Global Ag News for Feb 16.22

TODAY – EIA WEEKLY PETROLEM STATUS REPORT

Wheat prices overnight are up 2 1/2 in SRW, up 2 in HRW, up 3 in HRS; Corn is up 3 3/4; Soybeans up 12; Soymeal up $0.54; Soyoil up 0.28.

For the week so far wheat prices are down 15 1/4 in SRW, down 15 3/4 in HRW, down 3 1/2 in HRS; Corn is down 9 3/4; Soybeans down 18 3/4; Soymeal down $1.27; Soyoil up 0.54. For the month to date wheat prices are up 22 in SRW, up 27 1/2 in HRW, up 50 3/4 in HRS; Corn is up 16 3/4; Soybeans up 72 1/2; Soymeal up $25.50; Soyoil up 1.19.

Year-To-Date nearby futures are up 19% in SRW, up 27% in HRW, up 52% in HRS; Corn is up 16%; Soybeans up 13%; Soymeal up 4%; Soyoil up 40%.

Chinese Ag futures (MAY 22) Soybeans down 74 yuan ; Soymeal down 2; Soyoil down 78; Palm oil down 66; Corn down 11 Malaysian palm oil prices overnight were down 49 ringgit (-0.87%) at 5608.

There were no changes in registrations. Registration total: 1,900 SRW Wheat contracts; 17 Oats; 50 Corn; 146 Soybeans; 137 Soyoil; 0 Soymeal; 92 HRW Wheat.

Preliminary changes in futures Open Interest as of February 15 were: SRW Wheat down 385 contracts, HRW Wheat up 1,932, Corn down 4,517, Soybeans up 493, Soymeal up 5,252, Soyoil down 3,306.

Brazil Grains & Oilseeds Forecast: Rio Grande do Sul and Parana Forecast: Mostly dry Tuesday. Isolated showers Wednesday-Saturday, mostly north. Temperatures near to above normal through Saturday. Mato Grosso, MGDS and southern Goias Forecast: Scattered showers through Saturday. Temperatures near normal through Saturday.

Argentina Grains & Oilseeds Forecast: Cordoba, Santa Fe, Northern Buenos Aires Forecast: Mostly dry Tuesday. Isolated showers Wednesday. Mostly dry Thursday-Saturday. Temperatures near to above normal Tuesday-Wednesday, near to below normal Thursday-Saturday. La Pampa, Southern Buenos Aires Forecast: Mostly dry Tuesday. Isolated showers Wednesday. Mostly dry Thursday-Saturday. Temperatures near to above normal Tuesday-Wednesday, near to below normal Thursday-Saturday.

The player sheet for Feb. 15 had funds: net sellers of 13,000 contracts of  SRW wheat, sellers of 25,000 corn, sellers of 14,500 soybeans, sellers of 6,000 soymeal, and  sellers of 1,500 soyoil.

TENDERS

• SOYBEAN SALE: The U.S. Department of Agriculture reported private sales of 53,500 tonnes of U.S. soybeans to Mexico for 2021/22 marketing year shipment and 47,500 tonnes for 2022/23 shipment.
• WHEAT TENDER: A group of South Korean flour mills has issued tenders to purchase up to 82,000 tonnes of wheat to be sourced from the United States and Canada
• WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is seeking to buy a total of 54,692 tonnes of food-quality wheat from the United States in regular tenders that will close on Feb. 17.
• SUNFLOWER OIL TENDER: Turkey’s state grain board TMO has issued an international tender to purchase and import about 6,000 tonnes of crude sunflower oil.
• BARLEY, CORN AND SOYMEAL TENDER: Iranian state-owned animal feed importer SLAL has issued international tenders to purchase up to 60,000 tonnes of animal feed barley, 60,000 tonnes of feed corn and 60,000 tonnes of soymeal

PENDING TENDERS

• WHEAT TENDER: Bangladesh’s state grains buyer has issued an international tender to purchase 50,000 tonnes of milling wheat. The deadline for submission of price offers is Feb. 14.
• MILLING WHEAT TENDER: A Syrian state grains agency has issued an international tender to purchase and import 200,000 tonnes of milling wheat
• FEED WHEAT TENDER: An importer group in the Philippines has issued a tender to purchase around 45,000 tonnes of animal feed wheat
• FEED WHEAT, BARLEY TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries said it will seek 80,000 tonnes of feed wheat and 100,000 tonnes of feed barley to be loaded by May 31 and arrive in Japan by July 28, via a simultaneous buy and sell auction that will be held on Feb. 16.
• VEGOIL TENDER: Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), said on Sunday it was seeking vegetable oils in an international purchasing tender for arrival April 5-25. GASC said traders should submit bids for payment at sight and 180-days letters of credit. The deadline for offers is Feb. 16.
• WHEAT TENDER: Algeria’s state grains agency OAIC has issued an international tender to buy milling wheat to be sourced from optional origins
• WHEAT TENDER: The Taiwan Flour Millers’ Association has issued an international tender to purchase 54,920 tonnes of grade 1 milling wheat to be sourced from the United States
• BARLEY TENDER: Turkey’s state grain board TMO has issued an international tender to purchase an estimated 255,000 tonnes of animal feed barley
• BARLEY TENDER: Jordan’s state grains buyer has issued a new international tender to purchase 120,000 tonnes of animal feed barley

 ETHANOL: U.S. Weekly Production Survey Before EIA Report

Output and stockpile projections for the week ending Feb. 11 are based on eight analyst estimates compiled by Bloomberg.

