Global Ag News for Apr 4.24

TOP HEADLINES

Grain Trader Aston Denies Report of Ships Blocked in Russia

Russian grain trader Aston denied an earlier report that some of its grain ships had been blocked in the country.

  • Reuters reported on Wednesday that Russia’s agricultural watchdog, Rosselkhoznadzor, had not provided some of the company’s vessels with phytosanitary certificates
    • NOTE: Top Russian wheat trader TD Rif said in March that its ships were being blocked as it was facing pressure to sell its assets at a “negligible price”
  • Aston spokesperson said by email that its export program is continuing “without changes”, phytosanitary requirements are being observed fully
  • Separately, the agricultural regulator said it hadn’t received appeals from other grain exporters regarding problems with obtaining a phytosanitary certificate for grain
    • In March it said TD Rif’s exports had “systematic inconsistencies” in grain safety and quality

FUTURES & WEATHER

Wheat prices overnight are up 1 1/2 in SRW, up 3 1/2 in HRW, up 6 in HRS; Corn is up 1/2; Soybeans up 3/4; Soymeal up $0.60; Soyoil up 0.05.

For the week & month so far wheat prices are down 3 in SRW, down 1 1/4 in HRW, up 1/2 in HRS; Corn is down 9 3/4; Soybeans down 8 1/2; Soymeal down $7.10; Soyoil up 0.95.

Year-To-Date nearby futures are down 11.3% in SRW, down 9.0% in HRW, down 10.8% in HRS; Corn is down 8.3%; Soybeans down 8.5%; Soymeal down 14.4%; Soyoil up 2.2%.

Malaysian palm oil prices overnight were down 15 ringgit (-0.34%) at 4392. China markets are closed for holiday.

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 3 were: SRW Wheat up 4,029 contracts, HRW Wheat up 3,275, Corn down 13,855, Soybeans up 174, Soymeal up 3,524, Soyoil down 2,041.

Northern Plains: Shower and thunderstorm activity will occur in the region Saturday through Tuesday. Total moisture will vary from 0.20 to 0.80 inch, locally more than 1.00-inch. Occasional shower and thunderstorm activity is expected April 10 – 17. Much of the rain could occur April 10 and April 13 – 14.

Central/Southern Plains: Western Texas and southwestern Oklahoma will be dry through much of the next two weeks and fieldwork should advance well around one round of organized precipitation occurring Monday into next Wednesday that should induce beneficial increases in soil moisture in a few areas.

Midwest: Cool, breezy weather will linger for several days in the Midwest and East. In advance of the Western rain and snow showers, warm air will surge northward across the Plains. During the weekend, however, rain will return across the nation’s mid-section, spreading as far east as the Mississippi Valley by Sunday. The NWS 6- to 10-day outlook for April 8 – 12 calls for the likelihood of near- or above-normal temperatures nationwide, except for cooler-than-normal conditions in parts of southern Florida and the Southwest.

The player sheet for 4/3 had funds: net buyers of 4,500 contracts of SRW wheat, buyers of 3,500 corn, buyers of 3,000 soybeans, buyers of 2,000 soymeal, and buyers of 1,500 soyoil.

TENDERS

  • CORN, BARLEY AND SOYMEAL TENDER: Iranian state-owned animal feed importer SLAL has issued international tenders to purchase up to 120,000 tonnes of animal feed corn, 120,000 tons of feed barley and 120,000 tons of soymeal
  • WHEAT TENDER: Jordan’s state grain buyer has issued an international tender to buy up to 120,000 metric tons of milling wheat which can be sourced from optional origins
  • DURUM WHEAT TENDER: Tunisia’s state grains agency has issued an international tender to purchase about 50,000 metric tons of durum wheat
  • MILLING WHEAT TENDER: Tunisia’s state grains agency has issued an international tender to purchase 50,000 metric tons of soft milling wheat.
  • BARLEY PURCHASE: Jordan’s state grain buyer has purchased about 60,000 metric tons of animal feed barley in an international tender seeking up to 120,000 tons on Wednesday.

PENDING TENDERS

  • FOOD WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is seeking to buy a total of 113,535 metric tons of food-quality wheat from the United States, Canada and Australia in a regular tender that will close late on April 4.

 

freight containers

 

TODAY

DOE: US Ethanol Stocks Rise 1.2% to 26.416M Bbl

According to the US Department of Energy’s weekly petroleum report.

  • Analysts were expecting 26.166 mln bbl
  • Plant production at 1.073m b/d, compared to survey avg of 1.046m

GRAIN EXPORT SURVEY: Corn, Soy, Wheat Sales Before USDA Report

Estimate ranges are based on a Bloomberg survey of six analysts; the USDA is scheduled to release its export sales report on Thursday for week ending March 28.

  • Corn est. range 800k – 1,400k tons, with avg of 1,078k
  • Soybean est. range 250k – 700k tons, with avg of 470k

Brazil Corn Crop “less weird” than Soybeans

Glauber Silveira, the executive director of the Brazilian Corn Growers Association (ABRAMILHO), said that the current corn crop is “less weird” than soybeans because of the rains in March and early April.

