Global Ag News 9.8

Ag Market Headlines

Overnight trade has SRW Wheat down roughly 6 cents, HRW down 3; HRS Wheat down 1, Corn is up fractionally; Soybeans up 2;  Soymeal down $1.50, and Soyoil up 45 points.

For the week, SRW Wheat prices were up roughly 2 cents; HRW unchanged; HRS up 3; Corn was down 1 cent; Soybeans up 18; Soymeal up $8.00, and; Soyoil down 35 points. Crushing margins were down 5 cents at $0.91; Oil share is unchanged at 34%.

Chinese Ag futures (January) settled down 26 yuan in soybeans, up 9 in Corn, up 9 in Soymeal, up 106 in Soyoil, and up 66 in Palm Oil.

Malaysian palm oil prices were up 43 ringgit at 2,847 (basis November) at midsession following rival veg oils.

Speculators went on their biggest buying spree in Chicago-traded grains and oilseeds in more than a year over continued uncertainty about the U.S. corn and soybean harvests and China’s blistering buying pace of those products.

U.S. Weather Forecast: The 6 to 10 day forecast for the Midwest looks to be fairly quiet during this time period; some light rains are seen for OH; temps will be below average in the northwest sections of the Midwest with above average temps in the southeast for the week ahead. The 11 to 16 day outlook for the Midwest has below average rainfall and average temps for the region with no cold air threats. The 6 to 10 day forecast for the Southern Plains has little to no rainfall for the region with temps below average this week. The 6 to 10 day forecast for the Delta has light to moderate rainfall for most of the region.

The player sheet had funds net sellers of 3,000 contracts of SRW Wheat; bought 15,000 Corn; bought 2,000 Soybeans; net bought 6,000 lots of Soymeal, and; sold 4,000 Soyoil.

We estimate Managed Money net long 18,000 contracts of SRW Wheat; long 19,000 Corn; net long 176,000 Soybeans; net long 24,000 lots of Soymeal, and; long 79,000 Soyoil.

Preliminary Open Interest saw SRW Wheat futures down roughly 475 contracts; HRW Wheat up 2,400; Corn up 7,200; Soybeans up 2,400 contracts; Soymeal up 3,700 lots, and; Soyoil up 3,100.

Deliveries were 32 Soymeal; ZERO Soyoil; ZERO Rice; 200 Corn; ZERO HRW Wheat; ZERO Oats; 14 Soybeans; 9 SRW Wheat, and; 5 HRS Wheat.

There were changes in registrations (Soymeal down 15)—Registrations total 95 contracts for SRW Wheat; ZERO Oats; Corn 220; Soybeans 23; Soyoil 2,431 lots; Soymeal 393; Rice ZERO; HRW Wheat 147, and; HRS 1,351.

 Tender Activity—Turkey seeks 500,000t optional-origin wheat—Pakistan seeks 175,000t optional-origin wheat—

Private analytics firm IHS Markit Agribusiness, formerly known as IEG Vantage, on Friday lowered its forecast of the average U.S. 2020 corn yield to 178.1 bushels per acre, from 179.0 a month ago

U.S. Agriculture Secretary Sonny Perdue signed a USDA disaster declaration on Thursday for farmers in Iowa that will open up some further programs to producers; the secretary also said he is troubled by disparities in how crop-insurance companies are treating claims after last month’s windstorm leveled both crops and grain facilities across parts of the state

Alberta crop report – Reuters News: Crop Conditions as of September 1, 2020; Favourable weather conditions were prevalent across the province this past week with nominal amounts of moisture in the predominant growing areas; this enabled harvest operations to progress across the province with the estimate of crops in the bin now at 10 per cent, four points above last week; crops are estimated at nine per cent swathed in Alberta as compared to the five-year average of 13 per cent, with barley on par the five-year average of nine per cent and canola at 16 per cent compared to the five-year average of 23 per cent.

China’s soybean imports dipped in August from the previous month, customs data showed on Monday, amid falling shipments from Brazil as the South American harvest starts to dry up; China brought in 9.60 million tons of the oilseed in August, down 4.8% from 10.09 million tons in July; the figures were up 1% from last year’s 9.48 million tons, continuing a trend in the past few months, as Brazilian cargoes booked on good crush margins cleared customs.

China imported 832,000 tons of meat in August, customs data showed on Monday, down almost 17% from last month, although imports remain high as Beijing tries to plug a shortfall in domestic pork production; meat imports in July had reached 998,000 tons, but shipments had been expected to slow as exporters suspended cargoes from plants where workers have been infected with the coronavirus; the August number is the lowest since May when China imported 816,000 tons of meat; imports for the first eight months of the year are still up 73% at 6.58 million tons.

China will auction another 10,000 tons of frozen pork from its state reserves on Sept. 11, the China Merchandise Reserve Management Center said, adding to the 540,000 tons already sold this year

Brazil 2020-2021 Soybean Harvest to Reach a Record 132.2M Tons

Brazilian farmers will grow a record 132.2M metric tons of soybeans in the 2020-2021 growing season, according to agricultural consultancy Safras & Mercado. Good prices for the oilseeds, along with strong exports, should spur farmers to increase the area planted with the crop, and with favorable weather production can reach that forecast, the group says.

