Global Ag News for Apr 15.24

TOP HEADLINES

Kazakhstan extends ban on wheat imports for another six months

Kazakhstan’s Agriculture Ministry has extended the ban on wheat imports for another six months, the ministry said in a press release on Friday.

Order No.125 issued by the ministry on April 11, 2024 bans imports of wheat into the Kazakhstan, including from the states participating in the Eurasian Economic Union (EAEU) by motor vehicles, by water and rail with the exception of what imports by rail for poultry farms and flour mills exclusively for their auxiliary needs, according to the press release.

The ban does not apply to transit transportation of wheat through Kazakhstan by rail. The extended ban comes into force on April 12 for a period of six months.

Previously, Kazakhstan banned imports of wheat by motor vehicles for six months from April 10, 2023 to prevent illegal imports of wheat to Kazakhstan. According to the Agriculture Ministry, the illegal imports of wheat to Kazakhstan caused the wheat prices in the domestic market to plummet by more than 50%. As much as 1.5-2 million tonnes of wheat used to be imported to the republic illegally each year, and the total damage done to the republic was estimated at about $500 million.

On October 10, 2023, the Agriculture Ministry prolonged the ban on what imports until April 11, 2024 and also introduced a ban on its imports by rail.

FUTURES & WEATHER

Wheat prices overnight are down 7 1/4 in SRW, down 6 in HRW, down 4 in HRS; Corn is down 2 3/4; Soybeans down 4 3/4; Soymeal down $3.40; Soyoil up 0.07.

Markets finished last week with wheat prices down 17 in SRW, down 3 1/2 in HRW, down 11 1/2 in HRS; Corn is down 3; Soybeans down 12 1/4; Soymeal up $1.60; Soyoil down 1.93.

For the month to date wheat prices are down 12 1/4 in SRW, down 1/2 in HRW, down 6 1/4 in HRS; Corn is down 10; Soybeans down 23 1/4; Soymeal down $0.30; Soyoil down 1.96.

Year-To-Date nearby futures are down 12.7% in SRW, down 9.0% in HRW, down 11.7% in HRS; Corn is down 8.1%; Soybeans down 9.6%; Soymeal down 11.8%; Soyoil down 3.9%.

Chinese Ag futures (MAY 24) Soybeans down 38 yuan; Soymeal up 64; Soyoil up 78; Palm oil down 4; Corn up 1 — Malaysian Palm is down 85.  Malaysian palm oil prices overnight were down 85 ringgit (-1.99%) at 4197.

There were no changes in registrations. Registration total: 438 SRW Wheat contracts; 0 Oats; 37 Corn; 499 Soybeans; 710 Soyoil; 26 Soymeal; 0 HRW Wheat.

Preliminary changes in futures Open Interest as of April 12 were: SRW Wheat down 6,810 contracts, HRW Wheat up 1,091, Corn down 20,158, Soybeans up 10,849, Soymeal up 4,080, Soyoil up 1,256.

Plains: U.S. west-central high Plains is the only key crop area in the U.S. that is dry for most of the coming ten days. Some areas in the northwestern U.S. Plains do not get an abundance of moisture nor does the southwestern Canada Prairies

Midwest: U.S. weather over the next two weeks will bring on frequent bouts of rain resulting in slow fieldwork at times, but moisture abundance is expected in most of the Midwest, including Iowa.

Delta: U.S. Delta stays dry through Thursday, but rain prospects slowly increase during the weekend and early next week. No excessive rain is expected, but the region will turn wet again after finally drying out for little while this week.

Brazil: Brazil will experience drying from Bahia and Piaui into Minas Gerais and Goias during the next ten days to two weeks. Drying is also expected in center west and interior southern Brazil, but not until after Thursday. Rain through Thursday morning will offer some additional relief from dryness in Mato Grosso do Sul, Parana, and Paraguay where rainfall of 0.75 to 2.50 inches is expected by that time. Rio Grande do Sul, southern Paraguay and Santa Catarina are also expecting significant rain early this week with 2.00 to 4.00 inches of rain expected.

