Global Ag News for Oct 6.23

TOP HEADLINES

Global Food Prices Steady at Two-Year Low on Cheaper Oilseeds

Global food prices steadied at the lowest in more than two years as improving supplies of oilseeds and some grains countered sugar shortages.

A gauge of food-commodity costs was little changed in September, the United Nations’ Food and Agriculture Organization said Friday. The slump from a record set in March 2022 should eventually help ease grocery inflation that has been rampant since Russia’s invasion of Ukraine — and there are signs of that already happening in some countries.

Cheaper vegetable oils have been a significant driver of this year’s drop. Harvests of sunflowers in the Black Sea region and palm crops in Southeast Asia pulled prices almost 4% lower in September. While grains rose slightly, they also remain lower this year, as Russia’s second straight bumper wheat harvest buffers global supplies. Also, Asian rice prices have retreated from a 15-year high as better crop prospects in Thailand help stem the shock wrought by Indian export restrictions.

Still, futures for sugar — another major food staple — hit the highest in more than a decade last month. India saw its lowest monsoon rainfall in five years, increasing worries that the country will restrict sugar exports to keep local prices in check ahead of next year’s national election.

Dairy and meat prices declined last month, the FAO said.

It takes a while for lower food-commodity prices to filter through to supermarkets, which have been contending with high energy and labor expenses. Retail food prices in Britain fell for the first time in more than two years in September, though costs have continued to climb in nations from Turkey to Kenya.

FUTURES & WEATHER

Wheat prices overnight are down 4 1/2 in SRW, down 4 in HRW, down 2 1/4 in HRS; Corn is down 1/2; Soybeans up 3; Soymeal up $1.30; Soyoil up 0.11.

For the week so far wheat prices are up 32 1/4 in SRW, up 22 3/4 in HRW, up 20 in HRS; Corn is up 20 1/4; Soybeans up 8 3/4; Soymeal down $2.70; Soyoil down 0.44.

For the month to date wheat prices are up 32 1/4 in SRW, up 22 3/4 in HRW, up 20 in HRS; Corn is up 21; Soybeans up 8 3/4; Soymeal down $2.70; Soyoil down 0.46.

Year-To-Date nearby futures are down 27.6% in SRW, down 22.7% in HRW, down 22.3% in HRS; Corn is down 26.8%; Soybeans down 15.5%; Soymeal down 21.9%; Soyoil down 9.3%.

Malaysian palm oil prices overnight were down 9 ringgit (-0.25%) at 3598.

China markets are closed for holiday.

There were changes in registrations (-10 Soymeal). Registration total: 3,005 SRW Wheat contracts; 735 Oats; 4 Corn; 220 Soybeans; 67 Soyoil; 483 Soymeal; 402 HRW Wheat.

Preliminary changes in futures Open Interest as of October 5 were: SRW Wheat down 6,753 contracts, HRW Wheat up 429, Corn down 7,953, Soybeans up 2,832, Soymeal up 1,492, Soyoil up 782.

Northern Plains: Cold air is moving in behind a front and will produce a few showers into Friday. Widespread frost will be possible Friday and Saturday that could put an end to any immature crops. The cold should only be temporary temperatures moderate next week. Recent showers will cause some delays to harvest this week, but dryness that follows should allow equipment back out into the fields after a short period.

Central/Southern Plains: A front brought widespread showers and thunderstorms over the last couple of days, including some severe weather. Showers continue in Texas for Thursday. Colder temperatures are filling in behind the front, and should produce some frosts Friday through Sunday mornings across northern areas. Temperatures will moderate next week. Drier weather that follows should allow equipment to move back into the region rather quickly. Soil moisture increases for winter wheat establishment should be favorable as well. The next system may move through on the back half of next week with scattered showers.

Midwest: A front to move across the region through Friday with widespread showers. A second front will move through over the next couple of days with more isolated showers and much colder air. Temperatures will fall dramatically and there is potential for frost this weekend, especially across the north. Some isolated showers may continue into the weekend and possibly early next week in the cooler air over the Great Lakes. Temperatures will slowly moderate next week. Any fieldwork delays due to rainfall are likely to be short again, but we’ll watch for another potential storm system late next week.

