Global Ag News for Dec 6.23

TOP HEADLINES

 

FUTURES & WEATHER

Wheat prices overnight are up 6 3/4 in SRW, up 3 in HRW, up 5 1/4 in HRS; Corn is up 1; Soybeans up 4 1/2; Soymeal down $0.10; Soyoil up 0.65.

For the week so far wheat prices are up 37 1/2 in SRW, up 12 1/4 in HRW, up 5 1/2 in HRS; Corn is up 3/4; Soybeans down 24 1/2; Soymeal down $4.30; Soyoil down 1.46.

For the month to date wheat prices are up 42 1/4 in SRW, up 16 in HRW, up 6 1/4 in HRS; Corn is up 2 1/2; Soybeans down 42 3/4; Soymeal down $15.60; Soyoil down 2.35.

Year-To-Date nearby futures are down 22.3% in SRW, down 26.7% in HRW, down 24.7% in HRS; Corn is down 31.5%; Soybeans down 14.4%; Soymeal down 12.2%; Soyoil down 22.8%.

Chinese Ag futures (JAN 24) Soybeans down 8 yuan; Soymeal up 21; Soyoil down 98; Palm oil down 132; Corn up 4 — Malaysian Palm is down 11.  Malaysian palm oil prices overnight were down 11 ringgit (-0.30%) at 3708.

There were changes in registrations (-88 SRW Wheat, -297 Oats). Registration total: 2,858 SRW Wheat contracts; 225 Oats; 660 Corn; 596 Soybeans; 62 Soyoil; 0 Soymeal; 400 HRW Wheat.

Preliminary changes in futures Open Interest as of December 6 were: SRW Wheat down 20,073 contracts, HRW Wheat down 3,068, Corn down 5,891, Soybeans down 3,617, Soymeal down 9,798, Soyoil up 1,546.

Brazil: Some areas of central Brazil continue to see lower rainfall amounts by happenstance. Scattered showers will continue over the country into this weekend, but may be a little more isolated in coverage for central areas. Southern states continue to deal with too much rain this week but may get a better break late this week and into early this weekend before another system arrives by Sunday. These areas need drier weather to drain saturated soils for developing corn and soybeans.

Argentina: A system will produce widespread, light showers Wednesday. With another system moving through this weekend, conditions continue to be mostly favorable for planting and development of corn and soybeans as some of the heaviest rain showers are forecast to miss most of the main growing areas in central Argentina.

Australia: Eastern areas have been much wetter in recent weeks, which has disrupted the wheat and canola harvest, but favored the development of cotton and sorghum crops. Western areas have been drier. Decent rain showers will move through southern areas later this week into this weekend which may be more beneficial for developing cotton and sorghum but continue to disrupt the wheat and canola harvest, which may cause quality concerns as well.

Northern Plains: Dry and seasonably warm conditions are expected Wednesday. Another system will move along the Canadian border Thursday and Friday with scattered rain and snow showers in some areas. A cold front will move through with the system but temperatures behind the front will still be mild or warm for December. Dry conditions will return again this weekend with another weak system possible early next week.

Central/Southern Plains: Mostly dry conditions will continue through Thursday. A cold front will move through on Friday and will develop a system with scattered showers mainly in eastern areas. Dry conditions will likely make a return late this weekend into early next week along with slightly cooler temperatures; however, temperatures will still be relatively mild for December. Southwestern areas could use more soil moisture, but have the winter season to see good precipitation to potentially eliminate drought.

Midwest: A weak clipper moved through the eastern half of the region Tuesday, providing light rain and snow accumulations. Very warm temperatures will flood the region Wednesday and into the end of the week. A cold front will move through Friday and Saturday with some slightly cooler temperatures, but with potential for increased precipitation as well as accumulating snow. If the precipitation occurs, it would help with the remaining drought areas and increases for water levels on the Mississippi River. A weaker clipper system from the Canadian Prairies could drop into the region early next week providing some light precipitation.

Delta: Mostly dry conditions will continue through Thursday. A front will come through with potential for widespread precipitation Friday through the weekend, which may help with the drought and increasing water levels on the Mississippi River. There is also a risk for severe thunderstorms across the southern Delta Saturday as the system moves through. Temperatures aren’t expected to cool off much behind the cold front as they will remain near-normal. By early next week, mostly dry conditions will return.

