Information produced by ADM Investor Services, Inc. and distributed by Stewart-Peterson Inc.

 

Wheat prices overnight are down 3 1/4 in SRW, down 8 1/4 in HRW, up 1 3/4 in HRS; Corn is up 1; Soybeans up 3; Soymeal up $0.02; Soyoil up 0.38.

Markets finished last week with wheat prices down 57 3/4 in SRW, down 68 3/4 in HRW, down 39 1/4 in HRS; Corn is down 27 1/4; Soybeans unchanged; Soymeal up $0.53; Soyoil down 0.15.

For the month to date wheat prices are down 52 in SRW, down 44 3/4 in HRW, down 31 1/4 in HRS; Corn is down 27 1/4; Soybeans down 8; Soymeal up $11.70; Soyoil down 0.89.

Year-To-Date nearby futures are down 11.0% in SRW, down 6.1% in HRW, down 5.8% in HRS; Corn is down 3.9%; Soybeans up 0.8%; Soymeal up 4.0%; Soyoil down 3.7%.

 

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Chinese Ag futures (MAY 23) Soybeans down 16 yuan; Soymeal down 19; Soyoil up 2; Palm oil down 12; Corn down 19 — Malaysian palm oil prices overnight were up 23 ringgit (+0.55%) at 4225.

There were no changes in registrations. Registration total: 2,587 SRW Wheat contracts; 0 Oats; 0 Corn; 302 Soybeans; 467 Soyoil; 0 Soymeal; 152 HRW Wheat.

Preliminary changes in futures Open Interest as of February 24 were: SRW Wheat down 4,536 contracts, HRW Wheat down 1,790, Corn down 51,566, Soybeans down 17,359, Soymeal down 13,255, Soyoil down 7,396.

Brazil Grains & Oilseeds Forecast: Scattered showers continue for much of Brazil’s growing regions for the next week outside of Rio Grande do Sul and Minas Gerais, where showers will be more limited. Despite recent rains, many areas have made significant progress with regard to soybean harvest and corn planting. However, some areas are behind, somewhat significantly, and will expose more of the corn crop to the dry season which will start up in April. Corn already in the ground will benefit from good soil moisture.

Argentina Grains & Oilseeds Forecast: Dry conditions continue to be a concern for immature corn and soybeans moving forward. Any showers will be limited for at least the front half of March, though isolated showers may move through at times. Another burst of heat is expected this week going into next week. The heat and dryness is keeping stresses high for both crops in various stages of growth.

Northern Plains Forecast: Cold air moderated over the weekend, but it will remain mostly below normal for the next week. Much colder air should spread through the region next week. The storm track will either be in Canada or to the south, leaving the region fairly dry with only isolated showers moving through at times for the next couple of weeks.

Central/Southern Plains Forecast: A very strong storm system is moving through Sunday into early Monday. The storm is producing strong wind gusts which is depleting soil moisture but is also bringing widespread showers and thunderstorms through the region, some of which may be severe, centered on Oklahoma. Another storm system will move through later in the week. This system has potential for widespread precipitation as well, including some snow. While any precipitation will be welcome, amounts are not expected to be very heavy across the southwestern drought areas.

Midwest Forecast: The region will stay active this week with a system Sunday night and Monday, a weak piece of energy Tuesday into Wednesday, and a third system late Thursday through Friday. All three will produce mixed precipitation with wintry amounts changing location with each storm. The third should produce the most snow from Missouri to Lake Erie and the first and third pieces should also bring some stronger winds as well.

The player sheet for Feb. 24 had funds: net sellers of 16,000 contracts of SRW wheat, sellers of 10,000 corn, sellers of 5,500 soybeans, buyers of 2,000 soymeal, and sellers of 4,000 soyoil.

