Global Ag News Headlines 5.1

by ADMIS Research Team

Overnight trade has SRW down roughly 6 cents, HRW down 7; HRS Wheat down 3, Corn is down 3 cents; Soybeans down 5, Soymeal down $1.50, and Soyoil down 30 points.

US stocks are lower. US Dollar is lower. Crude is lower. Fact POTUS is asking China for reimbursement from China for US economy losses due to the virus and that he may reinstate tariffs against China is weighing on commodity prices.

For the week, SRW Wheat prices are down roughly 13 cents; HRW down 2; HRS down 1; Corn is down 5 cents; Soybeans up 10 cents; Soymeal up $1.00, and; Soyoil up 75 points; Crushing margins are up 3 cents; Oil share unchanged.

For the month, SRW Wheat prices were down roughly 39 cents; HRW down 11; HRS down 33; Corn was down 26 cents; Soybeans down 34; Soymeal down $23.00, and; Soyoil down 75 points; Crushing margins were down 27 cents, Oil share up 1 cent.

For the year, SRW Wheat prices were up roughly 26 cents; HRW down 6; HRS down 49; Corn was down 64 cents; Soybeans down 32; Soymeal down $17.00, and; Soyoil down 130 points; Crushing margins were down 19 cents, Oil share unchanged at 31%.

Chinese Ag futures are closed for holiday until Wednesday.

Malaysian palm oil market is closed for holiday until Monday.

U.S. Weather Forecast

A weather disturbance will impact the southwestern part of the Northern Plains May 8 – 9; a significant precipitation event is shown in West Texas next Thursday into May 8; there is a snow event in the Northern Plains May 12 – 14.

The Midwest looks to remain with a cooler and drier bias in the 6 to 10 day period.

South America Weather Forecast

Enough rain is still likely in second season corn and cotton production areas of Brazil; meaningful rain may be localized; temperatures behind this event will be below to well below average Wednesday through May 9 in southern and part of central Brazil and the cool-biased conditions will limit drying rates

Last night’s GFS model run showed another meaningful rain event in second season corn and cotton production areas of Brazil May 10 – 13; an additional rain event is possible, especially May 12 – 13, which would help provide some more improvement of topsoil moisture

Black Sea/Europe region

Scattered showers and periodic rain are still expected to occur over a large part of the European continent and the western Commonwealth of Independent States during the next two weeks; however, much of the rain is going to be light and it is still questionable how much relief from dryness will occur in northern Europe.

The player sheet had funds net buyers of 5,000 contracts of SRW Wheat; net bought 14,000 Corn; net bought 11,000 contracts of Soybeans; net bought 4,000 Soymeal, and; bought 3,000 Soyoil.

We estimate Managed Money net long 6,000 contracts of SRW Wheat; net short 162,000 Corn; net long 5,000 in Soybeans; net short 6,000 lots of Soymeal, and; net short 7,000 Soyoil.

Preliminary Open Interest saw SRW Wheat futures up roughly 1,800 contracts; HRW Wheat up 660; Corn down 8,800; Soybeans down 6,000 contracts; Soymeal up 3,900 lots, and; Soyoil down 3,400.

Deliveries were 22 Soymeal; 1,032 Soyoil; 65 Rice; 221 Corn; 9 HRW Wheat; ZERO Oats; ZERO Soybeans; ZERO SRW, and; 271 HRS.

There were changes in registrations (Soyoil up 804; Soymeal down 17; Rice up 65)—Registrations total 11 contracts for SRW Wheat; ZERO Oats; Corn 223; Soybeans 1; Soyoil 3,513 lots; Soymeal 547; Rice 332; HRW Wheat 10, and; HRS Wheat 821 contracts.

TODAY—MONTHLY FATS/OILS—MONTHLY GRAIN CRUSHINGS—COMMITMENT OF TRADERS— 

U.S. President Donald Trump said on Thursday his hard-fought trade deal with China was now of secondary importance to the coronavirus pandemic and he threatened new tariffs on Beijing, as his administration crafted retaliatory measures over the outbreak; Trump’s sharpened rhetoric against China reflected his growing frustration with Beijing over the pandemic, which has cost tens of thousands of lives in the United States alone, sparked an economic contraction and threatened his chances of re-election in November.

China’s warning of trade repercussions from Australia’s campaign for an independent inquiry into the coronavirus has rattled Australian business leaders as President Donald Trump’s administration urges other governments to back such a probe; China has accused Australia of parroting the United States in its call for an inquiry independent of the World Health Organization to determine the origins of COVID-19 and how the world responded to the emerging pandemic; Chinese Ambassador Cheng Jingye used an Australian newspaper interview this week to warn that pursuing an inquiry could spark a Chinese consumer boycott

COVID-19 cases at a JBS meatpacking plant in Colorado have more than doubled “in a number of days” and a sixth employee died of the virus, a union official said on Thursday, underscoring the risks of U.S. meat plants reopening; the beef plant in Greeley, Colorado, started operating last Friday after it was closed for about two weeks following an outbreak among workers; the uptick in cases in a matter of days shows how serious this crisis is and the dangers that workers are facing every day just trying to do their jobs.