Brazil 2023/2024 Soybean Crop Seen At 146.3 Million Tns – Datagro – Reuters

  • BRAZIL 2023/2024 SOYBEAN CROP SEEN AT 146.3 MILLION TNS VERSUS 147.3 MILLION TNS IN PREVIOUS FORECAST
  • BRAZIL 2023/2024 TOTAL CORN CROP SEEN AT 114.9 MILLION TNS

Brazil Soy Exports Seen Reaching 10.65 Million Tns In April Versus 14.05 Million Tns In Same Month A Year Ago- Anec

  • BRAZIL SOY EXPORTS SEEN REACHING 10.65 MILLION TNS IN APRIL VERSUS 14.05 MILLION TNS IN SAME MONTH A YEAR AGO- ANEC
  • BRAZIL SOYMEAL EXPORTS SEEN REACHING 2.31 MILLION TNS IN APRIL VERSUS 1.74 MILLION TNS IN SAME MONTH A YEAR AGO- ANEC
  • BRAZIL CORN EXPORTS SEEN REACHING 25,000 TNS IN APRIL VERSUS 166,552 TNS IN SAME MONTH A YEAR AGO- ANEC
  • BRAZIL WHEAT EXPORTS SEEN REACHING 80,582 TNS IN APRIL VERSUS 176,556 TNS IN SAME MONTH A YEAR AGO- ANEC

Russian Grain Exporter Buys Viterra’s Assets: Kommersant

Russian entrepreneur Ilya Kosykh, owner of Russian grain exporter Delivery by Sea, bought over 25% stake in Taman grain terminal complex, previously owned by Viterra, Kommersant reports, citing a grain complex earnings report and people familiar with the details of the deal.

  • Delivery by Sea CEO Natalya Tugaleva says that the stake was purchased based on “market conditions,” according to Kommersant
    • The Taman terminal has a transshipment capacity of up to 5.5m tons per year with an estimated value of 3.7b rubles ($40m)
  • Separately former Viterra manager Dmitry Kondakov and his partners earlier purchased Viterra’s operational business MZK Export and a 1.5 tons per year terminal in Rostov-on-Don, newspaper says
  • NOTE: Following pressure from Russia’s government on international merchants, Cargill and Viterra decided to leave the country in March 2023
    • Viterra had been seeking a buyer for its stake in Taman terminal since then

Argentina’s farm export revenues up 22% in March

Argentine farm exports rose to $1.5 billion in March, a 22% increase from the same month last year, oilseed industry and grains export chamber CIARA-CEC said on Wednesday.

Revenues from grain exports, a key source of foreign currency as the country battles an economic crisis, have been surging since President Javier Milei devalued the local peso currency by more than 50% after taking office in December, in a boost to agricultural shipments.

In 2024 so far, according to CIARA-CEC, revenues have jumped 61% on a yearly basis.

Argentina is one of the world’s top exporters of processed soy, the No.3 for corn and a major supplier of wheat.

CIARA-CEC said the March figures reflect “the new foreign exchange regime for exports in place since December 2023, low international prices and macroeconomic measures implemented by the new government that impact the decision to sell grains.”

Soybean meal is the country’s main export product, with a 12% share of total shipments, but the local industry has an elevated idle capacity now close to 70%, according to CIARA-CEC.

SOUTH AMERICA FLOODING RISKS WILL CONTINUE INTO MID-APRIL, BUT RAINS WILL BENEFIT BRAZIL 2ND CROP CORN – LSEG Commodities Research & Forecast

The Argentina Pampas will trend cooler/drier into mid-April to the benefit of the corn/soybean harvest, though northern crop regions will be impacted by excessive rains again Nearly widespread warmth is in store for Brazil through the next 10 days, and rains will increase over most of the country in a favorable trend for 2nd crop corn aside from localized flooding risks. Paraguay will be warm and wet through 7-10 days, which will slow the corn/soybean harvest pace.

FORECAST DISCUSSION: The Madden-Julian Oscillation (MJO) is likely to develop into a Phase 6 event near the end of the of the 15-day forecast. This will support the potential for warm Brazil temperatures with dryness along the Central-West and Northeast regions, while South Brazil and Argentina could be wetter than normal beyond 10 days. On numerical model performance, the EC has recently outperformed the GFS in South America. Therefore, the EC is the preferred forecast model. Numerical model performance has been declining of late, making for a low confidence 10-day forecast.

ARGENTINA/PARAGUAY: A cooling trend into next week across Argentina/Paraguay will be accompanied by a split rainfall pattern. Temperatures through 5 days will be near normal in Argentina, and 2-4 °C warmer than normal in Paraguay. A widespread cool-down will then arrive over both countries as the main change in the 6-10 day forecast. 10-day rainfall totals will be 15-30 mm (~0.6-1.2 in) drier than normal along the Argentina Pampas, and 25-75 mm (~1-3 in) wetter than normal from northern Argentina through Paraguay. Recent model guidance has been volatile, so flooding rainfall anomalies exceeding 100 mm (~4 in) are still very possible as an item to monitor for the wettest regions in the days ahead. Beyond 10 days, cool temperatures are likely to persist in Argentina, and high rainfall could expand southward again across the Pampas as well. In the meantime, Argentina Pampas corn/soybean harvest progress should proceed without issues, but excessive wetness concerns for crops to the north through Paraguay will persist.