TENDERS

• WHEAT PURCHASE: Iraq’s state grains buyer is believed to have purchased about 250,000 tonnes of wheat expected to be sourced from Australia in an international tender restricted to a limited number of participants this week.
• CORN PURCHASE: South Korea’s Feed Leaders Committee (FLC) purchased around 65,000 tonnes of animal feed corn expected to be sourced from either the United States, South America or South Africa in a private deal on Friday without issuing an international tender
• CORN PURCHASE: Leading South Korean animal feed maker Nonghyup Feed Inc. (NOFI) has bought an estimated 69,000 tonnes of animal feed corn in an international tender for up to 138,000 tonnes which closed on Friday
• CORN PURCHASE: South Korea’s Major Feedmill Group (MFG) purchased an estimated 50,000 tonnes of animal feed corn expected to be sourced from South Africa in a private deal on Friday without an international tender being issued
• CORN PURCHASE: The Korea Feed Association (KFA) purchased some 63,000 tonnes of animal feed corn to be sourced from worldwide optional origins in an international tender on Friday.
• SUNFLOWER OIL PURCHASE: Turkey’s state grain board TMO has provisionally purchased about 48,000 tonnes of crude sunflower oil in a tender for the same volume which closed on Friday.

PENDING TENDERS

• WHEAT TENDER: Turkey’s state grain board TMO has issued an international tender to purchase an estimated 790,000 tonnes of milling wheat
• WHEAT TENDER: Jordan’s state grain buyer has issued an international tender to buy up to 120,000 tonnes of milling wheat which can be sourced from optional origins
• WHEAT TENDER: The Taiwan Flour Millers’ Association has issued an international tender to purchase an estimated 48,975 tonnes of grade 1 milling wheat to be sourced from the United States
• BARLEY TENDER: Jordan’s state grains buyer has issued a new international tender to purchase up to 120,000 tonnes of animal feed barley.
• BARLEY TENDER: Turkey’s state grain board TMO has issued an international tender to purchase an estimated 440,000 tonnes of animal feed barley.

US BASIS/CASH

• Basis bids for soybeans shipped by barge to the U.S. Gulf Coast were mostly unchanged on Friday and lower in the week as seasonally slowing demand for U.S. shipments and weakening freight costs weighed on values, traders said.
  • CIF corn basis bids were narrowly mixed on Friday but mostly lower in the week. A drop in futures prices late this week sparked improved demand from some importers, notably South Korea, although U.S. exports continue to face competition from cheaper corn from rival suppliers.
  • Net weekly U.S. soybean export sales rose to 544,900 tonnes, up 6% from a week earlier.
  • Global soybean demand is shifting to South American exports. Top buyer China booked several April and May cargoes this week from Brazil, traders said.
  • CIF February soy barges were bid steady at about 83 cents over March futures. March barge bids were unchanged at 87 cents over futures.
  • FOB offers for February and March soybean shipments were each slipped to around 105 cents over March futures, down 5 cents.
  • CIF corn barges loaded in February were bid about 76 cents over March corn, up a penny. Corn barges loaded in March were bid 1 cent lower at 78 cents over futures.
  • FOB basis offers for February and March corn shipments held at around 85 cents over futures.
• Spot basis bids for soybeans were mixed at U.S. Midwest river terminals on Friday, dealers said.
• The cash basis for soybeans held steady at processors and elevators around the interior of the region.
  • Processor bids for corn were steady to firm, rising by 10 cents a bushel in Blair, Nebraska.
  • Corn bids were unchanged at interior elevators and river terminals.
  • Farmers were reluctant to sell either commodity at current price levels, dealers said.
• Spot basis bids for corn were steady to firm at U.S. Midwest processors and ethanol plants on Friday morning, grain dealers said.
  • The corn basis was flat at grain elevators and river terminals.
  • Cash bids for soybeans were narrowly mixed along rivers, and steady at processors and elevators around the interior of the region.
  • Weakness in the futures market chilled growers interest in selling early on Friday.
  • Growers have committed to sales at prices above current levels and dealers have said the farmers could afford to wait and see if prices rally before finalizing new contracts.
• Spot basis bids for hard red winter wheat were flat at rail and truck elevators across the southern U.S. Plains on Friday, grain dealers said.
  • Farmers were showing little interest in booking new deals for their grain, with most not even calling in to check on prices as the futures market plunged, an Oklahoma dealer said.
  • Dealers began rolling their basis bids to the May K.C. hard red winter wheat from March, which enters the delivery period next week.
  • Protein premiums for hard red winter wheat delivered by rail to or through Kansas City fell by 4 cents a bushel for all grades of wheat, according to the latest CME Group data.
• Spot basis offers for U.S. soymeal dropped at processors in the rail market on Friday, dealers said.
  • The cash basis was steady to weak at truck market processors, falling by $5 per ton in Mankato, Minnesota.
  • Demand was weak, a rail broker said.
  • Most end users had enough soymeal on hand to last them until their previously booked orders for March are delivered.
  • High cash prices chilled end users’ interest in booking deals for surplus soymeal.

