Global Ag News for Oct 2.24

TOP HEADLINES

Australia loses more than a million tons of wheat to frost, dryness

• Adverse weather damages crops in New South Wales, Victoria, South Australia
• Analysts cut wheat harvest estimates to as low as 27 mln T
• Expectations of lower global output drive prices to 3-1/2-month high

Dry weather and frosts in parts of Australia have damaged crops and will likely reduce wheat production by well over a million metric tons from earlier estimates, analysts said, as key global producers of the grain grapple with harsh growing conditions.

Adverse weather in Australia comes as dryness hits crops in Argentina, a rival wheat exporter in the southern hemisphere, and delays planting in top exporter Russia.

Expectations of lower worldwide wheat output helped drive benchmark Chicago futures Wv1 to their highest in 3-1/2 months this week, from a four-year low in July. GRA/

Australia’s harvest outlook looked rosy going into September with good soil moisture in most cropping zones, but rain has since been sparse and frost hit large areas of the country’s south and southeast two weeks ago.

“A dry start to spring across most regions, coupled with widespread frost damage in New South Wales, Victoria and South Australia, has negatively impacted yield estimates,” said Rod Baker at Australian Crop Forecasters in Perth.

Baker said he had revised his wheat harvest estimate to 30 million metric tons or less from 31.7 million tons in August and that rain would be needed in October to prevent further losses.

“If rain doesn’t materialise, we are likely to see more crops cut for hay through frost affected regions,” he said.

 

FUTURES & WEATHER

Wheat prices overnight are up 7 in SRW, up 7 3/4 in HRW, up 5 in HRS; Corn is up 4 3/4; Soybeans up 5 1/2; Soymeal down $0.40; Soyoil up 1.29.

For the week so far wheat prices are up 24 1/4 in SRW, up 26 1/4 in HRW, up 29 1/4 in HRS; Corn is up 14 1/4; Soybeans down 4 3/4; Soymeal up $3.80; Soyoil up 1.43.

For the month to date wheat prices are up 22 in SRW, up 22 1/4 in HRW, up 18 in HRS; Corn is up 9; Soybeans up 5 3/4; Soymeal up $5.50; Soyoil up 0.89.

Year-To-Date nearby futures are down 3.8% in SRW, down 6.1% in HRW, down 11.9% in HRS; Corn is down 8.3%; Soybeans down 18.0%; Soymeal down 8.8%; Soyoil down 10.3%.

Malaysian palm oil prices overnight were up 190 ringgit (+4.74%) at 4196.

China markets are closed for holiday.

There were no changes in registrations. Registration total: 220 SRW Wheat contracts; 0 Oats; 126 Corn; 232 Soybeans; 352 Soyoil; 126 Soymeal; 5 HRW Wheat.

Preliminary changes in futures Open Interest as of October 1 were: SRW Wheat up 4,993 contracts, HRW Wheat up 3,169, Corn up 8,140, Soybeans up 1,536, Soymeal up 17,419, Soyoil up 7,581.

 

Northern Plains: Several more fronts will move through this week and next, but none of them are forecast to bring precipitation. They may bring breezy winds at times though, which will dry out the corn and soybean crops, and hustle them toward maturity. Even with multiple fronts moving through, temperatures should be mostly above normal, coming down only briefly behind a front before popping right back up again.

Central/Southern Plains: Dry conditions are in the forecast for the next couple of weeks with no real chances for meaningful rain while temperatures remain very warm to hot. That is not a good combination for wheat establishment, but it is for harvesting corn and soybeans. 

Midwest: Several fronts will be moving through this week and next, but they are not forecast to produce much in the way of precipitation, favorable for drying out soils for fieldwork. Though fronts will be moving through, they do not have access to much cool air, and temperatures should remain rather warm on most days, getting pushed back toward normal after a front goes through, but then rising above normal a day or two later. 

Delta: Dry conditions are forecast through next week, though we will be watching a potential tropical system moving into the Gulf of Mexico later this week or weekend that could bring some impacts to the region. 

Southeast: Hurricane Helene caused horrific flooding in parts of the region late last week, causing some damage to cotton in Georgia and some corn and soybean acres in the Carolinas, though the worst of it occurred in the southern Appalachians where whole towns were washed away. Helene’s remnants will finally get pushed eastward on Tuesday and the region will be much drier for the rest of the week. We will be watching a potential tropical system moving into the Gulf of Mexico later this week that could bring some impacts to the region, though. 

Brazil: Wet season showers started in central Brazil over the weekend, but have been very spotty. That is expected to continue for the next week. The late start to significant rain is causing a slow start to soybean planting, which will have a more significant impact for the coming safrinha corn and cotton crops for early 2025. Southern Brazil has had more opportunities to pick up good rainfall over recent weeks, which continues this week with another front moving through with good rainfall that dies out as it gets into central Brazil. Another of these fronts is forecast for next week which may be more promising for rainfall in central Brazil later next week. 

Argentina: It was dry yet again over the weekend, continuing the trend of dry conditions that has significantly delayed corn planting for western areas and caused some to abandon their winter wheat due to poor conditions and limited or no rainfall. Far southern and eastern areas have fared better, but most areas are still dry. A system is moving through Tuesday but with spotty showers. A more promising system may move through this weekend into next week with potential for widespread rainfall, but this system will not be enough to reverse the outstanding drought. More rain is going to be needed soon to stave off the significant late plantings and increase soil moisture for the limited crop that has already been planted. 

