Global Ag News for Jan 20 22

TODAY – EIA WEEKLY PETROLEUM STATUS REPORT

Wheat prices overnight are down 5 1/4 in SRW, down 3 3/4 in HRW, up 3/4 in HRS; Corn is down 1 3/4; Soybeans up 4 1/4; Soymeal up $0.13; Soyoil up 0.18.

For the week so far wheat prices are up 54 1/2 in SRW, up 54 1/4 in HRW, up 63 1/4 in HRS; Corn is up 13 1/2; Soybeans up 25 3/4; Soymeal down $0.54; Soyoil up 2.44. For the month to date wheat prices are up 20 1/2 in SRW, down 5 1/4 in HRW, down 41 1/2 in HRS; Corn is up 15 1/2; Soybeans up 56 1/4; Soymeal up $0.50; Soyoil up 4.41.

Chinese Ag futures (MAY 22) Soybeans up 83 yuan ; Soymeal up 68; Soyoil up 104; Palm oil up 74; Corn up 15 — Malasyian Palm is up 66. Malaysian palm oil prices overnight were up 66 ringgit (+1.29%) at 5190.

There were no changes in registrations. Registration total: 1,900 SRW Wheat contracts; 21 Oats; 50 Corn; 316 Soybeans; 143 Soyoil; 0 Soymeal; 92 HRW Wheat.

Preliminary changes in futures Open Interest as of January 19 were: SRW Wheat up 2,878 contracts, HRW Wheat up 2,906, Corn up 14,447, Soybeans up 13,582, Soymeal up 290, Soyoil up 7,438.

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

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

The player sheet for Jan. 19 had funds: net buyers of 15,500 contracts of  SRW wheat, buyers of 15,000 corn, buyers of 16,500 soybeans, buyers of 4,000 soymeal, and  buyers of 7,000 soyoil.

TENDERS

• WHEAT TENDER: Iranian state agency the Government Trading Corporation (GTC) has issued an international tender to purchase about 60,000 tonnes of milling wheat
• BARLEY TENDER: Jordan’s state grains buyer has issued a new international tender to purchase 120,000 tonnes of animal feed barley
• WHEAT TENDER: Jordan’s state grain buyer has issued an international tender to buy 120,000 tonnes of milling wheat which can be sourced from optional origins
• FAILED FEED WHEAT, BARLEY TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) has received no offers in its tender seeking 80,000 tonnes of feed wheat and 100,000 tonnes of feed barley to be loaded by Feb. 15 and arrive in Japan by March 17, via a simultaneous buy and sell (SBS) auction

PENDING TENDERS

• RICE TENDER: The lowest price offered in the tender from Bangladesh’s state grains buyer to purchase 50,000 tonnes of rice which closed on Sunday was $421.99 a tonne CIF liner out
• WHEAT TENDER: The Taiwan Flour Millers’ Association has issued an international tender to purchase 49,395 tonnes of grade 1 milling wheat to be sourced from the United States
• BARLEY TENDER: Turkey’s state grain board TMO has issued an international tender to purchase 345,000 tonnes of animal feed barley
• WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is seeking to buy a total of 72,351 tonnes of food-quality wheat from the United States and Canada in regular tenders that will close on Jan. 20.
• RICE TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp has issued an international tender to purchase an estimated 46,344 tonnes of rice to be mainly sourced from China with some from Thailand

 ETHANOL: U.S. Weekly Production Survey Before EIA Report

Output and stockpile projections for the week ending Jan. 14 are based on seven analyst estimates compiled by Bloomberg.

• Production seen higher than last week at 1.013m b/d
• Stockpile avg est. 23.17m bbl vs 22.911m a week ago
• Would be the highest since February

USDA’s Brazilian Post Trims Soybean Output Forecast to 136M Tons

USDA’s attache in Brazil lowered its 2021-22 forecast for soybean production in the South American nation to 136m metric tons.

NOTE: Latest outlook is below USDA’s official estimate of 139m MT. The Brazilian post previously saw output at 137m MT.

