TOP HEADLINES
Indonesia reaffirms B40 biodiesel plan to be implemented Jan 2025
Indonesia’s government reaffirmed to lawmakers on Wednesday a plan to implement a 40% mandatory biodiesel mix with palm oil-based fuel, known as B40, in January 2025, as part of the new government’s “quick wins” programmes.
The plan was outlined in a presentation by Energy Minister Bahlil Lahadalia, who also told a parliamentary hearing the government expects to implement a B50 mandate by 2026.
The plan to increase the biodiesel blend from the current 35% is part of an effort to reduce fuel imports, which analysts have said would increase demand and prices for palm oil.
Malaysian palm oil futures had risen about 35% this year. At an industry conference last week, Thomas Mielke, head of Hamburg-based research firm Oil World, estimated the introduction of B40 would push them up another 10%-15%.
FUTURES & WEATHER
Wheat prices overnight are down 3 3/4 in SRW, down 2 1/2 in HRW, down 1 in HRS; Corn is unchanged; Soybeans down 1/2; Soymeal down $1.60; Soyoil down 0.19.
For the week so far wheat prices are down 21 3/4 in SRW, down 16 1/2 in HRW, down 19 1/4 in HRS; Corn is down 1 1/2; Soybeans down 19; Soymeal down $4.30; Soyoil down 2.66.
For the month to date wheat prices are down 22 in SRW, down 24 3/4 in HRW, down 27 1/2 in HRS; Corn is up 17 3/4; Soybeans up 15 1/2; Soymeal down $8.20; Soyoil up 1.08.
Year-To-Date nearby futures are down 12.3% in SRW, down 14.8% in HRW, down 20.0% in HRS; Corn is down 8.9%; Soybeans down 22.4%; Soymeal down 24.4%; Soyoil down 3.8%.
Chinese Ag futures (JAN 25) Soybeans down 52 yuan; Soymeal down 10; Soyoil down 288; Palm oil down 280; Corn up 11 — Malaysian Palm is down 39.
Malaysian palm oil prices overnight were down 39 ringgit (-0.78%) at 4987.
There were changes in registrations (-99 Soybeans). Registration total: 0 SRW Wheat contracts; 0 Oats; 114 Corn; 559 Soybeans; 369 Soyoil; 76 Soymeal; 5 HRW Wheat.
Preliminary changes in futures Open Interest as of November 12 were: SRW Wheat up 8,690 contracts, HRW Wheat up 3,605, Corn up 12,022, Soybeans up 10,565, Soymeal up 5,237, Soyoil down 4,216.
Brazil: Wet season showers continue in central Brazil, being favorable for soybean establishment. A system will move through the south on Tuesday, but with limited showers. Another system is expected next week that could mean better coverage and amounts, but overall rainfall will be lower than normal over the next two weeks. Soil moisture is lower in some areas, but overall conditions are still mostly favorable.
Argentina: A system moved through Sunday and Monday with scattered showers, but some areas were missed. Another system will move through this weekend into early next week with more widespread showers. Despite some more limited rainfall, overall favorable conditions continue to be present in most of the country. The threat of heat and dryness due to the building La Nina may be a threat later in the season.
Northern Plains: A system should bring some showers Tuesday night into Wednesday and another system should produce more this weekend. But a much bigger storm could develop next week with heavier and more widespread precipitation. Temperatures will generally stay above normal until that bigger storm moves in next week. Overall drought continues to increase, though some areas are worse than others. That could change if the system next week indeed is a big one.
Central/Southern Plains: A small system will move through Tuesday and Wednesday with some spotty rain. Recent rain and snow has significantly increased soil moisture across the region, though areas of Colorado and New Mexico are buried in snow that will not be helpful for winter wheat. Temperatures will generally be above normal except for areas covered in snow. A much bigger system could be possible next week that may mean a lot more precipitation. Temperatures are likely to take a dive after that system moves through next week.
Midwest: A system will move through on Wednesday and Thursday with scattered showers. Another will likely move through Canada this weekend but may still bring a few showers through. A much larger storm could develop next week and bring more widespread precipitation to the region. The continued active pattern should help to reduce drought and boost soil moisture for winter wheat.
