Global Ag News for Sept 13.24

TOP HEADLINES

Russia Missile Hits Grain Ship in Neutral Waters, Zelenskiy Says

Russia hit a grain ship with a missile immediately after it left Ukrainian waters on Thursday, President Volodymyr Zelenskiy said on Telegram.

The ship was carrying wheat for Egypt, Zelenskiy said. There are no casualties reported so far.

Ukraine is a major grain exporter, with agricultural commodities earning vital revenues for Kyiv. Moscow has often attacked the country’s export hubs on the Black Sea and the Danube since its 2022 invasion.

“Wheat and food security must never be a target for missiles,” Zelenskiy said. “We are expecting the world’s reaction.”

 

FUTURES & WEATHER

Wheat prices overnight are up 8 3/4 in SRW, up 7 1/4 in HRW, up 7 1/2 in HRS; Corn is up 3 1/2; Soybeans up 2 1/2; Soymeal up $0.60; Soyoil down 0.17.

For the week so far wheat prices are up 20 3/4 in SRW, up 17 in HRW, up 15 1/2 in HRS; Corn is up 4 1/2; Soybeans up 10 1/4; Soymeal up $0.60; Soyoil up 0.08.

For the month to date wheat prices are up 35 3/4 in SRW, up 28 1/4 in HRW, up 28 3/4 in HRS; Corn is up 8 1/2; Soybeans up 13 1/4; Soymeal up $10.80; Soyoil down 2.39.

Year-To-Date nearby futures are down 10.4% in SRW, down 9.9% in HRW, down 17.9% in HRS; Corn is down 17.1%; Soybeans down 23.3%; Soymeal down 18.0%; Soyoil down 14.7%.

Chinese Ag futures (NOV 24) Soybeans up 1 yuan; Soymeal up 13; Soyoil up 54; Palm oil up 34; Corn down 4 — Malaysian Palm is down 39.

Malaysian palm oil prices overnight were down 39 ringgit (-1.01%) at 3813.

There were changes in registrations (-26 Corn, 100 Soymeal). Registration total: 220 SRW Wheat contracts; 2 Oats; 209 Corn; 230 Soybeans; 453 Soyoil; 200 Soymeal; 5 HRW Wheat.

Preliminary changes in futures Open Interest as of September 12 were: SRW Wheat down 171 contracts, HRW Wheat up 134, Corn up 13,684, Soybeans up 2,436, Soymeal up 3,159, Soyoil down 164.

 

Northern Plains: Temperatures will be well above normal through the rest of this week and into much of next week. A system will move into the region Thursday, but most of the precipitation is forecast to occur either in western Montana or north into Canada. Another burst could come through in the same areas early-mid next week. Winds could be strong in some areas with these systems moving through, not favorable for harvest, and will generally dry out soils. The lack of precipitation could be disappointing for corn and soybeans that are behind developmentally.

 

Central/Southern Plains: Some drier areas in the region could use some rain for winter wheat planting and establishment. But even with a system moving into the Northern Plains Thursday, rainfall is forecast to be limited and rather spotty going through this weekend. A cold front could provide better chances for scattered showers by the middle of next week. By late this week and into much of next week, temperatures will climb above normal for the Southern Plains while remaining above normal for the Central Plains. For those with fieldwork to do, they may have to dodge showers next week. But for areas that miss out on the showers, it will not be favorable for the remaining filling corn and soybean crops.

 

Midwest: Temperatures will remain on the warm side through the upcoming weekend and induce stress in dry areas for immature corn and soybeans. Remnants of Hurricane Francine will move into the Central Mississippi Valley Thursday and could move into southern portions of the region through Friday. Precipitation from Francine would help bring needed moisture in for winter wheat planting later this fall, and could improve water levels on the Mississippi River, but could disrupt the early harvest. Northern areas will likely stay drier, not necessarily good for immature corn and soybeans that could use some additional rain. Spotty showers are possible next week with a cold front approaching from the West, but some areas may remain mostly dry.

 

Delta: Hurricane Francine made landfall in southern Louisiana Wednesday evening and provide heavy rainfall, gusty winds, thunderstorms, and flooding. Remnants of Francine will continue to work north on Thursday and stall out in the Tennessee Valley by Friday. Heavy rainfall and gusty winds could cause damage and disrupt harvest, but increase water levels on the Mississippi River, which have fallen very low again. Scattered showers could continue across the Delta through early next week and temperatures are favored to be above normal across central areas with slightly cooler temperatures in the south.

