Oil Exports 543,944 Tons: AmSpec
Shipments rise 8.7% m/m from 500,381 tons exported during Oct. 1-10, according to AmSpec Agri on Wednesday.
Malaysia Nov. 1-10 Palm Oil Exports +8.04% M/m: Intertek
Malaysia’s palm oil exports rose 8.04% m/m during Nov. 1-10, according to Intertek Testing Services.
Palm Oil Output Costs to Climb as Fertilizer Prices Surge: UOB
The spike in fertilizer will inflate palm oil’s cost of production by at least 15%-20% next year, countering the impact of higher prices for the tropical oil, said UOB Kay Hian analysts Leow Huey Chuen and Jacquelyn Yow.
Fertilizer has soared on strong demand, supply disruptions and export curbs by producing countries, they said in a note. The two main fertilizers used for palm oil crops, nitrogen and phosphorus, more than doubled in the past six months. Fertilizers make up about 30%-35% of production costs for oil palm planters, while labor accounts for a further 35%.
Although plantation companies have started tendering for fertilizer for 2022, responses have been muted because suppliers are worried about price fluctuations, hedging risks and delivery times.
China reports African swine fever outbreak on Hainan island, OIE says
China has reported an outbreak of African swine fever (ASF) at a pig farm on the island province of Hainan in the southern part of the country, the Paris-based World Organisation for Animal Health (OIE) said on Tuesday.
The outbreak on a farm of 1,063 animals began on Oct. 23 and was confirmed on Oct. 31, the organisaion said, citing a report by Chinese authorities.
African swine fever is harmless to humans but often fatal for pigs. After it reached China in August 2018 the virus wiped out 50% of the country’s pigs within a year.
EMEA CROP WEATHER: Middle East Rain Aids Wheat-Sowing Conditions
Widespread rains reached the Middle East in the week ended Nov. 6, spreading through much of Turkey and western and northern Iran, according to a USDA report.
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.