Global Ag News for Oct 3.24

TOP HEADLINES

EU Moves to Delay Deforestation Rule After Huge Pushback

• European Commission suggests postponing regulation by a year
• Agricultural heavyweights had vehemently criticized the plans

The European Commission moved to postpone a landmark law to tackle global deforestation, submitting to immense pressure from commodity-producing countries and industry.

The commission suggested a 12-month delay to rules aimed at curbing forest clearance in nations that send products such as coffee, cocoa, soy and beef to the bloc, it said Wednesday, confirming an earlier Bloomberg report. Global agricultural heavyweights from Brazil to Indonesia had fiercely criticized the plans on concern they’d hurt smallholder farmers and curtail key exports.

A delay would mark a fresh setback to the European Union’s green push. But it could offer a temporary reprieve for consumers just as extreme weather pushes up crop prices worldwide and revives worries about food inflation.

The extension would allow extra time for parties to get ready, but “in no way puts into question” the objectives of the law, the commission said in a statement. The proposal will need signoff from both the European Parliament and member states, as the regulation was slated to take effect Dec. 30.

“The commission recognizes that three months ahead of the intended implementation date, several global partners have repeatedly expressed concerns about their state of preparedness,” it said. “The state of preparations amongst stakeholders in Europe is also uneven.”

The bloc recently lost its greenest parliament ever, and governments across the continent have faced pressure to soften their environmental ambitions on cost concerns. Member states and industry groups have voiced alarm over the deforestation regulation, warning of impending supply disruptions and inflation.

‘Huge Relief’

“A delay would bring a huge relief to the EU value chains affected, from cocoa to palm oil — and not least to European consumers already affected by a cost-of-living crisis,” said Carlos Mera, an analyst at Rabobank in London.

The rules necessitate complex tracking systems, with importers required to collect precise data to identify the plots of land where the goods were grown. Companies must ensure the products they bring in weren’t made on areas deforested or degraded after 2020.

German farmers’ group DBV welcomed the move to delay.

“The uncertainties caused must now be a reason to fundamentally simplify the regulation again and not to impose additional bureaucracy on countries with effective forest protection,” DBV Secretary-General Bernhard Krüsken said.

Yet environmental groups were dismayed by the proposal, saying the world’s forests urgently need more protection.

European Commission President Ursula von der Leyen “might as well have wielded the chainsaw herself,” Greenpeace EU Forest Policy Director Sébastien Risso said. “People in Europe don’t want deforestation products on their supermarket shelves, but that’s what this delay will give them.”

 

FUTURES & WEATHER

Wheat prices overnight are down 2 1/4 in SRW, down 2 3/4 in HRW, unchanged in HRS; Corn is down 1 1/4; Soybeans down 7 1/2; Soymeal down $3.30; Soyoil up 0.01.

For the week so far wheat prices are up 33 1/4 in SRW, up 40 in HRW, up 40 3/4 in HRS; Corn is up 13 1/4; Soybeans down 17; Soymeal down $7.10; Soyoil up 1.29.

For the month to date wheat prices are up 29 in SRW, up 32 3/4 in HRW, up 27 1/4 in HRS; Corn is up 6 1/2; Soybeans down 8 1/2; Soymeal down $4.50; Soyoil up 0.34.

Year-To-Date nearby futures are down 2.3% in SRW, down 3.9% in HRW, down 10.3% in HRS; Corn is down 8.5%; Soybeans down 18.9%; Soymeal down 12.0%; Soyoil down 8.6%.

Chinese Ag futures (NOV 24) Soybeans down 8 yuan; Soymeal up 38; Soyoil down 36; Palm oil down 62; Corn up 34 — Malaysian Palm is down 14.

Malaysian palm oil prices overnight were down 14 ringgit (-0.33%) at 4182.

China markets remain 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 2 were: SRW Wheat up 4,075 contracts, HRW Wheat down 5,549, Corn up 14,745, Soybeans up 6,155, Soymeal up 7,058, Soyoil up 1,322.

 

Northern Plains: Mostly dry through Sunday. Temperatures near to above normal through Thursday, above to well above normal Friday-Saturday, near to above normal Sunday. Outlook: Mostly dry Monday-Friday. Temperatures above to well above normal Monday-Friday.

Central/Southern Plains: Mostly dry through Sunday. Temperatures above to well above normal through Saturday, near to above normal Sunday. Outlook: Mostly dry Monday-Friday. Temperatures near to above normal Monday, above to well above normal Tuesday-Friday. 

Midwest: West: Mostly dry Wednesday. Isolated showers Thursday. Mostly dry Friday-Sunday. Temperatures near to above normal Wednesday, above normal Thursday-Saturday, near to above normal Sunday. East: Mostly dry Wednesday-Thursday. Isolated showers Friday. Mostly dry Saturday. Isolated showers north Sunday. Temperatures near to above normal Wednesday-Thursday, above normal Friday-Sunday. Outlook: Mostly dry Monday-Friday. Temperatures near to above normal Monday-Wednesday, above normal Thursday-Friday.

 

The player sheet for Oct. 2 had funds: net buyers of 6,500 contracts of SRW wheat, buyers of 8,000 corn, buyers of 2,000 soybeans, sellers of 2,000 soymeal, and buyers of 3,500 soyoil.

