Global Ag News for July 1.22

HEADLINES TODAY

Wheat prices overnight are up 6 in SRW, up 3 3/4 in HRW, up 4 1/2 in HRS; Corn is up 2 3/4; Soybeans down 9; Soymeal down $0.13; Soyoil down 1.03.

For the week so far wheat prices are down 63 1/2 in SRW, down 57 in HRW, down 81 3/4 in HRS; Corn is down 56 3/4; Soybeans up 13 3/4; Soymeal up $1.28; Soyoil down 2.03.

Year-To-Date nearby futures are up 13% in SRW, up 19% in HRW, up 1% in HRS; Corn is up 25%; Soybeans up 24%; Soymeal up 13%; Soyoil up 24%.

Chinese Ag futures (SEP 22) Soybeans down 72 yuan; Soymeal down 15; Soyoil down 362; Palm oil down 450; Corn down 53 — Malaysian palm oil prices overnight were down 207 ringgit (-4.22%) at 4703.

There were no changes in registrations. Registration total: 2,668 SRW Wheat contracts; 0 Oats; 0 Corn; 0 Soybeans; 98 Soyoil; 0 Soymeal; 66 HRW Wheat.

Preliminary changes in futures Open Interest as of June 30 were: SRW Wheat down 676 contracts, HRW Wheat up 245, Corn up 15,804, Soybeans up 152, Soymeal up 5,532, Soyoil up 1,248.

Northern Plains Forecast: Periods of isolated to scattered showers through Monday. Temperatures near to below normal through Sunday, near to above normal Monday. Outlook: Periods of isolated to scattered showers Tuesday-Saturday. Temperatures near to above normal Tuesday-Saturday.

Central/Southern Plains Forecast: Periods of isolated to scattered showers through Monday, mostly north. Temperatures near to above normal through Sunday, above normal Monday. Outlook: Isolated showers Tuesday-Saturday, mostly north. Temperatures above normal Tuesday-Saturday.

Western Midwest Forecast: Periods of isolated to scattered showers through Monday. Temperatures near to above normal through Monday.

Eastern Midwest Forecast: Periods of isolated to scattered showers through Monday. Temperatures near to above normal through Monday. Outlook: Periods of isolated to scattered showers Tuesday-Saturday. Temperatures near to above normal Tuesday-Saturday.

Canadian Prairies Forecast:  And potential for more systems over the weekend and next week will keep the region active. Conditions will continue to be mixed for a while, favoring the west over the east, including with temperatures.

Black Sea Forecast: Heat is increasing in Ukraine and will spread to Russia next week. Showers are becoming very isolated and the hotter and drier conditions are causing more concerns for corn and sunflowers. The weather will be more favorable for maturing winter wheat and harvest, however, as that starts up soon.

Eastern Europe Forecast: A heatwave over eastern Europe will continue into next week, turning what used to be good conditions for spring crops into concerns with declining soil moisture. However, winter wheat and other winter grains should have overall more favorable conditions as harvest starts up. The heat is forecast to break around the middle of next week. Showers across the west are making for better conditions, though long-term dryness is still a concern. Farther south, Spain and Italy remain too hot and dry for summer crops nearing reproduction.

The player sheet for 6/30 had funds: net sellers of 11,500 contracts of  SRW wheat, sellers of 18,000 corn, sellers of 1,500 soybeans, buyers of 1,500 soymeal, and  sellers of 5,500 soyoil.

TENDERS

  • CORN PURCHASE: South Korean animal feed maker Nonghyup Feed Inc. (NOFI) bought an estimated 136,000 tonnes of animal feed corn in a tender which closed on Thursday
  • BARLEY TENDER: Jordan’s state grains buyer issued an international tender to purchase 120,000 tonnes of animal feed barley
  • CORN TENDER: The Korea Feed Association (KFA) has issued an international tender to purchase up to 69,000 tonnes of animal feed corn to be sourced from optional origins

PENDING TENDERS

  • WHEAT TENDER: A government agency in Pakistan issued an international tender to purchase and import 500,000 tonnes of milling wheat
  • WHEAT TENDER: Jordan’s state grain buyer issued an international tender to buy 120,000 tonnes of milling wheat which can be sourced from optional origins
  • SUNFLOWER OIL TENDER: Turkey’s state grain board TMO issued an international tender to purchase about 18,000 tonnes of crude sunflower oil
  • WHEAT TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 tonnes of milling wheat

CROP SURVEY: Analysts See Canada Wheat Planting at 24.7M Acres

Canada 2022-23 wheat area seen about 300,000 acres less than previously expected, according to a Bloomberg survey of seven analysts.

