TOP HEADLINES
No room for record Brazil harvest
The anticipated surge in Brazilian grain production for the 2024/25 harvest is poised to exacerbate the nation’s already significant storage deficit. According to the National Supply Company (CONAB), grain production is expected to reach 322.4 million tonnes, while the Brazilian Institute of Geography and Statistics (IBGE) reports that current storage capacity stands at 222.3 million tonnes—sufficient for only 69% of the projected output. The delayed planting season, which could compress the summer harvest, adds urgency to the situation.
“The storage deficit reached 124 million tonnes in 2024, and this year, it’s likely to increase by at least 5 million tonnes. With a record soybean harvest and a strong corn crop, the scenario could become even more critical,” warns Paulo Bertolini, president of the Sectorial Chamber of Machine and Equipment for Grain Storage (CSEAG) at the Brazilian Machine and Equipment Industry Association (ABIMAQ).
Mr. Bertolini highlights the mismatch between agricultural growth and storage expansion. “Agriculture is growing twice as fast as storage capacity. We would need to invest about R$15 billion annually to expand capacity by 10 million static tonnes per year to keep pace. Currently, we’re investing only half that amount,” he said.
Bernardo Nogueira, CEO of Kepler Weber, the largest grain storage company in Brazil, is closely monitoring developments in Mato Grosso do Sul, Mato Grosso, and Paraná, where soybean production is forecasted to rise by 26.7%, 17.3%, and 12.7%, respectively, compared to the 2023/24 harvest.
“These states are gearing up for a crop unlike anything harvested before, and they already faced logistical stress during the 2022/23 record harvest,” Mr. Nogueira noted. He added that estimated investments in storage infrastructure in these states total R$500 million. He also anticipates significant production increases in Tocantins and Goiás.
Kepler Weber recently announced a record 306 ongoing projects in 2024, with over a third located in Rio Grande do Sul. Nogueira cites robust demand across sectors, including ports, biofuels, cooperatives, and large-scale farms. He points to an Itaú BBA study indicating 22 new or expanded biofuel plants in the pipeline, representing R$20 billion in investments.
“We are seeing numerous investment announcements in Matopiba [the confluence of Maranhão, Tocantins, Piauí, and Bahia], Goiás, Mato Grosso, and Rio Grande do Sul. Despite expectations that falling soybean prices would temper farmer demand, the opposite has occurred— demand in 2024 exceeded 2023 levels, and we now believe this represents a new normal,” said Mr. Nogueira.
For 2025, Mr. Nogueira anticipates robust demand coupled with cost pressures. He also points to challenges such as declining profitability and persistently high interest rates across the sector. “Indebtedness has risen throughout the Brazilian agribusiness chain. Our default rate remains low at 0.5%, and it hasn’t increased during the crisis because many of our clients are well-structured. However, the rise in court-supervised reorganization signals a tighter market, with customers increasingly seeking discounts to finalize deals,” he explains.
GSI, which was acquired by private equity firm American Industrial Partners (AIP) from AGCO in July 2024 for $700 million, has also noted a rise in interest in storage solutions. “We see an improved outlook as we enter the 2025 cycle,” said Ricardo Marozzin, CEO of Grain & Protein Technologies, the company that owns GSI.
Mr. Marozzin highlights growing demand across all regions, particularly in the South, Matopiba, and Central-West. “We’ve seen a resurgence of requests for quotations and investments, especially from large cooperatives, trading companies, and biofuel industries,” he noted. Although he declined to share specific figures, Mr. Marozzin said GSI anticipates “double-digit growth” in Brazil this year, following a flat performance in 2024 compared to 2023.
Mr. Bertolini of BIMAQ criticized the bureaucratic hurdles that complicate access to credit for on-farm storage construction. “With R$2 million or R$3 million, a producer can build a basic storage structure— roughly the cost of some tractors. Yet, while buying a tractor requires only a bank guarantee, building a silo demands an environmental license, an installation license, an operating license, and a land mortgage. These layers of bureaucracy make financing more expensive and time-consuming,” he argued.
“Without adequate field structures, trading companies and industries absorb the costs of receiving and storing production, which ultimately makes the end product more expensive by embedding inefficiency into the price,” he added.
