Global Ag News for May 25

Headline News

Wheat prices overnight are up 1/2 in SRW, down 1 1/4 in HRW, up 2 in HRS; Corn is down 3 3/4; Soybeans up 7 3/4; Soymeal down $0.18; Soyoil up 0.85.

For the week so far wheat prices are down 11 1/2 in SRW, down 10 in HRW, down 13 3/4 in HRS; Corn is down 6; Soybeans up 4 1/4; Soymeal down $0.04; Soyoil up 0.53.

For the month to date wheat prices are down 72 in SRW, down 89 1/2 in HRW, down 77 in HRS; Corn is down 19 3/4; Soybeans down 3 3/4; Soymeal down $27.70; Soyoil up 3.59.

Chinese Ag futures (SEP 21) Soybeans up 22 yuan ; Soymeal up 22; Soyoil up 88; Palm oil up 32; Corn down 5 — Malasyian Palm is up 120.

Malaysian palm oil prices overnight were up 117 ringgit (+3.01%) at 4007 bouncing back after slumping almost 13% in four sessions, with a recovery in soybean oil prices in the U.S. and China prompting investors to resume purchases.

Midwest corn, soybean and winter wheat forecasts: West: Scattered showers through Tuesday. Mostly dry Wednesday. Scattered showers Thursday. Isolated showers Friday. Temperatures above to well above normal through Tuesday, near to above normal Wednesday, near to below normal Thursday-Friday. East: Scattered showers Wednesday. Scattered showers late Thursday-Friday. Temperatures above to well above normal through Wednesday, below normal north and above normal south Thursday, near to below normal Friday. 6 to 10 day outlook: Isolated showers Saturday-Tuesday. Scattered showers Wednesday. Temperatures near to below normal Saturday-Monday, near to above normal Tuesday-Wednesday.

The player sheet had funds net sellers of 4,000 contracts of SRW Wheat; sellers of 8,500 corn, sellers of 2,000 soybeans, sellers of 3,000 Soymeal, and; net sellers of 1,000 lots of Soyoil.

Preliminary changes in futures Open Interest as of May 24 were: SRW Wheat down 2,286 contracts, HRW Wheat down 1,933, Corn up 4,083, Soybeans down 570, Soymeal down 1,209, Soyoil up 5,965.

There were no changes in registrations. Registration total: 20 SRW Wheat contracts; 16 Oats; 0 Corn; 165 Soybeans; 1,003 Soyoil; 442 Soymeal; 1,249 HRW Wheat.

TENDERS

• WHEAT PURCHASE: Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), said it bought 240,000 tonnes of Romanian wheat in an international purchasing tender.
• Algeria Seeks 50,000 Tons of Durum Wheat
• Japan Seeks to Buy 124,620 Tons of Milling Wheat

PENDING TENDERS

• FEED WHEAT TENDER: Indonesia’s state procurement agency Bulog issued an international tender to buy and import about 180,000 tonnes of animal feed wheat.
• WHEAT TENDER: Bangladesh’s state grains buyer issued another international tender to purchase 50,000 tonnes of milling wheat.

Favorable Australian weather spells second bumper wheat harvest

Australia is poised for a second consecutive bumper wheat harvest as farmers plant grain in near-perfect growing conditions, easing some of the global supply concerns, which lifted world prices to multi-year highs last month.

China Vows to Better Handle Abnormal Commodity Price Changes

China top economic planning agency stepped up efforts to rein in “abnormal” fluctuations in commodities such as iron ore, copper and corn, part of a broader five-year plan to overhaul various pricing mechanisms. The National Development and Reform Commission will make timely suggestions on more comprehensive price controls and strengthen management of market pricing expectations. NDRC doesn’t give more details on the controls.

China Premier Sows Commodities Confusion After Port Comments

A call from China’s Premier Li Keqiang to improve the country’s port infrastructure and make “full use” of international markets may have sown confusion in already skittish commodity markets. During a visit to a major import terminal in Zhejiang province on Monday, Li urged the port authorities to “improve the import, storage and transportation of bulk commodities”, according to a State Council statement. Copper retraced a slump earlier in the day, as investors took Li’s comments to mean China may boost global purchases of industrial metals to meet domestic demand and stave off inflation. But observers in China say the Premier was merely talking about improving port logistics, and not giving a green light for boosting imports, which could offer fresh support to international prices.