Delta: Water levels on the Mississippi River have risen due to recent heavy rain across the Plains and Midwest. But for the River to have sustained improvements, more precipitation needs to fall in the Ohio Valley. Some good amounts went through over the weekend and the region will see additional systems moving through over the next couple of weeks that should help as well.
The player sheet for Nov. 12 had funds: net sellers of 5,500 contracts of SRW wheat, sellers of 7,000 corn, sellers of 7,500 soybeans, sellers of 3,000 soymeal, and sellers of 8,000 soyoil.
TENDERS
- CORN SALES: The U.S. Department of Agriculture confirmed private sales of 110,500 metric tons of U.S. corn to Mexico for delivery in the 2024/25 marketing year that began Sept. 1.
- WHEAT PURCHASE: Jordan’s state grains buyer purchased about 60,000 tons of hard milling wheat to be sourced from optional origins in an international tender.
- CORN PURCHASE: The Korea Feed Association’s Incheon section purchased an estimated 65,000 to 70,000 metric tons of animal feed corn in an international tender on Wednesday
- CORN TENDER: Algerian state agency ONAB issued a new international tender to purchase up to 240,000 tons of animal feed corn sourced from Argentina or Brazil only.
- SOYMEAL TENDER: Leading South Korean animal feed maker Nonghyup Feed Inc (NOFI) has issued an international tender to purchase up to 60,000 metric tons of soymeal sourced optionally from South America, the United States or China
- WHEAT TENDER: Leading South Korean animal feed maker Nonghyup Feed Inc. (NOFI) purchased about 65,000 metric tons of animal feed wheat in an international tender on Wednesday
PENDING TENDERS
- RICE TENDER: The state purchasing agency in Mauritius issued an international tender to buy 4,000 tons of long grain white rice sourced from optional origins
- RICE TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp issued an international tender to purchase an estimated 101,000 tons of rice
- FEED BARLEY TENDER: Jordan’s state grains buyer issued an international tender to purchase up to 120,000 tons of animal feed barley
- FEED WHEAT AND BARLEY TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) said it will seek 65,000 tons of feed wheat and 25,000 tons of feed barley via a simultaneous buy and sell (SBS) auction that will be held on Nov. 13.
- RICE TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 tons of rice.
- WHEAT TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 tons of milling wheat.
TODAY
USDA CROP PROGRESS: Winter Wheat Crop 44% Good/Excellent
Highlights from the report:
- Winter wheat 44% G/E vs 41% last week, and 47% a year ago
- Winter wheat planted 91% vs 87% last week, and 92% a year ago
- Corn harvest 95% vs 91% last week, and 86% a year ago
- Soybeans harvested 96% vs 94% last week, and 94% a year ago
- Cotton harvested 71% vs 63% last week, and 64% a year ago
US Inspected 793k Tons of Corn for Export, 2.278m of Soybeans
In week ending Nov. 7, according to the USDA’s weekly inspections report.
- Wheat: 347k tons vs 206k the previous wk, 245k a yr ago
- Soybeans: 2,278k tons vs 2,308k the previous wk, 2,011k a yr ago
- Corn: 793k tons vs 798k the previous wk, 719k a yr ago
CROP SURVEY: Brazil 2024-25 Soybean Output Seen at 168.3M Tons
Brazil soybean production seen rising 2.29m tons from the national forecast agency’s offical estimate made in October, according to the avg in a Bloomberg survey of eight analysts.
- The range of estimates varied from 166.2m tons to 171.8m tons
- Brazil’s corn crop seen at 123.5m tons, 3.8m tons higher than the prior estimate
- Conab, the Brazilian national supply company, is scheduled to release its first official estimates for the 2024-25 crops on Nov. 14 at 9am local time
Brazil likely to export record volume of soybean meal in 2024, says exporters group
Brazil’s soybean meal exports in 2024 will probably set a new record, topping the best mark in history recorded in 2023, according to local grains traders lobby Anec.
WHY IT’S IMPORTANT
In 2023/24, Brazil should once again be the second global exporter of soybean meal, according to data from the US Department of Agriculture (USDA), as it had taken the lead in 2022/23 after a crop failure in Argentina, traditionally the largest exporter.
Brazil is also the leader in foreign sales and production of soybeans.
BY THE NUMBERS
From January to November, Brazil is expected to export 21.12 million tons of soybean meal, while last year shipments totaled 22.35 million tons, according to Anec figures.