  • That would be a 5.8% increase over the 2021-22 crop
  • Canola area seen at 21m acres vs 20.9m acres, a 6.6% y/y decline
  • Statistics Canada, which made their initial 2022-23 estimates in a report released in April, is scheduled to revise those estimates in a report scheduled for July 5 at 8:30 am ET

Satellite Data Points to Ukraine Wheat Crop at 22.5m Tons: BayWa

Ukraine’s 2022 winter-wheat harvest is seen at 22.5m tons, according to an estimate posted Friday from VISTA Remote Sensing in Geosciences, a subsidiary of German crop merchant BayWa.

  • That would be 17% below the average of the past four years
  • During harvest, which runs through the end of July, it will become clearer how many fields are passable given mines and other metal in some areas, says BayWa CEO Klaus Josef Lutz
    • Any unharvested fields would not only curb this year’s production, but may also be unavailable for autumn sowing
  • VISTA says it reviewed hundreds of thousands of satellite images to make its assessment
  • Winter-barley crop estimated at 2.8m tons and rapeseed at 3.3m tons

EU Cuts Soft-Wheat Crop Estimate to 125M Tons; Also Lowers Corn

The EU’s 2022 soft-wheat harvest is now seen at 125m tons, down from a May estimate of 130.4m tons, according to a European Commission report.

  • Yield prospects waned in several key growers including Romania, France and Poland
  • Soft-wheat export outlook for the 2022-23 season kept steady at 38m tons
  • Barley crop outlook cut to 52.2m tons, versus 52.3m tons
  • Corn crop outlook cut to 71.7m tons, versus 72.5m tons
  • Total grains outlook cut to 286.4m tons, versus 293.8m tons

Argentina Bourse May Cut Wheat Estimate Again Amid Slow Planting

Wheat planting trails last season’s pace by 11 ppts because farms are too dry, the Buenos Aires Grain Exchange says in a weekly report.

  • “If dry conditions don’t end, planting will fall further behind, and we may even have to cut the area forecast again”
  • Planting is 73.5% complete
  • In central southern areas, known as Argentina’s breadbasket region, frosts have compounded a lack of rain by accelerating the drying out of surface moisture

Egypt Buys First Cargo of US SRW Wheat Since 2019, USDA Says

Top world wheat buyer Egypt purchased 26k tons of US soft red winter wheat in the week ended June 23, USDA data Thursday showed.

  • That’s the first cargo of US variety sold to Egypt since 2019
  • Egypt in years previous favored the variety, before it began diversifying imports largely with shipments out of the Black Sea
  • Announcement comes after Egypt’s wheat-buying agency made its biggest purchases in at least a decade amid Russia’s invasion of Ukraine that snarled grain shipments

Port Closures Could Limit Ukraine Grain Exports to 22m Tons: UAC

In the 2022-23 season, Ukraine has potential to export 16m tons of wheat, 2.7m tons of barley and 31.5m tons of corn, UkrAgroConsult analyst Maryna Marynych says in a webinar on Thursday.

  • That’s based on the consultant’s outlook for 2022 production, combined with carryover stockpiles from the previous season
  • However, if Black Sea ports remain out of operation due to the war, that could limit exports to 10m tons of wheat, 2m tons of barley and 10m tons of corn
  • Rapeseed exports could meet their full potential of 2.6m tons, even with the port closures
  • The crop is the first to be harvested in summer and is in strong demand in the EU, with high prices

Planalytics Lowers U.S. Corn Forecast to 176.60 Bu/Acre

Outlook for this year’s crop yield is down from previous forecast of 177.40 bu/acre, according to data issued by Planalytics on Thursday.

