Global Ag News for July 21.23

TOP HEADLINES

IGC Raises Global Grain Production, Stockpiles Estimates

World grain production in the 2023-24 season is now seen at 2.297b tons, up from a June forecast for 2.292b tons, the International Grains Council said in a report.

• Stockpiles raised to 581m tons from 577m tons
• Corn production seen higher on bigger US acreage, while wheat crop shrinks

FUTURES & WEATHER

Wheat prices overnight are down 7 in SRW, down 14 3/4 in HRW, down 1 1/4 in HRS; Corn is down 8 1/4; Soybeans down 7 1/4; Soymeal down $5.90; Soyoil up 0.49.

For the week so far wheat prices are up 58 1/4 in SRW, up 31 in HRW, up 16 1/2 in HRS; Corn is up 24 1/4; Soybeans up 26 3/4; Soymeal up $3.70; Soyoil up 2.15.

For the month to date wheat prices are up 69 in SRW, up 60 in HRW, up 83 3/4 in HRS; Corn is up 43 1/4; Soybeans up 54 1/4; Soymeal up $7.40; Soyoil up 3.94.

Year-To-Date nearby futures are down 9.1% in SRW, down 3.2% in HRW, down 4.0% in HRS; Corn is down 22.1%; Soybeans down 1.5%; Soymeal down 8.8%; Soyoil up 7.7%.

Chinese Ag futures (SEP 23) Soybeans down 22 yuan; Soymeal down 34; Soyoil down 36; Palm oil down 8; Corn down 17 — Malaysian palm oil prices overnight were down 9 ringgit (-0.22%) at 4037.

There were changes in registrations (-116 Soyoil). Registration total: 1,398 SRW Wheat contracts; 448 Oats; 0 Corn; 11 Soybeans; 187 Soyoil; 0 Soymeal; 147 HRW Wheat.

Preliminary changes in futures Open Interest as of July 20 were: SRW Wheat up 3,370 contracts, HRW Wheat up 456, Corn up 6,353, Soybeans up 9,586, Soymeal up 8,818, Soyoil up 1,829.

Northern Plains: Spotty showers continue may continue in the Northern Plains through the weekend, but precipitation should be limited as temperatures increase next week. Drought development continues to be a concern, especially with the coming heat during pollination for a lot of the corn and soybean crop, but there is some shot at meaningful rain with systems north of the border later next week.

Central/Southern Plains: The Central and Southern Plains will remain active through Friday, especially north, with areas of moderate to heavy rain. To the south, heat continues to bake soils across Texas. A front will briefly cool some southern areas this weekend, but the heat will spread through more of the region next week while showers will become less frequent and mainly in the northwest. Conditions will turn unfavorable, coming during pollination and grain fill for a lot of the crop in the region.

Midwest: Areas of showers and thunderstorms and mild temperatures will continue in the Midwest through the weekend, though any good rain will be spotty. Subsoil moisture remains critical across most of the region despite reduction in the drought intensity on today’s update to the Drought Monitor. Crops cannot take an extended period of heat and dryness without some effect to reproductive to filling corn and soybeans. Unfortunately, heat will increase next week, especially for western areas. Systems moving through Canada may bring fronts into the region, but prospects for rainfall are likely to be spotty. Conditions will turn less favorable next week and may continue into August, which may exacerbate drought conditions and pressure crops during the critical time period.

Delta: The Delta will remain active into the weekend and possibly next week as well as a front drives southward and stalls. Milder temperatures will move in with the front briefly. Overall soil moisture remains favorable for developing crops. Heat this week and building in again next week may stress some small areas that have been missing out in the more active pattern.

Canadian Prairies: A system produced scattered showers in the Canadian Prairies this week, which hit some key dry areas with rainfall. Several more systems moving off to the north could bring in some showers to eastern areas through the weekend as well, but would be spotty. Temperatures will bounce around a bit over the next week as the pattern will be variable. The variability will mean a trough moving through in pieces next week which should offer some additional chances for showers and thunderstorms, though models are not looking at southern areas with favor currently. Any rainfall would be helpful with wheat and canola in reproductive to filling stages.