• Production seen higher than last week at 1.003m b/d
• Stockpile avg est. 24.966m bbl vs 24.799m a week ago

Brazil Soy Crop Estimate Cut by 6% to 125.8m Tons: Agroconsult

Projected production is 18m tons below the initial estimate for the 2021-22 season, Brazil’s crop forecaster Agroconsult says in a report.

• Previous estimate was 134.2m tons
• Cut was made due to drought losses in the nation’s south and part of Mato Grosso do Sul state
• Avg yield seen falling 12.7% y/y to 51.7 bags/ha, the lowest since 2015-16
• Production may be even lower as Brazil’s south needs to get rains through mid-March
• Winter-corn crop seen at 92.2m tons, up 51% y/y
• Planted area may rise 7% to 15.7m ha

Brazil Soy Group Asks Bayer for Explanations on Supplier Failure

A Brazilian soybean-producer group asked Bayer AG for further explanation and assurances after the drug and chemical maker said a production shutdown by one of its suppliers will reduce output of its widely used herbicide.

• Fernando Cadore, president of Aprosojain Mato Grosso, said in a letter to the company that Bayer should have been more open about the scope of the glyphosate force majeure announcement
• “Problems within industrial structures are not atypical events and that‘s why corporations as big as Bayer have contingency plans, that we would like to be informed, given the importance of Intacta to the producer”
• According to Cadore, Brazilian law doesn’t accept adverse events that are normal in the course of business activity as a reason to evoke force majeure
• “From this conduct, we can only question if the company is starting a new force majeure concept that can be equally alleged by farmers that cannot fulfill their contracts due to crop losses or mechanical issues”
• The letter asks if the contracts signed with farmers will be fulfilled and, if not, what will be done to mitigate its impact to the clients

NOPA January soybean crush below expectations at 182.216 million bushels

U.S. soybean crushings in January fell short of all analyst estimates, although the crush was still the second largest on record for the first month of the year, according to National Oilseed Processors Association (NOPA) data released on Tuesday.

NOPA members crushed 182.216 million bushels of soybeans last month, down 2.3% from a record-high monthly crush of 186.438 million bushels in December and 1.3% below the January record of 184.654 million bushels set last year.

The crush was below expectations despite the inclusion of monthly crush data from a new NOPA member.

Processors had been expected to crush 186.677 million bushels in January, according to the average of estimates from nine analysts. Estimates ranged from 183.675 million to 188.500 million bushels, with a median of 187.000 million bushels. (Full Story)

NOPA said soyoil supplies among its members as of Jan. 31 totaled 2.026 billion lbs, the second largest end-of-month stocks since April 2020. The stocks were down 0.3% from 2.031 billion lbs at the end of December but up 12.6% from 1.799 billion lbs held by NOPA members at the end of January 2021.

Oil stocks had been expected to rise to 2.062 billion lbs, based on estimates gathered from seven analysts. Estimates ranged from 2.000 billion to 2.150 billion, with a median of 2.058 billion.

Malaysia Keeps Crude Palm Oil Export Duty at 8% in March

Gazetted price for crude palm oil at 5,277.58 ringgit a ton, which incurs the maximum export tax of 8%, according to a statement from the customs department posted on the Malaysian Palm Oil Board’s website.

• NOTE: Tax has been kept at 8% since Jan. 2021, following government exemption in July-December 2020
• NOTE: Export duty structure starts at 3% when FOB prices for CPO are in the 2,250-2,400 ringgit per ton range
• Maximum tax rate is 8% when prices are above 3,450 ringgit per ton

Malaysia Feb. 1-15 Palm Oil Exports to EU 188,517 Tons: SGS

Following is a table of Malaysia’s palm oil export figures, according to estimates by independent cargo surveyor SGS Malaysia Sdn.

• EU imported 188,517 tons; +104.4% m/m
• India imported 56,000 tons; -53.9% m/m
• South Africa imported 38,550 tons; +157% m/m

EU’s Soft-Wheat Exports Rise 2.4% in Season Through Feb. 13

Soft-wheat shipments during the season that began July 1 reached 17.3m tons as of Feb. 13, versus 16.9m tons in a similar period a year earlier, the European Commission said Tuesday on its website.