 

Canadian Prairies: Heat will continue to be in the region for most of the next two weeks, but a few systems could provide brief cool downs to southern areas at times. A system will develop in the Northern Plains Thursday and will continue to spread rain into the region over the coming days with showers becoming more spotty by the weekend. A similar system could do the same early-to-mid next week. The rainfall would not be favorable for the continued harvest, but would help to reduce drought and build soil moisture for next season.

 

Brazil: Another front will move north into the country with scattered showers on Thursday, lingering around the southern states into the weekend. That will help states like Parana and Rio Grande do Sul, improve soil moisture for any immature wheat or corn and soybean planting. Heat north of this front continues to bake soils ahead of first-crop soybean planting and soil moisture through most of central Brazil is way too low to begin planting. Wet season rains typically do not start for another couple of weeks and may be late, which would push back planting by a couple of weeks, putting the safrinha season in jeopardy as well.

 

Argentina: Rainfall from the mid-week front was spotty. Most of the country continues to be dry, impacting developing winter wheat and delaying corn planting. There will be a brief break in the above normal temperatures through the end of this week. Towards the second half of the upcoming weekend and into next week, above normal temperatures will return, which will evaporate more moisture out of soils. A stronger system providing more widespread showers may not arrive until the middle to end of next week, but there is uncertainty in the coverage of the showers this far out.

 

Europe: Scattered showers have been favorable for immature corn, but not for any intentions of winter wheat planting. A system has formed in southern Europe and will eventually move into the east late this week. Scattered showers could linger across eastern Europe this weekend into early next week. While rainfall will be favorable for those eastern areas, temperatures will drop significantly and higher elevation frosts and snow will be possible, a sign of the coming season of more variable conditions.

 

Black Sea: Western areas have been seeing scattered showers as systems from central Europe nudge east. Another front moving into Europe will have potential for showers in western areas later this week and weekend as well. Eastern Ukraine and western Russia, large winter wheat areas, will have very little potential for rainfall over the next couple of weeks. The window for effective winter wheat planting will be awfully short this year as frosts and freezes typically start to show up in about three or four weeks.

 

Australia: A mid-week system produced spotty rainfall in the east, which was beneficial for winter wheat and canola areas that actually saw some rainfall but not beneficial for those that missed out. A front will push through the southeast this weekend, but precipitation will largely remain confined to coastal areas. Colder air will move in across southern areas, however, and some areas across Victoria and New South Wales will be watched for frosts. Meanwhile, above normal temperatures will still be favored across western areas through early next week. Another front could produce more widespread showers to eastern areas towards the middle of next week.

 

The player sheet for Sept. 12 had funds: net sellers of 2,000 contracts of SRW wheat, sellers of 500 corn, sellers of 2,500 soybeans, buyers of 1,500 soymeal, and buyers of 3,500 soyoil.

TENDERS

• WHEAT SALE: Egypt’s state grains buyer purchased Russian wheat in a private deal this week outside of the traditional tender process, three sources familiar with the matter told Reuters. Two of the sources said the General Authority for Supply Commodities (GASC) bought 430,000 metric tons of Russian wheat for October shipment.
• CORN SALE: The U.S. Department of Agriculture confirmed private sales of 118,626 metric tons of U.S. corn for shipment to unknown destinations in the 2024/25 marketing year.
• RICE TENDER: Indonesian state purchasing agency Bulog has issued an international tender to buy about 450,000 metric tons of rice.
• FAILED WHEAT TENDER: Jordan’s state grain buyer is believed to have made no purchase in an international tender to buy 120,000 metric tons of milling wheat on Thursday, European traders said.

 

PENDING TENDERS

• CORN, BARLEY TENDER: Algerian state agency ONAB issued an international tender to purchase about 160,000 metric tons of corn and 35,000 tons of animal feed barley.

 

 

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 Sept. 5, according to data on the USDA’s website.

• Top buyer of soybeans: China with 963k tons
• Top buyer of corn: Mexico with 180k tons
• Top buyer of wheat: Taiwan with 105k tons

 

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 Sept. 5, according to data on the USDA’s website.

• Mexico bought 14.2k tons of the 29.9k tons of pork sold in the week
• South Korea led in beef purchases

 

Abiove Lowers Brazil Soybean Output, Stocks Forecasts for 2024

Brazilian soybean production this year is now seen at 153 million tons, down 200,000 from last month’s estimate due to a productivity reassessment based on information provided by associated companies, industry group Abiove said by email.

• Soy ending stocks estimate cut by 1.5% to 4.74m tons
• Soy imports raised by 16% from previous report to 930,000 tons
• Soy exports for this year unchanged at 97.8m tons; crushing still seen at 54.5m tons
• Soy meal exports raised 1.4% to 22m tons
  • Soy meal ending stocks reduced by 11% to 2.5m tons
• Soy oil ending stocks cut by 39% to 312,000 tons

 

Soil moisture in Brazil’s top soy states drops to lowest in 30 years

Soil moisture in the Brazilian states of Mato Grosso and Parana, two of the three largest soybean producers in the country, is at its lowest level in 30 years, creating challenging conditions for planting, according to the EarthDaily Agro company.

