Global Ag News for June 17.24

TOP HEADLINES

Ukraine starts 2024 grain harvest, minister says

Farmers in southern regions of Ukraine have started the 2024 grain harvest, the country’s acting agriculture minister Taras Vysotskiy said on Saturday.

Ukraine traditionally starts harvesting grain in the second half of June.

Vysotskiy said on Friday that the ministry had increased its forecast for the 2024 grain harvest to 56 million metric tons from the previous estimate of 52.4 million tons.

The harvest could include 21 million tons of wheat, 28.5 million tons of corn and 5 million tons of barley, according to the revised forecast.

 

FUTURES & WEATHER

Wheat prices overnight are down 14 1/2 in SRW, down 13 1/4 in HRW, down 7 3/4 in HRS; Corn is down 4 3/4; Soybeans down 11 3/4; Soymeal down $4.30; Soyoil down 0.48.

Markets finished last week with wheat prices down 14 in SRW, down 30 1/4 in HRW, down 23 1/2 in HRS; Corn is down 1 1/2; Soybeans down 20; Soymeal down $9.10; Soyoil down 0.58.

For the month to date wheat prices are down 85 1/2 in SRW, down 100 1/4 in HRW, down 94 in HRS; Corn is down 1 1/2; Soybeans down 46 1/2; Soymeal down $10.30; Soyoil down 2.56.

Year-To-Date nearby futures are down 4.5% in SRW, down 3.7% in HRW, down 9.9% in HRS; Corn is down 5.3%; Soybeans down 9.9%; Soymeal down 5.5%; Soyoil down 9.7%.

Chinese Ag futures (SEP 24) Soybeans down 5 yuan; Soymeal down 35; Soyoil down 66; Palm oil down 98; Corn down 13 — Malaysian Palm is up 10. Malaysian markets are closed for holiday.

There were no changes in registrations. Registration total: 1,479 SRW Wheat contracts; 39 Oats; 747 Corn; 405 Soybeans; 2,589 Soyoil; 0 Soymeal; 0 HRW Wheat.

Preliminary changes in futures Open Interest as of June 14 were: SRW Wheat down 3,819 contracts, HRW Wheat down 4,259, Corn down 7,299, Soybeans down 8,235, Soymeal up 6,048, Soyoil up 3,387.

 

Northern Plains: Scattered showers went through over the weekend as system pushed a front into the region. The front will continue to waffle around the region and areas to the south throughout the week, producing daily occurrences of showers and thunderstorms through Saturday. Some areas of flooding, breezy winds, and severe weather are forecast for the region. Temperatures will be cooler through midweek as well.

Central/Southern Plains: A front moved in over the weekend and produced areas of scattered showers and thunderstorms for much of the north and west. The front will waffle around the northern portions of the region through Saturday before it finally moves east, continuing showers and thunderstorms and severe weather in the north and west for most of the week. Some severe weather is also possible. South of the front, temperatures will continue to be quite warm to hot for mid-June, causing stress and quick reduction in soil moisture where showers do not occur.

Midwest: A system moved in over the weekend and produced widespread showers and thunderstorms in the northwest. Spotty showers occurred in other areas, but most stayed dry while temperatures rapidly increased on Sunday. The system laid down a front across the northwest where daily showers and thunderstorms will occur all week long. South of the front, temperatures will be excessive in some areas and humidity is very high, causing a rapid decrease in soil moisture and stress in areas that were not overly saturated. A general wet and cooler northwest and hotter and drier south and east will continue throughout the week with few exceptions, though models disagree on the potential for showers for the south and east, which may be slightly more widespread than the forecast. Crops would benefit from increased moisture and reduced heat if they indeed occur. The front will finally get pushed eastward over the weekend and another system moving through during the middle of next week will produce more widespread precipitation and milder temperatures as well.

Delta: Hot and largely drier weather occurred over the weekend, reducing soil moisture in the region, but causing limited stress as soil moisture was largely beneficial ahead of time. Hot temperatures will be in place all week long, but moisture coming north from the Gulf of Mexico may produce some showers at times and reduce the impact of the heat. A front moves through early next week with some showers and another moves through a day or two later with some more potential benfeficial showers.