Obese Pigs in China Are Fueling Relentless Slump in Pork Prices

Obese pigs in China are being blamed for worsening a sudden rout in the country’s pork prices. Farmers have been fattening hogs since late last year to almost double their normal weight — roughly the size of a pygmy hippo or a female polar bear — in the hopes the animals will generate higher returns should prices rebound. Cao Tao, a pig trader in the northwestern province of Shaanxi, said many of the swine he’s buying weigh more than 200 kilograms, compared with their usual size of around 125 kilograms. “Some farmers are holding onto their larger pigs on hopes of a price rebound,” he said. Instead, Chinese wholesale pork prices have plunged more than 40% since mid-January amid sluggish demand, increased imports and panic selling by farmers after fresh outbreaks of African swine fever. Muyuan Foods Co., the country’s biggest pig breeder, said this week it’s expecting a continued drop in domestic hog prices, with the slump not bottoming out until next year or even 2023.

China Steps Up Financial Support for Family Farms, Cooperatives

China supports banks boosting loans to new types of agricultural businesses including family farms and farmers’ cooperatives, according to a statement on PBOC’s website.

• Banks are told to be more lenient on bad loans of such entities and are encouraged to issue special bonds to support the agricultural sector
• Authorities express support for such agricultural businesses raising money via bond or stock offerings

China’s grain production to hit 692m tons in 2021

China’s grain production will hit 692 million tons and the self-sufficiency rate of staple grains such as rice and wheat will be 99.3 percent, according to the China Agricultural Sector Development Report 2021.

• “The grain production will keep increasing and China’s food security will be absolutely guaranteed during the 14th Five-Year Plan period,” said Mei Xurong, vice-president of the academy.
• Last year grain production reached 669 million tons.
• The soybean production increased to 19.6 million tons, up 8.3 percent year-on-year, and imports exceeded 100 million tons.
• Last year, hog production maintained good recovery, with 527 million pigs slaughtered and 411.3 million of them used for pork output. Pork imports have reached a new record high of 4.39 million tons, Mei said.
• “China has basically achieved self-sufficiency in seeds of three major grains,” he added.

Second Big Cyclone in 10 Days Set to Worsen India’s Virus Misery

A powerful cyclone is set to slam into India on Wednesday, the second in less than two weeks, with authorities gearing up for relief operations at a time when the nation is facing the world’s worst outbreak of Covid-19. Cyclone Yaas, equivalent to a category 3 hurricane, will cause heavy rains in the eastern states of West Bengal and Odisha, with wind speeds as high as 185 kilometers (115 miles) per hour, according to the India Meteorological Department. Sea levels may increase 4 meters above regular tides and inundate low-lying areas, it said.

U.S. Inspected 1.728m Tons of Corn for Export, 194k of Soybean

In week ending May 20, according to the USDA’s weekly inspections report.

• Soybeans: 194k tons vs 310k the previous wk, 344k a yr ago
• Corn: 1,728k tons vs 1,983k the previous wk, 1,097k a yr ago
• Wheat: 574k tons vs 660k the previous wk, 465k a yr ago

Brazil Animal Protein Group Warns Govt on Inflationary Pressure

• Chicken, pork and egg price for consumers may rise in the coming months amid an increase in animal-feed costs, meat exporter group ABPA says in a statement.
• In some regions of Brazil, corn prices doubled from a year ago, while the industry also has faced higher costs of soybeans, fuel and packaging
• Costs to produce chicken and pork rose 40% and 45% in April from a year ago

Brazil’s soybean export exceeds 800,000 daily tons up to 3rd week of May

Brazil’s average daily soybean exports reached 842,900 tons by the 3rd week of May, up 19.5% over the same month in 2020, data from the Secretariat of Foreign Trade (SECEX) showed Monday. Shipments remain heated as the harvest of a record 2020/21 oilseed crop nears its end, but dropped slightly from last week, when it stood at 880,000 tons a day.