US Agriculture Export Sales for Week Ending Feb. 16 

US Export Sales of Soybeans, Corn and Wheat by Country

The following table shows US export sales of soybeans, corn and wheat by biggest net buyers for week ending Feb. 16, according to data on the USDA’s website.

• China bought 176k tons of the 557k tons of soybeans sold in the week
• Japan was the top buyer of corn and Philippines led in wheat

US Export Sales of Pork and Beef by Country

The following table shows US export sales of pork and beef product by biggest net buyers for week ending Feb. 16, according to data on the USDA’s website.

• Mexico bought 25k tons of the 51.9k tons of pork sold in the week
• China led in beef purchases

Brazil Soybean Harvest 30.3% Done as of Feb. 24, Safras Says

Harvest advanced from 20.9% a week earlier, though it’s still below five-year average and progress from the same period last year, according to Safras & Mercado.

• Progress compares with 41.8% a year ago and the five-year average of 31.4% completed for the period, firm says in emailed report
• Harvest in top-producing state Mato Grosso is complete in 76% of the planted area, up from 58% a week ago
• Five-years average for Mato Grosso’s harvest is 66.4%

SOYBEAN/CEPEA: Index PR drops to the lowest daily level since Dec/21

Estimates for a corn soybean output in Brazil, the US dollar depreciation against the Real – which reduces the competitiveness of the Brazilian soybean, leading purchasers to the United States, Brazil’s major competitor – and low demand in the national spot market continue to press down soybean quotations in Brazil.

On Thursday, 23, the CEPEA/ESALQ Paraná Index for soybean closed at BRL 163.65 per 60-kilo bag, 1.5% down from that on the previous Thursday, 16, and the lowest daily level since Dec. 13, 2021. On the average of the regions surveyed by Cepea, soybean prices dropped 0.5% in the over-the-counter market (paid to farmers) and 0.4% in the wholesale market (deals between processors). The US dollar depreciated 1.7% in the last seven days, to BRL 5.132 on Feb. 23.

The ESALQ/BM&FBovespa Paranaguá (PR) Index dropped 1.4% between February 16 and 23, to BRL 170.76/bag. On the other hand, the export parity based on the port of Paranaguá (PR) – related to the March/23 contract, is calculated by Cepea at BRL 174.82/bag, 2.3% higher than bids in the spot market. This is due to the higher currency exchange rate at B3 for the Mar/23 contract.

The export parity in Brazil was also underpinned by valuations abroad, which were influenced by concerns about the crop in Argentina and the firm international demand for soybean in the USA. Expectations for a high demand for soy oil helped to push up international soybean prices.

CROPS – In Brazil, the harvesting has been slow because of the high rainfall in important producing regions. This scenario is beginning to concern national farmers about the possibility of damaged beans, which may hamper the production of by-products, majorly oil. Agents from the soybean market have reported damaged beans, however, the share of these beans is not relevant compared to the estimated output.

Of the total forecast for the 2022/23 crop of soybean in Brazil (152.88 million tons), 23% had been harvested by Feb. 18th, below the 33% harvested in the same period last year, according to Conab.

CORN/CEPEA: Delays in crop activities concern; deals are sporadic, and prices remain stable

Corn sales have been low in Brazil, and prices are currently stable. While purchasers have been away from the national spot market, sellers are prioritizing crop activities – the delay in the harvesting of the summer crop and sowing of the second crop (majorly in central-western Brazil) is concerning agents.

CROPS – Rains have been high in most corn-producing regions in Brazil, however, crop activities have not been interrupted. According to data from Conab, by Feb. 18th, nearly 14% of the summer crop of corn had been harvested, a weekly progress of 2.9 percentage points but a delay of 6 p.p. compared to the same period last season.

In Southern Brazil, where most of the summer crop is produced, rainfall is delaying the harvesting in Santa Catarina and in Paraná, while the lack of rains is damaging crops in Rio Grande do Sul.

Considering the second crop, sowing is expected to end out of the ideal period in some states in central-southern Brazil, raising the concerns about weather issues, such as frosts and droughts in the second semester. According to data from Conab released on Feb. 18th, 33.3% of the national second crop has been sown, a weekly advance of 13 percentage points but still 13 p.p. behind that in the same period last season.

