Global Ag News for Apr 6.22

TODAY

Wheat prices overnight are down 12 3/4 in SRW, down 12 1/2 in HRW, down 13 in HRS; Corn is down 2 3/4; Soybeans up 4 1/4; Soymeal up $0.02; Soyoil up 0.53.

For the week so far wheat prices are up 45 3/4 in SRW, up 52 3/4 in HRW, up 33 1/4 in HRS; Corn is up 23 1/2; Soybeans up 54 1/2; Soymeal up $1.79; Soyoil up 1.47.  For the month to date wheat prices are up 26 1/2 in SRW, up 40 1/2 in HRW, up 19 1/4 in HRS; Corn is up 8 1/4; Soybeans up 17; Soymeal down $1.40; Soyoil up 3.00.

Year-To-Date nearby futures are up 34% in SRW, up 33% in HRW, up 12% in HRS; Corn is up 28%; Soybeans up 23%; Soymeal up 14%; Soyoil up 29%.

Chinese Ag futures (SEP 22) Soybeans down 18 yuan; Soymeal down 45; Soyoil up 168; Palm oil up 214; Corn up 28 — Malaysian palm oil prices overnight were up 82 ringgit (+1.39%) at 5997.

There were no changes in registrations. Registration total: 2,185 SRW Wheat contracts; 1 Oats; 0 Corn; 132 Soybeans; 98 Soyoil; 0 Soymeal; 154 HRW Wheat.

Preliminary changes in futures Open Interest as of April 5 were: SRW Wheat up 289 contracts, HRW Wheat up 114, Corn up 12,477, Soybeans up 1,301, Soymeal up 198, Soyoil up 1,570.

Northern Plains Forecast: Isolated to scattered showers through Thursday. Mostly dry Friday. Isolated showers Saturday. Temperatures near to below normal Wednesday-Friday, near to above normal Saturday. 6-to-10-day outlook: Isolated showers Sunday. Scattered showers Monday-Wednesday. Mostly dry Thursday. Temperatures near to below normal Sunday-Monday, below to well below normal Tuesday-Thursday.

Central/Southern Plains Forecast: Isolated showers northeast Wednesday-Thursday. Mostly dry Friday-Saturday. Temperatures near to below normal Wednesday, below normal Thursday-Friday, near normal Saturday. 6-to-10-day outlook: Mostly dry Sunday. Scattered showers Monday-Wednesday. Mostly dry Thursday. Temperatures above to well above normal Sunday-Monday, below normal northwest and above normal southeast Tuesday-Wednesday, below normal Thursday.

Western Midwest Forecast: Scattered showers through Thursday. Mostly dry Friday-Saturday. Temperatures near to above normal Wednesday, below normal Thursday-Saturday.

Eastern Midwest Forecast: Isolated to scattered showers through Saturday. Temperatures near to above normal Wednesday, near to below normal Thursday, below normal Friday-Saturday. 6-to-10-day outlook: Mostly dry Sunday.

Scattered showers Monday-Thursday. Temperatures near to above normal Sunday, above to well above normal Monday-Wednesday, below normal west and above normal east Thursday.

 Brazil Grains & Oilseeds Forecast: Rio Grande do Sul and Parana Forecast: Isolated showers to scattered showers through Friday. Temperatures near to above normal through Friday. Mato Grosso, MGDS and southern Goias Forecast: Isolated showers through Friday. Temperatures near to above normal through Friday.

Argentina Grains & Oilseeds Forecast: Cordoba, Santa Fe, Northern Buenos Aires Forecast: Mostly dry through Thursday. Isolated showers Friday. Temperatures below near to above normal Wednesday-Friday. La Pampa, Southern Buenos Aires Mostly dry through Wednesday. Isolated showers Thursday-Friday. Temperatures near to above normal Wednesday-Friday.

The player sheet for 4/5 had funds: net buyers of 16,500 contracts of  SRW wheat, buyers of 13,500 corn, buyers of 13,500 soybeans, buyers of 5,500 soymeal, and  buyers of 500 soyoil.