Argentina: Argentina weather during the weekend turned much wetter as expected with significant rain in most of the nation. Additional rain is expected in southern and eastern parts of Argentina through Monday and then it will be dry the remainder of this week. Another 1.00 to 2.50 inches of rain is expected. Rain will return to northeastern Argentina this weekend into early next week while other areas dry down. None of the rain after early this week will be heavy in the south, central or east-central Argentina which should improve crop maturation and harvest conditions. Argentina temperatures should be seasonable during the next two weeks.

Australia: Australia rain during the weekend was restricted in summer crop areas which promoted good drying conditions and improved harvesting. Restricted rain will continue over the next ten days, although totally dry weather is not likely. Fieldwork will advance, although slowly and no serious change in crop quality is expected. A big boost in precipitation is needed for the planting of winter crops throughout the south

The player sheet for 4/12 had funds: net buyers of 1,000 contracts of SRW wheat, buyers of 3,000 corn, buyers of 4,500 soybeans, buyers of 3,000 soymeal, and sellers of 1,000 soyoil.

TENDERS

• SOYBEAN SALES: The U.S. Department of Agriculture confirmed private sales of 124,000 metric tons of U.S. soybeans for shipment to unknown destinations in the 2023/24 marketing year.
• CORN PURCHASE: South Korea’s Feed Leaders Committee (FLC) purchased around 65,000 metric tons of animal feed corn in a private deal on Friday without issuing an international tender

PENDING TENDERS

• SOYMEAL TENDER: Iranian state-owned animal feed importer SLAL has issued an international tender to purchase up to 120,000 metric tonnes of soymeal, European traders said on Monday.
• WHEAT TENDER: Jordan’s state grain buyer issued an international tender to buy up to 120,000 metric tons of milling wheat which can be sourced from optional origins.
• FEED BARLEY TENDER: Jordan’s state grains buyer issued an international tender to purchase up to 120,000 metric tons of animal feed barley.

 

 

TODAY

NOPA March US soy crush seen at record high 197.787 million bushels

U.S. soy processors crushed more soybeans in March than any month on record, although the daily pace slowed slightly after peaking in February, analysts said on Friday, ahead of Monday’s National Oilseed Processors Association (NOPA) report.

NOPA members, who handle about 95% of all U.S.-processed soybeans, crushed an estimated 197.787 million bushels last month, according to eight analysts polled by Reuters.

That would mark a 6.2% increase from 186.194 million bushels in February and a 6.4% advance from 185.810 million bushels in March 2023, breaking the record of 195.328 million bushels set in December 2023. The March crush estimate implied an average processing rate of 6.380 million bushels a day last month, down slightly from the record 6.420 bushels a day NOPA members crushed in February.

Crushers had ramped up processing in February to make up for weather-related plant downtime in January, analysts said. The daily crush rate in March, however, remained near the record pace as the industry recently expanded its processing capacity, largely to supply biofuel makers with more soyoil. Estimates for March ranged from 196.000 million to 202.500 million bushels, with a median of 197.248 million bushels.

The NOPA report is scheduled for release at 11 a.m. CDT (1600 GMT) on Monday. Soyoil supplies held by NOPA members as of March 31 were forecast at 1.792 billion lbs, based on estimates from six analysts. That would be up 6.0% from the 1.690 billion lbs at the end of February but down 3.2% from the 1.851 billion lbs at the end of March 2023. Soyoil stocks estimates ranged from 1.725 billion to 1.927 billion lbs, with a median of 1.780 billion lbs.

Brazil Farmers Harvest 85.13% Of 2023/2024 Soybean Area Versus 86.29% At This Time Last Year – Patria Agronegocios

BRAZIL FARMERS HARVEST 85.13% OF 2023/2024 SOYBEAN AREA VERSUS 86.29% AT THIS TIME LAST YEAR – PATRIA AGRONEGOCIOS

SOYBEAN/CEPEA: Liquidity increases, and export premium is positive again in BR

Soybean trades moved at a good pace in Brazil this week, influenced by the high demand, especially from abroad. This scenario boosted export premiums in the country, which resumed being at positive levels, a scenario that has not been observed for eight months. The dollar valuation against Real led Brazilian commodities to be more attractive to importers – the dollar quotation averaged BRL 5.089 on April 11, the highest since October 13, 2023.