 

TENDERS

• WHEAT PURCHASE: An importer group in Thailand is believed to have purchased around 120,000 metric tons of animal feed wheat in a tender that closed on Tuesday seeking up to 180,000 tons
• CORN TENDER: Algerian state agency ONAB issued an international tender to purchase up to 320,000 metric tons of animal feed corn sourced from Argentina or Brazil
• WHEAT TENDER: Jordan’s state grain buyer issued an international tender to buy up to 120,000 metric tons of milling wheat that can be sourced from optional origins.
• WHEAT TENDER: Saudi Arabia has issued a tender to buy 295,000 metric tons of hard milling wheat for arrival from December through January, the General Food Security Authority (GFSA) said on Thursday.
• NO PURCHASE IN BARLEY TENDER: Jordan’s state grain buyer is believed to have made no purchase in an international tender for 120,000 metric tons of animal feed barley.

 

 

 

 

TODAY

GRAIN EXPORT SURVEY: Corn, Soy, Wheat Sales Before USDA Report

Estimate ranges are based on a Bloomberg survey of four analysts; the USDA is scheduled to release its export sales report on Thursday for week ending Sept. 26.

• Corn est. range 600k – 1,000k tons, with avg of 831k
• Soybean est. range 1,000k – 1,600k tons, with avg of 1,319k

 

DOE: US Ethanol Stocks Fall 0.3% to 23.459M Bbl

According to the US Department of Energy’s weekly petroleum report.

• Analysts were expecting 23.367 mln bbl
• Plant production at 1.015m b/d, compared to survey avg of 1.005m

 

SovEcon Cuts 2024 Russian Wheat Exports Forecast to 47.6M Tons

Consultant SovEcon lowered its Russian wheat exports forecast for the 2024-25 season to 47.6m tons from 48.1m tons, it said in an email.

• Total grain exports were lowered to 55.4m tons from 56.5m tons
  • Corn exports estimate cut to 2.2m tons from 2.4m tons
  • Barley exports forecast cut to 2.4m tons from 2.8m tons
• The reductions reflect a small decrease in the size of the wheat crop and an anticipated increase in domestic feed demand
• “Despite these reductions, SovEcon is not yet prepared to significantly lower its export estimates. Reports of sluggish demand have not slowed Russia’s wheat exports, which continue at a fast pace,” managing director Andrey Sizov said

 

India’s Sept palm oil imports hit 6-month low on price rise, dealers say

India’s palm oil imports in September fell by nearly a third compared to the previous month, hitting a six-month low as a surge in tropical oil prices made it more expensive than rival oils, forcing refiners to postpone purchases, five dealers said.

Lower purchases by the world’s biggest importer of vegetable oils could lead to higher stocks of palm oil in key producers Indonesia and Malaysia, weighing on benchmark futures FCPOc3.

Palm oil imports fell 34% in September from the previous month to 530,000 metric tons, according to estimates from dealers.

“Palm oil became more expensive than soybean oil and sunflower oil last month. Simultaneously, India increased import duties, prompting some refiners to cancel contracts,” said Sandeep Bajoria, CEO of Sunvin Group, a vegetable oil brokerage.

Palm oil typically trades at a discount to soft oils, but it is currently being offered at a premium over the soft oils for October shipments.

In mid-September, India raised the basic import tax on crude and refined edible oils by 20 percentage points.

Soyoil imports in September fell 15% from a month ago to 388,000 metric tons, while sunflower oil imports plunged 49% to 145,000 metric tons, the lowest in 10 months, dealers said.

The drop in imports of palm oil, soyoil and sunflower oil brought down the country’s total edible oil imports by 31% to 1.06 million tons, as per dealers’ estimates.

India buys palm oil mainly from Indonesia, Malaysia and Thailand, while it imports soyoil and sunflower oil from Argentina, Brazil, Russia and Ukraine.

Industry body the Solvent Extractors’ Association of India (SEA) is likely to publish its data on September imports by mid-October.

“Palm oil imports are likely to improve in October because of festive season. We could see shipments of more than 750,000 tons,” said a Mumbai-based dealer with a global trade house.

 

Russian watchdog requests suspension of Kazakh grain and vegetable export certification

The Russian Federal Service for Veterinary and Phytosanitary Surveillance (Rosselkhoznadzor) has asked Kazakhstan’s Agriculture Ministry to suspend issuance of phytosanitary certificates for grain, processed grain products, tomatoes, peppers and sunflower seeds exported to Russia.

This request comes due to “an increase in the detection of quarantine pests in products imported from Kazakhstan,” posing a risk to the phytosanitary safety of Russia, as well as to the development of greenhouse farming, domestic breeding, and seed production.

The suspension of certification was required starting September 23. “Rosselkhoznadzor’s information systems will automatically block the issuance of phytosanitary documents for the specified products coming from Kazakhstan,” according to the regulator’s press service.

Kazakhstan has banned wheat imports by all types of transport from third countries and EAEU countries until December 31, 2024, to protect the domestic market and prevent re-export, except for transit through the country. The Agriculture Ministry has said wheat imports in the first half of 2024 reached 1.3 million tonnes, nearly matching the total imports for 2023, despite sufficient domestic reserves from the previous harvest.

 

 

 

 

 

 

 

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