TENDERS

• BARLEY TENDER PASSED: Jordan’s state grain buyer is believed to have made no purchase in an international tender for 120,000 tonnes of animal feed barley which closed on Tuesday, European traders said. Three trading houses were said to have participated in the tender, including Cargill, Bunge, and Viterra, but price offers were not revealed. A new tender is expected to be issued in coming days.
• WHEAT TENDER: Importers in the Philippines are tendering to purchase at least 50,000 tonnes of animal feed wheat
• WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is seeking to buy a total of 137,516 tonnes of food-quality wheat from the United States, Canada and Australia in regular tenders that will close on April 7.

PENDING TENDERS

• FEED GRAIN TENDER: Iranian state-owned animal feed importer SLAL issued an international tender to purchase up to 60,000 tonnes of animal feed barley, 60,000 tonnes of feed corn and 60,000 tonnes of soymeal
• BARLEY TENDER: A buyer in Qatar issued a tender to buy an estimated 105,000 tonnes of animal feed barley
• WHEAT TENDER UPDATE: Bangladesh’s state grains buyer received the lowest price offer assessed at $406.83 a tonne CIF liner out in an international tender to purchase and import 50,000 tonnes of wheat which closed on April 4
• WHEAT TENDER: Jordan’s state grain buyer issued an international tender to buy 120,000 tonnes of milling wheat which can be sourced from optional origins
• WHEAT TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 tonnes of milling wheat, traders said on Wednesday. The deadline for submission of price offers is April 11, they said. A separate tender from Bangladesh for 50,000 tonnes of wheat closed on April 4.

EU Soft-Wheat Exports Fall 4% in Season Through April 3

Soft-wheat shipments during the season that began July 1 totaled 20.1m tons as of April 3, versus 20.9m tons in a similar period a year earlier, the European Commission said Tuesday on its website.

• NOTE: Figures 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 are Algeria (2.96m tons), Egypt (2.08m tons) and China (2.04m tons)
• EU barley exports at 5.9m tons, versus 6.22m tons a year earlier
• EU corn imports at 12.2m tons, versus 12.3m tons a year earlier

Argentina Grain Truckers to Strike Amid Diesel Shortages

FeTrA, the Federation of Argentine Transportation, announces an indefinite grain-trucking strike from April 11, according to a statement on its website

• NOTE: Argentina’s soybean and corn harvests are just getting started
• “Increases to diesel prices and fuel supply shortages have made it impossible to keep working under reasonable conditions”
• NOTE: At gas stations, trucks are limited to 80-200 liters of diesel. There’s also rationing at wholesalers that supply farmers, according to the Federation of Grain Elevators
• On the Pampas farming belt wholesalers are pricing diesel at 135-170 pesos/liter: grain elevators
• The strike, which’ll feature protests at grain elevators and ports, won’t end until there’s an agreement to hike trucking rates to account for higher diesel costs
• Truckers have several other misgivings that they also want addressing
• NOTE: Argentine drillers are in talks with refiners to keep more diesel on the local market, where they get much lower prices vs. exports
• Federation of Grain Elevators also recommends increasing the biodiesel blend mandate

Mexico asks U.S. to coordinate on tamping down food inflation

Mexican President Andres Manuel Lopez Obrador expressed concern about food inflation and asked U.S. Agriculture Secretary Tom Vilsack to work with Mexico to curb the impact of rising prices, Mexican Agriculture Minister Victor Villalobos said on Tuesday.

Vilsack is in Mexico meeting with Villalobos to discuss cooperation on “shared priorities including open trade, science-based policy making and sustainable and climate-smart agricultural production,” the two governments said in a statement.

U.S. and Mexican authorities concluded all necessary plant health protocols and agreed to a visit by Mexican officials in April to finalize expanded access to the Mexican market no later than May 15 for all U.S. table stock and chipping potatoes, the statement said.

