US grain prices were mixed but mostly higher yesterday.
Traders are expecting to see shrinking US supplies in USDA’s next quarterly grain stocks report, out on this morning.
Thus corn prices saw the biggest bounce, trending 1.25% higher by the close.
Soybeans trended 0.5% higher, meantime.
Winter wheat contracts rising between 0.6% and 1%.
Spring wheat bucked the overall trend, slipping 0.25% lower.
On macro markets, oil prices fell on this morning, extending yesterday losses after official figures showed an unexpected rise in inventories in the United States.
Indeed, U.S. oil and fuel stockpiles increased last week, the U.S. Energy Department’s Energy Information Administration (EIA) said on Wednesday.
Particularly, crude inventories were up by 4.6 million barrels in the week to Sept. 24 to 418.5 million, EIA data showed, compared with analysts’ expectations which expected for a 1.7 million-barrel drop.
Thus Brent crude was down 11 cents at $78.53 a barrel by 01:37 GMT, after falling 0.6% on Wednesday.
U.S. oil fell 5 cents to $74.78 a barrel, having also declined by 0.6% in the previous session.
On the financial sid, overnight, the Dow Jones Industrial Average and the S&P 500 both posted small gains but the Nasdaq Composite dropped 0.24%.
The US dollar sat at a more than one-year high against major peers, upheld by lingering safe-haven demand and expectations for tighter U.S. monetary policy, although Federal Reserve chair Jerome Powell warned yesterday that “we see [supply chain bottlenecks] continuing into next year probably, and holding up inflation longer than we had thought.”
The ongoing U.S. debt ceiling stand-off could briefly amplify financial market jitters and support the USD in the short-term.
And meanwhile that U.S. lawmakers continue to wrangle over funding the government, face a Friday deadline to prevent a shutdown approached, which something that also capped gains in U.S. equities overnight.
Asian shares found some calm on Thursday following this week’s heavy China-driven losses.
Thus, MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 0.06%, while the Nikkei lost 0.36% a day after Japan’s ruling party chose softly spoken consensus-builder Fumio Kishida as its new leader and the country’s new prime minister.
Hong Kong stocks fell 1% but these were largely balanced by a 1.1% rise in Australia.
Chinese blue chips gained 0.5% after data published early on Thursday showed China’s services sector returned to expansion in September.
Coming back on grains market, with the stocks and acreage reports out later, on this morning, Reuter survey figures for this week’s reports the other day had put average guesses for the wheat crop at 1.68 bbu, slightly below the USDA’s last update and reflecting a lower spring wheat idea.
Stocks survey averages were 1.15bbu for corn and 175mbu for beans, both about WASDE level.
Thus, the only real unknown is the feed/residual value and traders are adjusting their positions to tonight’s USDA report.
Meantime, the Central Plains and western Corn Belt have the most significant chance for moderate rains over the next three days, with some areas ready to gather 0.75” to 1.75” between today and Sunday, according to the latest 72-hour cumulative precipitation map from NOAA.
The agency’s 8-to-14-day outlook predicts more seasonally wet weather for the Plains between October 6 and October 12, with warmer-than-normal conditions likely for most of the U.S. next week.
Much of the cutting so far has seen very dry grain so the rain may actually slightly help yields by boosting moisture back up.
Meanwhile, the consequences of Hurricane IDA are fading and operators are waiting for a resumption of export activity for the weeks to come.
Today we will see also US weekly export sales figures.
More worries emerged about the possibility of ASF hitting the US have seen the government there pledge some $500 million for preventative actions, after recent detections of the disease in the Caribbean.
Meanwile, yesterday weekly EIA ethanol figures had stocks higher yet again to 20.2 million barrels and production back slightly to 915,000bpd.
Ethanol operators have been more optimistic in the last few weeks with firmer margins and weaker corn values, the overall rally in energy also assisting.
In this context, corn basis bids jumped 5 to 10 cents higher at three Midwestern processors and were narrowly mixed at two interior river terminals while holding steady elsewhere across the central U.S..