To surpass 2023, therefore, soybean meal exports would need to total just over 1.23 million tons in December, which is very likely since Brazil has exported more than that every month of 2024 so far.
KEY QUOTE
“Considering that the monthly volume of soybean meal is very linear, we will export more than in 2023,” said Jean Budziak, head of Anec’s market intelligence area.
EU Soft-Wheat Exports Fall 29% Y/y in Season to Nov. 10
EU soft wheat exports in the season that started July 1 totaled 8.7m tons as of Nov. 10, compared with 12.3m tons a year earlier, the European Commission said on its website.
- Leading destinations included Nigeria with about 1.3m tons, Egypt with 692k tons and the UK with 605k tons
- Barley exports were 1.77m tons, down 37% y/y
- Corn imports totaled 7.1m tons, up 8% y/y
- NOTE: Export data for Italy are not complete for the last six weeks; data for France not complete since the beginning of calendar year 2024; Bulgaria and Ireland data incomplete since the start of marketing year 2023-24
SovEcon Increases Ukraine 2024 Corn Export Estimates by 6.8%
Consultant SovEcon raised its estimates for Ukraine’s 2024 corn crop by 1.6m tons to 25.1m tons, it said in a note.
- Cites relatively high yields in northern regions
- 2024 Ukraine corn export estimate increased by 1.3m tons to 20.3m tons
- “Shipments may slow in the coming months as the EU import quota for Ukrainian corn is nearly exhausted. This could redirect Ukrainian corn to other markets, including China”
- First estimate for Ukraine’s 2025 wheat crop pegged at 21.1m tons, below five-year average
India Vegetable Oil Imports Drop on Higher Local Oilseed Output
Palm oil imports by the world’s biggest edible oil buyer fell almost 8% from a year earlier to 9.02 million tons in the year ended Oct. 30, according to the Solvent Extractors’ Association of India.
- Soybean oil purchases dropped to 3.44m tons from 3.68m tons
- Sunflower oil imports were at 3.51m tons vs 3m tons year earlier
- Total inbound shipments of vegetable oils, including non-edible oils, declined to 16.23m tons during the period, from 16.71m tons
- Shipments fell due to higher domestic oilseed output and as high prices curbed demand
- Cooking oil reserves were 2.41m tons on Nov. 1, compared with 3.14m tons a year earlier
- India’s edible oil imports may drop by 1 million tons in 2024-25 as normal monsoon rains boost local oilseeds production
China’s soybean imports may fall 9.5% this marketing year, COFCO executive says
- Says have to see if Chinese buyers willing to take U.S. cargoes
- Chinese buyers stockpiled soybeans ahead of U.S. elections
- Hog companies’ profits, inventories to support soymeal demand
China’s soybean imports are likely to drop by 9.5% in the marketing year ending in September 2025, an executive of China National Cereals, Oils and Foodstuffs Corporation (COFCO) said on Wednesday.
Overseas shipments of soybeans into China, the world’s biggest consumer of the oilseed, will drop to 98.8 million metric tons in the year to September 2025 from 109.4 million tons shipped in the prior year, the executive, who asked to remain unidentified, said in a speech at an oilseeds conference.
Chinese buyers have ramped up soybean imports in recent months to stockpile the oilseed ahead of the U.S. elections. Donald Trump’s return to the White House early next year is likely to reignite trade tensions between Washington and Beijing.
The COFCO executive did not provide reasons for the anticipated drop in soybean imports this marketing year but said that they would need to see if buyers are willing to take on U.S. cargoes.
“If we look at the long-term trend, looking at December and January shipping schedules, profit margins from U.S. soybeans are relatively good,” the official said.
“But we have to monitor the effectiveness of the profit margins – whether people will dare to buy U.S. soybeans.”
During Trump’s first presidential term, China responded to U.S. tariffs by imposing duties on American soybeans. During the trade dispute, profit margins for U.S. soybeans were very high but it was not enough to attract demand, the official said.
China also agreed to buy a set value of U.S. agricultural goods as part of the Phase 1 trade agreement worked out in January 2020, but did not fulfil its commitment.
In October, China imported 8.09 million metric tons of soybeans, the most for the month in four years and up 56% from 5.18 million tons a year ago. Higher purchases are likely to take China’s imports in the 2024 calendar year to an all-time high.
