Global Ag News for Mar 25.24

TOP HEADLINES

Top Russia Grain Trader Says Exports Blocked by Agri Watchdog

• Watchdog says Rif cargoes repeatedly failing standards
• Rif says its under pressure to sell assets cheap, report says

A top Russian grain trader said that its wheat exports have been disrupted after the country’s agricultural watchdog faulted its cargoes for not meeting safety and quality standards. The owner of TD Rif, Petr Khodykin, said that his ships laden with Russian wheat are being blocked, causing his company “huge losses,” according to online news service Lenta.ru.

The comments are the latest sign of upheaval among traders in Russia, the world’s top wheat exporter. The Kremlin has moved to take stronger control of exports since Vladimir Putin’s invasion of Ukraine, with the major Western traders having stopped originating grain for export in Russia last year. The country’s bumper wheat harvests have helped bring global prices down from record highs.

TD Rif manager Marina Turyanskaya said in a letter to officials that its ships had been blocked since March 18 after inspectors started to find that cargo did not adhere to standards. Previous cargoes “freely passed” inspections for safety, quality and import quarantine requirements, the letter said, according to Lenta.

The company is under “unprecedented” pressure to sell its assets for a “negligible price,” the news report added, citing a note from TD Rif’s owner.

 

 

FUTURES & WEATHER

Wheat prices overnight are up 9 1/4 in SRW, up 5 1/2 in HRW, up 3 3/4 in HRS; Corn is up 1/4; Soybeans up 1 1/4; Soymeal down $2.00; Soyoil up 0.40.

Markets finished last week with wheat prices up 21 in SRW, up 22 1/4 in HRW, up 14 in HRS; Corn is up 3 3/4; Soybeans up 6; Soymeal up $5.20; Soyoil down 0.66.

For the month to date wheat prices are down 12 1/4 in SRW, up 8 3/4 in HRW, up 5 3/4 in HRS; Corn is up 10; Soybeans up 53; Soymeal up $7.90; Soyoil up 2.83.

Year-To-Date nearby futures are down 10.2% in SRW, down 7.2% in HRW, down 8.1% in HRS; Corn is down 6.7%; Soybeans down 7.7%; Soymeal down 12.7%; Soyoil up 0.4%.

Chinese Ag futures (MAY 24) Soybeans up 6 yuan; Soymeal down 81; Soyoil down 78; Palm oil down 22; Corn down 6 — Malaysian Palm is up 61. Malaysian palm oil prices overnight were up 61 ringgit (+1.46%) at 4249.

There were no changes in registrations. Registration total: 438 SRW Wheat contracts; 0 Oats; 37 Corn; 499 Soybeans; 710 Soyoil; 26 Soymeal; 0 HRW Wheat.

Preliminary changes in futures Open Interest as of March 22 were: SRW Wheat up 1,748 contracts, HRW Wheat up 289, Corn up 762, Soybeans up 3,801, Soymeal up 1,389, Soyoil down 483.

Brazil: A front settled into central Brazil over the weekend where it produced good showers for safrinha corn. The front will remain stalled almost all week, promising to build in some decent subsoil moisture where reserves have been more limited. At the same time, areas to the south will be much drier and have to rely on that built up soil moisture earlier than normal, which may be harmful if levels get too low too quickly. A little system moving through early next week may provide at least a few showers.

Argentina: A front left to the north late last week and meant cooler and drier conditions over the weekend. Outside of a small disturbance with a few showers for southern areas Tuesday and Wednesday, it should be dry this week, which is not ideal for filling corn and soybeans but will allow for some of the wetter areas to dry out a bit. A system should bring showers through this weekend.

Europe: A system moved through much of the continent over the weekend with scattered showers. Another big storm will close in on the UK early this week, sending several waves of showers through the continent throughout this week and probably portions of next week as well. Precipitation will be heavier in the west, which favors Spain but not the UK or France, which continue to be too wet.

Black Sea: A system will move through early this week with some areas of showers, but won’t be widespread and some areas of eastern Ukraine and southwestern Russia have been too dry over the last few weeks. Other systems going through Europe will likely escape around the region, which brings in warm air instead. That favors developing winter wheat, but also dries out soils which are going to hope for a slightly more active period next week.

Australia: A front brought scattered showers to Queensland over the weekend, which continues for the next few days. Drier weather elsewhere is fine for harvesting cotton and sorghum, but not for building in soil moisture ahead of winter wheat planting, which begins in mid-April. However, the ending El Nino and eventual turn to La Nina should favor the winter crops later this year.