FUTURES & WEATHER
Wheat prices overnight are down 1 1/2 in SRW, down 2 1/4 in HRW, down 3 1/4 in HRS; Corn is down 2 1/4; Soybeans down 1 1/4; Soymeal down $1.90; Soyoil down 0.29.
For the week so far wheat prices are up 12 3/4 in SRW, up 7 in HRW, up 6 in HRS; Corn is up 3 3/4; Soybeans up 26 1/2; Soymeal up $7.60; Soyoil up 0.12.
For the month to date wheat prices are down 8 in SRW, down 1/2 in HRW, down 5 1/2 in HRS; Corn is up 15 3/4; Soybeans up 41 1/4; Soymeal down $11.00; Soyoil up 5.34.
Chinese Ag futures (MAY 25) Soybeans up 43 yuan; Soymeal up 44; Soyoil up 74; Palm oil up 26; Corn up 12 — Malaysian Palm is down 57.
Malaysian palm oil prices overnight were down 57 ringgit (-1.27%) at 4443.
There were no changes in registrations. Registration total: 20 SRW Wheat contracts; 72 Oats; 6 Corn; 262 Soybeans; 1,116 Soyoil; 1,466 Soymeal; 105 HRW Wheat.
Preliminary changes in futures Open Interest as of January 13 were: SRW Wheat down 2,405 contracts, HRW Wheat up 1,692, Corn up 53,499, Soybeans up 1,730, Soymeal up 6,282, Soyoil up 1,877.
Brazil: Widespread wet season showers continue in central and northern Brazil, favorable for filling soybeans, but hampering the very early harvest. The main harvest period does not start for at least another week, so the rain is overall favorable. However, if rainfall continues to be heavy for the end of January and into February, it may have more of an impact on harvesting soybeans and planting safrinha corn. Showers across the south have been much less frequent, which has been a problem for filling soybeans in Mato Grosso do Sul and Parana and pollinating to filling corn in Rio Grande do Sul. A couple of fronts moving through this weekend are looking to bring more widespread precipitation.
Argentina: Soil moisture is falling in many areas of Argentina with very little showers and temperatures well above normal in the 90s and 100s, leading to declining crop conditions. We may see a burst or two of showers moving through later in the week and weekend, but any heavy amounts may be limited. Models disagree on the amount of precipitation that is expected to fall.
Northern Plains: Light snow continues for Monday but it should be drier and warmer for most of the week until another front moves through on Friday. Scattered light snow will occur behind the front over the weekend, but very cold air will move in as well, lasting well into next week.
Central/Southern Plains: A few light showers moved through over the weekend, but most areas were dry. A front and system will move through Friday and Saturday, bringing scattered showers, but also another burst of very cold air. Exposed wheat areas may see some winter kill from this burst of cold that should last well into next week.
Midwest: Lake-effect snow lasts through Tuesday and a system will move through with light snow on Tuesday as well. Temperatures will rise this week, especially in the northwest. But a system moving through this weekend should bring through a burst of more showers as a mix of rain and snow and will be followed by a burst of extremely cold air through most of next week.
Lower Mississippi: Water levels remain above the low-water mark in most of the Mississippi and Ohio River systems, making for mostly easy transportation. Northern areas of the Mississippi Basin are getting drier though, and could use some precipitation to keep water levels up. A system moving through this weekend could help that out some.
The player sheet for Jan. 13 had funds: net buyers of 6,000 contracts of SRW wheat, buyers of 13,500 corn, buyers of 17,500 soybeans, buyers of 8,500 soymeal, and buyers of 2,000 soyoil.
TENDERS
- SOYBEAN SALE: The U.S. Department of Agriculture confirmed private sales of 198,000 metric tons of U.S. soybeans to China for shipment in the 2024/25 marketing year.
- CORN TENDER: Taiwan’s MFIG purchasing group has issued an international tender to buy up to 65,000 metric tons of animal feed corn which can be sourced from the United States, Argentina, Brazil or South Africa.
PENDING TENDERS
- WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is seeking to buy a total of 132,888 metric tons of food-quality wheat from the U.S., Canada and Australia in a regular tender that will close late on Thursday.
- RICE TENDERS: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 metric tons of rice, with price offers due by Jan. 1
- 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.
- BARLEY TENDER: Jordan’s state grains buyer issued an international tender to purchase up to 120,000 metric tons of animal feed barley.
