Global Ag News for July 19.23

TOP HEADLINES

Brazil grain exports at record levels yet July soy shipments to drop -Anec

Brazil is poised to export a record 18.3 million metric tons of soybeans, soymeal, corn and wheat in July, revised data from exporters association Anec showed on Tuesday, even though soybean shipment projections fell from last week.

The previous record for July was set in 2020 for the four commodities, when 14.8 million metric tons were exported, Anec said.

The estimate puts Brazil on track to ship 106.1 million metric tons of the four commodities during the seven months of the year, which is also unprecedented. That is in spite of Anec lowering its estimated July export volume for soybeans, Brazil’s top agricultural commodity, to 8.8 million metric tons from 10.4 million metric tons last week.

The previous export volume record for the first seven months of the year was 89 million tons, reached in 2022, Anec data show.

Thanks to Brazil’s massive grain output, soy shipments from the country should also grow in relation to July of 2022, when they totaled 7 million metric tons, according to Anec data.

China is the main buyer of Brazil’s soy.

This year, however, Argentina imported significant volumes from its bigger neighbor as a drought destroyed its crops.

Already, corn exports from Brazil are projected at 6.8 million metric tons in July, virtually stable from last week’s estimate and above the 5.6 million in the same month in 2022.

Brazil’s corn shipments traditionally gain pace in the second half of the year, after the second-corn is harvested.

In 2023, Brazil is expected to unseat the U.S. as the world’s biggest corn supplier.

FUTURES & WEATHER

Wheat prices overnight are up 27 in SRW, up 16 1/4 in HRW, up 9 3/4 in HRS; Corn is up 20 3/4; Soybeans up 19; Soymeal up $4.60; Soyoil up 0.89.

For the week so far wheat prices are up 31 in SRW, up 12 3/4 in HRW, up 2 3/4 in HRS; Corn is up 35 3/4; Soybeans up 37 1/4; Soymeal up $18.50; Soyoil down 0.38.

For the month to date wheat prices are up 46 3/4 in SRW, up 43 1/2 in HRW, up 74 1/2 in HRS; Corn is up 60 1/2; Soybeans up 71; Soymeal up $23.50; Soyoil up 1.70.

Year-To-Date nearby futures are down 12.6% in SRW, down 5.2% in HRW, down 5.5% in HRS; Corn is down 19.9%; Soybeans down 0.9%; Soymeal down 6.6%; Soyoil up 1.2%.

Chinese Ag futures (SEP 23) Soybeans up 10 yuan; Soymeal up 55; Soyoil up 64; Palm oil up 22; Corn up 6 — Malaysian palm oil prices overnight were down 35 ringgit (-0.89%) at 3895.

There were changes in registrations (-44 Corn, -50 Soyoil). Registration total: 1,398 SRW Wheat contracts; 448 Oats; 0 Corn; 11 Soybeans; 303 Soyoil; 0 Soymeal; 147 HRW Wheat.

Preliminary changes in futures Open Interest as of July 18 were: SRW Wheat down 1,673 contracts, HRW Wheat up 1,148, Corn up 2,895, Soybeans up 8,472, Soymeal up 933, Soyoil down 1,259.

Northern Plains: A trough is entering the Canadian Prairies Tuesday and will eventually move into the Northern Plains by Wednesday, providing isolated to scattered showers. Chances for rain will continue across these regions into this weekend as more systems pass by. Near- to below-normal temperatures are expected to reduce stress on developing crops, but overall, below-normal precipitation is expected through this week as any heavier rainfall will likely be isolated.

Central/Southern Plains: A fairly active weather pattern will remain in place for the Central Plains the rest of this week as systems pass through from the west. Showers will become more isolated this weekend and shift farther south into Texas. Though the areas receiving rainfall are somewhat disorganized, the frequency is still good for this time of year. Temperatures are also mild for northern areas but will be above normal across Texas into this weekend. Conditions are mostly favorable for much of the region despite the continued drought, though the scattered rain will disrupt those finishing up their wheat harvest.

Midwest: Widely scattered showers and storms will continue through the middle of this week as a trough from the Canadian Prairies moves across the region by midweek. More scattered showers are expected for this weekend, as a front from Canada drops into the region. Drier conditions should return by early next week. Rain is coming at enough of a frequency to maintain or boost soil moisture in some areas, though there are plenty that are also seeing disappointment and low soil moisture, creating mixed conditions for developing corn and soybeans.

