Global Ag News For Jan 22

TODAY—EXPORT SALES—ETHANOL—CATTLE ON FEED—COMMITS—

Overnight trade has SRW Wheat down roughly 12 cents, HRW down 8; HRS Wheat down 9, Corn is down 7 cents; Soybeans down 25; Soymeal down $8.00, and Soyoil down 50 points.

For the week, SRW Wheat prices are down roughly 25 cents; HRW down 11; HRS down 16; Corn is down 14 cents;

Soybeans down 69 cents; Soymeal down $32.00, and; Soyoil up 115 points. Crushing margins are down $0.12 at $0.74 (March); Oil share up 2% at 33%.

Chinese Ag futures (May) settled up 16 yuan in soybeans, down 29 in Corn, down 35 in Soymeal, up 10 in Soyoil, and down 32 in Palm Oil. At

Malaysian palm oil prices were down 5 ringgit at 3,279 (basis April) back to weaker export ideas.

In Brazil, conditions will continue to be mostly good for crops with a few exceptions. The northeast will continue to be too dry through next Thursday. Some increase of rain will be possible in this area in week 2; though, more will be needed. Some pockets in Parana, Santa Catarina, and northern Rio Grande do Sul may become too wet.

In Argentina, a difference remains between the most recent GFS model run and European Model run with rainfall from the Monday and Tuesday event in eastern Cordoba through southern Entre Rios and northeastern Buenos Aires. Last evening’s GFS model showed significant rain in this area and the European Model continued to show shower activity that would be unable to counter evaporation. Confidence is high of it raining significantly in northern Argentina from this event. Southern Argentina will be driest in week 1 of the outlook with rising crop stress; though, partial relief is likely in week 2.          

The player sheet had funds net sellers of 7,000 SRW Wheat; bought 5,000 Corn; net bought 2,000 Soybeans; sold 2,000 lots of Soymeal, and; net bought 5,000 Soyoil.

We estimate Managed Money net long 11,000 contracts of SRW Wheat; long 385,000 Corn; net long 136,000 Soybeans; net long 72,000 lots of Soymeal, and; long 95,000 Soyoil.

Preliminary Open Interest saw SRW Wheat futures up roughly 2,300 contracts; HRW Wheat down 210; Corn up 13,600; Soybeans up 630 contracts; Soymeal up 1,200 lots, and; Soyoil up 1,800.

There were no changes in registrations—Registrations total 49 contracts for SRW Wheat; ZERO Oats; Corn ZERO; Soybeans 169; Soyoil 1,289 lots; Soymeal 175; Rice 732; HRW Wheat 91, and; HRS 1,023. 

Tender Activity—Jordan seeks 120,000t optional-origin wheat—Tunisia seeks 184,000t optional-origin wheat—

Private analytics firm IHS Markit Agribusiness, formerly known as IEG Vantage, on Thursday projected more U.S. plantings of corn and soybeans for 2021 than it did a month ago.

Wire story reports U.S. grain and oilseed producers cheered when the United States signed the Phase 1 trade deal with China a year ago, as it suggested one of their most crucial customers would be back in the American market in a bigger way than ever before. But while the deal delights U.S. farmers and exporters, its short-sighted nature could end up being harmful to domestic users of grain and other commodities, and those effects could ultimately hurt consumers. Cracking down on China’s trade practices was among the top goals of the Trump administration, which set forth the Phase 1 trade deal in January 2020. That deal suggested China’s 2020 U.S. farm imports would rise at least 50% above 2017 levels, and the 2021 target was even more aggressive. President Joe Biden, sworn in on Wednesday, said late last year he would not immediately cancel Phase 1 or the existing trade tariffs, since a deeper review was necessary first. But he has acknowledged China’s “abusive practices,” including stealing intellectual property and dumping products. Chinese media reported shortly after the U.S. election that Beijing would seek to renegotiate the trade deal with the new president, claiming the agreement favored the United States.

The United States generated more renewable fuel blending credits in December than in November, the Environmental Protection Agency said on Thursday. About 1.15 billion ethanol (D6) blending credits were generated in December, up from 1.14 billion in November. About 447 million biodiesel (D4) blending credits were generated last month, up from 390 million the month prior.