Canadian Prairies: A system went through over the weekend with rounds of showers and a few thunderstorms. The system also brought in cooler temperatures that will stick around through midweek before starting to rise. If skies can clear and winds calm down, there may be some patchy frost in the southwest. But those chances are low. Periods of showers will continue to move across the region all this week and into next week as well, keeping soil moisture high, though too high in some areas, especially in the east.

Brazil: A front moved into southern areas this weekend with heavy rain, which may have resulted in additional flooding in areas that are still trying to recover from last month’s historic floods. The front will remain stalled in the south all week long with more periods of rain and potential flooding. Winter wheat planting continues to face challenges from wet soils as well. Rain is forecast to largely stay south of the safrinha corn areas, while temperatures remain high, forcing corn into maturity quicker. Poor weather conditions over the last two months has meant limited or no rainfall for corn, and cuts to the safrinha crop are more likely as harvest continues to increase.

Argentina: Paraguay and southern Brazil will continue to see showers, but heavy rain is not forecast for Argentina. Instead, occasional showers will move through. Winter wheat planting and establishment could use some more widespread and heavier rainfall after the last couple of months of drier conditions. Only limited areas of the country will see some higher amounts this week. Cooler temperatures are likely to push through the country over the weekend into early next week, which may result in some frosts, especially for the south.

Europe: An upper-level low-pressure center brought unfavorable rainfall to northwestern areas over the weekend and another system will bring more showers to those same areas most of this week as well. France and Germany will be especially wet, unfavorable for maturing wheat and developing corn, where flooding and saturated soils are very common. Adjacent areas across the west and north will welcome the rainfall. Southeastern areas will be unfavorable dry with increasing heat yet again, which should cause stress for developing summer crops.

Black Sea: A system brought showers into eastern Ukraine over the weekend, but very limited showers for southwestern Russia, unfavorable for immature wheat that has been dealing with heat and dryness during the critical stages over the last couple of weeks. A few showers early this week and a few more mid-late week with another front will not bring much precipitation to very dry areas in the region. Instead, the lack of rain will increase temperatures most of this week, causing further stress to developing corn and sunflowers in areas of drought.

Australia: Isolated showers fell over the weekend, but many areas remained dry. A couple of fronts will move through this week and weekend with chances for scattered showers, though some areas will get missed. Soil moisture is mostly favorable across the country, though eastern areas couple use some more rain. The change to La Nina, though slower than expected, should favor increasing rainfall for eastern areas of the country over the next few months.

The player sheet for 6/14 had funds: net sellers of 4,500 contracts of SRW wheat, sellers of 11,500 corn, sellers of 5,500 soybeans, buyers of 2,000 soymeal, and sellers of 3,000 soyoil.

PENDING TENDERS

• WHEAT TENDER: Jordan’s state grain buyer issued an international tender to buy up to 120,000 metric tons of milling wheat which can be sourced from optional origins.
• FEED BARLEY TENDER: Jordan’s state grains buyer issued an international tender to purchase up to 120,000 metric tons of animal feed barley.

 

TODAY

Ukraine’s Grain Exports Are Up 3% So Far This Season

Ukraine’s grain exports have reached 48.7m tons in the season that started July 1, up about 3% from the same period a year earlier, Agriculture Ministry data show.

The total includes:

• 17.9m tons of wheat, up 11% y/y
• 2.46m tons of barley, down 8% y/y
• 27.8m tons of corn, little changed y/y

 

Ukraine to Export 60M Tons Grain, Oilseeds Next Season: Ministry

Ukraine’s agricultural exports are expected to touch 60 million tons in the next season, which starts on July 1, the acting Agriculture Minister Taras Vysotskyi said in emailed statement.

• Grain production is estimated at near 56m tons, which includes:
  • wheat: 21m tons
  • barley: 5m tons
  • corn: 28.5m tons
• Grain exports are estimated to touch 43m tons, including:
  • wheat: 15m tons
  • barley: 2.5m tons
  • corn: 25m tons
• Production of oilseeds is seen at 22 million tons with potential exports of over 17m tons: Vysotskyi

 

CORN/CEPEA: Prices move up at the port, but decrease in other areas

Increases of international prices (which boost the export parity), of premiums and of dollar quotations resumed increasing corn values at the ports this week. Moreover, the demand at the ports also rose.