TODAY
US Inspected 1.441m Tons of Corn for Export, 1.35m of Soybeans
In week ending Jan. 9, according to the USDA’s weekly inspections report.
- Corn: 1,441k tons vs 877k the previous wk, 956k a yr ago
- Wheat: 289k tons vs 412k the previous wk, 242k a yr ago
- Soybeans: 1,350k tons vs 1,295k the previous wk, 1,280k a yr ago
US Corn, Soybean, Wheat Inspections by Country: Jan. 9
Following is a summary of USDA inspections for week ending Jan. 9 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 543k tons of the 1.35m total inspected
- Japan was the top destination for corn inspections, Mexico led in wheat
Rabobank Sees Brazil Sugar Area Down; Corn Unchanged
Brazil is set for a shrinking of its sugar-cane harvested area in the upcoming crop year following earlier impacts of drought, while winter corn acreage is seen stable versus the prior season, Rabobank analysts say in report.
- Sugar-cane harvest in 2025-26 seen at 590m tons, down from 612m tons already harvested in the current season
- Sugar output at top producing region of Center-South projected at 41m tons
- Amount of cane juice used for sugar seen at 52%, up from 48.2% this season through December
- Planted area for winter corn crop seen unchanged from prior season as currency depreciation improved farmers’ margins
- Total corn production in 2024-25 estimated at 126m tons, up by 1m ton from previous estimate from October
- Beef production expected to decline as much as 6% in 2025 due to lower cow stocks in Brazil, reduced slaughter numbers
AgResource trims Brazil’s 2024/2025 total corn crop estimate
AgResource on Monday trimmed its estimate for Brazil’s 2024/2025 total corn crop by less than 1%, citing delays in soybean harvesting as affecting the outlook for country’s key second corn crop.
The second corn crop is planted after soybeans are harvested on the same fields, and represents around 70% to 75% of total corn production in Brazil.
Delays in the soybean cycle may reduce the ideal planting window for the second corn crop.
Brazil’s total corn crop estimate stands at 122.39 million metric tons, slightly lower than the 123.56 million tons previously forecast, AgResource said.
Farmers across the nation have harvested 0.3% of the soy area, down from 2.3% a year ago, according to AgRural data.
Recent rains are disrupting soy harvesting in some regions of central Brazil. In top agriculture state Mato Grosso, farmers are reaping their soy at the slowest pace in seven years, consultancy AgRural said.
AgResource also slightly upped its estimate for the soybean crop, from 170.04 million tons to 172.07 million tons.
“The risk of La Niña has returned and its impacts could affect the quality of soybean crops, especially in the later or replanted areas,” AgResource said. “However, the advance of the rains over the central-northern region of Brazil could help offset possible losses in some states and regions,” it added.
Brazil 2024/25 Soybean Harvest Starts, 0.3% Done: AgRural
Harvest has started in three states in Brazil’s center-south region, and also in Parana and some areas in Bahia and Minas Gerais states, according to an emailed report from AgRural.
- Harvest is 0.3% completed as of Jan. 9, compared to 2.3% a year earlier
- Summer corn harvest in the center-south is 1.3% completed, which compares to 5.1% a year earlier
- Winter corn planting is starting slow, as the soybean harvest advances at a slow pace
- AgRural to release updated estimates for soybean, corn crops before the end of January
Palm Oil Exports from Malaysia Seen Rising 2.4% in 2025: MPOB
Shipments from the world’s second-biggest grower Malaysia are expected to rise to 17.3m tons this year, according to Ahmad Parveez Ghulam Kadir, director general of the Malaysian Palm Oil Board.
- Exports surged 11.7% year-on-year to 16.9m tons in 2024, he said in presentation slides at a seminar in Kuala Lumpur Tuesday
- Palm oil output may rise to 19.5m tons in 2025
- Climbed 4.2% from a year earlier to 19.34 million tons in 2024
- Revenue from palm oil shipments totaled 109.33b ringgit last year; +15.1% y/y
- May increase to 120b ringgit in 2025
- The plantation area was at 5.61m hectares in 2024
- Stockpiles seen at 1.6m tons at the end of 2025
- CPO price expected to average between 4,000 ringgit and 4,300 ringgit per ton this year
Russia’s grain shipments for export fell 5.4% in July-Dec 2024 to 34.3 mln tonnes – expert
Russia exported 34.257 million tonnes of major grain and legume crops in the first half of the current agricultural year (July-December 2024), down 5.4% from the first half of the previous season (36.209 million tonnes), according to monitoring by the Russian Grain Union.
