Soybeans Have Generally Had The Lead As Of Late But…

Soybeans have generally had the lead as of late but corn led in overnight volume and is looking to extend its rebound along with wheat this morning, in contrast to a soybean complex that is now facing some adversity with the onset of Argentine rains and the beginning of a monster Brazilian harvest.

Wheat has found a bid from skyrocketing wheat prices in India; the country has not been historically known as a major exporter, but they did ship out a record 8+ MMT in 2021/22 (partially to cover Ukraine’s absence) before shutting down exports in May and now running into supply issues.

Iraq issued an international tender for a nominal 50k tonnes of milling wheat yesterday, with negotiations expected to start today; it can only be sourced from the U.S., Australia, or Canada.

Japan’s Ag Ministry received no offers in their regular SBS auction tender for 70k tonnes of feed wheat and 40k tonnes of feed barley.

India announced that three million tonnes of wheat would be available for purchase by millers from government stocks, more than the 2 MMT expected by the trade at the end of the marketing year in an effort to cool record high domestic prices.  The country’s wheat production fell to 106.8 MMT in 2022, down from 109.6 MMT in 2021, and they banned exports in May as well, but farmers and facilities are running out of wheat stocks.

Brazilian grain exporting association Anec yesterday pegged January soybean exports at 1.356 MMT, down from 1.999 MMT estimated previously; corn exports of 5.2 MMT are up slightly from their last 5.178 MMT estimate, with meal at 1.521 MMT versus 1.587 MMT a week ago.  January wheat exports of 804k tonnes were projected above 753k tonnes seen last week.

European Commission data showed cumulative 2022/23 soft wheat exports since July 1 at 18.14 MMT, up from 17.10 MMT through Jan 22 last year; corn imports of 16.13 MMT are up 81% from last year’s 8.91 MMT pace.

Germany is weighing phasing out crop-based biofuels by the end of the decade, as high agriculture prices renew concerns over using food crops for fuel production.

The country is considering cutting the share of crop-based biofuels, a type of renewable energy source, in its greenhouse gas-reduction quota from the current 4.4% limit to 2.3% next year and zero by 2030, according to a draft bill seen by Bloomberg News. Germany consumes about 10 million tons annually of crops such as rapeseed, corn and soy for biofuels.

Russia’s invasion of Ukraine sent crop prices soaring to records in 2022, stirring the debate over food versus fuel production. Environment Minister Steffi Lemke said last week she would prefer to see biofuels made from waste and residual materials, citing concerns about land use and biological diversity.

Still, crop prices have eased from their peaks and German biofuel association VBD hit back at the proposal, saying it’s “grotesquely anti-climate” and would increase fossil-fuel use. Rapeseed futures on the Euronext exchange fell to the lowest since August 2021 earlier this week.

Mpls wheat +5

KC wheat +10

Chic wheat +7

Matif wheat +2

Canola -5

Rapeseed -11

Soybeans -6

Soybean oil -36

Crude +25

Corn +0

CAD -5