The player sheet for Dec. 6 had funds: net buyers of 1,500 contracts of SRW wheat, sellers of 4,000 corn, buyers of 4,500 soybeans, sellers of 3,000 soymeal, and  sellers of 3,500 soyoil.

TENDERS

• WHEAT TENDER: Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), is seeking wheat in an international purchasing tender. The deadline for offers is Dec. 7.
• WHEAT, SOYBEAN SALES: Exporters sold 372,000 metric tons of U.S. soft red winter wheat to China and 136,000 metric tons of U.S. soybeans to China, all for 2023/2024 delivery, the U.S. Department of Agriculture said.
• WHEAT PURCHASE: Algeria’s state grains agency OAIC is believed to have purchased around 450,000 to 500,000 metric tons durum wheat in a tender that closed on Tuesday
• FEED WHEAT PURCHASE: Leading South Korean animal feed maker Nonghyup Feed Inc. (NOFI) purchased about 65,000 metric tons of animal feed wheat in an international tender.
• FEED CORN PURCHASE: South Korea’s NOFI bought an estimated 55,000 to 68,000 metric tons of animal feed corn in an international tender on Wednesday.
• WHEAT PURCHASE: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) bought a total of 132,504 metric tons of food-quality wheat from the United States, Canada and Australia in a regular tender that closed on Thursday.
• FEED WHEAT, BARLEY TENDER: Japan said it will seek 60,000 metric tons of feed wheat and 20,000 tons of feed barley to be loaded by Feb. 7, 2024 and arrive in Japan by March 7, via a simultaneous buy and sell (SBS) auction that will be held on Dec. 13.

PENDING TENDERS

• CORN TENDER: South Korea’s Korea Feed Association (KFA) had issued an international tender to purchase up to 138,000 metric tons of animal feed corn to be sourced from optional origins
• NON-GMO SOYBEAN TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp issued international tenders to purchase around 20,000 metric tons of food-quality soybeans free of genetically modified organisms (GMOs).
• MILLING WHEAT TENDER: The Lebanese government issued an international tender to purchase 30,000 metric tons of milling wheat
• MILLING WHEAT TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 metric tons of milling wheat, European traders said. The deadline for submission of price offers is Dec. 12.
• WHEAT TENDER: Bangladesh’s state grains buyer issued another international tender to purchase 50,000 metric tons of milling wheat.
• WHEAT TENDER: A government agency in Pakistan issued an international tender to purchase and import 110,000 metric tons of wheat.

TODAY

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 Nov. 30.

• Corn est. range 725k – 2,000k tons, with avg of 1,175k
• Soybean est. range 1,000k – 1,800k tons, with avg of 1,380k

China Soybean Agricultural Imports: Customs

• Soybean imports in Nov 7.92m tons
  • Soybean imports YTD rose 13.3% y/y to 89.625m tons
• Edible vegetable oil imports in Nov. 924,000 tons
  • Edible vegetable oil imports YTD rose 62% y/y to 9.015m tons
• Meat (including offal) imports in Nov. 557,000 tons
  • Meat (including offal) imports YTD rose 1.8% y/y to 6.816m tons
• Fertilizer exports in Nov. 3.403m tons
  • Fertilizer exports YTD rose 30.7% y/y to 29.174m tons

 China Nov soybean imports up 7.8% on year, less than expected

China imported 7.92 million metric tons of soybeans in November, customs data showed on Thursday, rising 7.8% from a year earlier but lower than traders’ expectations due to slower clearing of cargoes at customs.

The world’s top importer of soybeans was expected by some traders to bring in as much as 10 million tons last month, after large purchases of the oilseed from top supplier Brazil.

However customs is taking longer to issue import licences than before, which has delayed the unloading of cargoes, said Yuyun Chen, trader with Mingsui International（Shanghai) Trading Co.

Soybean vessels require an automatic import licence (AIL) to unload cargoes, which must be issued within 10 working days, but in practice have often been granted in a day.

Chen said customs was now taking up to 10 days to process the licences. Customs did not immediately respond to a fax seeking comment.