Brazil: Wet season showers continue in central Brazil, though they may be isolated at times. A front will continue over southern areas through the weekend with bouts of heavy rain again. Southern areas are dealing with too much rainfall, which has caused flooding and the need to replant early corn in some instances. Other than those issues, increased rainfall is favorable for early establishment. Even the below-normal rainfall in central Brazil should be sufficient for continued planting and establishment.

Argentina: It continues to be dry in Argentina. While planting conditions are good for corn, establishment conditions are not and filling wheat is in need of rain as well. Dry weather that is forecast to follow through early next week is not favorable either. The next system is forecast to move through in the middle of next week, but forecasts are not favoring the widespread heavy rain that is needed just yet.

The player sheet for Oct. 5 had funds: net buyers of 6,500 contracts of SRW wheat, buyers of 9,000 corn, buyers of 2,500 soybeans, buyers of 2,000 soymeal, and  sellers of 3,500 soyoil.

TENDERS

• CORN SALE: South Korea’s Feed Leaders Committee (FLC) purchased around 130,000 metric tons of animal feed corn in private deals in the past two weeks without issuing international tenders
• CORN SALE: South Korea’s Major Feedmill Group (MFG) purchased an estimated 68,000 metric tons of animal feed corn expected to be sourced from either South America or South Africa in a private deal in the past two weeks without issuing an international tender
• WHEAT SALE: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) bought a total of 91,234 metric tons of food-quality wheat from the United States, Canada and Australia in a regular tender that closed on Thursday.
• CORN, BARLEY SALE: Algerian state agency ONAB is believed to have bought between 30,000 to 60,000 metric tons of animal feed corn and about 30,000 tons of feed barley in an international tender which closed on Wednesday.

PENDING TENDERS

• WHEAT TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 metric tons of milling wheat.
• RICE TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp issued an international tender to purchase an estimated 50,100 metric tons of rice largely from the United States, traders said. Of the total, 900 tons should be sourced from Vietnam and the rest from the United States. The deadline for submissions of price offers in the tender is Oct. 12.

TODAY

US Export Sales of Soybeans, Corn and Wheat by Country

The following shows US export sales of soybeans, corn and wheat by biggest net buyers for week ending Sept. 28, according to data on the USDA’s website.

• Top buyer of soybeans: China with 589k tons
• Top buyer of corn: Mexico with 1.76m tons
• Top buyer of wheat: Philippines with 94k tons

US Export Sales of Pork and Beef by Country

The following shows US export sales of pork and beef product by biggest net buyers for week ending Sept. 28, according to data on the USDA’s website.

• Mexico bought 14.6k tons of the 42.9k tons of pork sold in the week
• South Korea led in beef purchases

Persistent Argentina Dryness Hampers Corn Seeding, Wheat Fields

Continued dryness in Argentina is holding back planting of the early corn crop, the Buenos Aires Grain Exchange said in a weekly report.

• Some farmers are already shifting to late corn or soy
• Wheat is suffering, with 33% of acreage in a poor-to-very-poor condition vs 27% last week
• In southern areas, rains were sufficient to unlock some corn planting and improve wheat plants, the Buenos Aires Grain Exchange said
• NOTE: Light rains this week in the key “zona nucleo” region weren’t enough to reverse the situation, the Rosario Board of Trade said on Wednesday

Argentine Corn Production Estimate Oct. 5: Exchange

The Buenos Aires Grain Exchange releases weekly report on website.

• 2023-24 corn planted area est. held at 7.3m ha
• Planting advances to 13.9% complete from 7.3%

Three More Ships Tracked Heading Toward Ukraine Black Sea Ports

Three more ships appeared to be heading to Ukraine’s Black Sea ports on Thursday, according to ship-tracking data compiled by Bloomberg.

• DSM Everton, Beaver and Ability were tracked approaching ports in Greater Odesa, according to the data
• Ukraine’s infrastructure ministry didn’t immediately respond to a request for comment
• NOTE: Twelve other vessels have completed journeys to major Ukrainian ports on the Black Sea without incident in the past few weeks, defying Russia’s threats to target vessels in the area

Ukraine’s Grain Harvest Advances 22% from Last Year: Ministry

Grain harvest was 32.3 million tons as of Oct. 6 for the season that started July 1, Ukrainian Agriculture Ministry says in a statement on website.