The U.S. Environmental Protection Agency awarded Sinclair Oil Corporation waivers that exempt both its refineries in Wyoming from biofuel blending requirements for the 2019 compliance year making it the only company to have received exemptions for that year so far. The EPA had announced it granted two 2019 waivers to refining facilities on Tuesday night, hours before the departure of the administration of President Donald Trump, but did not identify the recipients. Some 30 other waiver applications for that year remained unanswered. The two waivers went to the 85,000 barrel-per-day Sinclair Wyoming refinery and the 30,000 bpd Sinclair Casper refinery, which is also in Wyoming. The EPA also granted a waiver to a refining facility for the 2018 compliance year, but it was unclear who the recipient was.

China reported an outbreak of African swine fever in the southern province of Guangdong – the country’s first reported cases of the deadly disease in almost three months. African swine fever ravaged the pig herd in China, the world’s top pork consumer, after the first outbreak in mid-2018, killing millions of hogs. The industry has recovered, however, with the herd growing by 31% year-on-year to 406.5 million heads by the end of 2020. The Guangdong outbreak occurred on a farm in Pingyuan county with 1,015 pigs, killing 214 of them, the Ministry of Agriculture and Rural Affairs said in a statement, adding that illegal transportation was the suspected cause.

A new form of African swine fever identified in Chinese pig farms is most likely caused by illicit vaccines, industry insiders say, a fresh blow to the world’s largest pork producer, still recovering from a devastating epidemic of the virus. Two new strains of African swine fever have infected more than 1,000 sows on several farms owned by New Hope Liuhe, China’s fourth-largest producer, as well as pigs being fattened for the firm by contract farmers.

China reported its first cluster of COVID-19 cases among workers in a meat processing plant, raising fears among local consumers who have until now mainly worried about the safety of imported foods. Ten confirmed cases were found in a factory which slaughters 50 million chickens a year in the northeastern city of Harbin and is owned by Thai conglomerate Charoen Pokphand, one of the world’s top poultry producers.

Brazil’s soy output view reduced to 132.4 mln T after early-season drought, planting delays – Agroconsult – Reuters

Argentine soy and corn planting sped forward over the last week, helped by rain that moistened fields parched by months of dry weather, the Buenos Aires Grains Exchange said. More moisture was needed over the short term to ensure good yields for the 2020/21 crop. Some 98.6% of this season’s soy, and 93.4% of corn is planted. To date, 7.8% of prime soy areas are starting critical pod formation period, concentrated toward the center of the country. The region depends on more rainfall over the short term to sustain the improvement registered in the previous days. Earlier-planted corn areas were also going through critical yield formation stages.

Russia wants to curb increases in prices for pasta, eggs and potatoes as authorities are concerned about rising food inflation amid the coronavirus pandemic, the agriculture ministry said on Thursday.

Russia, one of the world’s largest wheat exporters, is trying to stabilise domestic food prices with a wheat export levy, a grain export quota and a series of other measures after President Vladimir Putin criticised the impact of excessive inflation. Rising prices for certain categories of food products require increased attention and monitoring by (Russia’s) regions,” the agriculture ministry said

Kazakhstan’s agriculture ministry is discussing the introduction of a 15% sunflower seed export duty with market players, a Grain Union official said on Thursday. The duty could take effect from April. Domestic sunflower oil prices have surged in Kazakhstan as many growers opted to export.

European wheat fell for a second session on Thursday from a 7-1/2 year high on persistent doubts over how a planned Russian export tax would affect global wheat trade and disappointment that Algeria may source some of its latest tender in Argentina. Benchmark March milling wheat was down 1.3% by 1650 GMT to 231.00 euros a tonne, now well off the high of 240.25 euros hit on Tuesday.

Asia Grains-Australian wheat prices hit seasonal highs as Black Sea supplies tighten – Reuters News

The price of palm oil, used in products from chocolate to toothpaste, is near a decade high and likely to climb further. In Malaysia and Indonesia, sources of roughly 84% of the world’s palm oil, labor shortages caused by the coronavirus pandemic have reduced production, while major consumers China and India are buying more for cooking and manufacturing. Malaysian stockpiles are at their lowest levels in years. The benchmark futures price touched the equivalent of $961 a metric ton earlier this month, the highest since August 2011 and up more than 100% since May.

Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.

ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.                  

A subsidiary of Archer Daniels Midland Company.

© 2024 ADM Investor Services International Limited.

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

Latest News & Market Commentary

Explore the latest edition of The Ghost in the Machine

Explore Now