Northern Plains: Cold air led to a burst of snow moving into the region over the weekend and a storm system brought moderate winds that produced some blizzard conditions in spots as well. The snow shifts to the eastern Dakotas for Monday before exiting. The cold will probably stick around through the coming weekend, especially where snow is the deepest from the storm. Some additional showers may move through later this week and weekend, but models are not consistent with any of the details to the system moving through.

Central/Southern Plains: A system built in over the weekend with scattered showers on Sunday and continues to impact the region on Monday. Though precipitation is more limited in this region, some heavier rain is going to fall on Nebraska and that will be followed by a band of snow for Monday from the Panhandles northeastward. Cold air will build in for a few days behind this system, which will bring about some 10s through much of HRW territory that could cause damage. The cold relents by late week with more showers being possible late week and weekend before another system goes through early next week. That storm track looks farther south, which would bring more widespread precipitation to the region if it continues that track.

Midwest: A big system moved into the region over the weekend and is bringing heavy snow to the northwest with showers and thunderstorms farther south and east through Tuesday. Some thunderstorms could be severe. Cold air will fill in behind the storm this week with the coldest air over the deeper snow pack across Minnesota. The rest of the region will warm up ahead of the next disturbance later this week. Some showers may fall because of that system this weekend. Another system that may stay to the south may bring a renewed shot of colder temperatures for early April. The precipitation from the more active pattern should benefit soil moisture ahead of spring planting.

Delta: A cold front will bring a line of showers and thunderstorms through the region on Monday, potentially with some severe weather. Another storm will move through early next week with more rainfall. Soils are in good shape across most of the region and big enough breaks between storms could lead to some early planting where it is not too wet. Colder and wetter conditions may limit planting in most places, though.

The player sheet for 3/22 had funds: net buyers of 3,500 contracts of SRW wheat, sellers of 500 corn, buyers of 6,500 soybeans, sellers of 3,000 soymeal, and sellers of 2,500 soyoil.

TENDERS

• CORN SALE: Exporters sold 263,000 metric tons of U.S. corn to Mexico, the U.S. Department of Agriculture said Friday. Of that, 173,000 metric tons is for delivery in the 2023/2024 marketing year, and 90,000 tons is for delivery in the 2024/2025 marketing year.

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 100,800 metric tonnes of rice mainly to be sourced from the United States and China.
• 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
• RICE TENDER: An international tender from Indonesian state purchasing agency Bulog to buy 300,000 metric tons of rice seeks arrival of the grain in Indonesia by May 31.
• 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

CROP SURVEY: US Farmers Seen Planting 91.8M Corn Acres This Year

US farmers seen decreasing corn planting by 2.8m acres this year vs 2023, according to the avg est. of as many as 28 analysts surveyed by Bloomberg.

• At last month’s Outlook Forum, USDA estimated 2024 corn acres at 91m acres
• Soybean planting seen at 86.7m acres vs 83.6m last year
  • The Outlook Forum est. was for 87.5m acres
• Wheat seen at 47.3m acres vs 49.6m last year
• Cotton seen at 11.3m acres vs 10.2m last year

CROP SURVEY: US Grain Stocks Seen Higher Ahead of USDA Report

US March 1 stockpiles of corn, wheat and soybeans stored on farms and commercial facilities are all seen higher than in the same period last year, according to the avg estimates of as many as 20 analysts surveyed by Bloomberg.

• Corn stocks seen 14.2% higher at 8.44b bu
• Soybean stocks seen up 8.8% to 1.84b bu
• Wheat stocks seen up 11.3% to 1.05b bu

Brazil Farmers Harvest 69.33% Of 2023/2024 Soybean Area Versus 70.42% At This Time Last Year – Patria Agronegocios

BRAZIL FARMERS HARVEST 69.33% OF 2023/2024 SOYBEAN AREA VERSUS 70.42% AT THIS TIME LAST YEAR – PATRIA AGRONEGOCIOS

US Cattle on Feed Rose to 11.84M Head on March 1

The feedlot herd rose 1.3% from a year ago, according to the USDA’s monthly report. Analysts were expecting a rise of 0.9%

• Placements onto feedlots up 9.7% to 1.89m head
• Cattle marketed from feedlots increased 3.4% to 1.793m head

USDA attaché lowers Brazil 2023/24 soy crop estimate to 152.6 million T

Following are selected highlights from a report issued on Friday by the U.S. Department of Agriculture’s (USDA) Foreign Agricultural Service post in Brasilia:

“Post forecasts that Marketing Year (MY) 2024/25 planted area will expand at a slower growth rate, reaching 45.6 million hectares (ha). Post forecasts MY 2024/25 (soybean) production at 157.5 million metric tons (MMT), 4.9 MMT more than the revised estimate in MY 2023/24. Due to poor weather in the end of 2023, Post estimates Brazil’s yields to reduce by 7% compared to MY 2022/23. Exports are forecasted at 99 MMT in MY 2024/25 mostly due to a solid international demand. … Post revises down its MY 2023/24 production estimate to 152.6 MMT, 4% below the previous estimate, at 158.5 MMT, elaborated in December. Lower yields outlooks have driven this downward estimate. This results from the poor weather conditions across major producing regions, as the Center West. Area estimates remain unchanged at 45.2 million ha.”