PRICES – In Campinas (SP), the ESALQ/BM&FBovespa Index for corn closed at BRL 86.22 per 60-kg bag on Thursday, 23, a slight 0.02% down from that on the previous Thursday, 16. In February, this Index has increased 0.9%. Between Feb. 16-23, on the average of the regions surveyed by Cepea, prices increased 0.6% in the over-the-counter market (paid to farmers) but dropped 0.3% in the wholesale market (deals between processors).

EXPORTS – International devaluations and the dollar depreciation pressed down the export parity, reducing the interest of Brazilian sellers in closing deals for prompt-delivery at ports.

Still, Brazilian corn exports have been high, due to the deals previously closed that were influenced by the decrease in the world supply, since production decreased in the United States and in Ukraine, and also because of the weather issues in Argentina. Besides, concerns about the agreements on exports from the Black Sea are underpinning the expectations for firm exports and high prices paid to Brazilian farmers.

Cepea surveys show that the price of the corn delivered to the port of Paranaguá (PR) rose 1.8% in the last seven days, closing at BRL 91.4/bag on Feb. 23rd. For delivery in August and in September, the averages in February are at BRL 83.45/bag and at BRL 83.94/bag, respectively, 1.7% and 1.4% below that in January.

Strategie Grains raises EU rapeseed crop forecast to 19.6 mln T

Consultancy Strategie Grains has increased its forecast for 2023 European Union rapeseed output to 19.6 million tonnes, up from 19.5 million projected a month earlier, it said in an oilseed report.

The forecast was now slightly above last year’s production, also estimated at 19.5 million tonnes.

Rapeseed plants are generally in satisfactory condition, though rain was needed in the western part of the EU, Strategie Grains said, echoing comments by other crop analysts.

The slight increase anticipated for harvest production could contribute to a further swelling in rapeseed stocks next season, with rapeseed also expected to face competition from sunflower seed and soybeans for crushing demand, it said.

Rapeseed stocks in the EU are already expected to rise in the current 2022/23 season, as supply from competitively priced Australian shipments and imports from Ukraine into Poland and Romania have outstripped demand, Strategie Grains said.

Rapeseed prices have retreated sharply from record highs last year following Russia’s invasion of Ukraine, and they had potential to drop further by the end of this season, it added.

The French consultancy trimmed its forecast for this year’s sunflower seed harvest to 11.2 million tonnes from 11.3 million previously, but that would be 22% above last year’s crop.

EU soybean output was still forecast at 3.2 million tonnes, up 28% on year.

Strategie Grains anticipates farmers will keep sunflower and soy planting close to last year’s high levels and that yields will recover from drought-affected results in 2022.

Sunflower seed planting is expected to start soon in the EU, though dryness in southern Spain may hamper early field work, it said.

Indonesia Says B35 Biodiesel Program up and Running Since Feb. 1

Govt committed toward implementing it, and any issues can be resolved along the way, says Coordinating Economic Affairs Ministry deputy for food and agribusiness Musdhalifah Machmud in Jakarta on Monday.

Indonesia must achieve palm oil replanting target -senior official

Indonesia will boost efforts to ensure a scheme to replant palm oil to lift flagging yields meet a target of 180,000 hectares this year, an official said on Monday, as growers of the edible oil face increased scrutiny over sustainability.

The world’s biggest palm oil producer launched a subsidised palm oil replanting programme for smallholders five years ago in a bid to boost output without clearing more forested land and to help fend off attacks on the sustainability of the crop.

The plans also come as the European Union, Indonesia’s third-largest market for palm oil, has agreed a deforestation law that requires companies to produce a due diligence statement showing when and where commodities were produced and provide “verifiable” information proving were not grown on land deforested after 2020.

At its launch in late 2017, Indonesia had initially targeted replanting 2.4 million hectares (5.9 million acres) by 2025. However, sluggish implementation forced authorities to adjust the target in 2019 to 180,000 hectare per year but this reduced target has also not been achieved.

Between 2017 and now, only around 278,000 hectares of the crop had been replanted, said Musdhalifah Machmud, a senior official at the Coordinating Ministry of Economic Affairs.

“The 180,000 hectare target must really be reached,” she said, adding that authorities had simplified requirements for the scheme and called for improvements in coordination, as well as boosting the involvement of private companies.