Soybean prices increased in the domestic market. From April 4-11, the ESALQ/BM&FBovespa Index (Paranaguá) upped 1.1%, closing at BRL 125.63 per 60-kg bag on April 11. The CEPEA/ESALQ Index (Paraná) increased 0.4%, to close at BRL 121.08 per 60-kg bag. On the average of the regions surveyed by Cepea, soybean prices rose 0.2% in the over-the-counter market (paid to farmers) and 0.3% in the wholesale market (deals between processors).

BYPRODUCTS – The value of soy oil dropped 1.7% between April 4 and 11, at 5,143.41 BRL per ton (in São Paulo city with 12% ICMS) on April 11. On the average of the regions surveyed by Cepea, soymeal prices moved down 1.1% in the last seven days.

Price rises for soybeans are also related to data indicating lower production in Brazil. Conab says that the crop is likely to hit 146.52 million tons, 5.2% down compared to the previous season and 0.23% below the projection released in March. The USDA, in turn, keeps the estimate for production in Brazil at 155 million tons.

CORN/CEPEA: Purchasers are away from trades; prices move down

Purchasers of corn are away from closing deals in the spot market in Brazil, since they claim to have stocks for the short-term. This scenario kept prices in a downward trend in many regions surveyed by Cepea. The progress of the summer crop in Brazil, estimates indicating a high global production and price drops in the international market have reinforced the decrease in Brazil.

From April 4-11, the ESALQ/BM&FBovespa Index (Campinas, SP) dropped 3.2%, closing at BRL 59.53 per 60-kilo bag on April 11. The Index had not closed below BRL 60/bag since November last year.

ESTIMATES – The USDA reduced ending stocks of corn in the United States in the 2023/24 season, now forecast at 53.9 million tons, against 55.17 million tons indicated in March. Global ending stocks may reduce to 318.28 million tons, against the 319.62 projected in the March report.

As for Brazil, the USDA kept the production estimate at 124 million tons and export may continue at 52 million tons. The world production is likely to hit 1.22 billion tons, against 1.23 billion forecast in March. The consumption continues at 1.21 billion tons.

Conab, in turn, reduced the projection for the production in Brazil, due to concerns with the second crop. Now, it is likely to total 110.96 million tons, 2% less than the March report and 16% below what was verified in the 2022/23 season. The summer crop may amount 23.35 million tons, while the third crop can total 1.99 million tons.

As for the second corn crop, the area will be 8% lower and the productivity is expected to reduce 8.9% in relation to the season before. As a result, production is forecast to hit 85.6 million tons, 16.4% less compared to the previous crop. Due to the lower production in Brazil and the higher global production, Brazilian shipments are expected to reduce 43% against the previous season, at 31 million tons. Therefore, ending stocks may total 5.5 million tons by January/25.

CROPS – Data from Conab indicate that, up to April 7, 99.5% of the second crop area in Brazil had been planted. As for the summer crop, the harvest had totaled 51% of the area until April 7, upping 4.6 percentage points compared to April 1 – data from Conab.

Northern Europe’s Wet Spring Causes Further Pain for Farmers

• Weather has limited wheat and barley growth this year
• Region also saw unseasonably high rainfall in winter

A soggy spring is delaying the development of key crops in northern Europe, driving concerns over yields and lifting crop prices from a lengthy downturn.

France experienced its fifth-wettest March since record-keeping began in 1958, government data shows. Britain’s grain-growing region saw 160% of typical rainfall for the start of the year, according to Aura Commodities meteorologist Tom Whittaker.

Those factors are straining the growth of soft wheat and barley — staples used in everything from bread to beer. The winter was also unseasonably wet. That could revive inflation later in the year.

British supplies of milling wheat, the variety used for flour, will likely need to be bolstered by imports, Agriculture and Horticulture Development Board analyst Ella Roberts said in a note this week. The researcher expects UK imports of wheat for the season to be above the five-year average.

However, nearby trading partners are also struggling. French wheat plantings in autumn were significantly delayed, and conditions this spring are running at the worst since 2020.

