TOP HEADLINES
Crop trader COFCO International signs $600 mln climate-linked loan
Crop merchant COFCO International on Friday announced a $600 million revolving credit facility with OCBC bank involving emissions reductions targets for soy and corn purchases.
COFCO International will be eligible for interest discounts if it achieves the targets, which it aims to do mainly through steps to eliminate deforestation and land conversion from its soy and corn supply chains, it said in a statement.
The firm, the overseas trading arm of Chinese food group COFCO Corp., is one of the world’s largest crop merchants. Like other agricultural traders it has incorporated sustainability targets in some of its financing.
FUTURES & WEATHER
Wheat prices overnight are up 1 3/4 in SRW, up 3 1/4 in HRW, up 5 1/2 in HRS; Corn is up 2 3/4; Soybeans up 7; Soymeal up $4.80; Soyoil down 0.17.
For the week so far wheat prices are down 15 3/4 in SRW, down 8 3/4 in HRW, down 4 1/4 in HRS; Corn is up 1 1/2; Soybeans down 21 1/4; Soymeal up $2.30; Soyoil down 2.73.
For the month to date wheat prices are down 13 1/4 in SRW, up 5 3/4 in HRW, up 1/2 in HRS; Corn is up 10 1/2; Soybeans down 22 1/2; Soymeal down $1.80; Soyoil down 1.82.
Year-To-Date nearby futures are down 14.6% in SRW, down 14.6% in HRW, down 17.9% in HRS; Corn is down 5.9%; Soybeans down 25.0%; Soymeal down 25.3%; Soyoil down 16.7%.
Chinese Ag futures (MAY 25) Soybeans up 16 yuan; Soymeal up 35; Soyoil unchanged; Palm oil down 98; Corn down 3 — Malaysian Palm is down 75.
Malaysian palm oil prices overnight were down 75 ringgit (-1.66%) at 4433.
There were changes in registrations (-22 Soybeans). Registration total: 20 SRW Wheat contracts; 72 Oats; 95 Corn; 205 Soybeans; 879 Soyoil; 1,665 Soymeal; 105 HRW Wheat.
Preliminary changes in futures Open Interest as of December 19 were: SRW Wheat up 12,596 contracts, HRW Wheat up 4,133, Corn up 5,002, Soybeans down 20,489, Soymeal down 9,266, Soyoil down 11,045.
Brazil: Overall good weather conditions continue with scattered wet season showers in central Brazil and fronts continuing to come up from Argentina with scattered showers for southern states. This general pattern is forecast to continue through next week, favoring flowering to filling soybeans and developing corn. Southern areas are getting below-normal amounts, though it is timely.
Argentina: A front that is moving out on Thursday brought isolated showers to the country, but hit the important state of Cordoba with good precipitation. Another couple of fronts will move through this weekend and next week. Precipitation will be spotty and areas are going to be missed, especially in the southeast, and that could lead to other dry areas developing.
Northern Plains: A clipper is bringing through a band of heavier snow Thursday, followed by another quick burst of colder air. Any cold should not last long as warmer air spreads back in again this weekend. The pattern stays active with multiple systems moving through this weekend and next week, but with little precipitation forecast for the region.
Central/Southern Plains: Wheat areas in the west have been drier lately, a continued pattern since a wet November. The pattern may be a little more favorable for precipitation next week as several systems move through with potential for precipitation, mostly in the form of rain with very warm temperatures in the region.
Midwest: A clipper moving through Thursday and Friday is bringing through a band of heavier snow to the north, while also bringing through some briefly colder air and lake-effect snow for the weekend. The pattern stays active next week with several systems moving through. Some drought reduction is possible as temperatures rise well above normal to end the year.
Lower Mississippi: Recent showers in the Mississippi and Ohio Valleys have given a bump to water levels on the river and the pattern is favoring more rain in the basin through next week with several systems and fronts. That should help to give a longer bump to the water levels, removing restrictions for transport across the Lower Mississippi for a while.
Europe: Several waves of systems, fronts, and showers are forecast to move through the continent through early next week, keeping up overly wet soils in the northwest, but maintaining or improving soil moisture for most other areas. Spain is forecast to be on the lighter end, though, and could use more rain.
Black Sea: Wheat went dormant in good condition in the west, but poor condition in the east, particularly in southwestern Russia. The region will hope for good precipitation over the winter for when the wheat breaks dormancy in the spring. Scattered showers fell over the weekend and early this week and a system or two are forecast to move through next week that could be beneficial.
Australia: The pattern continues to be drier to end the year with only limited showers. That helps with the remaining wheat and canola harvest, but will dry out soils for cotton and sorghum after recent rains had improved conditions there.
The player sheet for Dec. 19 had funds: net sellers of 4,500 contracts of SRW wheat, buyers of 6,500 corn, sellers of 7,500 soybeans, buyers of 4,500 soymeal, and buyers of 3,500 soyoil.