Villalobos said Lopez Obrador has asked ministers for proposals on how to contain inflation.

“Next Thursday we will have a new meeting to collect information in order to have a proposal,” he said.

Mexican inflation hit 7.29% in the first half of March, more than double the central bank target rate of 3%, with a one percentage point tolerance range above and below the target.

Chinese Trader Cofco’s Sunflower Oil Plant Near Mariupol Damaged

• Part of the structure damaged, access still limited: person
• Russia launched attacks on the region in early March

Fighting around Mariupol has damaged a Cofco Corp. sunflower seed crushing plant in the Ukraine, which produces almost 10% of the country’s supply, according to a person familiar with the matter.

The plant, the Chinese trader’s only one in the country, was damaged during Russia’s attack on the port of Mariupol in the first half of March, according to the person, who asked not to be named because the information isn’t public.

Chinese crop trader Cofco’s sunflower oil processing plant near Mariupol was damaged by Russian attacks in March

While the extent of the damage isn’t known, a recent satellite image from Planet Labs PBC shows several holes in the two main buildings. The holes aren’t visible in an image from earlier in the year. The main structure and silos appear to be intact. The most recent image also shows dozens of bomb craters around the facility as well as some nearby houses that have been destroyed.

U.S. Farmers Plant More Sunflowers as Ukraine War Curbs Supply

• Planting seen higher than early USDA estimate, group says
• Prices at record with world’s biggest supplier cut back

U.S. farmers may plant twice as many additional acres with sunflowers as the government forecast, according to a trade group, with prices soaring in the wake of Russia’s war with Ukraine.

The commodity used in everything from potato chips and frying food to bird feed and shampoo could see a massive supply shortfall as Ukraine’s sunflower-oil industry, the world’s largest, suffers cuts to planting and exports due to Russia’s invasion.

The squeeze already has American growers from North Dakota to Texas benefiting from the highest prices on record, fueling their motivation to sow more, according to John Sandbakken, executive director of the National Sunflower Association, a non-profit trade group based in Mandan, North Dakota. The U.S. Department of Agriculture last week issued a preliminary estimate for 10% more acreage this season.

“I’m pretty confident it will be higher, more like 20%,” Sandbakken said in a phone interview.

Most sunflower grown in the U.S. is processed domestically into oil used in snack foods, alternative meats and personal care products, as well as bird feed. The remainder is grown for seeds eaten by humans, with Spain as the biggest importer, Sandbakken said.

Sandbakken said he’s fielding calls from first-time producers seeking growing tips and even garden club members saying they will plant sunflowers this spring to show symbolic support for the Ukrainian people.

Last year’s devastating drought in the northern Plains is working to farmers’ advantage because it left excess nitrogen in the ground, allowing them to buy less fertilizer than would otherwise be needed.

The cash market price for new-crop sunflowers is now almost $34 per 100 pounds, surpassing the prior all-time high of $30.50 in 2008. Old crop prices are also nearing the record reached in 2011, according to Sandbakken.

Brazil Gets Final Wave of Crucial Russian Fertilizer Shipments

• Deliveries from Russia, top supplier, to end May 5: StoneX
• Fertilizer shortage in Brazil could impact global food prices

Brazil is getting its last wave of much-needed fertilizer from Russia before supplies plunge due to the Ukraine war, potentially hurting harvests in the biggest grower of crops from coffee to sugar to soybeans.

Dozens of Russian vessels laden with fertilizer are heading to Brazil, with a final ship unloading May 5, according to StoneX analysts. After that, it’s anyone’s guess where Brazil, which imports 85% of the fertilizer it needs, will get supplies as war disrupts shipments in Russia, the top supplier.

A fertilizer shortage in Brazil could result in smaller harvests and higher food costs globally, given the importance of the South American nation to world crop supplies.

The ships currently en route from Russia are carrying around 550,000 tons of fertilizers, with nearly half transporting potash. Fertilizer deliveries from all origins totaled almost 46 million tons in 2021, according to figures from the industry group Anda.