“The average yield of 2.5 tonnes per hectare must be increased to 6 tonnes to 8 tonnes per hectare,” Musdhalifah told a meeting with government officials and palm oil planters.

The programme is aimed at boosting output by small farmers, who account for around 40% of Indonesia’s 16 million hectares of palm oil plantations. Some palm oil trees in smallholder plantations have not been replanted in more than 25 years.

Farmers have faced difficulties in proving that their land meets requirements, including proving that their plantation is not in a forest area and does not overlap with other concessions. At times of high palm oil prices, farmers have also been reluctant to join the replanting scheme, worried about missing out on profit.

Ukraine’s Grain Exports Fall 27% in Season Through Feb. 27

Ukraine’s grain exports shrank by almost 27% from last year in season that started in July, according to Agriculture Ministry’s data updated on Monday.

• Total includes:
  • 18.2m tons of corn, down 5.8% y/y
  • 11.2m tons of wheat, down 38% y/y
  • More than 2m tons of barley, down 64% y/y
• NOTE: Deal that allows Ukraine to export its crops through the Black Sea amid war against Russia expires on March 20. Ukraine’s authorities expect it to be extended after talks that are set to start in coming weeks

Ukraine to set up $500 mln insurance fund for cargo ships entering ports

Ukraine will offer compensation for possible damages to civilian vessels entering its ports, Deputy Prime Minister Oleksandr Kubrakov said on Friday, as Kyiv tries to boost exports that are vital for its war-hit economy.

Ukraine is a major producer and exporter of agricultural products, metals and chemical goods but has faced blockades of Black Sea ports since Russia’s invasion a year ago and only food cargo can be shipped abroad.

Kubrakov said on Twitter that Ukraine’s parliament had approved a law to set up a $500 million insurance fund.

“We’re working on resuming delivery & expanding the range of products. I invite countries of the civilized world & interested businesses to cooperate,” Kubrakov said.

Ukraine said this week it would ask Turkey and the United Nations to start talks to roll over the Black Sea grain deal that was agreed last year, seeking an extension of at least one year that would include the ports of Mykolaiv.

The Black Sea Grain Initiative brokered by the U.N. and Turkey last July allowed grain to be exported from three Ukrainian ports. The agreement was extended in November and will expire on March 18 unless an extension is agreed.

Argentina farm group plans protest against FX controls, taxes

Argentina farmers, currently being hit hard by a prolonged drought, will hold a protest next week to demand better taxation, foreign exchange rates and financial support conditions, a major growers federation said on Friday.

The Argentine Agrarian Federation (FAA) said producers on Tuesday will gather at a major junction of a key highway going from farm hub city Rosario in Santa Fe to capital Buenos Aires.

“We will demonstrate and we will continue making our demands,” the FAA said, adding it would focus on asking for export taxes to be eliminated, financial aid to properly reach farmers and improvements in Argentina’s skewed FX markets.

Argentina’s strict capital controls have stoked popular gray currency markets where dollars are twice as expensive as the official rate, a disincentive for farmers to export because dollar revenues have to be converted back at the lower official rate.

The government has at times rolled out a preferential “soy dollar” exchange rate to encourage exports, hoping to bring in much-needed foreign currency from its top cash crop.

The country is the world’s top exporter of processed soy oil and meal, and the No. 3 for corn. However, a long drought worsened by climate change has led grains exchanges to slash harvest forecasts, with the 2022/23 soy crop expected to be at the lowest level in around 14 years.

“For two or three years punishment by various inclement weather conditions has built up, such as droughts, floods, frosts and hail, which have deepened this crisis, leading to some farmers ceasing to exist,” the FAA said.

The Buenos Aires grain exchange on Thursday cut its estimates for the 2022/23 soybean and corn harvests to 33.5 million tonnes and 41 million tonnes respectively, due to the impact of a drought, high temperatures and recent early frosts.

LIVESTOCK: USDA Cattle and Hog Slaughter Estimates

The following is for week ending Saturday, Feb. 25:

• Cattle slaughter estimate at 618k, down 5.1% from a year ago
• Hog slaughter at 2.375m, down 4.7% y/y

US Stocks of Beef, Pork and Chicken in Cold Storage

US Cattle on Feed, Placements, Marketings by State

SOUTH AMERICA

UNITED STATES

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