Brazil’s soy harvest for the 2020/2021 season is forecast to increase 5.8% from the prior crop to 131.7 million tonnes on the back of expectations for expanded planting area and record yields, according to a Reuters poll; that compares to an estimated harvest of 124.46 million tons of soybeans for 2019/2020, according to government agriculture statistics agency Conab’s estimate.

Russian wheat export prices rose for the second consecutive week last week as the Russian market continued to reflect stronger global prices in Chicago, analysts said; Russian wheat with 12.5% protein loading from Black Sea ports and for supply in September was at $216 a ton free on board (FOB) at the end of last week, up $5 from the previous week, agriculture consultancy IKAR said.

Russian agriculture consultancy Sovecon has raised its forecast for Russia’s 2020 wheat crop to 82.6 million tons from the previous estimate of 81.2 million, the agency said.

Prices for wheat on the global market are growing quickly, which could lead to record grain exports from Russia, according to SovEcon Center; the ruble is weakening, the export rate is at a high level, and it is highly likely that in the near future the high global prices will turn into record exports and record demand on the part of traders; however, judging by the center’s estimates, this is not the only possible scenario; customers do not particularly like fast price growth. On Thursday, Egyptian state-owned company GASC bought just one vessel of Russian wheat – a modest 55,000 tons against 530,000 ton the week before; prices grew markedly and came to $225 per ton against $213 (FOB).

The volume of Russian wheat bought by Egypt during the period from January 1 to the end of August 2020 amounted to about 80% of its total imports of wheat from different origins, compared to about 50% during the same period last year.

Russia’s August exports of wheat, barley and maize (corn) are estimated at 5.1 million tons, up from 3.0 million tons estimated in July, the SovEcon agriculture consultancy said.

Ukrainian farms have harvested 38.5 million tons of grain from 9.7 million hectares or 63% of the sown area as of Sept. 3, Ukraine’s economy ministry said; the ministry earlier this week cuts its 2020 grain crop forecast to 68 million tons from 70 million tons due to poor weather; Ukraine harvested a record 75 million tons of grain in 2019.

Ukraine has exported 8.29 million tons of grain so far in the 2020/21 July-June season compared to 10.09 million tons at the same point during the previous season, the economy ministry said on Monday; the volume is down due to a decline in corn sales, to 604,000 tons from around 1.9 million tons by the same date last season.

Wheat sales stood at 5.4 million tons, down from 5.9 million.

Ukraine’s 2020 export prices for 12.5% protein milling wheat rose by $8-$10 per ton over the past week thanks to high demand from importers and limited offers from growers, APK-Inform agriculture consultancy said; Ukrainian wheat prices stood at $211-$217 per ton on a free-on-board Black Sea basis as of the end of last week; it said 11.5% protein wheat cost between $209 and $215 per ton FOB Black Sea.

Kyiv-based consultancy ProAgro on Monday cut its Ukraine 2020 grain harvest forecast to 71.34 million tons from 76.15 million tons a month earlier due to poor weather across the country; the consultancy revised down its 2020 corn harvest outlook to 34.02 million tons from 38.86 million tons previously.

Ukraine will supply milling wheat to Saudi Arabia for the first time in 12 years, exporter Continental Farmers Group said on Monday, with 60,000 tons now being loaded at the Chornomorsk sea port due to arrive in Jeddah on Sept. 17.

Kazakhstan intends to boost grain and flour exports to China during the 2020-2021 marketing year, the country’s Agriculture Minister said; this year, the export potential is estimated at 7 to 8 million tons of grain and flour in grain equivalent; the main countries [importers] are Uzbekistan, Tajikistan, Turkmenistan, Kyrgyzstan, Afghanistan, and Iran.

Belarus has harvested 7.93 million tons of grain from around 97% of the sown area as of Sept. 7, the agriculture ministry said; the yield averaged 3.7 tons per hectare compared with 3.11 tons a year earlier; the country had harvested 6.5 million tons of grain from 98.9% of the sown area by the same date in 2019.

The following are consultancy Strategie Grains’ latest monthly estimates for oilseed crops in the European Union, including Britain, from 2018 to 2020; production estimates are in millions of tons, area in millions of hectares and yields in tons per hectare.

French soft wheat shipments outside the European Union fell to a four-year low for the month of August, despite a large volume sent to China, as activity eased after a poor harvest, Refinitiv data showed.

Soft wheat exports to destinations outside the EU totaled 644,000 tons in August, the second month of the 2020/21 season, an initial estimate based on Refinitiv loading data showed; that was the smallest August volume since 2016/17, although above a very low level seen in July

Soft wheat exports from the European Union and Britain in the 2020/21 season that started on July 1 totaled 2.94 million tons by Sept. 6, official EU data showed; that was 44% below the volume exported by the same week in the previous 2019/20 season

Soybean imports into the European Union and Britain in the 2020/21 season that started on July 1 totaled 2.89 million tons by Sept. 6, official EU data showed; that was 8% above the volume imported by the same week in the 2019/20 season

Australia on Tuesday raised its forecast for wheat production during the 2020/21 season by 8.4% as heavy rains across the east coast buoy output; the Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) said wheat production for the year ending June 30, 2021, will total 28.91 million tons, up from its June estimate of 26.67 million tons; increased production in New South Wales has accounted for 60% of the forecast increase.