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

 

Wheat prices overnight are down 7 1/4 in SRW, down 7 1/4 in HRW, down 7 1/4 in HRS; Corn is down 3 3/4; Soybeans down 13 3/4; Soymeal up $0.05; Soyoil down 3.34.

For the week so far wheat prices are down 8 in SRW, down 18 in HRW, down 12 in HRS; Corn is down 7 1/2; Soybeans up 25; Soymeal up $1.25; Soyoil down 2.67.

Year-To-Date nearby futures are up 0% in SRW, up 14% in HRW, down -3% in HRS; Corn is up 11%; Soybeans up 10%; Soymeal up 2%; Soyoil up 28%.

 

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Chinese Ag futures (JAN 23) Soybeans down 7 yuan; Soymeal up 9; Soyoil up 46; Palm oil up 10; Corn up 3 — Malaysian palm oil prices overnight were down 156 ringgit (-3.68%) at 4078.

There were changes in registrations (65 Oats, 150 Soyoil). Registration total: 3,056 SRW Wheat contracts; 65 Oats; 308 Corn; 121 Soybeans; 689 Soyoil; 278 Soymeal; 5 HRW Wheat.

Preliminary changes in futures Open Interest as of November 30 were: SRW Wheat up 2,224 contracts, HRW Wheat up 711, Corn down 7,152, Soybeans up 7,085, Soymeal up 7,658, Soyoil up 2,408.

Brazil Grains & Oilseeds Forecast: Rio Grande do Sul and Parana Forecast: Isolated showers north Thursday. Scattered showers Friday-Sunday. Temperatures near to above normal through Sunday. Mato Grosso, MGDS and southern Goias Forecast: Scattered showers through Sunday. Temperatures near normal through Sunday.

Argentina Grains & Oilseeds Forecast: Cordoba, Santa Fe, Northern Buenos Aires Forecast: Mostly dry Thursday-Sunday. Temperatures near normal through Friday, above normal Saturday-Sunday. La Pampa, Southern Buenos Aires Forecast: Mostly dry through Sunday. Temperatures near normal through Friday, above normal Saturday-Sunday.

Northern Plains Forecast: Mostly dry Thursday. Scattered snow Friday. Mostly dry Saturday-Sunday. Temperatures near normal Thursday, near to well below normal Friday-Sunday. Outlook: Scattered snow Monday-Wednesday. Mostly dry Thursday-Friday. Temperatures below to well below normal Monday-Friday.

Central/Southern Plains Forecast: Mostly dry through Friday. Isolated to scattered showers south Saturday-Sunday. Temperatures near to above normal Thursday-Friday, near to below normal Saturday, near to above normal Sunday. Outlook: Isolated to scattered showers Monday. Mostly dry Tuesday-Thursday. Isolated showers Friday. Temperatures near to above normal Monday, near to below normal north and above normal south Tuesday-Friday.

Western Midwest Forecast: Mostly dry Wednesday-Thursday. Snow north Friday. Mostly dry Saturday-Sunday. Temperatures below normal Wednesday-Thursday, above normal Friday, near to below Saturday-Sunday.

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

The player sheet for Nov. 30 had funds: net buyers of 5,500 contracts of SRW wheat, sellers of 3,500 corn, buyers of 4,500 soybeans, buyers of 5,000 soymeal, and sellers of 1,500 soyoil.

TENDERS

• WHEAT TENDER UPDATE: Algeria’s state grains agency OAIC started buying milling wheat in an international tender which closed on Wednesday
• SOYBEAN SALES: The U.S. Department of Agriculture confirmed private sales of 136,000 tonnes of U.S. soybeans to China for delivery in the 2022/23 marketing year that began Sept. 1.
• CORN PURCHASE: South Korea’s Feed Leaders Committee (FLC) purchased about 65,000 tonnes of animal feed corn expected to be sourced from South America in a private deal on Wednesday without an international tender being issued
• CORN PURCHASE: South Korea’s Major Feedmill Group (MFG) purchased around 69,000 tonnes of animal feed corn expected to be supplied from South America in a private deal without issuing an international tender
• CORN TENDER: The Korea Feed Association (KFA) has issued an international tender to purchase up to 69,000 tonnes of animal feed corn to be sourced from optional origins
• WHEAT TENDER UPDATE: The lowest price offered in the tender from Pakistan to purchase 500,000 tonnes of wheat which closed on Wednesday was believed to be $372.00 a tonne c&f thought to be for Russian-origin wheat