Brazil’s fertilizer imports and deliveries in the first quarter are almost steady compared with the same period last year, a record for the sector.

Covid Cases Stay High in China’s Jilin Despite Month in Lockdown

China’s northeastern Jilin province, an agricultural hub, is still reporting thousands of Covid-19 cases a day despite being locked down for almost a month, adding to doubts over the sustainability of the Covid-Zero policy and raising concerns over food supplies.

The province of 24 million people reported more than 2,700 infections on Wednesday, up from 2,400 the day before. Daily case numbers have been fluctuating between 2,000 and 4,000 since a lockdown was imposed first in capital Changchun on March 11, then the entire province on March 14. Many residents have complained on social network Weibo about running out of things like food, life-sustaining cancer medication and baby formula.

The highly transmissible omicron variant is posing the toughest test yet for China’s Covid-Zero policy since the virus emerged in Wuhan in 2020, with the country reporting over 20,000 daily new cases on Tuesday. Meanwhile, infections are still rising in financial center Shanghai, where some 25 million people are currently under lockdown.

The lockdown in Jilin could have important ramifications for China’s food supply if it continues and prevents farmers from working. The province is China’s second-biggest corn-growing region, and any disruption to output could raise concerns about shortages and increase prospects of China boosting imports at a time when global food prices are already high due to the war in Ukraine. Farming equipment and seed shipments have also been held up at checkpoints, the People’s Daily reported.

Jilin officials have said that farmers locked down far away from their fields can start applying to return home to plant crops provided they meet certain conditions. For example, those from high-risk areas need to show three negative PCR tests in the past week and a negative rapid antigen test on the day of travel.

Fertilizer Imports Beginning to Slow as Soaring Prices Bite

Urea and phosphate prices, already at or near record levels, continue to climb in New Orleans (NOLA), Brazil, Europe and the Middle East. India’s potash imports are slowing as the world’s fourth-largest buyer struggles to obtain supplies. Potash jumped in NOLA and Brazil to almost 2x last month’s Chinese annual contract.

India First to Feel Pinch of Higher Potash Pricing

India’s potash imports are trailing domestic demand as the world’s fourth-largest potash buyer struggles to find supply. India’s National Fertilizers Limited (NFL) extended its request for a long-term potash-supply proposal (RFP) for fiscal 2022-23 to April 11 — its second extension and third deadline. A new clause in the RFP permits payment in euros, rubles or rupees. Though the dollar remains the preferred currency, India is willing to move away from it to procure potash. Imports of the crop nutrient have fallen well below the rolling 12-month average, while India’s contract price has more than doubled since 2021. Nutrien and Mosaic are the largest publicly traded potash producers.

Argentine farmers have sold 20.7 mln T of 2021/22 corn, ministry says

Argentina’s farmers have sold 20.7 million tonnes of corn from the 2021/22 season so far, the Agriculture Ministry said on Tuesday, noting that 1.2 million tonnes were traded in the week through March 30.

The weekly volume rose sharply compared to the same period last year, when 631,600 tonnes were sold, at a moment when the conflict between Russia and Ukraine has led to a global supply shortfall of the grain.

Argentina is the world’s No. 2 corn exporter and its farmers are beginning to harvest the 2021/22 crop, which was estimated by the Buenos Aires grains exchange at 49 million tonnes.

At the end of last year, the Argentine government set a limit of 41.6 million tonnes for corn exports in 2021/22, in an attempt to rein in high domestic food prices.

Regarding the soybean crop, Argentine farmers have sold 12 million tonnes so far, according to government data, down from the 13.3 million tonnes traded by the same time last year.

The 2021/22 harvest has just started in the South American country. The BdeC expects production of the oilseed to reach 42 million tonnes this season.

Foreign exchange from agricultural exports is critical for Argentina’s battered economy, which in 2021 recovered from a three-year long recession exacerbated by the effects of the COVID-19 pandemic.