• The jump came largely from an bumper corn harvest, which is already 2.6m tons vs 400K tons for the same period last year
• Total also includes:
  • 22.2m tons of wheat, up 16% y/y
  • 5.9m tons of barley, up 7% y/y
• Sunflower seed harvest is 7.3 million tons, almost three times more than same period a year ago
• Soybean harvest is so far 3.1m tons vs 505,000 year ago
• Sugar beets harvest is 3.3m tons vs 1.6m tons year ago

FAO-AMIS Raises World Wheat, Corn and Rice Stockpile Estimates

World wheat stockpiles in the 2023-24 season are now seen at 319.3m tons, up from a September estimate for 315.2m tons, according to a report posted Thursday.

• Production estimate also raised as good weather lifts yields in Ukraine and Russia
• Corn stockpiles seen at 305.7m tons, up from 304.5m tons
  • Production lifted on better Brazil crop
• Rice stockpiles seen at 198.6m tons, up from 198.1m tons
• Soybean stockpiles seen at 52.6m tons, down from 52.9m tons

Coceral Cuts EU Grain Crop Forecast by 6.9m Tons on Dry Weather

This year’s grain harvest in the EU and UK is now seen at 289.8m tons, Coceral said in an a report.

• That’s down from a June estimate for 296.7m tons
• “The early dryness in the northern half of the EU has had a bigger impact than previously expected”
• Production estimates have been cut for Germany, Bulgaria, Denmark, Sweden, Finland, and Latvia

Russia Raises 2023 Grain Harvest Forecast to 135m Tons: IFX

Russian Agriculture Ministry raised its 2023 grain harvest forecast to 135m tons, Interfax reported, citing minister Dmitry Patrushev.

• Wheat harvest forecast is raised to 90m tons
• Russia may buy as much as 2m tons of grain for state fund in late 2023
• NOTE: Sept. 16, Flood of Russian Wheat Halves World Prices From Wartime High
• NOTE: Sept. 12, Russia Raises 2023 Grain Harvest Estimate to 130m Tons, Interfax Says

French Soft-Wheat and Winter-Barley Planting Underway: AgriMer

Some 2% of the French soft-wheat crop was planted as of Oct. 2, steady with a year earlier, office FranceAgriMer said on its website.

• Winter-barley crop was 5% planted, compared with 8% a year earlier
• The corn harvest was 27% complete, up from 12% a week earlier
• Compares with 64% at this time last year and a a five-year average of 34%

World Grain Stockpiles Seen at Record in 2023-24, FAO Says

World grain stockpiles at the end of the 2023-24 season are now seen at 884m tons, up 3% y/y and a record high, the UN’s Food and Agriculture Organization said in a report.

• Production outlook raised on better harvest prospects in Russia and Ukraine, offsetting dryness hurting Canadian crops
• This year also marks “a second successive season of no or negative utilization growth, as continued cuts in non-food uses are expected to offset a population-led increase in rice food intake”

Australia Posts Driest September on Record, Weather Bureau Says

Australia posted its driest September on record with the onset of El Niño expected to bring more warm weather ahead.

• The nation’s total rainfall was 70.8% below the 1961–1990 average for September, according to Australia’s Bureau of Meteorology
• National mean temperature was 2.43C above average, the third-warmest on record since national observations began in 1910
• Warmest September on record for Western Australia, second-warmest for New South Wales, Victoria and South Australia

Australia’s Soil Moisture Below Average During Dry September

Soil moisture for much of Australia away from the north and central inland areas was below average last month after the driest September on record, according to a notice from the Bureau of Meteorology.

• Soil moisture was in the lowest 30% of all years since 1911
• Water storage levels remain low in some parts of southern and central Queensland, south-eastern parts of New South Wales, central Tasmania, and urban areas of Perth
• Below median rainfall is likely for much of western, northern and southern Australia during November 2023 to January 2024
• Small areas of northern New South Wales have slightly increased chance of above median rainfall

Kenya Bans Corn, Wheat Imports Temporarily to Protect Farmers

Kenya won’t issue millers permits to import wheat or corn into the East African country, President William Ruto says in statement posted on X.