For the first 11 months of the year, imports by the world’s top soybean buyer totalled 89.63 million tons, up 13.3% from the same period a year earlier, the data also showed.

Arrivals in December could jump as last month’s delayed cargoes get unloaded, said Chen.

“Soybean arrivals in December will probably jump sharply unless the delays get worse,” he said.

Brazil has dominated shipments to China this year but arrivals of U.S. soybeans may rebound in the coming months as China has ramped up purchases since November in a wave of buying amid improving ties between the two countries.

The interest in U.S. beans has also coincided with a severe drought in Brazil that has disrupted planting and compromising the outlook in the world’s biggest soybean grower.

 China November meat imports at 557,000 tonnes – customs

China, the world’s top meat buyer, imported 557,000 tonnes of meat in November, up 0.9 % on prior month, General Administration of Customs data showed. Meat imports for January to November were 6.82 million tonnes, up 1.8% on a year ago.

Russia could repeat its record 29-mln tonne oilseed harvest this season -IKAR

This season, Russia could repeat last year’s 29-million tonne record oilseed harvest, Dmitry Rylko, Director General of the Institute for Agricultural Market Studies (IKAR) said.

“During the season, we quite radically revised our vision of the oilseed harvest this year and now we think it will be nearly the same as last year’s record-setting season, that is, approximately 29 million tonnes,” Rylko said at the Pig Breeding 2023 conference on Wednesday in Moscow.

Meanwhile, he clarified that “two local records may occur. This is sunflower, the harvest of which will reach 16.5 million tonnes, and maybe more, and, the main thing for livestock farmers, soybeans, which will most likely see a 7-million tonne harvest, which has never happened before,” the head of IKAR said.

Last season, Russia’s sunflower harvest totaled 16.4 million tonnes, while soybeans reached 6 million tonnes, Rosstat data show.

“As a result, if all this is processed, we will get a very serious increase in the production of soybean and sunflower meals and cakes, which should seriously please pig farmers. There will be some reduction in rapeseed,” Rylko said.

Production of sunflower meal and cake this season may increase to 6.3 million tonnes from 5.9 million tonnes in the past, while meal and cake from soybeans could reach 4.7 million tonnes against 4.3 million tonnes. The total production of meal and cake is projected at 12.9 million tonnes compared to 12.1 million tonnes the previous season, Rylko’s presentation said.

At the same time, he noted that these products are in high demand on the world market and are intensively exported. “But if this season the Russian Federation exports approximately 4.2 million tonnes, then 8.7 million tons will still remain on the domestic market. This would be a record; it also has never happened before,” he said.

Last season, the export of meal and cake totaled 3.7 million tonnes, the presentation said.

Rylko also drew attention to “a very important point this season -the quality of the soybean harvest in the European part of Russia. All soybeans are conventionally divided into two categories – those with low protein and those with high protein. Now processors still have the resource and process soybeans with high protein, but there are a lot of soybeans with low protein,” he said, noting that “no one is interested” in buying meal made from those soybeans.

As for pricing on the meal market, Rylko said that there most likely should not be any radical changes unless there are strong fluctuations in the ruble exchange rate, which affects soybean meal most of all.

Ukraine’s Danube port infrastructure hit by Russian drones, driver killed – governor

A driver was killed and grain infrastructure damaged by a Russian drone attack on Ukrainian grain infrastructure near the Danube River, the governor of Odesa region said on Thursday.

The governor said the drones attacked over two hours overnight, and that while most were shot down, some got through, damaging a storage building, an elevator and trucks.

Brazil 2023 soy, corn exports to be record – Anec

Brazilian exporters will send record volumes of both soybeans and corn to export markets in 2023, according to projections released on Wednesday by trade group Anec based on shipping schedules until the end of the year.

Brazilian corn exports are expected to reach 55.94 million metric tons in 2023, compared with 44.7 million tons in 2022, while soybean exports are estimated at 101.1 million tons, up from 77.8 million in 2022, said the association that represents large grains traders including Cargill and Bunge.

Brazil 2023 soy, corn exports to be record despite Amazonian drought – Anec

Brazilian grain traders will export record volumes of both soybeans and corn in 2023, according to projections released on Wednesday by trade group Anec that reflect a bumper crop and strong demand from China.