For the week ended April 23rd, U.S. All Wheat sales are running 2% ahead of a year ago, shipments up 6% with the USDA forecasting a 5% increase on the year

—By class, HRW wheat sales are up 6%, shipments 17% ahead with a USDA forecast of a 15% increase

—SRW sales 29% behind, shipments 17% behind with a 26% decline seen

—HRS sales 9% ahead, shipments up 6% with a 6% increase seen

For the week ended April 23rd, U.S. Corn sales are running 20% behind a year ago, shipments 35% behind with the USDA forecasting a 16% decline.

For the week ended April 23rd, U.S. Soybean sales are running 13% behind a year ago, shipments 5% ahead with the USDA forecasting a 2% increase on the year

—Soymeal sales 8% behind on the year, shipments down 3% with a 1% decrease forecasted

—Soyoil sales 49% ahead of a year ago, shipments 44% ahead with a 24% increase forecasted

The International Grains Council trimmed its forecast for global wheat production in the 2020/21 season, driven partly by downward revisions for Russia, Ukraine and the European Union

—In its monthly update, the inter-governmental body cut its global wheat crop forecast by 4 million tons to 764 million tons

—The global wheat crop in 2020/21 was still seen at a record level, exceeding the prior season’s 762 million tons

—The council put 2020/21 world corn (maize) production at a record 1.158 billion tons, marginally up from its previous projection of 1.157 billion and well above the prior season’s 1.119 billion

—The IGC also made substantial revisions to its estimates for the current 2019/20 season with global grains consumption cut by 11 million tons to 2.18 billion tons with the biggest reduction for industrial usage, led by a sharp slowdown in demand for ethanol processing

—The IGC made a modest downward revision to its global grains consumption forecast for 2020/21 of 4 million tons to 2.22 billion tons

Major poultry producer Pilgrim’s Pride says that it expects grain prices to be low throughout the summer, forecasting robust harvests by US farmers this year will keep supplies of corn and soybeans easily available; soybean and wheat supplies globally are also expected to stay strong, giving Pilgrim alternatives to consider in the event of a supply disruption in any grain

—Up until coronavirus hit and kept consumers inside, Pilgrim’s Pride was seeing higher production for 1Q–with poultry poundage up 6.4%, according to the company CEO; the effect of stay-at-home orders instituted because of the new coronavirus is now being seen by the company, with slaughters down 11.8% versus pre-Covid levels; as a result, Pilgrim’s expects to slow down production in 2Q

—Even amid the struggle of handling the coronavirus outbreak in the US, Pilgrim’s Pride reports that demand for chicken from China was a bright spot for the company’s earnings; the company said that its export sales grew 24% year-over-year, with sales to China totaling 86 million pounds

News wires yesterday were reporting Chinese state-owned importers bought at least five bulk cargoes of U.S. soybeans on Thursday, or at least 300,000 tons, for shipment mostly from U.S. Gulf Coast export terminals in August and September; the importers were also inquiring about prices for U.S. Pacific Northwest soybeans shipments, but traders could not immediately confirm that such purchases had been finalized.

Wire story reported agriculture market-watchers have been somewhat skeptical about the feasibility of the Phase 1 trade deal the United States signed with China back in January, which suggested that U.S. farm product exports to China in 2020 would exceed 2017 levels in value by 50%; however, China has stepped up U.S. agricultural purchases in recent weeks, perhaps in an “under the radar” way, since the purchases have not involved eye-popping volumes or many big-ticket items as might be expected with such a lofty target; soybeans are one of those big-ticket items, as they account for about half of the annual exported value of U.S. farm goods to China in a normal year; China still has a long way to go on the purchases if the terms of the deal are to be met; but the recent progress is an improvement from the first couple months of the year, and that is despite the global market shock caused by the coronavirus pandemic.

Argentine farmers have harvested 68.2% of this season’s soy crop, the Buenos Aires Grains Exchange said

—Harvesting was focused in regions that did not register heavy rains adding that 36.7% of this year’s corn had been harvested as of Thursday

—Argentina is expected to sow 6.7 million hectares with 2020/21 wheat, starting in the coming weeks, compared with 6.6 million hectares planted in the 2019/20 crop year; the recent rains have set the stage for a good wheat sowing season by softening soils

The condition of French soft wheat and barley crops declined for the third week in a row in the week to April 27, farm office FranceAgriMer said

—For soft wheat, 57% of crops were rated good or excellent against 58% a week earlier

—Farmers had sown 70% of the expected grain maize area compared with a revised week-earlier figure of 54%

Indonesia will keep its export tax for crude palm oil at zero for a second month in May while the export levy will remain at $50 a ton, a Trade Ministry document showed

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