TENDERS
- SOYBEAN SALES: The U.S. Department of Agriculture on Thursday confirmed private sales of 227,200 metric tons of soybeans to “unknown” destinations, of which 152,200 tons is for delivery during the 2024/25 marketing year and 75,000 tons is for delivery during the 2025/26 marketing year.
- SOYMEAL PURCHASE: Three South Korean groups purchased a total 180,000 metric tons of soymeal in to be sourced from optional origins in a deal on Thursday
- SOFT WHEAT AND DURUM PURCHASE: Tunisia’s state grains agency is believed to have purchased about 100,000 metric tons of soft wheat and about 100,000 tons of durum in an international tender for the same volume on Thursday
- FEED WHEAT PURCHASE: The TFMA group of animal feed importers in Thailand is believed to have purchased around 100,000 metric tons of animal feed wheat in a tender which closed on Thursday seeking up to 120,000 tons
- WHEAT PURCHASE: South Korean flour mills bought an estimated 86,800 metric tons of milling wheat to be sourced from the United States and 40,000 tons from Canada in an international tender on Thursday
- CORN PURCHASE: Leading South Korean animal feed maker Nonghyup Feed Inc. (NOFI) bought an estimated 136,000 metric tons of animal feed corn in an international tender on Thursday
- CORN PURCHASES: South Korea’s Major Feedmill Group (MFG) purchased an estimated 67,000 metric tons of animal feed corn in a private deal on Thursday without issuing an international tender
- CORN PURCHASE: South Korea’s Feed Leaders Committee (FLC) bought around 65,000 metric tons of animal feed corn in a private deal on Wednesday without issuing an international tender
- CORN PURCHASE: The Korea Feed Association (KFA) in South Korea is believed to have purchased about 67,000 metric tons of animal feed corn in a private deal on Thursday without issuing an international tender
- FEED BARLEY TENDER: Jordan’s state grains buyer has issued an international tender to purchase up to 120,000 metric tons of animal feed barley.
- FOOD WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) bought a total of 77,220 metric tons of food-quality wheat from the U.S. and Australia in a regular tender on Thursday.
PENDING TENDERS
- RICE TENDER: Bangladesh’s state grains buyer has issued an international tender to purchase 50,000 metric tons of rice.
TODAY
US Export Sales of Soybeans, Corn and Wheat by Country
The following shows US export sales of soybeans, corn and wheat by biggest net buyers for week ending Dec. 12, according to data on the USDA’s website.
- Top buyer of soybeans: China with 648k tons
- Top buyer of corn: Mexico with 395k tons
- Top buyer of wheat: Philippines with 83k tons
US Export Sales of Pork and Beef by Country
The following shows US export sales of pork and beef product by biggest net buyers for week ending Dec. 12, according to data on the USDA’s website.
- Mexico bought 4.1k tons of the 17k tons of pork sold in the week
- South Korea led in beef purchases
Argentine Corn, Soy, Wheat Estimates Dec. 19: Exchange
The Buenos Aires Grain Exchange releases weekly report on website.
- 2024-25 corn and soybean area estimates are maintained
- Soybean planting progress advances to 77%
Argentina corn planting resumes in Cordoba after rains
Planting has resumed for the 2024/2025 season in Argentina’s top corn-producing province of Cordoba following recent rains, the Buenos Aires Grain Exchange (BdeC) said on Thursday in its weekly crop report.
Planting had stopped in many towns in Cordoba last week due to low soil humidity, according to the exchange.
“Pulses of humidity over the center and north of the agricultural area have increased surface humidity and allowed satisfactory progress with the incorporation of plots,” the report said, adding that 65.8% of Argentina’s 6.3 million hectares (15.6 million acres) planned for corn have been planted.
Argentina is the third largest corn exporter in the world.
Regarding soybeans for 2024/25, the exchange reported that planting advanced 11.5 percentage points over last week and that 76.6% of the 18.6 million hectares estimated for the current season have been planted.
Argentina is the world’s leading exporter of soybean oil and meal.
Harvesting of the 2024/25 wheat crop has advanced rapidly over the past seven days thanks to dry conditions reported in Buenos Aires province, the country’s main wheat-producing district.
The cereal harvest is 76.1% complete, with an estimated production of 18.6 million tons, according to the report.
China’s Nov soy imports from Brazil falls 25% y/y, US arrivals jump
China’s soybean imports from Brazil shrank 25% in November from a year earlier, while shipments from the United States rose as buyers concerned about rising trade tensions between Washington and Beijing raced to secure supplies.
The world’s largest soybean buyer received 2.79 million metric tons of U.S. soybeans in the month, compared to 2.29 million tons a year ago, according to the General Administration of Customs data on Friday.