PENDING TENDERS

• RICE TENDER: Turkey’s state grain board TMO issued an international tender to purchase a total 40,000 tonnes of rice.
• BARLEY TENDER: Turkey’s state grain board TMO issued an international tender to purchase an estimated 495,000 tonnes of animal feed barley

US BASIS/CASH

• Basis bids for soybeans shipped by barge to U.S. Gulf export terminals softened on Wednesday on cheaper freight costs and slowing exporter demand as Argentine growers increased their soybean offerings, traders said.
  • CIF Gulf corn basis bids also declined.
  • Spot bids for empty barges on Midwest rivers were down 25 to 50 points compared with Friday, although trade was subdued, barge sources said. BG/US
  • CIF soybean barges loaded in November traded at 140 cents January and were re-bid at the same level, down 6 cents from Tuesday’s last bid. December barges traded at 130 cents over futures and were re-bid at 128 cents over, down 17 cents from Tuesday.
  • Export premiums for soybeans shipped in the last half of December held steady at around 165 cents over futures.
  • For corn, CIF barges loaded in November were bid at 125 cents over December, down 5 cents from Tuesday. December corn barges were bid at 117 cents over futures, also down a nickel.
  • Corn export premiums for late December loadings were down 2 cents at around 143 cents over December futures.
• Spot basis bids for soybeans mostly weakened along Midwest rivers and interior elevators on Wednesday, with an uptick in farmer sales pressuring the cash market.
  • Some farmers were booking soybean sales after a recent rise in futures prices, an Ohio broker said.
  • Corn basis was mixed along rivers and truck market facilities, while the rail market continued to strengthen.
  • Farmer sales of corn have been slow in recent weeks, with futures trending lower.
• Spot basis bids for hard red winter wheat were mostly flat at grain elevators across the southern U.S. Plains on Wednesday.
  • Some farmers were booking deals before the end of the year, an Oklahoma dealer said.
  • Protein premiums for hard red winter wheat delivered by rail to or through Kansas City were unchanged for all grades of wheat, according to CME Group data.
• Spot basis offers for U.S. soymeal fell at processors in the eastern truck market and were also lower in the western rail market on Wednesday, dealers said.
  • For export, offers were largely unchanged for both soymeal shipped by barge to the U.S. Gulf and for loadings onto ocean-going vessels at export terminals.
  • Rallying futures prices pulled cash prices higher, easing demand.
  • Livestock and poultry producers often book extra soymeal for December to ensure they have enough supplies on hand during Christmas, when processors are shut down.
  • Rail traffic has been light with some nervousness about a potential shutdown, though the U.S. House of Representatives was set to vote Wednesday on an effort to prevent one.

GRAIN EXPORT SURVEY: Corn, Soy, Wheat Sales Before USDA Report

CROP SURVEY: US Soybean Crush and Corn for Ethanol

The following is from a Bloomberg survey of six anlaysts.

• Soybean crush seen at 196m bu in Oct., a 0.5% drop from a year ago
• Crude and once-refined soybean-oil reserves at end of October seen at 2.093b lbs, down from 2.386b
• Corn used in ethanol production seen down 7.4% y/y to 433.3m bu
• The USDA is scheduled to release its October Fats and Oils report along with the Grain Crushings report on Dec. 1 at 3pm

Biden Set to Raise Refiners’ Biofuels Quotas in Green Push

• EPA seeks to boost quotas for corn- and soy-based biofuels
• Proposal shows administration’s focus on shift to biofuels

The Biden administration is seeking to boost renewable fuel requirements for oil refiners and importers over the next three years, part of a broader plan to encourage greener energy production, according to people familiar with the matter.

The Environmental Protection Agency will ask companies to blend 20.82 billion gallons of renewable fuel into their diesel and gasoline next year — with as much as 15 billion gallons coming from conventional, corn-based ethanol — said the people, who asked not to be identified because the proposal isn’t public.

The numbers aren’t yet final and could change before publication. The proposal — set to be released as early as Wednesday evening and finalized by the EPA in mid-2023 — reflects the Biden administration’s push to promote greener energy sources and support biofuels produced in rural America.

US ethanol makers rose. Bunge Ltd. gained as much as 2%, Archer-Daniels-Midland Co. increased 1.2%, and Green Plains Inc. was up 7.1%.