“Extreme weather, with drought in some regions and excessive rain in others, has dampened prospects for a record crop”: USDA

U.S. Corn Saves Hungry Canadian Cows After Drought Scorches Feed

Canada is now one of the top buyers of U.S. corn as cattle ranchers scour for grain to feed their animals.

Dry conditions zapped as much as 40% of western Canada’s grain output last year, sending prices for barley and other crops to all-time highs and leaving a dearth of feed for the nation’s cattle industry. The squeeze has prompted Canada to make a rare commitment to bring in about 3.2 million metric of tons of corn from its southern neighbor, according to U.S. Department of Agriculture data.

That’s the most in roughly two decades and compares to only 457,000 tons a year ago. Canada’s now one of the biggest purchasers alongside China, Mexico and Japan, and its buying binge is reducing already tight stockpiles of feed grains.

“If you can’t get a car tire, that’s an inconvenience. If a cow can’t get something to eat, that’s a major problem,’’ said Bob Lowe, president of the Canadian Cattlemen’s Association.

Lowe is using about 40 tons of American corn a day to feed his 5,000 cattle in Nanton, Alberta. The recent cold snap prompted him to buy about 15% more corn than he usually needs to sustain his animals this winter. Widespread drought means there are no local alternatives available, and omicron-related disruptions at Alberta’s biggest beef processing plants have left some producers feeding animals for longer, he said.

“Keeping cattle alive becomes the number one criteria and economics becomes a distant second,’’ Lowe said.

Earlier this week, Canada also made a rare purchase of European barley as there are limited supplies available in the Prairies, and European malt barley is cheaper and better quality than what is available. The northern nation hasn’t imported significant volumes from the European Union since the 2015-16 season, trade data show.

The extra corn exports are bolstering prices for U.S. farmers, but the demand could slow if Canadian farmers recover from last year’s drought and boost yields this year.

Malaysia’s Jan. 1-20 Palm Oil Exports 633,531 Tons: AmSpec

Shipments fall 36.4% m/m from 996,331 tons exported during Dec. 1-20, according to AmSpec Agri on Thursday.

Malaysia Jan. 1-20 Palm Oil Exports -38.41% M/m: Intertek

Malaysia’s palm oil exports fell 38.41% m/m during Jan. 1-20, according to Intertek Testing Services.

China’s U.S. Soybean Purchases Surged in Dec.; Brazil Buys Drop

China’s soybean imports from the U.S. surged 68% in December from a month earlier to 6.09m tons, according to Chinese customs data on Thursday. That’s 4.3% higher than Dec. 2020

South Korea lifts temporary suspension of Canadian beef – source

WINNIPEG, Manitoba, Jan 19 (Reuters) – South Korea is lifting its temporary suspension of Canadian beef that it imposed after Canada detected a case of bovine spongiform encephalopathy (BSE) in December, a source with knowledge of the situation said on Wednesday.

U.S. winter wheat production unchanged but winterkill risks remain uncertain

Outlooks for 2022/23 U.S. winter wheat planted area and production are unchanged at 35.1 million acres and 37.9 [34.6–41.2] million tons, respectively. As winter wheat remains dormant over the next several weeks, temperature and insulating snow cover are the key features to watch. While in the dormant stage, winter wheat typically is left unharmed with temperatures down to 0 °F, but becomes vulnerable to damage when temperatures reach and stay below -10 °F for a significant period of time (as it can kill the submerged growing point resulting in winterkill). If snow cover (above 1 inch or so) is present these cold temperatures might not be able to penetrate the snow’s insulating qualities. Winterkill is not a common occurrence in U.S. winter wheat production regions, as a combination of extreme low temperatures and little (less than 1 inch) or absent snow cover is a rare event.

Early January featured a largely unfavorable weather pattern across the hard red winter (HRW) wheat crop areas of the Central and Northern Plains. A number of blasts of Arctic air have been transported into much of the region during the period of 05-10 January, dropping temperatures occasionally to the winterkill threshold of -10°F in the Dakotas, Minnesota and northeastern part of Montana. The majority of these areas had at least 1 inch or more of snow cover, however, adequate enough to protect the dormant crop from significant damage. Temperatures since then have notably moderated and should remain relatively high until later today, but another cold snap is expected tomorrow, warranting attention. The expanding drought across the Southern Plains is another important item to watch, as it could significantly undermine yield potential if persists long enough. In Winter Wheat and Canola Seedings (12 January), USDA set its initial estimate of 2022/23 plantings at 34.4 million acres, up 2% from last season. This prediction is directionally in line with what we have been calling for (first released on 29 September 2021) which suggested an upward shift in winter wheat plantings from last season’s 33.6 million acres.