BRAZIL: Stable warmth and increasing rainfall prospects are in store for Brazil in the next 1-2 weeks. Temperatures will be 2-4 °C above normal throughout the next 10 days everywhere except the Northeast region, where conditions will be near normal instead. 10-day rainfall totals will be 25-75 mm (~1-3 in) wetter than normal in Rio Grande do Sul and from Central-West Brazil through the Northeast region, while areas in between will receive near normal totals (see figure below). Based on recent model trends, there is still considerable potential for flooding risks and rainfall anomalies exceeding 100 mm (~4 in) in Rio Grande do Sul, an item to watch closely in the days ahead. Beyond 10 days, a drying trend is likely to emerge over Central-West and South Brazil. For now, excessive wetness will negatively impact the corn/soybean harvest in Southern Brazil, while high rainfall to the north will be very favorable for 2nd crop corn that is suffering from drought.

U.S. winter wheat production up despite recent volatile temperatures across the Plains – LSEG Commodities Research & Forecast

2024/25 U.S. WINTER WHEAT PRODUCTION: 35.6 [33.1–37.8] MILLION TONS, UP 2% FROM LAST UPDATE

Recent cold temperatures across the central and southern Plains are more than offset by the long-awaited return of precipitation this week and next week amid warm weather, thereby increasing 2024/25 U.S. winter wheat production by 2% to 35.6 [33.1–37.8] million tons. National-level yield is now pegged at 50.3 bushels per acre, 3.1% above trend yield set earlier in the season. Our current median estimate puts total winter wheat area at 35.28 million acres, down 1.418 million acres from last season. In Prospective Plantings (28 March), USDA placed 2024/25 winter wheat plantings at 34.14 million acres, fractionally (<1%) down from its previous projection in January. USDA’s first Crop Progress report of the season (01 April) rated 56% of the winter wheat crop as good or excellent, much higher than last year’s 28% for the category.

Very cold temperatures dominated the second half of March for key hard red winter (HRW) wheat areas of the Plains and the soft red winter (SRW) wheat belt across the Upper Midwest, posing some spring freeze concerns after crops were pulled out of dormancy earlier than expected. Any damage potentially inflicted by the abnormally cold weather must have been marginal, however, as the coldest temperatures below the spring freeze threshold (24 °F for two hours or more) were focused mostly across the northern Plains and northwestern parts of SRW wheat belt, relatively minor crop regions. These areas, plus major producing areas of the Upper Midwest and central Plains are rather expected to receive plentiful precipitation later this week and next week amid warm weather, promising a positive yield outlook.

Malaysia Palm Reserves Seen at 8-Month Low on Strong Exports

  • Survey shows inventory down for 5th month to 1.76 million tons
  • Shipments rose on strong festival season demand, analyst says

Palm oil stockpiles in Malaysia probably slumped to the lowest level since July as a surge in festival-season buying offset improving production in the world’s second-biggest grower.

Inventories dropped 8.3% in March from a month earlier to 1.76 million tons, according to the median forecast of 12 plantation executives, traders and analysts surveyed by Bloomberg. That would be a fall of almost 30% since October. Inventories likely dropped, despite expectations of an increase in production, as Malaysian exports and local consumption stayed strong, said Anilkumar Bagani, head of research at Mumbai-based Sunvin Group.

Crude palm oil output increased 8%, the first monthly advance since October, to 1.36 million tons, according to the survey. Exports soared 21% to 1.23 million tons as traders stocked for Ramadan and Eid al-Fitr. Cooking oil consumption generally rises during the major Muslim festivals as people prepare treats such as biryani, deep fried pancakes, cookies and sweets.

Exports were strong in March due to Ramadan and as major destination markets, especially India, had low vegetable oil stockpiles, better import margins and a shortage of soybean oil, Bagani said.

Benchmark palm oil eased 0.2% to 4,398 ringgit ($928) a ton by the midday break on Thursday, a day after worries about shrinking supplies boosted futures to the highest level since November 2022.

The tropical oil may climb as high as 4,500 ringgit in the coming months on tightening supply, veteran trader Dorab Mistry, a director at Godrej International Ltd., said last month.

More From the Survey:

  • Stockpile estimates were in the band of 1.63 million and 1.98 million tons, while production was seen between 1.32 million and 1.43 million tons
  • Export forecasts ranged from 1.17 million to 1.33 million tons
  • Imports are seen climbing to around 40,000 tons, compared with 32,556 tons in February
  • Local consumption figure is likely to be between 250,000 tons and 400,000 tons

Argentina Scraps Wheat-Flour Subsidy by Soy Exporters: Govt

Argentina has ditched a fund whereby soy exporters subsidize domestic wheat flour, the government said in the official gazette.

  • The fund was set up in 2022 using soy export taxes to quell food inflation following Russia’s invasion of Ukraine

 

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