The player sheet for 7/20 had funds: net sellers of 1,500 contracts of SRW wheat, sellers of 6,000 corn, sellers of 2,500 soybeans, sellers of 3,000 soymeal, and  buyers of 4,500 soyoil.

TENDERS

• WHEAT PURCHASE: Japan’s Ministry of Agriculture, Forestry and Fisheries bought a total of 106,366 metric tons of food-quality wheat from the United States, Canada and Australia in a regular tender that closed on Thursday.
• CORN TENDER PASSED: Iranian state-owned animal feed importer SLAL is believed to have rejected all offers and made no purchase in an international tender to buy up to 180,000 metric tons of animal feed corn, European traders said. Prices were regarded as too high following a rise in corn futures this week.

PENDING TENDERS

• RICE TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp issued an international tender to purchase an estimated 43,000 metric tons of rice. The deadline for submissions of price offers in the tender was July 10.
• VEGETABLE OILS TENDER: Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), set an international purchasing tender for vegetable oils with a July 26 deadline for offers. GASC is seeking an unspecified quantity of sunflower oil and soyoil for arrival between Aug. 20 and Sept. 5 and/or Sept. 6-20, with a requested for offers to be made at sight.
• WHEAT TENDER: Bangladesh’s state grains buyer issued an international tender to purchase 50,000 metric tons of milling wheat.

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 July 13, according to data on the USDA’s website.

• Mexico was the top buyer of soybeans in the week with 339k tons
• Mexico was the top buyer of corn and Chile led in wheat

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 July 13, according to data on the USDA’s website.

• China bought 5.3k tons of the 19.2k tons of pork sold in the week
• South Korea led in beef purchases

Argentine Corn, Wheat Crop Estimates July 20: Exchange

The Buenos Aires Grain Exchange releases weekly report on website.

• 2022-23 corn production est. maintained at 34m tons, with 66% of the crop harvested.
• 2023-24 wheat planting area est. unchanged at 6.0m ha 

Russia has no plans to attack civilian ships in Black Sea – ambassador

Russia is not preparing to attack civilian ships in the Black Sea despite assertions by the United States, Russia’s ambassador to Washington said on Thursday, in comments posted by his embassy.

On Wednesday, Moscow said it would deem all ships travelling to Ukrainian ports to be potential carriers of military cargo and their flag countries to be parties to the conflict on the Ukrainian side, after Russia quit a year-old deal to give ships exporting Ukrainian grain safe passage despite the war.

Commenting on the decision, the White House said Russia could expand its attacks on Ukrainian grain facilities to include attacks on civilian shipping in the Black Sea.

Ambassador Anatoly Antonov said in comments posted on the embassy’s Telegram account: “Attempts to attribute to Russia the preparation of some attacks on civilian ships are pure falsification …

“We regard the U.S. statements as an attempt to disguise by any means its own destructive activities, aimed at the de facto sabotage of the implementation of the interrelated Istanbul agreements.”

Moscow on Monday quit the deal under which it had allowed Ukraine to export grain from its Black Sea ports to alleviate a global food crisis.

Russia said a parallel memorandum signed in Istanbul at the same time had been ignored. That was intended to facilitate Moscow’s own grain and fertiliser exports in the face of Western sanctions on Russia in response to its invasion of Ukraine.

Brazil Soy Output, Exports Seen Higher Than Previous Estimates

Brazil soybean production in 2023 seen at 156.5m metric tons, up by 0.3% from previous estimate in June, industry group Abiove said by email.

• Exports seen at 97.5m t, up 0.5% from previous estimate
• Domestic crush estimate raised by 0.6% to 53.5m t
• Ending stock estimate cut by 4.9% to 7.25m t
• Soymeal export forecast raised 0.5% to 22m t
• Soyoil export forecast raised 4.3% to 2.4m t

Indonesia May Palm Oil Exports Rise 4.5% m/m to 2.23m Tons

Indonesia’s palm oil exports rose to 2.23m tons in May from 2.13m tons in April, according to Indonesian Palm Oil Association (Gapki).