Brazilian corn exports are expected to reach 55.95 million metric tons in 2023, a 25% increase from last year’s level, which was already a record, despite logistics problems caused by a severe drought that slowed grain traffic through Brazil’s northern routes in the fourth quarter.

Anec, which represents global grains traders operating in Brazil, also predicted soybean exports will reach an unprecedented 101.2 million tons, up some 30% from 2022 and almost 17% higher than 2021’s previous export record of 86.6 million tons.

“For the first time, a simultaneous record was broken for both soybean and corn shipments,” Anec director Sergio Mendes said in a statement to Reuters. “The expectation is that we will close this year surpassing previous records for these grains by 25 million tons, with 14 million tons more for soybeans and 11 million tons more for corn.”

Mendes admitted that the drought hitting Amazon rivers caused some setbacks.

Anec said, however, it was not possible to quantify the extent of the problem as shipping volumes held steady throughout the year, including when the drought lowered river levels in the north.

Navigation on some Amazon river tributaries, often tricky in the dry season, become especially difficult this year, threatening northern export routes that spurred Brazil’s export competitiveness over recent years.

On the Madeira River, for example, the government said in October barge routes between Porto Velho and Itacoatiara, where firms as privately owned Amaggi operate, were functional but barge loads had to be reduced as a precautionary measure.

Similarly on the Tapajos, barge traffic was disrupted for a time, leading Brazilian grain exporters to divert a small number of export cargos to southern port terminals, Anec said at the time .

Continued sowing delays amid unfavorable weather conditions cut Brazil soy production – Refinitiv Commodities Research

2023/24 Brazil soybean production is further decreased by 4% to 152.2 [141.7–160.9] million tons, reflecting adverse impacts from abnormal warmth/dryness and continued sowing delays in key areas of the Central-West and the Southeast, despite recent improvements. Our current median estimate is 10.8 million tons below the USDA’s World Agricultural Outlook Board (WAOB)’s 163 million tons, which assumes soybean sowings at 45.6 million hectares and national level yield of 3.58 tons per hectare (tph) (vs. LSEG Ag Research’s 46 million hectares and 3.31 tph, respectively). Brazil’s agriculture state agency (CONAB) has lately pegged soy production and area at 162.4 million tons and 45.3 million hectares, respectively.

As weather continues mixed across the major producing areas, the past two weeks featured once again overall below average (30-60 mm below normal) rainfall in Mato Grosso and Mato Grosso do Sul (i.e. the two key soybean and second corn crop regions), while great surpluses (20-80 mm above normal) were received predominantly in Paraná, Santa Catarina, and Rio Grande do Sul. Temperatures were 3-7 °C warmer than normal in the majority of the Central-West and Southeast, while the South remained near to slightly below normal. The current soil moisture levels are hovering around 6-year lows in the Central-West (where more than half of total soybeans are grown), while they are at least 6-year highs in the South (where nearly 30% of the total crop resides). Such an extreme contrast in weather conditions for an extended period of time during the crucial prime planting season is already undermining the overall yield potential, as this unfavorable uneven weather pattern is likely to continue at least through the end of the month.

As of 02 December, Brazil’s soybeans are only 83.1% planted nationally according to the latest CONAB crop progress report (04 December), still behind last year’s pace of 90.7% and the 4-year average of 88%. Farmers may have to replant soy fields unless weather conditions improve significantly (which does not seem likely), as the Central-West (Mato Grosso in particular) is in urgent need of water supply while the South (Paraná and Rio Grande do Sul in particular) is suffering from excessive moisture and flooding risks. The LSEG Weather Research team’s December-February outlook indicates slightly improved conditions during the prime growth period in terms of both temperature and precipitation, but even in the best case scenario the early season delays will likely cause at least some degree of growth curve shift, forcing crops to miss their ideal development windows and hence lowering yield, warranting attention.

