Author Archives: GW Commodities

US wheat futures traded either side but finished in the red following April’s WASDE report which had higher US wheat ending stocks and lower world wheat ending stocks.

US wheat 2022/23 ending stocks came in higher than anticipated at 0.598bbu which was above the trade estimate and the March report figure of 0.568bbu.

World wheat ending stocks were decreased 2.15MMT to 265.05MMT which was below trade estimates.

The drain on world stocks was mostly due to an increase to China’s FW usage of 2MMT.

Russian wheat exports for April are estimated to come in between 4.2-4.5MMT, which is up over 80% y/y.

Yesterday’s news of a resolution between Australia and China over China’s 80% barley tariff is a buoy for exporters, a trade flow worth up to 1.5B each year.  China will conduct an expedited review over the next 3 months.

 

Wheat accounted for a surprising share of an otherwise low volume overnight session, chopping higher through the morning hours with Russia continuing to complain about their end of the Black Sea bargain and attempt to pressure the other parties and the West in general.

Hot and dry weather should be kicking off corn planting throughout the Midwest.

Jordan bought 60k tonnes of optional origin hard milling wheat yesterday at just over $303/tonne C&F, for late September shipment; they issued another tender for up to 120k tonnes for Oct-Nov shipment, with a deadline of 4/18.  Jordan made no purchase in their tender for up to 120k tonnes of feed barley.

South Korea’s NOFI bought around 60k tonnes of optional origin feed wheat this morning at $306/tonne C&F for late September arrival; the country’s millers bought 45k tonnes of U.S. wheat for June shipment as well.

Taiwan bought 65k tonnes of Argentine feed corn in an international tender this morning, for May-June shipment.

France’s Farm Ministry sees 2023 soft wheat planted area up almost 2% to 4.77 million hectares (11.8 million acres).

The Kremlin said the Black Sea grain deal “could not stand on one leg” and that the outlook for the agreement “is not good”, continuing to note obstacles for Russian agriculture and fertilizer exports. Meanwhile, Romanian farmers are threatening to begin a nationwide protest on June 7 unless the country bans Ukrainian grain imports and transit.  UKR Railways has also suspended cargo transportation to Poland until further notice, including wheat & grains.

Argentina’s government has authorized the country’s exporters to delay soybean shipments for up to 60 days; that follows similar measures for corn (allowed to delay by 180 days, agreed in March) and wheat (allowed to delay late last year) as the country experiences historic drought.  They’re hoping for increased sales under the new “soy dollar” policy, though soybean movement has still been slow so far this week.

 

Mpls wheat +7

KC wheat +10

Chic wheat +5

Matif wheat +1

Canola -7

Rapeseed -14

Soybeans -1

Soybean oil -57

Crude +65

Corn +1

CAD +9

Wheat futures are higher. Dry US south plains weather supports KC futures. Some est US 2022/23 wheat carryout near 595 mil bu vs USDA 568 due to lower exports. USDA April report is Tuesday. Same group est US 2023 wheat acres near 49.9 vs 45.7 ly, US crop near 1,885 vs 1,650 ly, total demand near 1,942 vs 1,900 ly and end stocks near 650 vs USDA 568. Some est US HRW crop at 680 mil bu vs 531 ly and end stocks at 228 vs 265 ly. Same group est US HRS crop at 450 mil bu vs 446 ly and end stocks at 110 vs 139 ly. Russia and EU supply is adequate vs potential for lower US, Canada and Australia 2023 supplies.

 

Russian officials are again raising concerns over the Black Sea grain export deal, continually making sure the rest of the parties never get too comfortable.

Corn rallies will likely be held in check with Midwest planting likely firing up in a big way during a warm and dry week.

Egypt’s GASC on Thursday bought 600k tonnes of Russian wheat in their international tender for May 10-31 shipment, all priced at $293-294/t C&F.

Private consultancy Safras & Mercado on Thursday raised their 2022/23 Brazilian soybean production estimate, from 152.4 to 155.1 MMT, with forward sales of the crop at 44%, down from almost a 60% five year average.

Ukraine’s Ag Ministry reported cumulative grain exports through April 10 at 38.8 MMT, down from 45.3 MMT on the comparable date last year, and including 13.3 MMT of wheat, 22.8 MMT of corn, and 2.3 MMT of barley.

 

Mpls wheat +7

KC wheat +6

Chic wheat +1

Matif wheat closed today

Canola +6

Rapeseed closed today

Soybeans +2

Soybean oil +20

Crude -71

Corn +0

CAD -1

Wheat futures traded slightly lower yesterday on what must have been some profit taking as prospects for the winter wheat crop remain bleak with a dry 2 weeks ahead following the G/E rating of only 28%.