Delta: More scattered showers and storms are expected through this weekend as systems work east from the Rockies. Drier conditions will steadily return through the first half of next week. Any rainfall will benefit crops entering their reproductive stages, but for those who miss the more measurable rainfall, yield potential may decrease.

The player sheet for 7/18 had funds: net buyers of 5,500 contracts of SRW wheat, buyers of 20,000 corn, buyers of 9,500 soybeans, buyers of 4,000 soymeal, and  sellers of 3,500 soyoil.

TENDERS

• CORN TENDER: Iranian state-owned animal feed importer SLAL issued an international tender to purchase up to 180,000 metric tons of animal feed corn with Ukrainian supplies still included among grain sources which can be offered.
• WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is seeking to buy a total of 106,366 tonnes of food-quality wheat from the United States, Canada and Australia in a regular tender that will close on July 20.

PENDING TENDERS

• RICE TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp issued an international tender to purchase an estimated 43,000 metric tons of rice. The deadline for submissions of price offers in the tender was July 10.
• CORN TENDER: Algerian state agency ONAB issued an international tender to purchase up to 240,000 metric tons of animal feed corn to be sourced from Argentina or Brazil.
• WHEAT TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 metric tons of milling wheat.

TODAY

LIVESTOCK SURVEY: US Cattle on Feed Placements Seen Falling 1.8%

June placements onto feedlots seen falling y/y to 1.61m head, according to a Bloomberg survey of ten analysts.

• Estimates range from -4% to +2.7% y/y change
• Feedlot herd as of July 1 seen falling by 2.2% y/y to 11.15m head
• Marketings seen falling 4.7% y/y

LIVESTOCK SURVEY: US Cattle Herd Seen Smallest Since 2014

The US cattle herd as of July 1 seen falling by 2.2m head from last year to 96.4m head, according to the avg of four analysts’ estimates.

• That would be the lowest level in nine years
• Beef cow replacement seen at 29.4m head, which would be the lowest on record in data going back to 1971
• The USDA is scheduled to release its semi-annual cattle inventory report at 3pm on July 21

ETHANOL: US Weekly Production Survey Before EIA Report

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

• Production seen higher than last week at 1.042m b/d
• Stockpile avg est. 22.669m bbl vs 22.658m a week ago
• The EIA in Washington is scheduled to release the report at 10:30am Wednesday 

Russian Missiles Hit Grain, Vegetable Oil Terminals in Odesa

Russia fired a barrage of missiles and drones toward southern Ukraine overnight, the country’s southern military command said on Facebook.

• Some missiles hit a grain terminal and a vegetable oil terminal in Odesa, damaged reservoirs, loading equipment and caused a fire
• Other missiles hit an industrial object in the Odesa region and also damaged fireworks and tobacco depots
• Several people were reported injured as missile and drone debris hit residential buildings as well
• NOTE: Ukraine downed 14 out of 31 Russian missiles launched overnight from ships, strategic bombers and land launchers, as well as 23 out of 32 drones, the country’s Air Force command said on Telegram

Ukraine Recap: Zelenskiy Says Russia Targeted Grain Facilities

Ukrainian President Volodymyr Zelenskiy said Russia intentionally attacked grain-deal infrastructure as he ordered his military to boost port defense and diplomats to step up contacts with partners to continue exports of Ukrainian crops.

• The Ukrainian military said Russia fired a barrage from the Black Sea overnight, mainly striking at infrastructure in the southern Odesa region. In total, Russian forces launched 31 missiles and 32 drones with Ukrainian forces downing fewer than half of all the projectiles aimed at the Odesa region. Some hit a grain terminal and a vegetable oil terminal, according to the country’s southern military command.
• Brazilian President Luiz Inacio Lula da Silva, who has expressed ambivalence toward Russia’s attack on Ukraine, said the world is tiring of the war. In remarks to reporters in Brussels, he suggested that a group of countries who are able to talk to Moscow and Kyiv will be needed to ensure peace.

Brazil farmers to increase soy planted area in 2023/24 cycle – Patria Agronegocios

Brazilian farmers are expected to plant 44.48 million hectares (109.9 million acres) with soybeans in the 2023/24 cycle, 0.48% more than in the previous year, according to Patria Agronegocios’ first projection for the new crop.