Argentine farmers sold 37.5 mln tonnes of 2020/21 soybeans -govt

Argentine farmers have sold 37.5 million tonnes of soybeans from the 2020/21 season so far including 261,200 tonnes in the seven days to Jan. 12, the Agriculture Ministry said on Wednesday.

The rhythm of sales was behind that of the previous season. At this time last year, sales of 38.6 million tonnes of soybeans had been registered, according to official data.

The 2020/21 soybean harvest in Argentina ended in June at 43.1 million tonnes, according to the Buenos Aires Grains Exchange, which estimated the 2019/20 crop at 49 million tonnes.

Foreign exchange from agricultural exports is essential for Argentina’s battered economy, which is only now beginning to grow after more than two years of stagflation exacerbated in 2020 by the COVID-19 pandemic.

Argentine farmers are now planting 2021/22 soy. The grains exchange expects 44 million tonnes to be harvested. Farmers have sold 5.5 million tonnes of grains from that season, as planting reaches its final stages.

U.S. Urea Prices Slip Again

The urea market remains under pressure, with New Orleans (NOLA) pricing slipping to as low as $550 a short ton (st) by midweek, down from the week-ago $575-$685/st. Urea at St. Louis was quoted at $635/st at midweek vs. $650 the week before, while new offers at Rivergate, Oregon, were confirmed at $810, down more than $100 since late December. Diammonium phosphate (DAP) prices also drifted lower at NOLA and in the Corn Belt. Higher prices continued to be reported for ammonium sulfate, however, with most Corn Belt terminals now quoted in the $605-$630/st range, and California prices firming to $610-$620 vs. $560-$575 in December.

U.S. Army Corps to upgrade lock and dam critical for grain exports

The U.S. Army Corps of Engineers will use $732 million in federal infrastructure funding to modernize a lock and dam on the Upper Mississippi River that are crucial for shipping grain and soybeans to export markets, officials said on Wednesday.

Upgrading infrastructure is essential for the United States to maintain its place as a top global agriculture exporter, as competitors including Brazil have made improvements.

The Army Corps will design and construct a lock replacement at Lock and Dam 25 on the river in Winfield, Missouri, about 50 miles north of St. Louis, according to a work plan. Opened in 1939, the system is well past its 50-year design life.

Nearly every bushel of soybeans and corn shipped along the Mississippi River from Illinois, Iowa, Minnesota, Missouri and Wisconsin pass through Lock and Dam 25 to export facilities near the Gulf of Mexico, said Mike Steenhoek, executive director of the industry group the Soy Transportation Coalition.

The lock chamber measuring 1,200 feet by 110 feet to be built at the site will cut the transit time for a typical 15-barge tow to 30-45 minutes from two hours, he said.

“A second lock will provide needed resiliency and redundancy, allowing a key link in the supply chain to remain operational if one of the lock chambers was closed,” Steenhoek said.

The Upper Mississippi River System transports more than 60% of America’s corn and soybeans and has suffered disruptions due to infrastructure problems.

In May 2021, Mississippi River shut to vessel traffic near Memphis, Tennessee, because of a bridge fracture, causing a backlog of more than 1,000 barges.

Modernizing Lock and Dam 25 will help farmers bring goods to market faster and increase trade by speeding up shipping, said U.S. Rep. Cheri Bustos, an Illinois Democrat.

The Army Corps allocated funds for the project from the Infrastructure Investment and Jobs Act. It will also spend $97.1 million on environmental restoration at Lock and Dam 22 near Saverton, Missouri, officials said.

Norway Salmon Export Prices Rise 7% in Week

Following is a summary of Norwegian export prices and volumes for fresh and frozen salmon from Statistics Norway in Oslo: