Global Ag News for Dec 3.24

TOP HEADLINES

Smithfield Foods reduces hog footprint in deal with Murphy Family Ventures

Smithfield Foods, the world’s biggest pork processor, said on Monday it will sell 150,000 female pigs to Murphy Family Ventures.

The deal will further reduce the number of hogs owned by Smithfield as it prepares for a U.S. listing.

Murphy will become one of the largest independent pork producers in the U.S., with the capacity to produce approximately 3.2 million hogs annually for Smithfield’s fresh pork operation, Smithfield said in a statement.

Murphy will assume ownership of 150,000 sows — and the market hogs they produce — that are currently owned by Smithfield, while Smithfield will provide production, feed and transportation services, the statement said.

“Smithfield has evolved over the last 10 years into a more streamlined consumer packaged goods company,” President and Chief Executive Officer Shane Smith said.

“With this agreement, we continue this transformation while ensuring a supply of hogs from a family farming operation.”

The transaction is expected to close by the end of the year, Smithfield said.

Smithfield’s owner, Hong Kong-based WH Group 0288.HK, is seeking shareholder approval for the proposed spin-off of Smithfield and plans to list the business in the U.S.

Last year, Smithfield said it would end contracts with 26 farms in Utah, permanently close 35 farm sites in Missouri and close a plant in North Carolina.

Pork producers lost money last year as pig prices and consumer demand struggled at a time of high costs for labor and other expenses, leading them to cut down supply. This also led to Smithfield reducing hog production and reducing farm operations in Missouri, Utah, Arizona, California and the East Coast. The Virginia-based firm also announced the separation of its European operations.

 

FUTURES & WEATHER

Wheat prices overnight are up 5 3/4 in SRW, up 6 3/4 in HRW, up 7 in HRS; Corn is up 1 3/4; Soybeans up 5 3/4; Soymeal up $1.40; Soyoil up 0.57.

For the week so far wheat prices are up 5 in SRW, up 6 1/2 in HRW, up 3 in HRS; Corn is up 1 1/4; Soybeans up 1 1/2; Soymeal down $2.60; Soyoil up 0.25.

Year-To-Date nearby futures are down 14.1% in SRW, down 18.4% in HRW, down 22.6% in HRS; Corn is down 9.7%; Soybeans down 23.4%; Soymeal down 26.4%; Soyoil down 14.3%.

Chinese Ag futures (JAN 25) Soybeans down 19 yuan; Soymeal down 26; Soyoil down 114; Palm oil up 30; Corn down 27 — Malaysian Palm is up 120.

Malaysian palm oil prices overnight were up 120 ringgit (+2.42%) at 5075.

There were changes in registrations (74 Oats, -22 Soybeans). Registration total: 0 SRW Wheat contracts; 74 Oats; 114 Corn; 400 Soybeans; 369 Soyoil; 891 Soymeal; 105 HRW Wheat.

Preliminary changes in futures Open Interest as of December 2 were: SRW Wheat up 7,451 contracts, HRW Wheat up 8,048, Corn up 3,657, Soybeans up 2,923, Soymeal up 4,977, Soyoil up 7,501.

 

Brazil:  Rio Grande do Sul and Parana:  Scattered showers north Tuesday-Wednesday. Mostly dry Thursday. Scattered showers Friday. Temperatures near to below normal through Thursday, near to above normal Friday. Mato Grosso, MGDS and southern Goias: Scattered showers through Friday. Temperatures near normal through Friday.

Argentina: Cordoba, Santa Fe, Northern Buenos Aires:  Mostly dry through Wednesday. Scattered showers Thursday-Friday. Temperatures below normal through Friday. La Pampa, Southern Buenos Aires: Mostly dry through Wednesday. Scattered showers Thursday-Friday. Temperatures below normal through Friday.

Central/Southern Plains: Mostly dry Tuesday. Scattered showers southeast Wednesday. Isolated showers Thursday-Friday. Temperatures above normal west and below normal east Tuesday, near to above normal Outlook: Mostly dry Saturday. Isolated showers Sunday-Monday. Mostly dry Tuesday-Wednesday. Temperatures above normal Saturday-Monday, near to above normal Tuesday-Wednesday. 

Midwest: West: Mostly dry Tuesday. Isolated snow north Wednesday. Mostly dry Thursday-Friday. Temperatures below normal Tuesday, near to above normal Wednesday, below normal Thursday-Friday. East: Lake-effect snow Tuesday. Scattered showers Wednesday-Thursday. Isolated lake-effect snow Friday. Temperatures below normal through Friday. Outlook: Isolated to scattered showers Saturday-Wednesday. Temperatures above normal west and below normal east Saturday, near to above normal Sunday-Tuesday, near to below normal Wednesday.

 

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

TENDERS

• SOYBEAN SALE: Exporters struck deals to sell 134,000 metric tons of U.S. soybeans to top-importer China for 2024-25 delivery, the U.S. Department of Agriculture said on Monday.
• RICE PURCHASE: South Korea’s state-backed Agro-Fisheries & Food Trade Corp. purchased an estimated 40,000 metric tons of rice to be sourced from the United States in an international tender in late November.
• OFFERS IN RICE TENDER: The lowest price offered in the tender from Bangladesh’s state grains buyer to purchase 50,000 metric tons of rice that closed on Monday was assessed at $459.47 a metric ton CIF liner out. 

PENDING TENDERS

• WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is seeking to buy a total of 111,405 metric tons of food-quality wheat from the United States, Canada and Australia in a regular tender that will close late on Thursday.
• MILLING WHEAT TENDER: Jordan’s state grain buyer issued an international tender to buy up to 120,000 metric tons of milling wheat that can be sourced from optional origins
• RICE TENDER: Bangladesh’s state grains buyer issued another international tender to purchase 50,000 metric tons of rice
• FEED BARLEY TENDER: Jordan’s state grains buyer issued an international tender to purchase up to 120,000 metric tons of animal feed barley.
• DURUM EXPORT TENDER: Turkey’s state grain board TMO issued an international tender to sell and export 100,000 metric tons of durum wheat.
• NON-GMO SOYBEAN TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp. issued international tenders to purchase a total of 70,000 metric tons of food-quality soybeans free of genetically modified organisms, European traders said. Some 20,000 tons are sought in five consignments of 4,000 metric tons each, with a deadline for submissions of price offers on Dec. 10. Another 50,000 tons is sought in two 25,000-ton consignments, with a deadline for submissions of price offers on Dec. 5.

 

 

 

TODAY

Kansas Winter Wheat Rating Rises to 56% Good/Excellent: USDA

Winter wheat conditions in the top-producing US state rose by a percentage point to 56% rated good or excellent in the week ending Dec. 1, according to data on USDA’s website.

• This compares with 40% good/excellent at this time last year
• NOTE: In the previous week, Kansas ratings improved by 6 points to 55% good/excellent

 

US Soybean Crushings at 215.8M Bushels in October: USDA

USDA releases monthly oilseed report on website.

• Crushing 7.1% higher than same period last year
• Crude oil production 8.2% higher than same period last year
• Crude and once-refined oil stocks down 1.1% y/y

 

US Corn Used for Ethanol at 460.5M Bu in October

The following is a summary of US corn consumption for fuel and other products, according to the USDA.

• Corn for ethanol was 0.4% lower than in October 2023
• DDGS production rose to 1.87m tons

 

US Inspected 936k Tons of Corn for Export, 2.088m of Soybeans

In week ending Nov. 28, according to the USDA’s weekly inspections report.

• Wheat: 296k tons vs 365k the previous wk, 188k a yr ago
• Corn: 936k tons vs 1,009k the previous wk, 1,176k a yr ago
• Soybeans: 2,088k tons vs 2,117k the previous wk, 1,173k a yr ago

 

US Corn, Soybean, Wheat Inspections by Country: Nov. 28

Following is a summary of USDA inspections for week ending Nov. 28 of corn, soybeans and wheat for export, from the Grain Inspection, Packers and Stockyards Administration, known as GIPSA.

• Soybeans for China-bound shipments made up 952k tons of the 2.09m total inspected
• Colombia was the top destination for corn inspections, Philippines led in wheat

 

StoneX Raises Brazil Soybean Export Estimate for 2024-25 Season

Brazilian exports are forecast to be 103 million tons for current marketing year, 1 million tons higher than November estimate, StoneX says in statement.

• Annual soy production estimate for current year unchanged at record 166.2m tons
• Crop season ending stocks forecast to be 6.10m tons vs prior estimate of 5.62m tons
• Export estimate for 2023-24 season raised to 99m tons — up by 4m tons from prior estimate — due to significant shipped volumes
  • Output estimate raised to 149.8m tons from 149m tons in November
• Corn exports forecast for 2023-24 season at 38.5m tons, up 1m tons from November estimate
  • Corn production forecast at 121.8m ton in 2024-25 crop, down from prior 128.5m ton estimate
    • First corn crop estimate cut due to dryness-related losses expected for southern state, Rio Grande do Sul
  • Exports for 2024-25 forecast to be little changed at 40m tons

 

Brazil Soybean Planting 91% Completed as of Nov. 28: Agrural

The estimated area for the 2024 and 2025 soybean harvest was 91% planted in Brazil as of last Thursday, compared to 86% a week earlier and 85% in the same period of 2023, according to a survey by AgRural.

• Overall, planting advances without major problems in states that still have machines in the fields, and crops have excellent productive potential in most parts of the country
• While the 91% planted in the country is the fastest pace for this time of year since 2018, planting has lost some steam in Rio Grande do Sul due to the lack of rain, says AgRural in a statement

 

Australia Sees Wheat Production Rising 23% in Year to July 2025

Australia’s wheat production is forecast to increase by 23% to 31.9m tons in fiscal year through June 2025, 20% above 10-year average through last June, according to a quarterly government report.

• Output in two largest growing states — New South Wales and Western Australia – is forecast to rebound by 75% and 40%, respectively, Australian Bureau of Agricultural and Resource Economics and Sciences said in crop report
• Chickpea production seen jumping 284% y/y to 1.9m tons, which would be second-highest harvest on record
  • Represents 42% upward revision from September 2024 report and is 141% above 10-year average
• Barley to increase 8% y/y to 11.7m tons, 3% above 10-year average
• Canola output to fall 8% y/y to 5.6m tons, following decrease in total area planted and lower yields due to dry conditions in south-eastern Australia

 

WHEAT/CEPEA: Prices move down at the end of the harvest

While the wheat harvesting is close to the end (there are only 3% left to be harvested in Rio Grande do Sul and 25% in Santa Catarina), purchasers are willing to trade the raw material to produce flour. As the supply and the quality of the product are lower this season in Brazil, the need to import is likely to increase.

In this harvesting scenario, wheat prices are low in Brazil; however, record dollar quotations against Real tend to boost import costs, sustaining domestic prices. In general, liquidity is low in Brazil.

According to data from Cepea, between November 22 and 29, the prices paid to wheat farmers (over-the-counter market) decreased 0.2% in Rio Grande do Sul, 0.23% in Santa Catarina and 1% in Paraná. In the wholesale market (deals between processors), quotations dropped 1.33% São Paulo, 0.64% in Santa Catarina and 1.18% in Paraná, but rose 0.7% in Rio Grande do Sul. Dollar quotations increased 3.37% against Real in the same comparison, at BRL 6.006 on November 29.

In November, the monthly average of wheat prices in Paraná was BRL 1,429.98 per ton, stable against October/24, but increasing 7.4% in relation to that in November/23, in real terms (IGP-DI). In Rio Grande do Sul, the average was BRL 1,265.61/ton, 1.1% down in one month and -0.3% in one year. In São Paulo, prices averaged BRL 1.584.73/ton, +3.2% and +23.6% in the same comparisons. As for Santa Catarina, the average was BRL 1,426.82/ton in November, moving down 1.5% compared to October/24, but increasing 2.6% against that in the same month last year.

 

India’s winter expected to be warmer, threatening wheat yields

India is likely to see above-average temperatures during the winter season, the state-run weather office said on Monday, raising concerns about the yields of crops such as wheat and rapeseed.

India is expected to experience above-normal minimum and maximum temperatures from December to February, with fewer “cold wave days expected”, the India Meteorological Department said in a statement.

Winter-sown crops such as wheat, rapeseed, and chickpea are planted from October to December and need cold weather during their growth and maturity stages for optimal yields.

Lower production could force the world’s biggest wheat producer after China to import the staple to ensure affordable supplies for its 1.4 billion people, and also to increase imports of pulses and edible oils.

So far, New Delhi has resisted calls for wheat imports despite record-high prices, aiming to avoid upsetting farmers.

In the past few years, it has become clear that temperature matters far more than other factors when it comes to wheat yields, said a Mumbai-based trader with a global trade house. Hot and unseasonably warm weather hit India’s wheat output in 2022 and 2023, leading to a sharp drawdown in state reserves.

Wheat prices hit a record 32,000 rupees per metric ton in Delhi last week, up from 25,000 rupees in April and far above the government-fixed minimum support price of 22,750 rupees for last season’s crop.

To bring down prices by boosting supplies, India plans to sell 2.5 million metric tons of wheat from its state reserves to bulk consumers such as flour millers and biscuit makers.

 

Zimbabwe Wheat Production Jumps 21% to a Record 563,961 Tons

Winter harvest for 2024 increases from 467,000 tons a year earlier, Agriculture Ministry says in emailed report.

• NOTE: Zimbabwe consumes 360,000 tons of wheat annually
• NOTE: Zimbabwe previously imported wheat from Ukraine and Russia; boosted production following outbreak of conflict between the two nations, with output helped by easing drought conditions

 

Louis Dreyfus Says It’s Selling Russia Assets to Local Company

Louis Dreyfus Co. is in the process of selling its assets in Russia to a local company, chairwoman Margarita Louis-Dreyfus said in an interview.

• Dreyfus is “losing” on the deal because it doesn’t have negotiating power, she said
• Declines to say the name of the buyer
• Companies have not been operational for a year; some papers are not yet signed due to “formalities which are really difficult”

 

Rains bring relief to Argentina’s agricultural heartland

Recent rains across Argentina’s agricultural heartland have brought much-needed moisture to the soil as the planting of corn and soybeans are underway, Rosario’s grains exchange reported on Monday.

Argentina, a key grains exporter worldwide, went through a mostly dry winter and is now facing almost weekly rain fronts as the Southern Hemisphere summer approaches.

Weekend rains fell over the southern region, where the soil had dried out, after largely falling in the north before that, according to the exchange.

Farmers are in the early stages of planting soybeans and corn. The rains have let soybean planting progress smoothly, according to a report from the Buenos Aires Grains Exchange last week.

The Rosario exchange pegs the soybean harvest at 53 million-53.5 million metric tons. It sees the corn harvest yielding 50 million-51 million tons.

Argentina is the world’s third-largest corn exporter as well as a major wheat supplier.  In January, wheat harvesting is expected to wrap up, with the Rosario exchange estimating output at 18.8 million tons.

 

 

 

 

 

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