• NOTE: Figures for the prior season include trade for the U.K. until Dec. 31, 2020, when the country departed the EU customs union
• Top soft-wheat destinations are Algeria (2.7m tons), China (1.68m tons) and Egypt (1.64m tons)
• EU barley exports at 5.15m tons, versus 4.85m tons a year earlier
• EU corn imports at 10.1m tons, against 10.5m tons a year earlier

Sovecon Raises Russia Wheat Crop Est. 4% on Near Ideal Weather

Russia’s 2022 wheat harvest is now seen at 84.8m tons, up 3.55m tons from a prior outlook, consultant SovEcon says in an emailed note.

• “The 2021-22 winter has been almost ideal for the new crop, especially in the south,” says Andrey Sizov, head of SovEcon
• Temperatures have been above normal, ice-crust problems are minimal
• Accumulated moisture is well above normal in southern regions, and snow has aided fields in Central and Volga Valley areas
• Farmers may pare back fertilizer use, but yield impact should be limited
• NOTE: Russia produced 76m tons of wheat in 2021 and record 85.9m tons in 2020, according to SovEcon

Ukraine Winter-Grain Plantings Rose About 5% Y/y: Ministry

Ukrainian farmers planted 7.7m hectares of winter-grain crops for the 2022 season, up 0.4m hectares from the prior year, according to data published by the agriculture ministry this week.

• Winter-wheat and triticale area at 6.5m hectares, up 0.4m hectares
• Barley area at 1m hectares, up 45k hectares
• Rapeseed area at 1.02m hectares, up 143k hectares

AgriMer Lowers French Wheat Reserves Estimate, Cuts Exports

Crops office FranceAgriMer lowered its outlook for French soft-wheat stockpiles at the end of the 2021-22 season to 3.58m tons, due to higher animal-feed and food use, it said in a report Wednesday.

• That compares to a January estimate for 3.65m tons
• Estimate for exports outside the EU cut to 8.9m tons, from 9m tons
• Total exports seen at 16.8m tons

BARLEY

• Export estimate little changed at 5.97m tons
• End-of-season stockpiles also little changed

CORN

• Stockpiles seen at 2.03m tons, versus previous outlook of 1.87m tons
• That’s partly due to lower animal-feed use

Indonesia’s 2022 Wheat Import Seen Rising 5% as Economy Recovers

Indonesia’s food-grade wheat imports may increase about 5% as economy recovers and two new flour mills are completed this year, according to the Association of Flour Producers in Indonesia.

• Wheat-flour consumption continued to increase in the past two years despite the pandemic, said Ratna Sari Lopies, executive director at the association
• Total wheat milling capacity to reach 13.1m tons a year from 32 factories
• Indonesia’s wheat flour consumption in 2021 is estimated to grow 5.27% to 7m tons or equivalent to 8.99m tons of wheat
  • 2020 consumption was at 6.71m tons of wheat flour, equivalent to 8.6m tons wheat or a 0.4% increase from 2019
• Imports of food-grade wheat in Jan-Nov 2021 rose 7.4% to 8.07m tons compared to previous year, according to the statistics office

Fertilizer Just Got Even More Expensive as Potash Prices Jump

Fertilizer just got even more expensive.

Canpotex has agreed to supply China with potash fertilizer shipments at $590 a metric ton through December, which is more than double the price from a year ago and the highest since at least 2013, according to data from Bloomberg’s Green Markets released Tuesday. The price is at the top end of expectations, Scotiabank analyst Ben Isaacson said Tuesday in a note.

The joint venture that markets offshore potash sales for Nutrien Ltd. and Mosaic Co. also just settled a contract to supply India for the same price. Potash is used on major commodity crops and to grow produce, among other uses.

Fertilizer costs have skyrocketed as high natural gas prices, a key input, forced some European plants to halt or curtail production. Adding to concerns, the U.S. imposed sanctions on a major potash supplier in Belarus in December that will affect global supplies. It all points to rising costs for farmers, who are already curbing their fertilizer use, which could lead to lower crop yields and further boost food inflation.

Nutrien Ltd. has increased potash prices across North America by $25, Green Markets said Tuesday.

Grain Handler Andersons Soars as Fertilizer Prices Fuel Profit

• Shares jump after market close as company beats estimates
• Andersons doesn’t see return of 2021 fertilizer price spikes

The Andersons Inc., one of the five largest U.S. grain traders, surged in after-market trading as gains in the company’s fertilizer business lifted fourth-quarter profit above expectations.

“Fertilizer prices and farm income both remain high,” Chief Executive Officer Pat Bowe said in a statement.

Andersons said it expects fertilizer prices to stay elevated, though not at the same levels as 2021. In biofuels, the company is rebranding its ethanol division to “renewables,” reflecting the company’s push into new markets, especially renewable diesel.

Shares jumped as much as 7.5% following the close of U.S. markets. They ended the formal trading day up 3.2% at $40, the highest close in more than three years.