The overall renewable fuel quota would climb to 21.87 billion gallons in 2024 — up from this year’s 20.63-billion gallon requirement, and up to at least 22.43 billion gallons in 2025, an 8.7% increase from this year’s target. An additional 250 million gallons of renewable fuel could also be required in 2025 to address a previous court ruling.

The EPA would also boost quotas for biodiesel, which is typically made from soybean oil and other fats, up to 2.95 billion gallons in 2025.

EPA’s proposal envisions significant growth in the amount of renewable natural gas harvested from landfills and farms.

Argentina farmers soybean sales nearly double, exchange says

Argentine farmers nearly doubled soybean sales on Tuesday from the day before, the major Buenos Aires grains exchange said, after a preferential exchange rate went into effect for exports of the cash crop.

Soy producers sold 567,815 tonnes of the 2021/22 soybean harvest, exceeding the two-month high of 298,911 tonnes sold Monday.

The new policy, which allows farmers to settle sales for 230 pesos per dollar, nearly 40% above the official rate, boosted sales from the 78,303 tonnes sold Friday, the exchange said.

Brazil’s Rumo says goods are being delivered to Paranagua port

BRAZIL RAIL OPERATOR RUMO SAYS RAILWAY TO PARANAGUA PORT RESUMED OPERATIONS WITH RESTRICTIONS AFTER LANDSLIDES

BRAZIL’S RUMO SAYS GOODS ARE BEING DELIVERED TO PARANAGUA PORT

Bumper Australian Wheat Harvest Expected, But Rains Raise Question on Quality

Analysts at Fitch Solutions are expecting a bumper wheat crop from Australia this year, but heavy rains have affected growth, raising questions over quality. Fitch expects Australian wheat production to reach 34 million metric tons in 2022-23, which although representing a 6.2% drop on year in terms of output is still 40% higher than the five-year average. Exports as a result are predicted at 26 million tons–47.5% higher than the five-year average and roughly 12% of global exports, which Fitch’s analysts say should help alleviate some of the losses from Ukraine. That said, “Torrential rains and flooding throughout the New South Wales wheatbelt have sparked concerns over Australia’s wheat harvest quality,” Fitch adds.

ING Pegs Wheat Futures at $8.50/Bushel in 2023 on Tight Supply

Global wheat supplies are likely to tighten in the coming 2023-24 season, Warren Patterson, head of commodity strategy at ING, says in a note.

• Uncertain how much Ukraine can produce and export amid the war
• There are concerns for the next US winter-wheat crop, given ongoing drought
• Will also be a challenge for Russia to repeat this year’s record harvest, given heavy rains that delayed plantings and weaker prices in ruble terms
• Sees CBOT wheat averaging $8.50/bushel over 2023, and Euronext milling wheat averaging EU330/ton
• Prices are currently at $7.8525/bushel and €316.25/ton

India Buys More and Saves More in 1.5 Million-Ton Urea Tender

Farmers in the US Corn Belt tried to apply autumn fertilizers in late November, but winter weather stalled some activity. Ammonia continued moving to the field in some Midwest locations, along with potash and phosphates. Prices in India’s latest urea tender dropped about $76 a metric ton from the last one, to $578.77 cost and freight. Most fertilizer prices were flat or down in late November.

Nitrogen, Phosphate, Potash Weaken in Wednesday Whisper

US fertilizer prices were under pressure in late November. Fueled by lower international prices and increased production in Europe, Tampa ammonia for December was down $120 a metric ton (mt) from November. New winter ammonia offers in Western Canada were C$200-$250/mt lower than fall prices, while urea and urea ammonium nitrate (UAN) fell again at New Orleans (NOLA) and in the Western US and Canada. Phosphate prices also plunged in the Western US and Canada amid new producer offers, with potash slipping in California and Western Canada. Brazil phosphate prices rebounded slightly from last week, but the urea market fell $18-$20/mt amid low demand.

Argentina corn production down again as sowing delays continue amid lack of moisture – Refinitiv Commodities Research

2022/23 Argentina corn production is cut by 2% to 48.0 [43.9–52.3] million tons amid a historic drought and planting delays throughout the main Pampas, despite recent beneficial rains that brought some relief to key crop areas. Our current estimate puts planted area at 7.65 million hectares, slightly above 7.3 million hectares reported by Bolsa de Cereales in Buenos Aires, but below the Bolsa de Comercio in Rosario’s 7.9 million hectares. In November’s WASDE (09 November), USDA placed Argentina corn production at 55 million tons, unchanged from last update. Bolsa de Cereales in Buenos Aires and Bolsa de Comercio in Rosario currently forecast production at 50 and 56 million tons, respectively.