Brazil corn production down again amid first corn delays and gloomy second crop outlooks – Refinitiv Commodities Research

2023/24 Brazil corn production is  further decreased by 2% to 118.1 [106.4–129.2] million tons, reflecting adverse impacts from excessive moisture in key first crop areas of the Southeast/South, and potential second crop cycle disruptions caused by the current delays in soybean crop progress throughout the Central-West amid hot and dry weather. Our current median estimate is 10.9 million tons below the USDA’s World Agricultural Outlook Board (WAOB)’s 129 million tons, which assumes total corn sowings at 22.9 million hectares and national level yield of 5.63 tons per hectare (tph) (vs. LSEG Ag Research’s 21.6 million hectares and 5.46 tph, respectively). Brazil’s agriculture state agency (CONAB) has lately pegged corn production and area at 119.1 million tons and 21.1 million hectares, respectively.

As weather continues mixed across the major corn producing areas, the past two weeks featured once again overall below average (30-60 mm below normal) rainfall in Mato Grosso and Mato Grosso do Sul (i.e. the two key second corn and soybean crop regions), while great surpluses (20-80 mm above normal) were received predominantly in Paraná, Santa Catarina, and Rio Grande do Sul (i.e. the top three first corn producers). Temperatures were 3-7 °C warmer than normal in the majority of the Central-West and Southeast, while the South remained near to slightly below normal. The current soil moisture levels are hovering around 6-year lows in the Central-West (where more than half of second corn is grown), while they are at least 6-year highs in the South (where many key first corn areas reside). Such an extreme contrast in weather conditions for an extended period of time during the crucial prime planting season is already undermining the overall yield potential, as this unfavorable uneven weather pattern is likely to continue at least through the end of the month.

As of 02 December, Brazil’s first corn is 60% planted nationally according to the latest CONAB crop progress report (04 December), behind last year’s pace of 71.2% and the 4-year average of 70%. Soybean sowing pace has picked up greatly in recent weeks, but still only 83.1% of the crop planted so far, behand last year’s 90.7% and the 88% four-year average, warranting attention. Critically, further delays in soy crop progress could leave a significant portion of the second safrinha corn crop to be sown outside the ideal window (hence lowering yield) as the safrinha crop is planted after soybeans are harvested. The second corn accounts for more than 75% of Brazil’s total corn production. Flooding risks and excessive moisture concerns in key first corn areas in the South are another item to watch moving forward.

Argentina corn production down amid early season delays despite recent beneficial rains – Refinitiv Commodities Research

2023/24 Argentina corn production is decreased by 3% to 51.9 [48.0–56.1] million tons, despite improved weather/soil moisture conditions compared to  recent weeks, amid continued early season planting delays. Our current estimate puts planted area at 8.2 million hectares, slightly below 8.5 million hectares reported by Bolsa de Comercio in Rosario, but well above the Bolsa de Cereales in Buenos Aires’ 7.1 million hectares. In November’s WASDE (09 November), USDA placed Argentina corn production at 55 million tons, unchanged from its previous update in October. Bolsa de Cereales in Buenos Aires and Bolsa de Comercio in Rosario currently forecast production at 55 and 56 million tons, respectively.

Since wet weather returned to Argentina’s main Pampas region late October, the overall soil moisture levels in key crop areas of Buenos Aires, Santa Fe, Entre Ríos and Santiago del Estero have improved greatly. These provinces combined account for over 50% of the country’s total corn production, and a healthy start of the season is giving farmers a much-needed relief after months of abnormal dryness. However, the rest of the core producing regions, including the top corn producer Córdoba, are still suffering from lack of moisture despite recent rains, warranting attention. The southeastern areas of Córdoba in particular, have been missing out on the rain and is greatly behind in the sowing as well (on par with last season, which saw a historic delay), mounting concerns albeit still early in the season.

Corn planting is 46% complete so far nationally according to the Ministry of Agriculture, slightly ahead of last year’s 45%, but well behind the five-year average of 56%. Considering last year’s pace around this time was on par with the slowest over the last two decades, the current national-level sowing delay demands close attention. To add insult to injury, the latest long-term outlook by our LSEG Weather Research team suggests that

Sowing delays and dire weather outlooks cut Argentina soy production despite recent improvements – Refinitiv Commodities Research

2023/24 Argentina soybean production is decreased by 4% to 46.5 [41.6–50.9] million tons, despite improved weather/soil moisture conditions compared to recent weeks, amid continued early season planting delays. Our current estimate puts planted area at 16.9 million hectares, below 17.3 and 17.4 million hectares reported by Bolsa de Cereales in Buenos Aires and Bolsa de Comercio in Rosario, respectively. In November’s WASDE (09 November), USDA placed Argentina soybean production at 48 million tons, unchanged from its previous update in October. Bolsa de Cereales in Buenos Aires and Bolsa de Comercio in Rosario both currently forecast production at 50 million tons.