Ukraine Grain Exports Drop 4% Y/y; Spring Plantings Quicken

Ukraine’s grain exports in the season that started July 1 reached 37.6m tons as of Friday, down 4% from the same time a year ago, data from the Agriculture Ministry show.

• The total includes:
• 14.7m tons of wheat, including 386k tons so far in April
  • That’s about 9% higher y/y
  • 2.1m tons of barley, down 9% y/y
  • 20.5m tons of corn, down 11% y/y
• NOTE: Almost all agricultural exports are being transported via Ukraine’s Danube ports and the so-called Black Sea corridor. Black Sea Ports Exports Almost Reached Pre-War Level
• Ukrainian farmers have already planted 1.26 million hectares (3.1 million acres) of grain and leguminous crops, according to Ministry’s data.
  • This is almost twice as much compared with the same period last year due to warm weather

Palm Oil Stockpiles in Malaysia Decline 10.7% M/m in March: MPOB

Malaysia’s palm oil inventories dropped from a month earlier to 1.71 million tons in March, according to data posted by the Malaysian Palm Oil Board on Monday.

• Palm oil production at 1.39m tons in March; +10.6% m/m
• Exports at 1.32m tons; +28.6% from February

El Niño Drives Southern African Millers to Seek Brazilian Corn

• Zimbabwe grain millers will be sending delegation to Brazil
• Dry weather withers crops across southern African region

Zimbabwe is considering importing corn from Brazil for the first time since 2014 as the El Niño weather pattern withers crops in the country and its neighbors.

The dry spell triggered by the phenomenon has slashed South Africa’s corn crop by at least 20% and Zimbabwe’s by about 60%. Malawi, Zambia and Zimbabwe have declared states of national disaster because of the crop failures.

Normally, the three nations are self-sufficient or can meet the bulk of their own needs with occasional shortfalls covered by imports from South Africa, the biggest producer in the region. This may be difficult this year with South Africa producing less.

White corn for July delivery rose to a record 5,467 rand ($290) a ton on the South African Futures Exchange in Johannesburg on Monday as concern grows about supplies. It has gained 38% so far this year.

South Africa’s Corn Harvest Could Be Smallest in Five Years

World’s Top Fertilizer Maker Plans to Exit Argentina, Chile

• Nutrien also seeks to divest retail operations in Uruguay
• Company says it will focus on retail in Brazil, other markets

Nutrien Ltd., the world’s largest maker of fertilizers, said it is seeking to sell its retail operations in Argentina, Chile and Uruguay in order to focus on Brazil and other global markets. The Canadian company is prioritizing key markets in a bid to boost returns for investors, a spokesperson said in an emailed statement to Bloomberg.

Nutrien, which has been in South America for more than a quarter of a century, is working to recover after sharply missing profit expectations in the last three months of 2023 amid plunging fertilizer prices that hurt retail results.

The company said in its annual report that Argentina’s currency controls meant it lost money when it transferred currency out of the country because it had to use a more expensive exchange rate. New President Javier Milei has promised to scrap the controls as he seeks to deregulate the economy.

Its exit from the Argentine retail business comes as the country seeks to cheapen the herbicide and fertilizer market for farmers by reducing import taxes on both inputs.

Other companies have also abandoned Argentina’s tough business environment in recent years, including HSBC Holdings PLC and Walmart Inc. Bayer AG ditched its Argentine soy seed business in 2021.

Nutrien didn’t say what it’s planning to do with its 50% stake in Profertil SA, a urea and ammonia manufacturing venture it has with Argentina state-run oil company YPF SA. YPF, under new management appointed by Milei, is looking to divest assets to focus on shale drilling. Nutrien on Friday said it would continue to support all customers and partners through its divestiture process.*

US Pork Production Up 2.6% This Week, Beef Down: USDA

US federally inspected pork production rises to 535m pounds for the week ending April 13 from 521m in the previous week, according to USDA estimates published on the agency’s website.

• Hog slaughter up 2.6% from a week ago to 2.485m head
• Beef production down 1.4% from a week ago, cattle slaughter falls 1.6%
• For the year, beef production is 3.3% below last year’s level at this time, and pork is 0.2% above

 

 

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