Yield in key states versus previous Planalytics forecast (in bu/acre):

  • Iowa 200.00 vs 201.10
  • Illinois 199.90 vs 201.20
  • Indiana 181.70 vs 182.80

Planalytics Keeps U.S. Soybean Forecast Unchanged at 51.10 Bu/Acre

Outlook for this year’s crop yield is unchanged from previous forecast of 51.10 bu/acre, according to data issued by Planalytics on Thursday.

  • Yield in key states versus previous Planalytics forecast (in bu/acre):
    • Iowa 58.10 vs 58.10
    • Illinois 60.20 vs 60.40
    • Indiana 56.90 vs 57.10

Argentine Corn, Wheat Crop Estimates June 30: Exchange (Table)

The Buenos Aires Grain Exchange releases weekly report on website.

  • 2021-22 Corn production held at 49m tons, with 46.5% harvested
  • 2022-23 Wheat planting held at 6.3m ha

Argentina trucker strike ends, boosting grains exports

An Argentine truckers strike ended on Thursday, after some unions upset with diesel shortages reached a deal to lift the one-week protest around the major port of Rosario, which is expected to help the flow of grains for export going forward.

The truck driver protest over high fuel prices has paralyzed corn and other grains exports just as the bulk of the harvest was headed to ports for shipment to foreign markets.

Some protests, however, could continue since some smaller truckers groups were not involved in the deal.

Argentina is the world’s second biggest corn exporter, the top exporter of processed soyoil and meal, as well as a major wheat and beef supplier.

“Despite not agreeing (with a recent negotiation of truck cargo rates) and taking into account the crisis that our country is going through, we decide to lift the strike,” one of the unions, Autoconvocados Unidos, said in a statement.

The union described its decision as an act of good will.

The volume of trucks entering ports had already picked up on Thursday, up some 70% versus a day earlier to reach over 1,500 vehicles, according to data from the Rosario grains exchange.

Rosario’s ports are the point of departure for 80% of Argentina’s agricultural exports, most of which arrives in trucks.

“It’s getting back to normal,” said Guillermo Wade, manager of the country’s maritime port chamber, referring to the ability of trucks to access the port.

Also on Wednesday, the transport ministry agreed with some farm and transport groups that were not involved in the strike to hike grain freight rates by 25%.

But most protesting unions, including the UNTRA truckers union, called the rate increase insufficient even as they mostly opted to remove highway blockades.

Effects of Fertilizer-Price Spike Could Worsen in 2023: USDA

High fertilizer prices could “take a heavier toll on 2023” planting decisions as the war in Ukraine continues, according to a USDA report.

  • Global outlook for food security concerns could be “even more dire” in 2023 as high fertilizer prices could potentially cut yields: report
  • Uncertainty surrounding Russia’s fertilizer supply will likely keep prices elevated until the war ends
    • Ramping fertilizer production takes an average of three to five years if necessary reserves are available
  • NOTE: Many US producers avoided surge in fertilizer prices caused by Russia’s invasion of Ukraine because they bought product in 2021

Saskatchewan Says Crops Are Behind as Weather Too Dry or Wet

Crop development has been slow due to early season drought conditions in the west and excess moisture in the east, the province’s agriculture ministry says Thursday in a report.

  • 76% of fall cereals, 58% of spring cereals, 46% of oilseeds and 69% of pulse crops at normal development stage
  • “Producers are hoping for improved conditions through July to ensure their crops develop properly”
  • Rainfall continues to be concentrated in the east but more is needed in western regions to ensure adequate crop growth

North Dakota Sees Less ‘Prevent Plant’ Acres Than 2019: Insurer

North Dakota is seeing fewer so-called prevent plant acres than in the disastrous 2019 season, even as relentless rain hindered grain and oilseed plantings, says John Martin, VP of field claims for AgriSompo North America, one of the largest US writers of federally-sponsored crop insurance policies.

  • “With commodity prices where they are, the incentive for farmers is to get as many acres planted as possible,” Martin says in interview
  • There also are fewer prevent plant acres nationally than in 2019: Martin
  • NOTE: The number of unplanted acres surged in 2019 following severe flooding
    • Prevent plant refers to a failure to sow an insured crop within a final designated time-frame

Russia to Ban Rice Exports From July 1 to Dec. 31: Interfax

Russia to ban export of rice and some related products to ensure nation’s food security, maintenance of stable domestic prices, Interfax reports, citing the Agriculture Ministry.

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