Together, the two states accounted for around 40% of soybean production in Brazil, the world’s largest producer and exporter of the oilseed.

In Mato Grosso, the conditions are likely to continue over the next ten days, bringing unfavorable conditions for the start of soybean planting in the state, said Felippe Reis, crop analyst at EarthDaily Agro, which specializes in satellite-based analytical data.

Adding to worries, average temperatures in Mato Grosso, the country’s agricultural heartland, could be up to 7°C above normal, the company said.

Weather conditions there will only improve towards the end of the month with the arrival of rain, according to its projections.

Reis did not comment on whether the dryness might lead farmers to plant soy later. A prolonged delay could have consequences for the production of corn and second crop cotton.

Some meteorologists, including consultancy Rural Clima’s Marco Antonio dos Santos, have said that longer-term models indicate rains will become more regular in key regions of Brazil after mid-October.

Fires that have burned through straw used by farmers to protect fields from the heat mark another “aggravating” setback for this season’s crop, Aprosoja Brasil, a farmer’s group, said earlier this week.

 

Argentina Set for Biggest Expansion in Soy Acreage in 15 Years

Argentine farmers gearing up for the main event of their 2024-25 season are on course to widen soybean planting from last year by 7.5% — the biggest inter-annual jump since 2009-10.

Fieldwork, mainly done in November and December, is forecast to cover 17.7 million hectares (43.7 million acres), 1.3 million more than the last crop, the Rosario Board of Trade said in its latest monthly estimates.

The main driver behind the jump is a rotation away from corn because of concerns about a leafhopper plague that attacked the grain last year.

Corn planting has already started but is being negatively impacted by a lack of rain, and farmers are bracing themselves for more dryness as a La Niña climate pattern develops. That might exacerbate the shift to soy.

Rosario’s preliminary harvest estimate for soy, based on multi-year average yields, is between 52 million metric tons and 53 million, up from 50 million last season.

 

Ukraine’s Dry Summer Depletes Soil Moisture Ahead of Winter Crop

Ukraine’s record hot and dry summer has resulted in a near absence of required soil moisture for its winter crop, according to the National Hydrometeorology Center.

• “We have one of the biggest summer-autumn droughts now,” Tetiana Adamenko, the head of the organization’s agriculture department, says at a conference in Kyiv
• Soil moisture deposits are almost absent in 70% of the areas to be planted with winter grains, according to expert analysis by weather observation stations
• In some areas the soil has zero moisture to a depth of one meter
• However, winter crops can be planted through early October and through early November in the country’s south, leaving farmers some more time to wait for rain
• “Everything may work out” for winter grains: Adamenko
• Ukraine had similar summer-autumn droughts in 2011 and in 2015

 

La Niña has 71% chance of developing between September and November: US meteorologist

The La Nina weather pattern has a 71 percent chance of occurring between September and November, a U.S. government weather agency said on Thursday.

The weather conditions are expected to persist until January-March next year, the Climate Prediction Center (CPC) of the National Weather Service said in its monthly forecast.

WHY IS IT IMPORTANT?

La Niña, a weather pattern that begins with cooler-than-normal ocean temperatures in the central and eastern equatorial Pacific, is linked to both flooding and drought, as well as an increase in hurricane frequency in the Caribbean.

La Niña is expected to bring less rain, worsening drought conditions , which could affect agriculture around the world.

CONTEXT

The cycle between El Niño, La Niña and a neutral phase typically lasts two to seven years.

Earlier this week, Japan’s meteorological bureau said there was a 60 percent chance of a La Niña phenomenon developing in the Northern Hemisphere through winter.

Brazilian soybean farmers could produce 14% more in the 2024/2025 season compared with the previous year, according to a Reuters poll, as expectations of more rain in the final quarter of the year increase.

 

US Corn Crops in Drought Area Rise to 18%, Soybeans 26%: USDA

The following shows the percent of US agricultural production within an area that experienced drought for the week ending Sept. 10, according to the USDA’s weekly drought report.

• Corn crops experiencing moderate to intense drought rose by 5 percentage points from the previous week to 18%
• Soybean crops jumped 7 points to 26% in drought

 

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

Barge shipments down the Mississippi river declined to 395k tons in the week ending Sept. 7 from 481k 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 27% w/w
• St. Louis barge rates were $31.68 per short ton, an increase of $4.19 from the previous week

 

 

 

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