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

 

Wheat prices overnight are up 3 1/2 in SRW, up 4 3/4 in HRW, up 3 in HRS; Corn is down 3 3/4; Soybeans down 13 1/2; Soymeal down $0.24; Soyoil down 1.36.

For the week so far wheat prices are down 5 1/2 in SRW, down 2 1/4 in HRW, down 3 in HRS; Corn is down 12 3/4; Soybeans down 31 1/4; Soymeal down $1.21; Soyoil down 2.65.

For the month to date wheat prices are up 43 1/2 in SRW, up 35 1/2 in HRW, up 16 3/4 in HRS; Corn is down 6 3/4; Soybeans down 28; Soymeal down $3.90; Soyoil down 6.45.

Year-To-Date nearby futures are up 14% in SRW, up 18% in HRW, down -4% in HRS; Corn is up 12%; Soybeans up 5%; Soymeal up 3%; Soyoil up 15%.

 

Like what you’re reading?

Sign up for our other free daily TFM Market Updates and stay in the know!

 

Chinese Ag futures (JAN 23) Soybeans down 6 yuan; Soymeal up 24; Soyoil down 10; Palm oil down 96; Corn down 16 — Malaysian palm oil prices overnight were down 294 ringgit (-8.35%) at 3229.

There were changes in registrations (-2 Soyoil). Registration total: 3,084 SRW Wheat contracts; 0 Oats; 0 Corn; 5 Soybeans; 46 Soyoil; 147 Soymeal; 40 HRW Wheat.

Preliminary changes in futures Open Interest as of September 27 were: SRW Wheat up 2,793 contracts, HRW Wheat down 1,572, Corn up 2,622, Soybeans up 11,389, Soymeal down 2,895, Soyoil down 2,212.

Northern Plains Forecast: Mostly dry through Thursday. Scattered showers Friday-Saturday. Temperatures above to well above normal Wednesday-Saturday. Outlook: Isolated to scattered showers Sunday-Thursday. Temperatures above normal Sunday-Thursday.

Central/Southern Plains Forecast: Mostly dry through Friday. Isolated showers Saturday. Temperatures near to above normal through Saturday. Outlook: Isolated showers Sunday-Thursday. Temperatures near to above normal Sunday-Thursday.

Western Midwest Forecast: Mostly dry through Saturday. Temperatures near to below normal through Thursday, near to above normal Friday-Saturday.

Eastern Midwest Forecast: Mostly dry Wednesday-Friday. Isolated showers far southeast Saturday. Temperatures near to below normal through Friday, near normal Saturday. Outlook: Isolated showers Sunday. Mostly dry Monday-Wednesday. Isolated showers Thursday. Temperatures near to above normal Sunday-Thursday.

The player sheet for Sept. 27 had funds: net buyers of 5,000 contracts of SRW wheat, buyers of 2,000 corn, buyers of 2,000 soybeans, sellers of 2,000 soymeal, and  sellers of 2,000 soyoil.

• international tender closing Sept. 27, a government source said. Jordan’s state grains buyer opened the new tender after making no purchase in a Tuesday tender.
• BARLEY TENDER: Jordan’s state grain buyer is seeking 120,000 tonnes of barley for shipment in March and April in an international tender closing Sept. 28, a government source said.
• WHEAT TENDER: The World Food Programme, a United Nations agency, has issued an international tender to purchase about 100,000 tonnes of milling wheat, European traders said on Monday. The deadline for submission of price offers in the tender is Sept. 28 with an award expected on Sept. 30.
• MILLING WHEAT TENDER: The Taiwan Flour Millers’ Association has issued an international tender to purchase 51,800 tonnes of grade 1 milling wheat to be sourced from the United States, European traders said on Monday. The deadline for submission of price offers in the tender is Sept. 29.

