Global Ag News for Jan 26

Overnight trade has SRW Wheat down roughly 2 cents, HRW up 3; HRS Wheat down 1, Corn is up 2 cents; Soybeans up 3; Soymeal up $0.50, and Soyoil up 30 points.

Chinese Ag futures (May) settled down 11 yuan in soybeans, down 11 in Corn, up 2 in Soymeal, up 84 in Soyoil, and up 68 in Palm Oil.

In Brazil, conditions will be good for most key production areas. There will be a few exceptions though. The northeast will need more rain. Net drying is expected in central and eastern Minas Gerais and much of Bahia through week 1 of the outlook and likely in week 2 as well. Rio Grande do Sul will be too wet in the next seven to ten days with some flooding.

In Argentina, conditions will still be mostly good for crops with a favorable mix of rain and sunshine in most areas. Some of the south will be too dry, especially eastern La Pampa and southwestern Buenos Aires.

The player sheet had funds net buyers of 11,000 SRW Wheat; bought 37,000 Corn; net bought 22,000 Soybeans; bought 7,000 lots of Soymeal, and; net bought 5,000 Soyoil.

We estimate Managed Money net long 1,000 contracts of SRW Wheat; long 341,000 Corn; net long 131,000 Soybeans; net long 65,000 lots of Soymeal, and; long 96,000 Soyoil.

Preliminary Open Interest saw SRW Wheat futures up roughly 2,400 contracts; HRW Wheat up 1,700; Corn up 5,700; Soybeans down 3,500 contracts; Soymeal down 40 lots, and; Soyoil up 6,000.

There were no changes in registrations—Registrations total 49 contracts for SRW Wheat; ZERO Oats; Corn ZERO; Soybeans 169; Soyoil 1,289 lots; Soymeal 175; Rice 732; HRW Wheat 91, and; HRS 1,023.

Japan’s Ministry of Agriculture sought 60,715 tonnes of food-quality wheat from Australia in a regular tender.

Japan, the world’s sixth-biggest wheat importer, keeps a tight grip on imports of the country’s second-most important staple after rice and buys the majority of the grain for milling via tenders typically issued thrice a month.

Condition ratings for winter wheat declined during January in Kansas, the top U.S. winter wheat producer, but monthly ratings were mixed in several other Plains and Midwest states, the U.S. Department of Agriculture said on Monday.

The United States is the world’s second-largest wheat exporter after Russia.

The USDA issued its last national winter wheat ratings of the season on Nov. 30, reporting 46% of the U.S. crop in good to excellent condition as of Nov. 29. Over the winter, USDA’s National Agricultural Statistics Service releases monthly reports for select states. The government will resume weekly U.S. crop progress reports in April.

The USDA rated 43% of the Kansas winter wheat crop in good to excellent condition as of Jan. 24, down from 46% at the start of the month. A year ago, 34% of the Kansas crop was rated good to excellent.

Winter wheat ratings also declined in Colorado, Nebraska and South Dakota, but improved in Montana, the No. 4 winter wheat producer in 2020.

Farmers in the Plains states grow mostly hard red winter wheat, the largest U.S. wheat class, which is milled into flour for bread.

Ratings improved in Illinois and Kentucky, where farmers grow soft red winter wheat used to make cookies and snack foods. But ratings declined in North Carolina, another soft wheat producer.


December 2020 Highlights

Total red meat supplies in freezers were up 1 percent from the previous month but down 11 percent from last year. Total pounds of beef in freezers were up 4 percent from the previous month and up 11 percent from last year. Frozen pork supplies were down 3 percent from the previous month and down 30 percent from last year. Stocks of pork bellies were up 32 percent from last month but down 54 percent from last year.

Despite warnings that Chinese authorities might block wheat from ­Australia amid escalating tensions, wheat ­exports to China surged last month, underscoring a year in which overall trade ­between the two countries ­approached a record high.

Chinese buyers were drawn to lower Australian wheat prices as well as its plentiful supply, after Russia – the world’s leading wheat exporter – curbed its exports on the back of domestic food inflation by introducing an export tax between last February and June.

The Russian government has formally approved a proposal to impose a higher export tax on wheat from March 1, it said on Tuesday, in another push to curb a rise in domestic food prices triggered by the COVID-19 crisis.

Russia is one of the world’s largest wheat exporters. Global wheat prices jumped after the proposal to raise the tax was first announced by Russian officials earlier in January on expectations that it could make buyers prefer wheat from other countries.

The Russian government approved an increase in the export duty on wheat from 25 to 50 euros per tonne starting on March 1, 2021, as part of a quota, according to the decree signed by Russian Prime Minister Mikhail Mishustin, the government press service reported on Tuesday.

Russia’s cabinet has approved introduction of an export duty at 25 euro per tonne inside the grain export quota for corn and at 10 euro per tonne for barley starting March 15, according to a respective decree signed by the Prime Minister Mikhail Mishustin, the government’s press service reported on Tuesday.

Ukraine ranked second among the world’s grain exporters behind only the United States in the 2019-2020 marketing year, Interfax-Ukraine news agency reported on Monday.

Ukrainian soft milling wheat export prices decreased by $3-$4 a tonne on Monday following the global downward trend, analyst APK-Inform said on Tuesday.

Grain crops in the European Union have mostly acquired greater frost resistance during cold spells since December, but an unusually mild winter in the southeast of the bloc was limiting plant sturdiness there, the EU’s crop monitoring service said.

Soft wheat exports from the European Union in the 2020/21 season that started last July had reached 14.50 million tonnes by Jan. 24, data published by the European Commission showed on Monday. That was down from 17.21 million tonnes cleared by the same week last season, the data showed.

European Union soybean imports in the 2020/21 season that started last July had reached 8.32 million tonnes by Jan. 24, data published by the European Commission showed on Monday.That compared with 7.98 million tonnes cleared by the same week last season, the data showed.

Egypt imported about 8.2 million tons of wheat during the first half of 2020/2021 (July/June), a 9% increase from the same period last year, and 29% above the five-year average of 6.35 million tons, according to Refinitiv trade flow models.

Malaysian palm oil futures gave up early gains to trade lower by midday break on Tuesday, as data showing weak exports in January dampened demand outlook. The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange fell 0.7% to 3,218 ringgit ($795.94) per tonne by midday break, heading for a third straight session of losses.

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