Argentina’s core Pampas region welcomed long awaited rains during the second half of November, after an extreme drought period that lasted more than 5 months since May. Northern Buenos Aires, western Córdoba and southern Santa Fe – where more than half of the country’s total corn is grown – finally received some meaningful precipitation over the past two weeks, totaling 30-50 mm throughout. The total amount of the drought relieving November rain was far from sufficient, however, barely above normal, not enough to recharge soil moisture storage and restore adequate planting conditions. Most key producing provinces are still showing at least five-year low soil moisture levels, and the dire conditions will likely get worse as there appears to be no end in sight to dryness following the short period of wetness in November.

Corn planting is only 38% complete nationally according to the Ministry of Agriculture, still among the slowest in the past 25 years, far worse than last year’s 51% and the 53% five-year average. Bolsa de Cereales in Buenos Aires also reported a progress of 23.8%, a record low according to our available data. The first phase of planting is essentially complete in Entre Ríos and Santa Fe, where the delays are estimated at -9% and -19%, respectively. The second phase of planting in these regions will not start until next week, to avoid pollination in January, a notoriously hot and dry month known to farmers there. The latest ENSO outlook (by Refinitiv Weather Research) suggests that the current La Niña event is forecast to last through the end of the year and may not completely dissipate by early next year, warranting close attention, as La Niña conditionsare most frequently associated with hot and dry weather in the main Pampas region.

India wheat production set at a record high thanks to higher sown area and favorable weather

2023/24 India wheat production remains unchanged at 111 [107-112] million tons as sufficient soil moisture, record high marginal profit expectations, and low wheat stock from the unprecedented heat wave last season encouraged higher wheat sowing. Thanks to favorable conditions, growers in major key producing northern states including Punjab, Uttar Pradesh, and Haryana are increasing wheat acreage by planting the crop on land that is traditionally cultivated for oilseeds and pulses.

The latest planting report released by the Ministry of Agriculture on 25 November indicates that India farmers sowed 15.3 million hectares of wheat as of the report date, 11% higher than the corresponding period last year, with fast sowings primarily in the North. Recent cool and dry temperature forecast indicate cool and dry weather conditions in the North during the next week, which will be favorable for wheat planting. Refinitiv’s latest EC seasonal model run forecasts cooler temperatures in India during December-February, increasing our yield estimate to 3.51 tons per hectare. Should cool temperatures prevail during January-March, wheat yield could be raised. Alternatively, hot temperatures, and unprecedented rain during harvest, could cut yields substantially. We will periodically update yield upon changes in temperatures, soil moisture levels, and satellite imagery.

U.N. says deal close on resuming Russia ammonia exports via Ukraine

A deal is “quite close” to resume Russian ammonia exports via a pipeline to a Black Sea port in Ukraine, U.N. aid chief Martin Griffiths told a Reuters NEXT event on Wednesday, stressing that it was “almost more important” than ensuring grain exports.

Facilitating Russia’s food and fertilizer shipments is a central aspect of a package deal brokered by the United Nations and Turkey in July – and extended earlier this month – that also restarted Ukraine’s Black Sea shipments of grain.

Russia’s Feb. 24 invasion of its neighbor had stalled Ukraine’s Black Sea exports of foodstuffs and also shut down a pipeline transporting ammonia from Russia to a Black Sea port in Ukraine. Ammonia is a key ingredient in nitrate fertilizer.

When asked about a deal to restart the ammonia pipeline, Griffiths said: “I think we’re quite close, we’re edging towards it this week.”

“It’s essential,” he said, warning that if Russia’s fertilizer exports were not resumed then it could spark a food availability problem in a year. “So it’s hugely important, almost more important than grain.”

The United Nations has said Russia’s war in Ukraine worsened a global food crisis, pushing some 47 million people into “acute hunger” and sparking the need for the export deal. Ukraine and Russia are both key global grain and fertilizer exporters.

“The operation of that ammonia pipeline from Russia through Ukraine … is well understood, it’s not difficult, it can be started within a week or two. I think we’ll get there,” said Griffiths.