• Palm oil output rose to 5.08m tons from 4.52m tons in April
  • CPO production at 4.63m tons in May; CPKO at 454,000 tons
  • Jan-May total palm oil output at 22.87m tons
• Palm oil stockpiles rise to 4.67m tons from 3.63m tons in April
• Palm oil domestic consumption fell to 1.82m tons from 1.9m tons in April
  • Jan-May consumption at 9.1m tons
• Palm oil for biodiesel domestic consumption fell to 696k tons from 776k tons in April
  • Jan-May palm oil use for biodiesel at 3.8m tons

Egypt to sign $100 mln renewable loan deal for grains purchases -minister

Egypt is to sign a $100 million renewable loan facility with the Abu Dhabi Fund for Development (ADFD) to fund its grains purchases, Supply Minister Ali Moselhy said.

Abu Dhabi-based agribusiness firm Al Dahra will be one of the first suppliers of the grain through the deal, but Moselhy said that the funding could be used for other purchases.

The loan will be facilitated through ADFD’s Abu Dhabi Exports Office (ADEX), people familiar with the deal told Reuters.

The Ukraine war delivered a broad shock to Egypt’s economy, causing investors to pull out billions of dollars. Its currency tumbled and inflation soared.

The country’s state grains buyer, the General Authority for Supply Commodities (GASC), had started deferring payments for its wheat purchases as a result of the acute currency crunch.

Moselhy added that Russia’s refusal to renew the UN grain deal “wasn’t great news to hear”, adding that it will have an impact on global prices, shipping and insurance.

However, he added that Egypt is capable of diversifying its purchases and has 5.2 months-worth of wheat reserves.

The finance ministry said funding for subsidies on food, mostly bread, will rise 41.9% to 127.7 billion Egyptian pounds ($4.1 billion) in the fiscal year from July 2023 to June 2024.

Many recent wheat purchases have been made with loans from the International Islamic Trade Finance Corporation (ITFC), which last year doubled a credit facility extended to Egypt to $6 billion, and from the World Bank, which funded wheat imports earlier this year.

Egypt is one of the world’s biggest wheat importers, buying around five million tonnes of wheat annually from abroad.

Heavily subsidised bread, a politically sensitive measure, is available to more than 70 million of its 104 million population.

China Agriculture Shares Rise as Xi Urges to Boost Sector Output

Chinese stock tied to agriculture rise with Hainan Shennong Technology advancing as much as 9.1% after state media reports President Xi Jinping is planning to boost agricultural output to ensure the nation’s grain security.

China will step up efforts to transform saline-alkali land into fertile soil, state media says, citing a meeting by the central financial and economic committee as saying

Drought Eases in US Corn and Soybean Regions: USDA

The following shows the percent of US agricultural production within an area that experienced drought for the week ending July 18, according to the USDA’s weekly drought report.

• Corn crops experiencing moderate to intense drought fell by 9 percentage points from the previous week to 55%
  • This marks the third consecutive weekly decline after peaking at 70%
• Soybean crops in drought also declined by 7 points, falling to 50%

US Milk Production Rose 0.2% Y/y in June, USDA Says

Agency releases report on website.

• Output for the 24 major-producing states was 18.11b lbs, 37m more than in June of last year
• Milk per cow averaged 2,028 lbs, unchanged from last year
• Estimated output for all the US unchanged y/y at 18.916b lbs

US Miss. River Grain Shipments Fall, Barge Rates Increase: USDA

Barge shipments down the Mississippi river declined to 414k tons in the week ending July 15 from 511k tons the previous week, according to the USDA’s weekly grain transportation report.

• Barge shipments of corn fell 19% from the previous week
• Soybean shipments down 11% w/w
• St. Louis barge rates were $12.52 per short ton, an increase of $1.76 from the previous week

 

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