Shifting Crisis in stocks and opportunity in Ag…..Remember we trade food not tennis shoes.
Overnight trade has SRW down roughly 4 cents, HRW down 1; HRS Wheat down 1, Corn is down 1 cent; Soybeans down 4, Soymeal down $2.00, and Soyoil up 30 points.
Chinese Ag futures (Sep) settled up 3 yuan in Soybeans, down 3 in Corn, up 16 in Soymeal, up 68 in Soyoil, and up 68 in Palm Oil.
Malaysian palm oil prices were up 62 ringgits at 2,351 (basis June) on financial rebounds.
In Argentina, a round of beneficial shower and thunderstorm activity will impact southern and far western crop areas of the region Tuesday through Wednesday and this will help maintain good production after the recent period of dryness. Occasional shower and thunderstorm activity is likely in southern Argentina the next two weeks which will limit any crop losses. Dryness will likely continue in northeastern Argentina through this week before greater rain occurs in the second week of the outlook.
In Brazil, concern remains for some crops in the south due to ongoing dryness. Greater erratic shower and thunderstorm activity will likely start this weekend; however, this rain will need to be significant due to monsoonal rains withdrawing later in April
The player sheet had funds net buyers of 12,000 contracts of SRW Wheat; net sold 3,000 Corn; bought 12,000 Soybeans; net bought 7,000 lots of Soymeal, and; bought 3,000 Soyoil.
We estimate Managed Money net long 32,000 contracts of SRW Wheat; net short 117,000 Corn; net long 10,000 contracts of Soybeans; net long 48,000 lots of Soymeal, and; net long 4,000 Soyoil.
Preliminary Open Interest saw SRW Wheat futures down roughly 20 contracts; HRW Wheat down 5,100; Corn down 4,500; Soybeans down 5,600 contracts; Soymeal down 1,500 lots, and; Soyoil down 2,800.
There were no changes in registrations—Registrations total 11 contracts for SRW Wheat; ZERO Oats; Corn 43; Soybeans 357; Soyoil 2,668 lots; Soymeal 564; Rice 700; HRW Wheat 10, and; HRS Wheat 821 contracts.
Tender Activity—Thailand bought 120,000t optional-origin feed wheat—
Yesterday’s U.S. weekly export inspections had
—Wheat exports running 9% ahead of a year ago (9% last week) with the USDA currently forecasting a 7% increase on the year
—Corn 41% behind a year ago (42% last week) with the USDA down 16% for the season
—Soybeans 9% ahead of a year ago (up 10% last week) with the USDA having a 4% increase forecasted on the year
Weekly USDA wheat ratings improve across southern U.S. Plains states
—The U.S. Department of Agriculture’s (USDA) National Agricultural Statistics Service in a weekly crop report on Monday rated 48% of the Kansas winter wheat crop in good to excellent condition, up from 46% a week earlier.
- The USDA reported surplus moisture in 23% of Kansas topsoil, up from 18% a week ago.
- For Texas, the USDA rated 49% of the crop as good to excellent, up from 36% the previous week.
- The Texas corn crop was 36% planted, ahead of the state’s five-year average of 31%.
- For Oklahoma, the USDA rated 77% of the winter wheat crop in good to excellent condition, up from 67% a week earlier.
- The USDA said 27% of Oklahoma’s winter wheat had reached the jointing stage of growth, compared with the five-year average of 35%.
- For Colorado, the USDA rated 55% of the winter wheat as good to excellent, up from 46% a week earlier.
- In Arkansas, where farmers grow soft red winter wheat, the USDA rated 43% of the state’s wheat as good to excellent, up from 39% a week earlier
- The USDA on Jan. 10 said U.S. farmers planted 30.804 million acres of winter wheat for 2020 harvest, down 1% from a year earlier and the fewest since 1909
Millers, bakers scramble to satisfy bread-buying binge; North American flour mills and bakeries are rushing to boost production as the spread of the new coronavirus leads to stockpiling of staples like bread and pasta.
U.S. ethanol producer POET said that it has suspended corn buying “at a number of locations” due to weak biofuel demand and is evaluating its production levels.
U.S. ethanol producers are on track to shut about 2 billion gallons of annualized output by the end of this week because of a slump in demand for fuel, the head of the Renewable Fuels Association trade group said
—Biofuel producers are feeling the impact of an energy industry in crisis as countries including the United States take unprecedented steps to contain the coronavirus pandemic, curbing demand for products such as gasoline and jet fuel.
–it looks to us like we’re nearing 2 billion gallons of capacity on an annualized basis that was operating as recently as a month ago that we think by the end of this week will be offline
U.S. Senators Chuck Grassley and Joni Ernst of Iowa have asked the Trump administration not to appeal a court ruling that would slash the use of small refinery biofuel waivers, but have not heard back yet on its decision
U.S. chicken company Sanderson Farms Inc said that a slaughterhouse worker was infected with the new coronavirus, the first publicly confirmed positive test of a worker in a U.S. meat plant, though the plant is not closing.