Decision aimed at protecting local farmers and the government “will only deviate from the directive if the local produce is insufficient”

US Crops in Drought Area for Week Ending Oct. 3: USDA

The following table shows the percent of US agricultural production within an area that experienced drought for the week ending Oct. 3, according to the USDA’s weekly drought report.

• Corn crops experiencing moderate to intense drought rose a percentage point from the previous week to 59%
• Drought exposure at this time last year was 44%
• Soybean crops in drought rose by 3 percentage points to 58%

US Miss. River Grain Shipments Rise, Barge Rates Decline: USDA

Barge shipments down the Mississippi river increased to 377k tons in the week ending Sept. 30 from 197k tons the previous week, according to the USDA’s weekly grain transportation report.

• Barge shipments of corn rose 213.4% from the previous week
• Soybean shipments up 30.6% w/w
• St. Louis barge rates were $38.14 per short ton, a decline of $14.76 from the previous week

Brazilian prosecutors seek to ban popular herbicide atrazine

Brazilian labor prosecutors have requested a court order to ban the use of atrazine, which is present in 5% of pesticides sold in the country, the prosecutors said on Thursday.

National health regulator Anvisa, which would be forced to cancel the registration of pesticides containing atrazine if a judge rules in favor of the labor prosecutors, did not immediately have a comment on the lawsuit filed on Wednesday in a Brasilia court.

Atrazine, which is used on crops from sugarcane to corn and soy, was banned in the European Union in 2003 due to the risk of contaminating groundwater.

Nine years later it was also forbidden in Switzerland, the headquarters of Syngenta, which developed the herbicide and continues to produce and export the chemical, prosecutors said.

Syngenta did not respond to a request for comment. On its website, Syngenta calls atrazine “safe for people” and “good for the environment and the economy,” citing studies that attest to its safety on U.S. farms, where its use is permitted.

Brazil, whose tropical climate has made it an agribusiness powerhouse, is the world’s largest consumer of pesticides, including many banned elsewhere. Researchers estimate that Brazil accounts for about 20% of total global pesticide use.

Prosecutors cited 2021 data from Brazilian environmental agency Ibama, the most recent available, showing atrazine was the country’s fifth most used pesticide ingredient. The best seller was glyphosate, a weed-killer that genetically modified soybeans are designed to tolerate.

Brazil, the world’s biggest soybean and sugar exporter and a major corn grower, imported about 77,700 tons of products containing atrazine in 2022, mainly from China, which accounted for about 80% of supplies, according to Brazilian government trade data.

The United States and Israel also export the chemical to Brazil, the data showed.

Reliance Says Feedstock Challenge Impedes India’s Biofuels Goal

Challenges in aggregating and storing crop waste are posing an obstacle for India’s plans to roll out 5,000 compressed biogas plants, according to energy giant Reliance Industries Ltd.

• Feedstock needs to be accumulated in a short duration of one month when the crop is harvested and it’s a challenge to store it for a full year without losing its energy potential, according to Bashir Ahmed Shirazi, COO for bioenergy at Reliance
• Most states lack the ecosystem for collection of the residue and supply chains have yet to develop to cater to the nation’s targets, he said at a renewable energy seminar outside New Delhi Friday
• NOTE: Reliance echoed concerns raised previously by an Indian lawmakers’ panel, which said that out of the 5,000 CBG plants planned by March next year, only 40 had been set up so far
• Reliance is still on course to build 100 CBG plants in the next 3-5 years, Shirazi said
• NOTE: To Fight India’s Deadly Smog, Farmers Told to Sell Crop Waste

Select Fertilizer Prices Rebound — Market Talk

Prices on some types of fertilizer have turned higher after easing overall for the past year, according to the latest assessment from agricultural research firm DTN, covering pricing through September 29. The firm says that of the eight type of fertilizer prices it assesses, five of them are higher this week — including major types like anhydrous ammonia and urea. Volatility in nitrogen pricing is behind much of the choppiness as prices more than doubled from 2021 through 2022. Higher input costs amid increasing inflation has created strains for US farmers.

 

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