Wheat shipments increased 0.7% to 30 million tonnes, barley shipments fell 27% to 2.9 million tonnes and corn shipments dropped 46% to 1.284 million tonnes, head of the union’s analytical department Elena Tyurina told Interfax.
“If we base [calculations] on the annual grain export potential of 56 million tonnes, including 46 million tonnes of wheat, as of January 1, 61% of the grain export potential and 65% of the wheat export potential have been shipped. Thus, according to the union’s assessment, the export potential for the second half of the season is 21.7 million tonnes of grain, including 16 million tonnes of wheat,” Tyurina said.
The primary buyer of Russian wheat was Egypt in the first half of the season, she said. The country received 6.348 million tonnes, 48.5% more than a year earlier. Bangladesh ranked second, with shipments matching the level of the first half of last season at 2.652 million tonnes. Algeria came third with 2.231 million tonnes, up 2.6% year-on-year. Wheat shipments to Turkey fell 47.5% to 2.137 million tonnes. Rounding out the top five was Israel, which received 1.454 million tonnes, 16.8% more than in the first half of the previous season.
There was significant growth in shipments to African countries, Tyurina said. Shipments to Kenya increased 46% to 1.386 million tonnes, to Morocco 2.7-fold to 1.187 million tonnes and to Nigeria 3.6-fold to 1.072 million tonnes. Exports to Angola rose 3.3-fold, to Tunisia nearly 1.8-fold and to Tanzania almost 1.6-fold.
In addition, nearly 1.1 million tonnes were exported to Saudi Arabia, up 6%, and 624,000 tonnes were shipped to Sri Lanka, which did not receive any shipments last year.
Exports to Latin America declined, with shipments to Mexico down 27% and to Brazil 41%.
Overall, wheat was shipped to 56 countries compared to 72 a year earlier. The number of exporting companies dropped to 120 from 206 in the first half of the previous season. Fifteen leading companies accounted for 81% of all wheat exports, she said.
India’s 2024-25 Soybean Output Seen Rising 6% Y/y to 12.58M Tons
Production in the South Asian nation is forecast at 12.58 million tons in 2024-25, compared with about 11.87 million tons a year earlier, according to the Soybean Processors Association of India.
- Arrivals in the domestic market fell to 4.6m tons in three months ended Dec. 31, from 5.2m tons a year ago
- Soybean meal output dropped to 2.4m tons during the three-month period, from 2.8m tons
- NOTE: The oilseed is grown during the June-September monsoon season, while harvesting begins in October
India Dec. Vegetable Oil Imports Fall to 1.23m Tons: SEA
India’s vegetable oil imports fell to 1.23m tons in December from 1.63m tons in November, according to the Solvent Extractors’ Association of India.
- Palm oil imports fell to 500,175 tons from 841,993 tons in November
- Soybean oil imports rose to 420,651 tons from 407,648 tons in November
- Sunflower oil imports fell to 264,836 tons from 340,660 tons in November
WHEAT/CEPEA: Trades move at a slow pace in Brazil, but imports are firm
The pace of wheat trades is slow in the domestic market, and players say that this scenario is likely to persist up to the end of January. Both purchasers and sellers are unwilling to close deals, in general.
According to data from Cepea, between January 3 and 10, the prices paid to wheat farmers (over-the-counter market) moved down 1.78% in Rio Grande do Sul and 0.78% in Santa Catarina, but rose 0.11% in Paraná. In the wholesale market (deals between processors), quotations upped 0.81% in São Paulo, 0.37% in Paraná and 0.96% in Santa Catarina, but decreased 0.89% in Rio Grande do Sul. Dollar quotations downed 1.36% against Real in the same comparison, at BRL 6.098 on January 10.
As for imports, they continue firm despite high dollar quotations. Data from Secex show that Brazil purchased 520.9 thousand tons of wheat in December. Thus, the volume totaled 6.65 million tons in 2024, against 4.18 million tons in 2023. The amount imported in December/24 was the highest for the month since 2019 and the volume in 2024 was the highest since 2018.