Canada is asking recently retired meat inspectors to come back to work as it tries to ease staffing shortages and ensure the food system remains intact during the coronavirus outbreak, officials said
China’s top grain region Heilongjiang province said it will raise subsidies for corn growers in 2020; the northeastern province will keep subsidies for soybean farmers stable
—subsidies for soybean growers will be set 200 yuan higher than those for corn farmers
—the decision was made to implement central government policies to “appropriately increase corn acreage,” and “increase grain output
China’s grain, pork, sugar imports in Jan-Feb 2020 – Reuters News
|Commodity||Jan-Feb 2020 (tonnes)||% change y/y|
China’s pig herd increased by 2.8% in February from a month earlier, the agriculture ministry said; the growth is rare in February when slaughtering typically increases due to the Lunar New Year holiday; however, this year there was a large increase in slaughtered pigs in December and January while the coronavirus outbreak led some farmers to hold on to pigs for longer.
The planting of Brazil’s second corn crop, which starts after soybeans are harvested, reached 96% of the estimated area for the Center-South through last Thursday, agribusiness consultancy AgRural said; at this time last year 100% of Brazil’s second corn had been planted while 97% is the five-year average in the region; high corn prices, driven by the exchange rate, encourage producers to continue sowing
Brazil’s soy exports for March so far have already exceeded February’s entire volume, suggesting the coronavirus has not yet caused problems for the sector although analysts expect the outbreak could affect trade going forward.
—So far this month, Brazil has exported a daily median of 479,200 tons of soy
—Overall, Brazil has exported 7.2 million tons of soy in the month, already above the 5 million tons exported for all of February, when heavy rains delayed harvesting; if trends persist, Brazil could export more than the 8.5 million tons of soy shipped in March of last year
—A town in the heart of Brazil’s farm country has halted all non-essential services and ordered industrial sites, including agricultural processing facilities, to suspend operations in response to the coronavirus crisis.
Brazilian mills are expected to make a sharp switch from ethanol to sugar production in the new season kicking off in the world’s largest sugarcane producer, as falling gasoline prices and a weak currency reduce the biofuel’s appeal
The port of Timbues in northern Rosario, Argentina’s main grains export hub, has reopened its terminals to freight days after closing them to help stop the spread of coronavirus, grain processors said
Russia has suspended exports of processed grains such as ready-to-eat buckwheat, rice or oat flakes from March 20 for 10 days, a letter sent by the country’s agriculture safety watchdog to its regional offices showed; domestic demand for ready-to-eat grains, mainly buckwheat, has risen significantly in the country as Russians worried by the coronavirus epidemic have stockpiled staples
Ukraine’s grain exports are up around 21.8% at 44.2 million tons so far in the July 2019 to June 2020 season, the Ministry for Development of Economy, Trade and Agriculture said
—Wheat exports have risen to 17.4 million tons, the ministry said in a statement, adding Ukraine has exported about 22 million tons of corn and 4.2 million tons of barley
European Union crop monitoring service MARS forecast that the average soft wheat yields in the EU, including Britain, would fall 2.1% from last year, mainly owing to excessive rain in western Europe offseting good crop weather elsewhere.
—In its first yield forecast for 2020, MARS projected EU soft wheat yields at 5.88 tonnes per hectares (t/ha) this year, down from 6.01 t/ha in 2019
—that would still be 1.9% above the five-year average
Soft wheat exports from the European Union in the 2019/20 season that started last July had reached 23.21 million tons by March 22, official data showed; that was 72% above the volume cleared by March 17 last year
—EU 2019/20 barley exports had reached 5.24 million tons, up 59% from the year-earlier period
—EU 2019/20 maize imports stood at 15.41 million tons, down 13%
European Union soybean imports in the 2019/20 season that started last July had reached 10.21 million tons by March 22, official data showed; that was 4% below the volume cleared by March 17 last year
—EU rapeseed imports in 2019/20 had reached 4.75 million tons, up 45% versus the year-earlier period
—Soymeal imports so far in 2019/20 were at 12.82 million tons, up 1% compared with the year-earlier volume
—palm oil imports stood at 4.02 million tons, down 14%
Wheat imports to Egypt, the largest wheat importing country, for 2020-21 (July-June) are estimated at 12.85 million mt, against 12.6 million mt for 2019-20, the US Department of Agriculture’s Foreign Agriculture Service said.
A recent heavy slump in palm oil demand is expected to persist through the first half of 2020 as a growing number of countries impose lockdowns to contain the coronavirus outbreak, the Malaysian palm oil industry regulator told Reuters.Back