In 2025, China is likely to import 20 million to 25 million tons of U.S. beans, but overall volumes will depend on Washington and Beijing’s trade relations, said Francisco Magnasco, global head of soybeans at agricultural commodity merchant Louis Dreyfus Company.
“U.S.-China trade negotiations could imply higher U.S. shipments to China,” he told the conference in Dalian.
Russia’s October seaborne grain exports at 6.3 mln tons, up 11% y/y
Russia’s seaborne grain exports rose 11% year-on-year in October to 6.3 million metric tons, and so far this year are up 2.1% on the same period of 2023, according to shipping data from industry sources released on Tuesday.
Russia, the world’s top wheat exporter, has been exporting grain at a near-record pace in recent months, despite low global prices and domestic measures aimed at restricting exports to keep prices low at home.
Analysts estimate that Russia has already shipped about 45% of its grain export potential for the current season, which is estimated at around 60 million tons. The data showed that seaborne exports have amounted to 22.8 million tons this season.
Seaborne exports, mostly from Black Sea ports, accounted for about 90% of Russia’s total grain exports last season. Last year Russia exported about 62 million tons of grain through its sea terminals, according to analysts’ estimates.
The data also showed that grain exports from Baltic Sea terminals surged 28% in October, confirming their growing role in targeting new markets for Russian grain, including West Africa and Latin America.
Exports from Black Sea terminals, targeting Russia’s traditional customers in the Middle East, rose 15%, while exports through the Caspian Sea, which mostly go to Iran, fell 51.3%, the data showed.
Argentina Crop Companies See Export-Tax Cuts in 2025: Bioceres
There is a “realistic expectation” that the government will reduce taxes on crop exports next year, Federico Trucco, CEO of Bioceres Crop Solutions, said on an earnings call.
- “We’re going into an election year, and farmers are a core constituency of the government, so there is a realistic expectation”: Trucco
- NOTE: While Rosario-based Bioceres operates in other countries, its earnings are closely linked to sales in Argentina where wider farmer profit margins would likely boost demand for its products
- On the same call, CFO Enrique Lopez Lecube said: “Argentina is probably the one market in the world where farmers still have a cushion that can be made available essentially by the government. So if export duties are lifted, at least partially, that has a big, big impact on profitability. And there’s somewhat of an expectation building up.”
- Dry weather and a big shift to soybeans, which requires less fertilizer than corn, hurt Bioceres’ earnings last quarter, 1Q 2025 in their fiscal year
- Its US-traded shares have slumped more than 50% this year
- On Monday, Cresud CEO Alejandro Elsztain said that while he doesn’t expect anything soon, farmers are “waiting patiently” and should see tax cuts sometime over the next year
- NOTE: The government of Javier Milei says it is philosophically opposed to the taxes on crop exports, but that for now it needs the billions in annual proceeds to meet budget goals
Fuel Groups Warn of Higher Prices Without Tax Credit Certainty
- More than 30 trade groups pen letter to congressional leaders
- Energy and agriculture leaders in quandary on how to proceed
More than 30 trade groups across the energy, farming and transport sectors say a lack of US government guidance on tax credits is putting Americans at risk of higher fuel prices.
The current US Congress should extend credits set to expire next month, including a $1 a gallon biodiesel tax incentive that’s been in place since 2005, they say, to ensure market stability as fuelmakers, airlines and crop processors wait for details on how new credits that take effect in January will work.
“Absent the certainty provided by a bridge package, American consumers would face rising energy and fuel prices, and our organizations and the members we represent would face regulatory, legal, and tax filing uncertainty,” the groups including those representing fuel retailers and truck stops wrote in a letter to congressional leaders on Wednesday.
The transition to a new administration under President-elect Donald Trump, along with a lack of guidance under President Joe Biden, has the energy and agriculture industries in a quandary on how to proceed. The new incentives under Biden’s signature climate change law are meant to encourage lower-emitting energy sources and help jump-start developing industries like green jet fuel.
“We don’t know whether or not the credit will be there for us on Jan 1st of next year nor how long it would take for it to be there,” Tom Michels, head of government affairs for United Airlines Holdings Inc., said in an interview.
Another issue that needs to be addressed is extending the upcoming credits for at least 10 years so investors can see the government is serious about the transition to clean energy and companies can get new fuel plants up and running, Michels said.
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