At the port of Paranaguá (PR), values upped 1.9% between June 6 and 13. Dollar prices, in turn, moved up 2.2% in the same period, closing at BRL 5.373 on June 13.

However, price rises at the ports were not transferred to the interior of Brazil. Although producers are focused on increases of international prices and at ports and are evaluating the impacts of the weather on crops, regional values continue low.

The harvest advance of both first and second crops and the low demand have been pressing values down.

From June 6-13, the ESALQ/BM&FBovespa Index (Campinas, SP) dropped 1.3%, closing at BRL 57.53 per 60-kilo bag on June 13. On the average of the regions surveyed by Cepea, corn values increased 0.9% in the wholesale market (deals between processors) and 0.1% in the over-the-counter market (paid to farmers) between June 6 and 13.

ESTIMATES – In spite of producers concerns about the impacts of the dry weather on second corn crops and floods in Rio Grande do Sul, Conab released a report on June 13 indicating possible increases in the total 2023/24 output in Brazil. The season is likely to amount 114.14 million tons, against 111.63 million tons projected in May, but still 13.5% lower than in 2022/23.

Conab says that the second corn crop may total 88.11 million tons – in May, it indicated 86.15 million tons. As for the first and third crops, Conab now forecasts 23.62 and 2.4 million tons, respectively.

Conab also indicates that, up to June 9, the harvest of the second crop reached 7.5% of the total. As for the summer crop, the harvest hit 85.2% of the area until June 9.

 

SOYBEAN/CEPEA: Pace of trades increase; prices move up

Soy trades are moving at a good pace in the domestic market, because of the firm demand (both international and local) and of the dollar valuation against Real. Therefore, prices rose in the Brazilian spot market, especially soybean oil quotations. Besides the higher international demand, the competition between consumers of the food industry and of the biofuel industry increased.

This scenario boosted soy oil export premiums in Brazil. The price rose 5.8% from June 6-13, at BRL 5.644,04 per ton (in São Paulo city with 12% ICMS) on June 13, the highest value since April 11, 2023, in nominal terms. In real terms (IGP-DI May/24), the average price in the partial of June (up to June 13), is the highest of this year.

Conab indicates that the soybean oil production is likely to hit the record of 10.6 million tons, 0.9% more than in the season before. However, the consumption is projected at 9.26 million tons (+10.3%). This scenario may limit exports, forecast at 1.4 million tons, 40% down against the previous crop.

Thus, the industry will have the challenge to flow soybean meal. Moreover, Argentina may lead exports again in this season. Conab projects a decrease of 11% for Brazilian shipments of soybean meal.

Conab expects the domestic soybean meal consumption to amount 18 million tons, 1.1% more than in the crop before, which sustained quotations in Brazil. On the average of the regions surveyed by Cepea, soymeal prices upped 1% between June 6 and 13.

SOYBEANS – Due to the firm demand for byproducts and attractive margins for the industry, local companies were demanding the raw material, boosting the competition with importers.

Conab says that the national soybean output is likely to total 147.35 million tons, 4.7% lower than in the season before. Exports are estimated at 92.43 million tons, for a decrease of 9.3% in the same comparison.

The ESALQ/BM&FBovespa Index (Paranaguá) moved up 1.5% from June 6-13, closing at BRL 140.53 per 60-kg bag on June 6. The CEPEA/ESALQ Index (Paraná) increased 2%, to close at BRL 136.06 per 60-kg bag. On the average of the regions surveyed by Cepea, soybean prices rose 2.2% in the over-the-counter market (paid to farmers) and 1.7% in the wholesale market (deals between processors).

 

China expects another bumper summer grain harvest

China expects to see another bumper summer grain harvest this year, a spokesperson from the National Bureau of Statistics said on Monday.

The comment came as recent heat hit some regions in northern China and had some impact on agricultural production.

 

US Pork Production Falls 1.2% This Week, Beef Rises: USDA

US federally inspected pork production falls to 515m pounds for the week ending June 15 from 521m in the previous week, according to USDA estimates published on the agency’s website.

• Hog slaughter down 1.3% from a week ago to 2.39m head
• Beef production up 0.1% from a week ago, cattle slaughter rises 0.2%
• For the year, beef production is 1.6% below last year’s level at this time, and pork is 0.8% above

 

 

 

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