Europe: A system is moving through Europe with widespread rainfall, with the main portion of the storm digging down into the Mediterranean midweek with better rainfall for areas there into the southeast. More systems are lining to move through the continent for next week as well. Soil moisture is much improved, though some areas have dealt with wetness and flooding that has caused issues for winter wheat planting and corn harvesting.

 

The player sheet for Oct. 1 had funds: net buyers of 6,000 contracts of SRW wheat, buyers of 20,500 corn, buyers of 6,500 soybeans, buyers of 7,500 soymeal, and buyers of 3,500 soyoil.

TENDERS

• CORN, SOY SALES: Exporters sold 195,000 metric tons of U.S. corn to undisclosed destinations and 120,000 metric tons of U.S. soybeans to undisclosed destinations, the U.S. Department of Agriculture said in its daily reporting system.
• WHEAT PURCHASE: An importer group in Thailand is believed to have purchased around 120,000 metric tons of animal feed wheat in a tender which closed on Tuesday seeking up to 180,000 tons
• NO PURCHASE IN WHEAT TENDER: Jordan’s state grain buyer is believed to have made no purchase in an international tender to buy 120,000 metric tons of milling wheat.
• MOROCCAN WHEAT IMPORTS: Russia is expected to be Morocco’s top soft wheat supplier this 2024/25 season, surpassing France, the head of the Moroccan grain traders’ association (FNCL) Omar Yacoubi said. 

PENDING TENDERS

• WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is seeking to buy a total of 137,048 metric tons of food-quality wheat from the United States, Canada and Australia in a regular tender that will close late on Thursday.
• BARLEY TENDER: Jordan’s state grains buyer has issued an international tender to purchase up to 120,000 metric tons of animal feed barley with an Oct. 2 deadline.
• WHEAT TENDER: Jordan’s state grain buyer has issued an international tender to buy up to 120,000 metric tons of milling wheat which can be sourced from optional origins. A new announcement had been expected by traders after Jordan made no purchase in its previous tender for 120,000 tons of wheat on Tuesday.

 

 

TODAY

US Soybean Crushings at 168M Bushels in August: USDA

USDA releases monthly oilseed report on website.

• Crushing 0.9% lower than same period last year
• Crude oil production 1.1% lower than same period last year
• Crude and once-refined oil stocks down 8.1% y/y

 

US Corn Used for Ethanol at 472.7M Bu in August

The following is a summary of US corn consumption for fuel and other products, according to the USDA.

• Corn for ethanol was 7% higher than in August 2023
• DDGS production rose to 1.998m tons

 

ETHANOL: US Weekly Production Survey Before EIA Report

Output and stockpile projections for the week ending Sept. 27 are based on seven analyst estimates compiled by Bloomberg.

• Production seen higher than last week at 1.005m b/d
• Stockpile avg est. 23.367m bbl vs 23.524m a week ago

 

StoneX Increases Estimates for US Corn and Soybean Production

US corn production is estimated at 15.222 billion bushels, up from 15.127 billion last month, StoneX says Tuesday.

• US corn yield raised to 184 bu/acre from 182.9: StoneX
  • Change comes after the USDA’s Sept. 12 increase to 183.6 bu/acre
• StoneX estimates US soybean production at 4.613 billion bushels with a yield of 53.5 bu/acre
  • Those compare to last month’s estimates of 4.575 billion and 53 bu/acre

 

Brazil 2024/25 Soybean Crop Seen At 165.03 Million Tns – StoneX

• BRAZIL 2024/25 SOYBEAN CROP SEEN AT 165.03 MILLION TNS, STABLE FROM PREVIOUS FORECAST – STONEX
• BRAZIL 2024/25 FIRST CORN CROP SEEN AT 24.87 MILLION TNS VERSUS 24.96 MILLION TNS IN PREVIOUS FORECAST – STONEX

 

North Africa Seen Boosting Wheat Imports by 700k Tons: Soufflet

North African imports of wheat of all varieties are seen rising to 31.9m tons in the 2024-2025 season, up 700k tons from a year earlier, Jean-Francois Lapie, a trader at Soufflet, said at an event in Casablanca, Morocco.

• Algeria and Morocco will have “important” soft-wheat imports of 6.5m tons and 5.5m tons, respectively
  • That’s vs 6.8m tons and 5.4m tons a year earlier
• Egypt seen importing 12m tons of soft wheat, unchanged y/y
• French soft-wheat exports to Morocco, Algeria, Egypt and West Africa seen falling in the 2024-25 season:
  • Exports to Morocco 1.5m tons vs 2.8m
  • Exports to Algeria 0.78m tons vs 1.62m
  • Exports to Egypt 0.25m tons vs 0.44m
  • Exports to West Africa 1.39m tons vs 2.26m

 

US Agriculture Sentiment Lowest Since 2016: Purdue Univ.

The Purdue University/CME Group’s agricultural sentiment index fell to 88 points in Sept. from 100 in Aug., according to a survey of 400 agricultural producers.

• “These were the weakest barometer and future expectations readings since March 2016, when the farm economy was in the throes of an economic downturn,” according to the report’s authors James Mintert and Michael Langemeier
• Current conditions component declined by 7 points from Aug.
• Future expectations down by 14 points

 

 

 

 

 

 

 

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