Ukraine Exports 40.9M Tons of Grain So Far in 2020-21 Season

• 15.6m tons of wheat, within the official target for the season of 17.5m tons
• 20.4m tons of corn, within the official target for the season of 24m tons
• Given the current shipment pace, “grain exports won’t exceed the agreed volumes and the level of stockpiles will be pretty high,” ministry says, citing its deputy minister Taras Kachka

Ukraine could harvest 100 mln tonnes of oilseeds this crop year

Ukraine could harvest 100 million tonnes of grains and oilseeds during the 2021-2022 crop year, the country’s agrarian policy and food minister said during a press conference on Monday.

• “We have all the prerequisites for setting an absolute record this year regarding the harvest of grains and oilseeds totaling 100 million tonnes,” the Ukraine agricultural minister said.
• As previously reported, the Ukrainian Grain Association expects to boost the harvest of grains and oilseeds by 14.5% year-on-year to 96.25 million tonnes during the 2021-2022 crop year versus the previous one owing to the good wintering of winter crops as well as favorable weather conditions.
• Ukraine’s agricultural producers in 2020 harvested 65.4 million tonnes of grains and legumes from an area totaling 15.3 million hectares.

UkrAgroConsult Raises Ukraine Barley Crop Estimate, Trims Corn

Ukraine’s barley harvest in the 2021-22 season is now estimated at 8.2m tons, up from an April estimate for 7.95m tons, due to larger expectations for spring plantings, Kyiv-based researcher UkrAgroConsult says in a note.

• Outlook for the corn crop is trimmed to 37m tons, from 37.2m tons, on slightly smaller acreage
• “Quite probably, we will upwardly revise our wheat and barley crop estimates next month, as long-term weather forecasts are also very positive”

Mexican judge rejects industry bid to halt GMO corn, glyphosate ban

A Mexican federal judge ruled against a request by the National Farm Council to freeze implementation of a government plan to ban genetically-modified (GMO) corn and the widely-used herbicide glyphosate by 2024, national science council said on Monday.

Judge Martin Adolfo Santos Perez’s ruling allows the executive order by President Andres Manuel Lopez Obrador late last year that outlines the planned ban to proceed.

WHEAT/CEPEA: Weather should accelerate sowing in PR; prices drop in the state

Rains and lower temperatures favored wheat crops in all Brazilian producing regions last week. This scenario added to the current attractive prices should lead sowing to step up in the coming days, since activities are late compared to that in previous seasons, although the conditions of the areas already sown have improved. Thus, the prices paid to wheat farmers began to drop more steeply than that in the wholesale market of Paraná State (PR).

According to Seab/Deral, sowing had reached 26% of the area in PR until May 21. Despite the recent favorable scenario, activities are late – the average of the last five years (until the first fortnight of May) is 44%. Higher rains on May 12 in some Brazilian regions favored the crops that were sown on dry soil, and now, 71% of them are in good conditions.

Liquidity continues low in the Brazilian wheat market, due to lower demand. Although the weather favored activities in PR, Cepea collaborators have reported that devaluations are also linked to the lower prices for the product imported from Argentina and Paraguay compared to that in PR. Demand is weak, since mills have built stocks and the demand for wheat flour is currently low.

Egypt Favors Romanian Wheat in Second Purchase of Season

Egypt’s state buyer bought 240,000 tons of Romanian wheat on Monday in its second tender purchase for the new season.

S.Africa’s 2020/2021 maize output seen up 7% on last season

South African maize farmers are expected to harvest 7% more of the staple crop during the 2020/2021 season compared with the previous season, as yields are boosted by favourable weather, a Reuters survey showed on Monday. South Africa’s Crop Estimates Committee (CEC) is expected to forecast the 2020/2021 maize crop at 16.413 million tonnes, up from the 15.300 million tonnes harvested last season, the average estimate of five traders and analysts showed. The forecast is 2% higher than the CEC’s April forecast of 16.095 million tonnes.

Malaysia’s May 1-25 Palm Oil Exports 1,107,570 Tons: AmSpec

Shipments during the period rose 0.3% from 1,103,864 tons exported during April 1-25, according to AmSpec Agri on Tuesday.

Malaysia May 1-25 Palm Oil Exports +0.25% M/m: Intertek

Malaysia’s palm oil exports rose 0.25% m/m during May 1-25, according to Intertek Testing Services.