Since wet weather returned to Argentina’s main Pampas region late October, the overall soil moisture levels in key crop areas of Buenos Aires, Santa Fe, Entre Ríos and Santiago del Estero have improved greatly. These provinces combined account for over 60% of the country’s total soybean production, and a healthy start of the season is giving farmers a much-needed relief after months of abnormal dryness. However, the rest of the core producing regions, including the second largest soy producer Córdoba, are still suffering from lack of moisture despite recent rains, warranting attention.

Soybean planting is 46% complete so far nationally according to the Ministry of Agriculture, slightly ahead of last year’s 45%, but well behind the five-year average of 52%. Considering last year’s pace around this time was on par with the slowest over the last two decades, the current national-level sowing delay demands close attention. To add insult to injury, the latest long-term outlook by our LSEG Weather Research team suggests that significant heat/dryness risks may be targeting the central Pampas from December through February, the soy crop’s prime growth period, hinting potentially worsening droughts and resulting yield reductions. In Argentina early soy planting typically ends in December, but second crop soybean (otherwise known as double crop soybeans) planting can occur until January once wheat is harvested. The planting windows for soybeans are narrower than those for corn, which makes November-December weather conditions crucial especially regarding the sowing sequence/pace.

On a side note, as Javier Milei, a strong right-wing oriented liberalist whose election promises include the unification of exchange rates and reduction/elimination of export taxes, wins presidency (19 November) and takes office this Sunday (10 December), some important agriculture-related government policy changes may follow in the future.

Argentina wheat production unchanged with harvest well underway on schedule – Refinitiv Commodities Research

2023/24 Argentina wheat production is unchanged at 14.8 [14.2–15.1] million tons, with harvest progressing on schedule in most crop regions despite recent volatile weather. In November’s WASDE (09 November) USDA placed Argentina wheat production at 15 million tons, down from its previous estimate of 16 million tons in October. Bolsa de Cereales in Buenos Aires and Bolsa de Comercio in Rosario currently forecast production at 14.7 and 13.5 million tons, respectively. Harvest is well underway in most key producing regions, with national level progress at 37% according to the Ministry of Agriculture, largely in line with last year’s 38%. Less rains are in the forecast across Buenos Aires – which has been inundated with heavy precipitation lately – for next week, which should help kick off the harvest campaign in the top wheat producing province.

PRICES REMAIN INCREASING DUE TO GOOD PACE OF EXPORTS AND FIRM DOMESTIC DEMAND

Corn prices moved up in the Brazilian market in November, boosted by the firm pace of exports and high domestic demand. Moreover, sellers were refrained, offering small volumes in the spot market, betting on new valuations – they were also focused on the delay of summer crop sowing activities, which may affect the second crop.

The ESALQ/BM&FBovespa Index (Campinas, SP) closed at BRL 62.74 (USD 12.74)/bag on November 30, the highest value since early May this year – BRL 62.85 (USD 12.59)/bag –, and moving up 4.53% over the month.

According to Secex, Brazilian corn exports reached 7.4 million tons in November, 25.7% up compared to that verified in the same month of 2022.

CROPS – Sowing activities have gained pace over the last days of November, favored by rains in the Central-Western and the Southeastern areas in Brazil and the lower volume of rainfall in the South. According to Conab, 55% of the summer crop area had been planted until November 25, a delay of 13.6 percentage points compared to the crop before.

FAO-AMIS Raises World Wheat, Corn and Rice Stockpile Estimates

• World wheat stockpiles in the 2023-24 season are now seen at 319.3m tons, up from a November estimate of 315.1m tons, according to a FAO-AMIS report published Thursday.
• Production estimate raised on higher output forecasts for Russia, Saudi Arabia and Turkey
• Corn stockpiles seen at 309.1m tons, up from November forecast of 307.2m tons
  • Production estimates seen 4.6% higher than year before
• Rice stockpiles seen at 199.7 tons, up from previous forecast of 198.9m tons
• Soybean stockpiles were cut to 51.8m tons from 53.0m tons on expected stock releases in Brazil and China

Indonesia’s Biodiesel Use Seen at 13.4M Kiloliters in 2024

The figure is based on fuel demand and its growth for next year, according to Dadan Kusdiana, Indonesia’s secretary general at the energy and mineral resources ministry says by text messages on Wednesday.