US BASIS/CASH

• Spot basis bids for soybeans and corn rose at river terminals around the U.S. Midwest on Tuesday, traders said.
  • The river basis was supported by the slower-than-average pace of the early Midwest harvest, which left dealers looking for supplies to fill barges headed for export terminals at the U.S. Gulf.
  • Corn bids were sharply lower at the region’s rail terminals.
  • The soybean basis was mixed at processors and flat at elevators in the truck market.
  • Corn bids were steady to weak at processors and truck elevators.
• Spot basis bids for hard red winter wheat for supplies shipped by rail to the U.S. Gulf fell on Tuesday, pressured by weak export demand, traders said.
  • Truck market bids for wheat were steady to firm in Oklahoma and flat in Kansas.
  • Prices were too low to spark much interest in farmers, who already were worried that dry conditions will cut into yields for the crop they were planting, an Oklahoma dealer said.
  • Protein premiums for wheat delivered by rail to or through Kansas City rose by 20 cents a bushel for wheat with protein content ranging from ordinary through 11.8%, according to the latest CME Group data.
  • Premiums were unchanged for wheat with protein content between 12.0% and 14.0%.
• Spot basis bids for soybeans and corn fell at U.S. Midwest processors on Tuesday morning as deliveries of early harvested supplies were big enough to meet nearby demand at the plants, grain dealers said.
  • Country movement of both commodities was expected to pick up in the coming days as harvest expand around the region.
  • Cash bids for corn and soybeans were steady to firm at elevators and river terminals.
  • At ethanol plants, corn bids were steady to weak, falling by 15 cents a bushel in Annawan, Illinois.
• Spot cash millfeed values were mostly steady across the United States on Tuesday, amid continued tight supplies, dealers said.
  • In general, millfeed supplies have been tight this month as mills undergo pre-scheduled maintenance this week, dealers said.
  • Demand for supplemental feedstuff remained strong amid drought-hit grazing pastures in the U.S. Plains, dealers said.
  • One dealer said some Midwest grain elevators are beginning to hunt for rail freight capacity – rather than barge, where prices are soaring – to move grain to the port in New Orleans for export shipments.
• Spot basis offers for U.S. soymeal fell at truck market processors on Tuesday as expectations for burgeoning supplies weighed on the market, dealers said.
  • Offers on the rail market were steady to weak, falling by $10 a ton in Kansas City.
  • Midwest farmers were starting their harvest deliveries of soybeans to processors, which will allow the plants to boost their crush rates and increase the amount of soymeal available for sale.

ETHANOL: US Weekly Production Survey Before EIA Report

Output and stockpile projections for the week ending Sept. 23 are based on six analyst estimates compiled by Bloomberg.

• Production seen higher than last week at 912k b/d
• Stockpile avg est. 22.402m bbl vs 22.501m a week ago
• Would be the lowest level since Dec. 2021

EU Soft-Wheat Exports Increase 0.6% Y/y; Corn Imports Surge 81%

EU soft-wheat exports during the season that began July 1 reached 8.8m tons as of Sept. 25, compared with 8.75m tons in a similar period a year earlier, the European Commission said on its website.

• NOTE: The commission said the data may be incomplete, which has been the case for much of the season
• Leading destinations are Algeria (1.26m tons), Morocco (1.13m tons) and Egypt (779k tons)
• EU barley exports are at 2.04m tons, compared with 3.12m tons a year earlier
• EU corn imports at 6.65m tons, against 3.67m tons a year earlier

Egypt bought 3.5 million tonnes of wheat since the start of current fiscal year – minister

Egypt, the world’s biggest wheat importer, has bought 3.5 million tonnes of wheat since the start of the current fiscal year that started in July, the supply minister Aly Moselhy said on Tuesday.

Brazil Corn Exports Seen Reaching up to 7.132 Million Tns In September – Anec

• BRAZIL SOY EXPORTS SEEN REACHING 3.818 MILLION TNS IN SEPTEMBER VERSUS 4.152 MILLION TNS FORECAST IN PREVIOUS WEEK – ANEC
• BRAZIL SOYMEAL EXPORTS SEEN REACHING 2.013 MILLION TNS IN SEPTEMBER VERSUS 2.225 MILLION TNS FORECAST IN PREVIOUS WEEK – ANEC
• BRAZIL CORN EXPORTS SEEN REACHING UP TO 7.132 MILLION TNS IN SEPTEMBER VERSUS 7.618 MILLION TNS FORECAST IN PREVIOUS WEEK – ANEC

Russia Harvests 95% of Wheat Area; Yield Increases: IFX

Russia harvested 101.5m tons of wheat in bunker weight as of Sept. 27, compared with 73.9m tons this time last year, Interfax reports, citing the agriculture ministry.

