Written Commentary
TODAY—WEEKLY EXPORT SALES—
Overnight trade has SRW down roughly 1 cent, HRW down 1; HRS Wheat down 1, Corn is down 1 cent; Soybeans up 2, Soymeal up $1.00, and Soyoil up 15 points.
Chinese Ag futures (Sep) settled down 1 yuan, up 33 in Corn, up 30 in Soymeal, down 28 in Soyoil, and up 12 in Palm Oil.
Malaysian palm oil prices were down 7 ringgit at 2,649 (basis October) at midsession on position-evening.
U.S. Weather Forecast
Last evening’s GFS model run suggested a notably cool and dry air mass to shift down into the Corn Belt and central U.S. July 30 – Aug. 3 causing significant decreases of rain both in this region and the Hard Red Winter Wheat Region as well.
Conditions in much of the U.S. are still expected to remain favorable; though, there will be some pockets that are too dry most notably in West Texas, the southern Hard Red Winter Wheat Region, Montana, the central Delta, and in erratically distributed areas of the Southeast.
The 11 to 16 day forecast for the Midwest is back to mixed with the European showing below average temps and close to average precip; the GFS has ridging producing below average rainfall and above average temps.
The player sheet had funds net buyers of 5,000 contracts of SRW Wheat; net bought 15,000 Corn; bought 3,000 Soybeans; net bought 1,000 lots of soymeal, and; sold 1,000 Soyoil.
We estimate Managed Money net short 5,000 contracts of SRW Wheat; short 125,000 Corn; net long 88,000 Soybeans; net short 29,000 lots of Soymeal, and; long 24,000 Soyoil.
Preliminary Open Interest saw SRW Wheat futures up roughly 1,800 contracts; HRW Wheat up 215; Corn up 9,900; Soybeans up 275 contracts; Soymeal unchanged, and; Soyoil down 1,700.
There were no changes in registrations—Registrations total 95 contracts for SRW Wheat; ZERO Oats; Corn ZERO; Soybeans ZERO; Soyoil 2,786 lots; Soymeal 511; Rice 174; HRW Wheat 47, and; HRS 1,387.
Tender Activity—Jordan seeks 120,000t optional-origin wheat—
U.S. ethanol production for the week ended July 17th averaged 908,000 barrels per day (down 2.5% versus a week ago, down 12.6% versus a year ago); stocks totaled 19.8 mil barrels (down 3.9% versus a week ago, down 16.4% versus last year); corn use for the week was 90.9 mil bu (91.6 mil last week) and versus the 99.4 mil bu needed to meet USDA projections.
July is usually a busy time for ethanol consumption in the United States as travelers hit the road for their summer vacations, and although activity has been curtailed this year by the coronavirus pandemic, last week’s ethanol demand echoed typical levels for the second time this season; however, the running weekly averages for both ethanol and gasoline consumption remain below normal, and the recovery path for the ethanol industry may continue to be non-linear, especially as some areas of the country pull back on some of the reopening efforts
U.S. frozen pork inventories fell 25% from a year earlier at the end of June, the U.S. Agriculture Department said on Wednesday, after coronavirus outbreaks in meatpacking plants slowed production; the data show supplies in cold-storage facilities remain lower though meat processing has largely recovered after plants temporarily closed in April and May due to the spread of the contagious respiratory virus; as of June 30, 464.373 million pounds of pork, including ribs, loins and hams, were in cold-storage facilities, down from 467.927 million the previous month and 619.454 million a year earlier, the USDA said in a monthly report.
POLL-U.S. June cattle placements seen up 3.8%, after virus slowed slaughter – Reuters News
It’s been a long time coming, but USDA released its long anticipated report July 22 on the unnerving dynamics in the cattle markets following the Tyson Finney County packing plant fire last year and the market disruptions caused by COVID-19 this year; Bottom line-Boxed beef and fed cattle markets acted about as expected, given the unprecedented disruptions those two events caused and with the coronavirus, are still causing.
China’s grain, pork imports in June 2020
China imported 400,000 tonnes of pork in June, customs data showed on Thursday, up 128.4% from the same month a year earlier, as a months-long buying spree continued as importers try to help plug a domestic shortage.
China’s National Health Commission on Thursday issued coronavirus epidemic control guidelines for meat processing companies, including demanding imported livestock and poultry products must have virus-free certificates before being processed in Chinese plants.
Russia shipped two wheat cargoes to Brazil this month, totaling 60,000 tons, in the first trades of their kind this year; purchases of the Russian cereal, confirmed by sources at trading firms Sodruzhestvo and Glencore, followed a new tariff-free quota for Brazilian wheat imports from outside the Mercosur bloc, which includes neighboring Argentina, Brazil’s main wheat supplier.
The Port of Paranaguá, Brazil’s second busiest for soybean and sugar cargoes, is gradually resuming grain export operations after a fire that affected conveyor belts at two terminals, according to a statement from the port authority
European wheat prices edged higher on Wednesday, supported by a rise on U.S. markets but their advance was capped by a strong euro that hampers EU grains’ competitiveness on the export market; front-month September wheat futures settled 0.75 euro higher at 183.75 euros a ton.
German pig prices stabilized this week following heavy falls, with the market underpinned as a huge German slaughterhouse reopened after a coronavirus outbreak; pig prices have remained unchanged this week around 1.47 euros a kilo after Toennies reopened, the German pig farmers’ association said; this compared to 1.60 euros a kilo four weeks ago
Indonesian state oil company PT Pertamina is set to test the production of jet fuel made up of 3% palm oil by the end of the year; the comments come a week after the company announced its first batch of biodiesel using feedstock of 100% palm (D100), saying it would produce 1,000 barrels per day (bpd); the green jet fuel trial is part of the roadmap for Pertamina’s biorefinery development in order to realize green energy in Indonesia
Exports of Malaysian palm oil products for Jul. 1-20 fell 10.5 percent to 1,089,021 tons from 1,217,356 tons shipped during Jun. 1-20, cargo surveyor Societe Generale de Surveillance said
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