• Official biodiesel allocation for the B35 mandate in 2024 still pending decision from related ministers’ meeting this week
• NOTE: Indonesia currently requires biodiesel to contain 35% palm oil, a policy known as the B35

EU Grain Exports to Swell by 2035 as Locals Swap Meat for Plants

The European Union will have more wheat and barley to export in a decade, in part because locals are cutting back on meat, requiring less grain to feed livestock herds.

The bloc’s agricultural output is expected to grow more slowly due to climate change-led severe weather events, stricter regulations and lower productivity growth, but changes in consumption patterns will increase export availability, according to a medium-term outlook report published Thursday. The region is one of world’s biggest wheat shippers, while other primary exports include dairy and pork.

“Consumer concerns about impacts of their diets are expected to contribute to lower meat consumption,” the report added. “On the other hand, consumption of some plant proteins could grow.”

Net exports of soft wheat and barley could rise 21% by 2035. Overall oilseed production will get a boost from a 30% jump in the domestic production of soybeans, driven by an increase in demand for the vegetable protein that’s “deforestation-free” and labeled free of genetic modification.

• EU Agricultural Outlook to 2035EU cereal production could rise by 1.4m tons to 281.2 million tons in 2035, with a slight increase in wheat production due to bigger planting area
• Production of oilseeds and protein crops is expected to increase slightly from current levels to 31.8m tons in 2035
• Meat consumption per capita could decline by 1.6 kilograms (3.5 pounds) between now and 2035, and meat production, apart from poultry, is seen continuing to decline

The EU’s efforts to reduce the environmental footprint of its farming and food production industry have stumbled, as farming groups have argued they jeopardize food security. Still, the bloc agreed late last year to set mandatory rules for companies selling commodities including coffee, palm oil and soy to ensure products do not come from deforested land.

Fertilizer Prices Mixed as China Moves to Restrict Exports

Global nitrogen buying eased after India’s latest urea tender, which should sate its appetite until early 2024. US phosphate prices were up slightly on tight supply following a robust fall application season. Exports from China, the nitrogen and phosphate swing supplier, will be curbed through 2Q under a new policy.

NOLA Phosphates, Urea Strengthen

Phosphate prices rebounded at New Orleans (NOLA) and some inland terminals amid reports of tight supply after a heavy fall application season, with NOLA prices rising $5-$15 a short ton (st) from last week. After a month of softening prices, the NOLA urea market bounced to $325-$330/st vs. last week’s $295-$310 on reports of strengthening nitrogen prices in Brazil and Egypt, while inland urea terminals remained under pressure. NOLA potash was down $5/st from last week for the latest trades, though strong fall demand has kept inland warehouse prices at a premium. US ammonia prices were steady, with expectations that spring prepay programs will be announced in mid-December.

Fertilizer Prices Stable to Firm as Demand Picks Up in Brazil

Fertilizer demand has increased slightly in Brazil’s inland markets amid drought relief and improved affordability. Import prices have firmed for nitrogen as demand rises, while remaining stable for phosphates and potash. Inland market prices remain mixed.

Nitrogen Firms in Brazil; MAP, Potash Stable

Urea prices in Brazil jumped 11.9% to $345-$360 a metric ton (mt) cost-and-freight, up from last week’s $310-$320, with offers and bids reported both above and below this range. On the heels of the urea increase, ammonium sulfate prices rallied 9.55% to $165-$175/mt vs. last week’s $150-$165/mt CFR range, though a lack of prompt availability has pushed the next loadings out to mid-January. Monoammonium phosphate (MAP) prices in Brazil edged up $5/mt at the high end of the range to $560-$570/mt vs. last week’s $560-$565. Brazil’s potash market was stable, remaining at last week’s $320-$330/mt with reports of increased demand and healthy supply keeping the market balanced.

 

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