• NOTE: Bunker weight is before drying and cleaning
• Yield increased to 3.33 tons/ha, from 2.62 tons/ha a year ago
• Russia has also harvested 23.8m tons of barley, up from 18.1 tons at this time last year

Manitoba Says Frost Damage Relatively Light as Harvest Stalls

Few crops were harvested last week amid frequent rain and high humidity, the province’s agriculture ministry says Tuesday in a report.

• Killing frosts reported in parts of the province
• While some damage is expected in green canola and soybeans, overall crop injury “relatively light”
• 47% of crops harvested, about 3.5 weeks behind five-year average of 79%

Goldman Says Commodities in ‘Negative Feedback Loop’ on Dollar

Commodities have been caught in a negative feedback loop driven by higher US rates relative to the rest of the world, US dollar gains, and weaker non-US economic growth, according to Goldman Sachs Group Inc.

• At present, these dynamics are mutually self-reinforcing, bank analysts including Jeffrey Currie, Daniel Sharp and Damien Courvalin wrote in a note dated Sept. 27
• With 12-month LIBOR at ~5%, cash is “extremely attractive relative to financial or physical commodity positions that need funding”
• Still, the loop will be transient, not structural, ending when there’s a reconvergence in global rates

Ukraine Says Russia Is Poised to Disrupt Grain Shipment Accord

Ukraine sees a risk of disruption of an agreement that allows trade vessels to export its grain and other agriculture commodities through the Black Sea, partially blocked by Russia’s warships, President Volodymyr Zelenskiy said in his regular night address on Tuesday.

• “It is obvious that Russia is preparing the ground for an attempt to disrupt the grain initiative”
• NOTE: The deal was reached in July to help both Ukraine’s economy and poorer countries in order to prevent food shortages there
• NOTE: Ukraine has exported more than 5 million tons of agricultural products from its three ports in the Black Sea since early August, basically to African countries including Algeria, Ethiopia, Egypt, Libya, Kenya, Somalia, Sudan, Tunisia

Ukraine 2023 winter wheat sowing 16% complete – ministry

Farms in regions controlled by the Ukrainian government have sown 622,000 hectares to winter wheat for the 2023 harvest, or 16% of the expected area, the agriculture ministry said on Tuesday.

The ministry did not provide a forecast, although Agriculture Minister Mykola Solsky told Reuters last month that the area could fall to 3.8 million hectares from 4.6 million a year earlier because of Russia’s invasion.

Kyiv-based Barva Invest consultancy said last week the area sown to winter wheat could total around 3.4 million hectares, 10.5% less than the agriculture minister expected. (Full Story)

Ukraine sowed more than 6 million hectares of winter wheat for the 2022 harvest, but a large area has been occupied by Russian forces since the invasion in February.

The ministry said in a statement that farmers had also sown 65,000 hectares of winter barley, or 10% of the expected area, and 27,000 hectares of rye, or 31% of the forecast.

It also said farmers had completed winter rape sowing, seeding a total of 961,000 hectares.

Ukraine harvested 19 million tonnes of wheat this year, compared with around 32.2 million tonnes in 2021. The sharp decline was the result of hostilities in many regions and the occupation of large areas by Russian forces.

First Deputy Agriculture Minister Taras Vysotskyi said last week Ukraine’s 2023 wheat harvest may decrease to 16-18 million tonnes from 19 million tonnes in 2022 because of an expected fall in the winter wheat sowing area.