 

Agricultural commodities lower across the board as forecasts for temperatures to surge across the North American midsection next week would lead to a favorable jump in planting progress.  While this is good news for Midwest corn and soybean growers, it’s more of the same for the drought stricken US southern plains.  A rapid temperature rise could also prompt flooding across the Northern plains as the current snow pack melts.

Higher production estimates for Brazil are also contributing to today’s softer tone.

No export announcements today.

Argentina has pushed back details of their preferred currency plan to stimulate soybean exports until Wednesday.

The Russian ruble is at all time low, this could be reflecting lower economy but will cheapen up ag exports substantially

Despite being hampered by Western sanctions, Russia exported a record 4.5MMT over the month of March vs only 2.1MMT this time LY.

EU prices have been firming with 11.5 cargoes offered CFR Indo at USD325/mt for May/June shipments.  ASW9 comparatively is around low $320s and APW1 low $330s for June shipments.  In containers, Moldova 11.5pro has been cheapest in to Asia for a few weeks now with prices around $310/mt for June/July vs ASW9 sub $330

 

Jordan made no purchased in their tender for 120k tonnes of milling wheat yesterday, despite receiving offers from seven different trading firms this time around; they are expected to reissue another similar tender later this week.  They also have a tender out for 120k tonnes of barley, receiving offers from five companies so far as of this morning.

Japan is seeking 60k tonnes of feed wheat and 20k tonnes of feed barley in an SBS tender next week, for September arrival.

Poland’s Ag Minister resigned today, citing the European Commission’s decision to extended duty free imports for Ukrainian grain through 2023/24, against local farmers’ wishes for import taxes.  Large volumes of Ukrainian grain have wound up there since the start of the war, affecting local prices.  The timing is interesting with Ukrainian President Zelenskiy visiting the country today to meet with leaders and galvanize support for the war.

The Rosario stock exchange yesterday estimated 2022/23 soybean meal production at 27 MMT, down 36% year over year, with exports at 20 MMT; that would be down from Brazil’s 21-23 MMT estimated total. Argentine meal shipments hit 23.5 MMT in 2021/22, down 13% from the previous season.

Ukraine’s Ag Ministry reported cumulative grain exports at 38.5 MMT through today, down from 45.1 MMT on the comparable date last year, and including 13.2 MMT of wheat, 22.7 MMT of corn, and 2.29 MMT of barley.

A USDA attaché in Cairo estimated Egypt’s 2023/24 (July-June) wheat imports at 10.8 MMT, up almost 3% from the current season’s 10.5 MMT; that total is the second lowest in the last decade, behind 10.15 MMT in ‘13/14.

 

Mpls wheat -14

KC wheat -16

Chic wheat -12

Matif wheat -2

Canola -10

Rapeseed -18

Soybeans -6

Soybean oil -46

Crude -9

Corn -6

CAD +6

Wheat futures are higher

MWK is up 11 cents after US estimated 2023 spring wheat acres lower than expected.

US north plains weather forecast remains cold and wet.

 

OPEC surprised the crude oil market with a production cut announcement yesterday and WTI’s $5/bbl gain provided the grains with a clear path higher to open the week.

With the USDA March 31 reports here and gone, it’s time for the trade to concentrate on planting weather; that’s bullish for now but the cold and wet rut could be improving by mid month and we are always surprised at the speed that the farmer can put the crop in.

Argentina’s government said they would introduce the new “soy dollar” starting today, giving preferential exchange rates to farm sales and boosting exports; analysts are looking for an exchange rate of 270-300 Argentine pesos per dollar, compared to the current rate of 209 pesos.

Safras & Mercado increased ‘22/23 Brazilian corn production from 125.3 to 130.3 million tonnes, with second crop output up from 87.7 to 92.2 MMT.

Ukraine’s Ag Ministry reported the start of 2023 spring planting, with half a million hectares (1.2 mln acres) sown so far, mostly spring wheat and barley.

Private analysts Strategie Grains this morning cut their estimate for 2023 European Union rapeseed production, from 19.6 to 19.5 MMT, still up slightly from 2022.  Sunflower seed output rose from 11.2 to 11.3 MMT, up 23% from 2022, with soybeans steady this month at 3.2 MMT, up 28% year over year.

 

Mpls wheat +11

KC wheat +13

Chic wheat +13

Matif wheat +4

Canola +14

Rapeseed +14

Soybeans +12

Soybean oil +118

Crude +439

Corn +4

CAD +32