Total soy production is estimated at 155.8 million metric tons, 1.6% above the previous season, Patria said.

Brazilian farmers normally start planting soybeans in September in key areas including Mato Grosso state, the country’s top grain producer.

Barchart Raises Corn Yield Estimates, Cuts Soybean Yield Estimates

Today Barchart released its July 2023 Crop Production and Yield Forecasts for US corn and soybeans.

The latest report indicates a increase in US corn production with end-of-season corn production at 14,993 million bushels with a yield of 177.97 bu/ac. This compares to the previous estimate of 14,973 million bushels with a yield of 177.76 bu/a and is 0.5 (bu/ac) above the USDA’s most recent forecast.

The latest report also sees end-of-season U.S. soybean production at 4,390 million bushels with a yield of 50.76 bu/ac.  This compares to the previous estimate of 4,379 million bushels with a yield of 50.62 bu/a and is 1.2 (bu/ac) below the USDA’s most recent forecast.

Top Broker Marsh Says Ukraine Grain Insurance Program Suspended

Insurance broker Marsh said that a facility to provide cover for grain and food cargoes traveling through Ukraine’s grain corridors was suspended, after Russia ended the Ukraine grain-export deal on Monday.

The marine cargo and war facility had provided cover for cargoes being shipped from Ukraine’s Black Sea ports under a deal brokered by the UN and Turkey.

India June Oilmeals Exports Fall to 280,001 Tons

India’s oilmeals exports fell to 280,001 tons in June from 436,596 tons in May, according to the Solvent Extractors’ Association of India.

• Rapeseed meal exports fell to 140,506 tons from 233,663 tons in May
• Soymeal exports fell to 73,139 tons from 114,225 tons in May
• Rice-bran extract exports rose to 45,705 tons from 42,398 tons in May
• Castorseed meal exports fell to 17,512 tons from 43,761 tons in May

UN says ideas ‘floated’ on how to get Ukraine, Russia grain to world

There are a “number of ideas being floated” to help get Ukrainian and Russian grain and fertilizer to global markets after Moscow quit a deal allowing the safe Black Sea export of Ukraine grain, the United Nations said on Tuesday.

The Black Sea deal was brokered by the U.N. and Turkey in July last year to combat a global food crisis worsened by Russia’s February 2022 invasion of Ukraine. Ukraine and Russia are among the world’s top grain exporters.

Russia’s withdrawal on Monday, which included revoking its guarantees for safe navigation, also ended a pact between the United Nations and Moscow in which U.N. officials agreed to help Russian food and fertilizer exports reach world markets.

However, U.N. Secretary-General Antonio Guterres “will continue to explore all possible avenues to ensure that Ukrainian grain, Russian grain, Russian fertilizer are out on the global market,” U.N. spokesman Stephane Dujarric said.

“There are a number of ideas being floated,” he told reporters, without giving details.

Ukraine’s Foreign Minister Dmytro Kuleba said an alternative to the Black Sea grain deal had to be found and “there are very active discussions now.”

The European Union said on Tuesday it is seeking to transport more Ukrainian grains via road and rail. While appreciative of EU efforts, Kuleba said Ukrainian exports through Europe would not be able to “compensate for the absence of deliveries from Ukrainian ports on the Black Sea.”

Kuleba said the focus on reviving Black Sea shipments was either to continue within the existing framework or create a new model, but added: “The problem, of course, is what is going to happen if Russia decides to attack a vessel carrying grain.”

“We have to take risks and we have to demonstrate that we can carry on without Russia,” he told reporters on Tuesday during a visit to the United Nations.

Russia struck Ukrainian ports on Tuesday, a day after quitting the Black Sea grain deal. The Kremlin also warned that attempts to ship grain from Ukrainian Black Sea ports without security guarantees from Russia would carry risks because it said Kyiv used those waters for military activities.

Bioceres Partners With Corteva to Market Insecticide in Europe

Argentina’s Bioceres Crop Solutions has agreed to work with Corteva Agriscience to accelerate the regulatory processes for bringing a biological insecticide to market in Europe, according to a company statement.

• The bio-insecticide —which Bioceres says can be as effective as conventional insecticides, and targets crops including corn, sunflower and rapeseed— is being developed by its Pro Farm unit
• Corteva would be the exclusive distributor in Europe

 

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