Category Archives: Mark’s Minutes

Seems that Russia sabre rattling have cooled down a bit this morning
Soybeans led another strong overnight session of volume and popped off early last night, but the spot March contract couldn’t clear the $16/ bushel mark and lost momentum as the overnight session progressed. Soybean bulls remained quite persistent into the end of last week but will that continue, especially with an outside reversal potentially looming already today?
Paraguay’s soybean harvest could fall by as much as 50% to some 5 million tons in what would be its lowest level in the last decade due to a drought affecting the region, Paraguay’s Agriculture and Livestock minister, Santiago Bertoni, told Reuters on Friday. Paraguay, the world’s fourth largest exporter of soybeans, produced close to 10 million tons in the previous cycle. But yields in the 2021/2022 season fell in most crop areas to about 1 ton per hectare, far below the average of 2.8 tons per hectare.

Taiwan millers are seeking 55k tonnes of U.S. milling wheat in a range of different types, for April shipment from the Pacific Northwest.
Bangladesh is seeking a nominal 50k tonnes of wheat in a tender closing today, with their lowest offer coming in at $391/tonne C&F for shipment during the next 40 days. Offers ranged up to $412/tonne C&F.
China sold 520k tonnes of wheat from state reserves this week, or 99% of the total offered, at an average price of $407 per tonne. They’ve sold a total of just under 2.9 MMT from state reserves since auctions began in late October.
SovEcon reported February Russian grain exports at 2.9 MMT, up from 2.8 MMT in January, with wheat at 2.6 MMT versus 2.4 MMT last month.
Egypt’s government is reportedly working on measures to protect its wheat imports, including diversifying origins and overhauling food subsidy programs, given the potential Russia-Ukraine conflict; the country buys around 50% of its wheat imports from the former and 30% from the latter.

Mpls wheat -5
KC wheat -8
Chic wheat -11
Matif wheat 1
Canola -11
Rapeseed -8
Soybeans -18
Soybean oil -35
Crude -63
Corn -5
CAD -7

Grain volume exploded overnight, particularly in front end corn, while spot soybeans remain perched near move highs pre-USDA
South Korea’s FLC bought around 65k tonnes of feed wheat in a private deal with no tender, at $331/tonne C&F for May 20 arrival; the country’s MFG bought 68k tonnes of feed corn in an international tender for up to 140k tonnes, at $342/tonne C&F for April-May; and Korea’s KFA rejected all offers and made no purchase in their tender for up to 68k tonnes of corn.
Agricensus reported an 18k-tonne soybean sale from Argentina to Paraguay yesterday, the first-ever booking between the two countries in that direction.
Brazilian exporting agency Anec estimated February soybean exports at 7.5 MMT, down from 9.92 MMT expected last week, with corn exports seen at 521k tonnes, up from 447k tonnes forecasted a week ago.
The European Commission reported cumulative soft wheat exports since July 1 at 16.92 MMT, up from 16.22 MMT over the same span last year; corn imports through Feb 6 stand at 9.79 MMT, down from 10.28 MMT last year.
Statistics Canada’s all-wheat stocks number came in at 15.6 MMT as of Dec 31, well below the 17.3 MMT estimate and below 25.1 MMT last year; du-rum stocks came in at 2.1 MMT, just above the 2.0 MMT guess but down from 4.8 MMT LY, with canola inventories at 7.6 MMT, slightly above the 7.5 MMT expectation but below 13.3 MMT LY. Corn stocks at the end of 2021 totaled 11.5 MMT, up from 11.1 MMT LY and the 10.7 MMT in 2019.

WADSE estimates
• ‘21/22 U.S. Carryout Estimates (bln bu):
Avg Est / Est Range / Jan USDA
Corn: 1.512 / 1.420-1.560 / 1.540
Soybeans: 0.310 / 0.182-0.350 / 0.350
Wheat: 0.629 / 0.596-0.655 / 0.628
• ‘21/22 World Carryout (000 tonnes):
Avg Est / Est Range / Jan USDA
Corn: 300.3 / 294.3-303.0 / 303.1
Soybeans: 91.5 / 86.0-94.0 / 95.2
Wheat: 279.9 / 275.9-282.4 / 279.95
• ‘21/22 S.A. Production (000 tonnes):
Avg Est / Est Range / Jan USDA
ARG Corn: 52.1 / 51.0-53.5 / 54.0
ARG Soy: 44.5 / 43.0-46.0 / 46.5
BRZ Corn: 113.6 / 111.0-116.1 / 115.0
BRZ Soy: 133.7 / 126.5-137.5 / 139.0

Mpls wheat -1
KC wheat -3
Chic wheat -4
Matif wheat -2
Canola +2
Rapeseed +5
Soybeans +7
Soybean oil +35
Crude +32
Corn +3
CAD +14

Double digit gains to finish last week

Double digit gains tested the recent downtrend although it wasn’t enough to save wheat from a downturn week which saw weekly losses of -21c for CBOT(H), -16.5c for KC(H) and -7.25c for MGEX(H).

In cash markets on Friday, South Korea’s MFG booked 50k FW at $331.90/mt CFR for Mar-May shipment as well as 50k Indian wheat at $328.50/mt CFR FO April shipment.

Japan’s MAFF booked 53k of Canadian (CWRS, Mar/Apr) and Aussie (ASWJ, June/July) wheat.

Syria issued an international tender for 200k tonnes of milling wheat, with a deadline of Feb 14, and shipment sought at some point in the next two months

Australia exported 2.2mmt in the month of December which was a 37% increase m/m although below LY record of 2.5mmt.  China took the majority at 714k with Indonesia a distant second at 231k.

An error in publishing saw Bloomberg publish the title “Russia Invades Ukraine”, which was quickly removed upon realising the error.  US officials advised the media that Russia already has 70% of military utilised that would be needed to invade Ukraine.

 

Soybeans continued to lead the way to open the week, with the March contract hitting a fresh eight month spot high and key new crop November to new contract highs

Soybean meal is favored over oil this morning but the entire complex remains on the rocket ship until further notice.

Russia’s SovEcon pegged Jan grain exports at 2.8 MMT, down from 4.2 MMT in Dec, with wheat at 2.4 MMT vs 3.5 MMT last month.  Customs data showed 2021 wheat exports at 32.9 MMT, down from 38.55 MMT in 2020.

A USDA attache in Brazil Friday estimated the country’s 2021/22 corn production at 113 MMT, down from 115 MMT Jan WASDE figure, with export exports cut to 42 MMT, a million below the USDA January figure.

 

Mpls wheat +8

KC wheat +8

Chic wheat +7

Matif what +2

Canola +6

Rapeseed +2

Soybeans +24

Soybean oil +30

Crude -86

Corn +10

CAD +18