U.S. needs to press Mexico on looming biotech corn ban, Vilsack says

U.S. Agriculture Secretary Tom Vilsack said on Tuesday he is continuing to talk with officials in Mexico about that country’s looming ban on genetically modified (GM) corn, adding that it will be important to get clarity on the issue in 2023.

A decree issued by Mexico’s President Andres Manuel Lopez Obrador in late 2020 would phase out GM corn and the herbicide glyphosate by 2024.

The United States could use the USMCA trade pact to challenge Mexico’s policies if needed, Vilsack said. Mexico is a top buyer of U.S. corn.

“I recognize the importance of 2023 in terms of getting clarity about exactly where we are,” he said on a livestream of a meeting with state agriculture officials in the United States.

“We do need to press the issue, and will this year and take whatever steps are necessary and appropriate to raise this issue a notch or two as we get closer to 2024.”

Some officials in Mexico’s government, including Agriculture Minister Victor Villalobos, have signaled that yellow corn imports for livestock feed will not be disrupted by the GM ban. U.S. farmers, however, remain wary since no official document states that, according to a U.S. agriculture official familiar with recent meetings with Mexican officials.

Vilsack said he told Lopez Obrador during a meeting that a disruption of U.S. corn shipments to Mexico for livestock feed would hurt Mexican consumers, particularly those who are poor. He did not say when the meeting took place.

“I’ve educated him on the importance of understanding the role of biotechnology, the role of production, and the connection to his livestock industry,” Vilsack said. He added that an inconsistent message from Mexico about biotechnology could chill innovation in the sector.

Corn for human consumption, including white corn used in food products like tortillas, accounts for between 18% and 20% of Mexico’s total U.S. corn imports. There are still questions about whether such GM imports will be eliminated by 2024.

Taliban Sign Deal With Russia to Buy Cheap Oil, Gas and Wheat

Afghanistan’s ruling Taliban have signed an agreement with Russia to import fuel and wheat at a discount as the country struggles to feed its population and seeks to boost regional trade a year after regaining power.

Items like gasoline, diesel, gas and wheat will be purchased in Russian rubles and at a “special discount,” said Abdul Salam Jawad Akhundzada, a spokesman of the Ministry of Commerce and Industry, by phone from Kabul on Wednesday. Preparations are underway to start importing the products “within days or weeks,” he said.

The deal, the largest such agreement the Taliban has signed since they returned to power, includes one million tons each of petrol and diesel, half a million tons of liquefied petroleum gas, and two million tons of wheat to be supplied annually until an unspecified date, Akhundzada said. More longer-term deals with Moscow are expected in the future, he added.

The agreement follows a visit to Russia last month by Afghanistan’s Minister of Commerce and Industry Nooruddin Azizi. In June, the Taliban struck a deal with Iran to purchase 350,000 tons of petroleum products to ease fuel prices.

No country has formally recognized the Taliban government however, Russia is one of a few to have kept its embassy in Kabul open. Moscow has also approached several Asian countries to discuss possible long-term oil contracts at steep discounts as US officials continue to try and push a plan that would cap the price of the country’s oil, a Western official told Bloomberg last month.

Afghanistan consumes 1.3 million tons of fuel annually, imported mostly from Uzbekistan, Turkmenistan, and Iran, according to the ministry.

China’s sow herd up 0.6% in August on month

China’s sow herd reached 43.2 million pigs in August, the state broadcaster reported on Wednesday, adding that it is 5.5% higher than normal levels required.

The sow herd has increased by 0.6% versus July, according to a Reuters calculation based on July data published by the agriculture ministry.

 

This commentary is provided by ADM Investor Services, a futures brokerage firm and wholly owned subsidiary of ADM Company. ADMIS has provided expert market analysis and price risk management strategies to commercial, institutional and individual traders for more than 50 years. Please visit us at www.admis.com or contact us at sales@admis.com to learn more.

 

Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by Archer Daniels Midland Company. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS.

 

CONFIDENTIALITY NOTICE This message may contain confidential or privileged information, or information that is otherwise exempt from disclosure. If you are not the intended recipient, you should promptly delete it and should not disclose, copy or distribute it to others.