CORN/CEPEA: Corn prices move down in BR

Pressed by low demand, Brazilian corn prices moved down again in most part of the regions surveyed by Cepea. The higher decreases were registered for producing regions of the second crop.

In São Paulo state, prices have been decreasing for five days in a row, returning to the levels verified in late February. Buyers are enough supplied, by volumes came from Central-West, with no need to purchase large quantities in the spot market in a short-term. The downward trend, however, was limited by the retraction of sellers.

The disparity between the prices asked by sellers and those offered by buyers keeps high, which limited the domestic liquidity. From March 14 to 21, the ESALQ/BM&FBovespa Index (Campinas, SP) dropped 1%, closing at BRL 62.62/bag on March 21. On the average of the regions surveyed by Cepea, corn values upped slightly 0.3% both in the wholesale market (deals between processors) and in the over-the-counter market (paid to farmers) over the last seven days.

Brazilian agents are also focused on the weather conditions in Argentina and United States. In Argentina, low moistore during the grain development period and, more recently, excessive rainfall in harvesting areas pressed estimates for corn production in that country. Now, the harvest is expected to total 54 million tons, 4.4% below than that forecasted in the previous week – Bolsa de Cereales data. It is important to consider that the current production may still be 58.8% higher than that in previous season.

PORTS – In the first 11 working days of March, the daily average of exports is 64% inferior than that in March/23, according to data from Secex. In the partial of the month, sales had totaled 227 thousand tons, against 1.33 million tons verified in the same month last year.

CROPS – Although lower than expected, the rains returned in most of the producing regions. Players surveyed by Cepea indicate that more rainfall is needed, especially for the second crop.

Up to March 17, the second crop planting reached 92.3% of the total area, according to Conab data, for an advance of 6.6 percentage points in one week and of 7.2 percentage points compared to the previous year.

SOYBEAN/CEPEA: Rain interrupts harvesting activities; prices keep moving up

Rains in the South and Southeast of Brazil have interrupted punctually soybean harvesting activities this week in some regions surveyed by Cepea. In this scenario and also concerned about the Brazilian productivity – which may be lower in some regions –, growers were cautious in new trades in the spot market.

On the other hand, agents showed more interest in exporting the product; however the liquidity was limited by the low supply at Brazilian ports. In Argentina, another important global player for the soybean and byproducts, low moisture during the grain development period and, more recently, excessive rainfall can reduce crop quality. In this context, export premium increased in Brazil, also boosting domestic quotations.

From March 14-21, the ESALQ/BM&FBovespa Index (Paranaguá) upped 1.8%, closing at BRL 124.78 per 60-kg bag on March 21. The CEPEA/ESALQ Index (Paraná) increased 2%, to close at BRL 120.39 per 60-kg bag. On the average of the regions surveyed by Cepea, soybean prices rose 1.8% in the over-the-counter market (paid to farmers) and 1.3% in the wholesale market (deals between processors).

BYPRODUCTS – The slow liquidity, due to lower international demand, pressed down export premium and domestic values for soybean byproducts. On the average of the regions surveyed by Cepea, soymeal prices decreased 0.4% in the last seven days. The Brazilian value of soy oil also moved down 0.4%, at 5,147.88 BRL per ton (in São Paulo city with 12% ICMS) on March 21.

HARVEST – Data released by Conab indicate that the soy harvest reached 61.9% of the area up to March 17, against 62.5% one year ago.

 

US Pork Production Up 2.6% This Week, Beef Down: USDA

US federally inspected pork production rises to 546m pounds for the week ending March 23 from 532m in the previous week, according to USDA estimates published on the agency’s website.

• Hog slaughter up 2.7% from a week ago to 2.532m head
• Beef production down 0.2% from a week ago, cattle slaughter falls 0.5%
• For the year, beef production is 4% below last year’s level at this time, and pork is 0.5% above

US Egg Production Rose 5% in February From Year Ago: USDA

The US produced 8.62b eggs in February vs 8.21b in the same period a year ago, according to a report from the USDA.

• Output of table eggs rose 5% y/y to 7.39b
• Hatching eggs up 4.9% to 1.22b

 

 

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