China imported a total of 7.15 million tons of soybeans in November.
For the 11 months of 2024, China imported a total of 97.09 million tons of the oilseed, on track for an annual record as U.S exporters rushed to move their shipments before incoming president Donald Trump enters the White House.
Tariff threats from Trump, who will be sworn in on Jan. 20, have sparked fears of another trade war between Washington and Beijing that could halt soybean trade.
Shipments from the U.S, the world’s second largest producer, have been surging since April.
However, despite the decline in Brazilian imports, the majority of China’s imports for November came from the country at 3.94 million tons.
Meanwhile, arrivals from Argentina surged to 242,227 tons from 54,214 tons a year earlier.
For the January-November period, China’s total U.S. soybean imports fell 9% from a year ago to 17.88 million tons.
Total shipments from Brazil during the 11 months rose 10% to 71.7 million tons.
China’s Sinograin has bought nearly 500,000 tons of U.S. soybeans this week for shipment in March and April, paying more for U.S. supplies for state reserves rather than buying cheaper Brazilian beans, two U.S. traders familiar with the deals said.
Sinograin’s latest purchases follow deals China booked last week for around 750,000 tons for shipment from January to March.
China’s state importer books US soy purchases as tariff threat looms
- Sinograin buys 500,000 tons of U.S. soybeans for March-April, traders say
- Sinograin prefers U.S. beans for storage due to quality
- Deals come ahead of inauguration of Trump, who has promised hefty China tariffs
- Purchases may aim to replenish reserves, not political appeasement, analysts say
China’s Sinograin has bought nearly 500,000 metric tons of U.S. soybeans this week for shipment in March and April, paying more for U.S. supplies for state reserves rather than buying cheaper Brazilian beans, two U.S. traders familiar with the deals said.
China is the world’s top soy buyer and a crucial market for both U.S. and Brazilian farmers, who supply the bulk of China’s imports.
The industry is monitoring sales and trade flows to China closely ahead of President-elect Donald Trump’s inauguration on Jan. 20, on concern that another round of tit-for-tat tariffs would erode the value of U.S. soybeans.
Soy prices hit four-year lows this week on trade tensions and amid high U.S. stockpiles and a looming record harvest in Brazil.
Sinograin’s purchases this week follow deals China booked last week for around 750,000 tons for shipment from January to March. Those are modest volumes for Sinograin, China’s state-run grains trader and strategic reserves manager, which typically buys millions of tons at a time, the traders said.
Sinograin prefers U.S. beans when it is buying for storage because they are less prone to spoilage than those from Brazil, traders said.
Sinograin did not immediately respond to a request for comment on Thursday.
That would explain Sinograin paying more for U.S. beans, rather than buying cheaper Brazilian beans that will be abundant during the March-April delivery period, according to market analysts.
Sinograin bought at around 90 cents a bushel over Chicago Board of Trade March futures and 80 cents over May futures on a free-on-board (FOB) basis, according to one trader, around 80 cents to $1 above Brazilian FOB prices for that period.
The purchases come as overall Chinese agricultural imports have slowed. They also come as Brazil, China’s top soy supplier, is preparing to harvest a record crop.
Poor processing margins for turning soy into animal feed and oil are discouraging imports, and tariff threats by Trump have stoked tensions between the two economic powers.
U.S. exporters have been racing to ship soybeans to China before Brazilian supplies hit the market early next year and before Trump takes office.
Imports by private crushers could be subject to any tariffs imposed on U.S. supplies by China in response to Trump’s mooted duties. That would make the soybeans costly. State-run importers, however, are more likely to receive tariff exemptions, traders said.
Chinese purchases of the most recent U.S. soybean crop for shipment through next summer are running about 6% behind last year, compared with forecasts for a mere 2.6% drop in Chinese imports of soybeans, according to U.S. Department of Agriculture data.
The purchases may be intended as an olive branch to trade hawks in the incoming U.S. administration, the traders said. But market analysts said they were more likely intended to replenish the country’s strategic reserves, because the volumes were not big enough to score political points.
“If the Chinese do it for political appeasement it’s millions of metric tons, not a few tons here and there,” said Dan Basse, president of Chicago-based AgResource Co.
The recent purchases were much smaller than other deals viewed as political appeasement, such as the roughly 3 million metric tons purchased in a single week ahead of an APEC summit in November 2023 where relations between China, Taiwan and the U.S. were at the top of the agenda, he said.
The price premium for U.S. beans also suggests China is looking to top off its reserves – and that the buying spree could be short-lived, Basse said.
Volumes in China’s state reserves are a closely guarded secret, although supplies are regularly auctioned off to domestic crushers then refilled with fresh supplies.
“When South America is a dollar a bushel cheaper than the United States, it’s hard to keep doing this,” Basse said.