Lula proposes pact to curb Brazilian soy linked to savanna deforestation

Brazilian President-elect Luiz Inacio Lula da Silva’s transition team has held meetings with the soy industry to discuss a new pact to stop deforestation in the Cerrado savanna, modeled on an agreement for the Amazon, a Lula adviser said on Wednesday.

The Cerrado, the world’s most species-rich savanna, borders the Amazon and is called an upside-down forest because of its deep carbon-rich roots. Deforestation there is a major source of greenhouse gas emissions that drive climate change.

In 2006, soy traders voluntarily agreed to stop buying soy from areas deforested in the Amazon after a certain date. Since then, soy farming has expanded rapidly in the Cerrado, where environmental advocates have lobbied for a similar pact.

“There are all the pacts that were done in the past – the soy moratorium, the legal wood pact, legal minerals. This needs to be redone, including yesterday and the day before we spoke to the soy sector about making a pact for sustainable soy in the Cerrado,” said former Environment Minister Carlos Minc in a news conference alongside Lula’s top environmental advisers.

“We have had this in the Amazon and it is functioning well and should be an example.”

Minc did not give further details, and the transition team said it was still finalizing its first report to detail Lula’s likely future environmental policy.

Brazil’s farm industry and global commodities traders have previously resisted attempts to forge such a Cerrado pact, although in recent years major firms have laid out goals to eliminate deforestation in their supply chains everywhere by 2025.

Deforestation in the Cerrado increased 8% to a six-year high in 2021, according to government data.

Vitol Returns to Grain Trading as Ukraine War Stokes Volatility

• Profit at agricultural traders Cargill, Viterra rose this year
• Trader Vitol pulled back from agricultural markets in 2016

Energy giant Vitol Group is again hiring grain traders, six years after scaling down its agricultural business.

Vitol is hiring a trader in Geneva and another in Houston, according to a person familiar with the mattter who asked not to be named as the matter is private. One of its hires is Michael Lin, who was previously global head of wheat trading at Avere Commodities SA, another person said.

The tentative return to grains for Vitol, the world’s biggest independent oil trader, comes after Russia’s invasion of Ukraine upended agricultural markets. That’s created extreme volatility, allowing trading houses such as Cargill Inc. and Viterra to post bumper profits.

Vitol, which was historically an active player in sugar markets, notched a record $4.2 billion profit in 2021. The company pulled back from grain trading in 2016 after a three-year foray into the market.

Trading houses are increasingly looking to diversify as a way of maintaining profits in volatile markets. The growing market for biofuels is also bringing the energy and agricultural sectors ever closer together.

Corteva to Buy Biologicals Firm Stoller for $1.2 Billion

• Deal is Corteva’s second this year for alternative market
• Corteva sees growth in market for nature-based crop protection

Agricultural chemical giant Corteva Inc. agreed to buy biologicals firm Stoller Group for $1.2 billion to accelerate its expansion into the growing market for nature-based crop protection products.

Corteva gains a closely held Houston-based company with operations and sales in more than 60 countries and $400 million in forecast revenues from the deal, the Indianapolis-based company said Wednesday in a statement. The all-cash takeover is expected to close in the first half of next year and will add to Corteva earnings for 2023.

“Stoller represents a leader in the biologicals industry given its commercial presence and market expansion potential, while also delivering attractive growth and operating margins,” Corteva Chief Executive Officer Chuck Magro said in the statement.

Corteva shares were little changed at $65.61 as of 1:42 p.m. in New York.

The move comes as the agricultural industry seeks alternatives to chemical pesticides and fertilizers, with farmers increasingly under pressure to adopt environmentally friendly practices. Biologicals use material that already exist in nature to replace synthetic ingredients in chemical pesticides. Pest and crop diseases are growing more resistant to synthetic chemicals.

Bloomberg reported in May that the owners of Stoller were exploring a sale that could value the company at as much as $1.5 billion, including debt.

The takeover is Corteva’s second biologicals deal this year, after agreeing to buy Spanish microbiological technologies firm Symborg in September, and the latest in a series of industry acquisitions in the alternative crop protection area. Rival FMC Corp. agreed to acquire pheromone pioneer BioPhero ApS for about $200 million in June.

The biologicals market is expected to grow high-single digits annually through 2035, representing about 25% of the overall crop protection market by 2035, Corteva said in its statement.

US October Agricultural Prices Paid and Received

SOUTH AMERICA

UNITED STATES

 

 

 

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