BYPRODUCTS – Comparing the period from January 6-10 with the previous (Dec. 30 to Jan. 3), values of wheat bran increased 0.83% (in bags) and 1.28% (product in bulk).
The USDA indicates that the 2024/25 global season is estimated at 793.238 million tons, 0.3% up compared to 2023/24. The consumption is likely to hit 801.89 million tons, upping 0.5% in the same comparison.
Pertamina Starts Distributing B40 Biodiesel From Two Refineries
Kilang Pertamina Internasional, a unit of state-owned Pertamina, distributed about 9,600 kiloliters of 40% palm-mixed biodiesel from two refineries on Tuesday, the company says in a statement.
Plaju refinery in South Sumatra expected to produce 119,240 kiloliters of B40 per month and Kasim unit in Southwest Papua 15,898 kiloliters per month, according to the statement
Panama Canal traffic rose in Dec, but waterway still has empty slots
- Unfilled slots show some shippers are sticking to other routes
- Canal’s toll revenue increased 26% from fiscal 2020 to 2023
The average number of vessels that passed through the Panama Canal in December increased to 34.2 per day, according to a notice from its authority seen on Monday, but the waterway did not fill all the slots on offer, a sign that some ships continue taking alternative routes.
The canal, the world’s second busiest and the only interoceanic way that operates with freshwater, between August and September lifted passage restrictions following a severe drought that forced a limit to daily transits and vessel drafts.
The Panama Canal Authority had been expecting a return to the full allotment of 36 transits per day, especially during peak periods, such as the last quarter of the year. But the open slots show many shippers have kept to their alternative routes.
In November, an average of 33.3 vessels transited through the waterway per day, while the average for October was 31.4 ships per day.
The canal’s authority did not immediately reply to a request for comment.
Some vessels, including bulk carriers and liquefied natural gas (LNG) tankers, have continued using alternative routes when the cost of passing through Panama matches the extra fuel they must use to travel around the capes of Horn or Good Hope to transit between the Americas and Asia.
The canal’s increase in passage fees in the last decade, something U.S. President-elect Donald Trump has recently complained about, has been an issue with some commodities producers and shippers, say analysts. Trump recently said he did not rule out using military or economic action to take over the canal.
In the fiscal year that ended in September, the canal reported a 5% decrease in its toll revenue to $3.18 billion, despite large declines in tonnage handled and the total number of vessels that passed through.
Between the 2020 and 2023 fiscal years, the canal’s toll revenue had increased almost 26% to $3.35 billion, according to its annual reports.
The canal has said it expects in this fiscal year to achieve an annual tonnage close to the 511 million tons it handled in 2023, and see up to 12,582 deep-draft vessel transits between the Atlantic and Pacific Oceans.
Australian Ports May See Shipment Delays From Industrial Action
Industrial action at several major Australian ports managed by Qube Holdings Ltd. could see disruption of shipments of grains and other merchandise.
- Workers from the Construction, Forestry and Maritime Employees Union plan to strike at Port Kembla until Jan. 23, the Port of Brisbane until Jan. 15, and at the Port of Melbourne until Jan. 27, with partial stoppages elsewhere, according to a spokesperson from Qube
- The ports manage non-containerized products including grain, cars, machinery, steel and fertilizer
- In mid-2024, Qube offered workers a 18% wage increase, which the union rejected, the spokesperson said
- The Maritime Union of Australia, a division of the CFMEU, remains open to ongoing discussions with the company, it said in a statement on Friday. The union’s membership of more than 1000 workers at Qube’s port sites around Australia voted overwhelmingly in favor of taking action, it said
US Farm Recovery Not Expected Until 2026 as Crop Prices Stay Low
Low crop prices and high costs for seeds and machinery mean a rebound in the American farm sector won’t start until next year, according to an outlook Monday from farm lender AgAmerica.
US net farm income has been in a downturn since hitting a record in 2022, with farmers now struggling to profit in a market awash in ample supplies of corn and soybeans. Growers are also getting less government payments as aid tied to pandemic relief expires.
“Commodity prices are coming off record highs, government support is dwindling and indicators across the board suggest the cyclical nature of agriculture may be steering us toward an economic slowdown,” AgAmerica said in the report. “Economists anticipate a modest recovery starting in 2026.”
The US Department of Agriculture will make its first net-farm income outlook for 2025 next month.
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