Unlike private Chinese crushers which are more price sensitive, Sinograin tends to be more focused on soybean quality, said a veteran soy industry executive in China.
“Brazil beans are so easily degraded in storage, never being considered for the reserve program,” the executive said. “Only quantity will tell if the purchases are out of concerns over a possible trade war.”
German Winter-Grain Plantings for 2025 Rise 5.6% Y/y: Destatis
German farmers planted about 4.8m hectares of winter grain for the coming season, according to a statement from the federal statistics office.
- That’s up 5.6% y/y, although plantings were restrained last year by heavy autumn rainfall
- Total includes 2.8m hectares of winter wheat, up 12% y/y
- Farmers also planted 1.1m hectares of rapeseed, up 2.3% y/y
EU 2025 Grain Harvest Seen Up 7% Y/y as Wheat Recovers: Coceral
Next year’s grain production in the EU, combined with the UK is estimated at 297.8m tons, industry group Coceral says in an initial estimate.
- That would be up from 278.5m tons collected in 2024
- Soft-wheat crop seen at 140.4m tons, up from 125.5 tons
- This is “mainly because of a higher area and a return to normal yields in Western Europe after the disappointing crop in 2024”
- Barley harvest expected at 59.7m tons, versus 57.3m tons this year
- Corn crop seen at 61.9m tons, versus 60.2m tons
- Sees a “much higher crop in the Balkan countries, but slightly lower crops in Germany and France”
- Rapeseed crop seen rising to 20.3m tons, versus 18.3m tons
EU Lowers Corn, Barley and Wheat Crop Forecasts for 2024-25
The EU’s total grain production will be 255.8m tons in the 2024-25 season, down from a November estimate of 256.9m tons, the European Commission said in a report.
- Soft-wheat crop estimate cut to 111.9m tons, from 112.3m tons
- Exports outside the bloc forecast at 25m tons
- Barley crop cut to 49.4m tons, from 49.8m tons
- Corn crop slightly lowered to 59.5m tons, from 59.6m tons
Russia Sets Wheat Export Quota at 10.6m Tons Feb. 15-June 30
Russian government sets wheat export quota at 10.6m tons from Feb. 15 to June 30, according to a statement on Telegram.
South Africa 2024 Wheat-Crop Estimate Cut by 0.2%
The expected production of wheat for the 2024 season is 1.935 million tons compared with the previous forecast of 1.94 million tons, South Africa’s Crop Estimates Committee says in a statement.
- Estimates for 2024 is 5.6% smaller than the 2023 harvest
- The area estimate for wheat is 505,300 hectares, of which 73% is planted in the Western Cape province, 10% in the Free State and 8% in the Northern Cape
- Total production of winter crops, which also include barley, canola, oats and sweet lupines, is estimated at 2.7 million tons
US generated fewer renewable blending credits in November, EPA says
The United States generated fewer renewable blending credits in November versus the month prior, data from the Environmental Protection Agency showed on Thursday.
About 1.19 billion ethanol (D6) blending credits were generated last month, compared with about 1.27 billion in October, the data showed.
Credits generated from biodiesel (D4) blending fell to about 732 million in November from about 784 million in October, according to the data.
Second vessel with wheat for Egypt’s GASC leaves Russia
A second shipment of 54,000 metric tons of Russian wheat out of the 430,000 that Egypt bought in September left the port of Novorossiysk on Friday, sources and LSEG shipping data showed.
Russia’s agricultural watchdog confirmed it had issued all the necessary phytosanitary certificates for the wheat shipment.
LIVESTOCK: US Red Meat Production Fell 2.5% Y/y in November
Commercial beef and pork production fell to 4.56b pounds in Nov., according to the USDA’s monthly livestock slaughter report.
- Beef production down 2.7% y/y to 2.22b pounds
- Nov. cattle slaughter totaled 2.57m head, a 5.8% decline from a year ago
- Avg live weight rose by 38 pounds from last year to 1,425 pounds
- Pork production down 2.2% y/y to 2.33b pounds
- Hog slaughter fell 2.6% y/y to 10,844m head
- Avg live weight was 289 pounds vs 289 pounds a year ago
US Miss. River Grain Shipments Rise, Barge Rates Decline: USDA
Barge shipments down the Mississippi river increased to 902k tons in the week ending Dec. 14 from 728k tons the previous week, according to the USDA’s weekly grain transportation report.
- Barge shipments of corn rose 109.8% from the previous week
- Soybean shipments down 15.1% w/w
- St. Louis barge rates were $15.56 per short ton, a decline of $0.08 from the previous week
Australia Says Live Rock Lobster Exports to China Restarted
China has notified Australia on Dec. 20 that full resumption of live rock lobster trade can recommence, according to a statement by the Australian government.
- Australia welcomes this notification
- Says will continue with its “calm and consistent approach to the China relationship”
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