Soybean basis bids were steady to weak after falling 1 to 10 cents lower across half a dozen Midwestern locations.
From South America, Brazil is also still looking for some more moisture on the latest model runs, but still fairly light and not expected to be a major planting delay outside of some parts of southern Parana.
On European market, we have seen another session of increases for all products yesterday.
Indeed, reduced corn and rapeseed imports and sustained wheat exports have boosted Euronext.
In fact, per the latest data from the European Commission, EU corn imports during the 2021/22 marketing year reached 3.43 million tonnes through September 26, falling 19% below last year’s pace.
European Union soybean imports during the 2021/22 season reached 2.697.325 tonnes through September 26, representing a moderate year-over-year decline so far.
EU soymeal and canola imports are also trending moderately lower from a year ago.
European Union soft wheat exports for the 2021/22 marketing year have reached 6.95 million tonnes through September 26, enjoying a year-over-year increase of nearly 37% so far.
Durum wheat exports, meantime, reached 102.381 tonnes.
That was up from 48.931 tonnes by the same week in 2020/21.
While durum import, reached only 347.087 tonnes, down from 736.081 tonne by the same week in 2020/21.
EU 2021/22 barley exports had reached 2.37 million tonnes , against 2.11 million a year ago.
It should to note that the Commission said at these data lacked figures from France since Aug. 12 and from Italy since Sep. 10.
The weekly data had been delayed from Tuesday due to a technical problem.
Corn imports are also very low pending the Black Sea harvests and thus accentuate tension within the Union.
Conversely, wheat exports are considering very strong.
From South Africa, farmers are expected to harvest 6% more corn in the 2020/2021 season compared with the previous season, the government’s Crop Estimates Committee (CEC) said on Wednesday, trimming its previous estimate slightly.
The CEC pegged the 2021 maize harvest at 16.211 million tonnes.
The crop is expected to consist of 8.609 million tonnes of white maize, used for human consumption, and 7.602 million tonnes of yellow maize, used mainly in animal feed, the CEC said.
From the Black Sea basin, as of September 28, Russian agrarians harvested grains and pulses throughout the areas of 40.3 mln ha.
The production volumes reached 105.4 mln tonnes of grain, reported the press-service of the Ministry of Agriculture of Russia.
In particular, agrarians harvested 74.2 mln tonnes of wheat throughout 26.3 mln ha.
Also, Russia harvested 18.1 mln tonnes of barley throughout 7.6 mln ha, 2.6 mln tonnes of corn throughout 562.6 thsd ha.
Agrarians harvested 2.2 mln tonnes of rapeseed throughout 1.2 mln ha, 4.7 mln tonnes of sunflower seed throughout 3 mln ha and 1.4 mln tonnes of soybean throughout 832.2 thsd ha.
Meantime, Russian agrarians planted winter crops throughout 10.5 mln ha.
On the other hand, since the start of 2021 and as of September 26, Russia exported agricultural products at the general sum of 23.148 bln USD, up by 19% compared to the same period of 2020, informed Agroexport Center at the Ministry of Agriculture of Russia.
Particularly, Russia increased export of grain by 13% to 7.114 bln USD, fat&oil products by 45% to 4.829 bln USD, products of food and processing industry by 7% to 3.044 bln USD, meat and dairy products by 28% to 1.035 bln USD.
Turkey remained the leading importer of Russian agricultural products (12.5% in the overall structure).
It increased import of Russian products by 34% to 2.885 bln USD.
Supplies to the EU (11.6%) increased by 32% to 2.679 bln USD.
The export to China (11%) decreased by 7% to 2.537 bln USD.
TOP-10 importers of Russian agricultural products included South Korea, Kazakhstan, Egypt, Belarus, Ukraine, Uzbekistan and Saudi Arabia.
Turkey (1.632 bln USD) and Egypt (1.004 bln USD) remain the leading importers of Russian grain this year. Turkey (873 mln USD) and China (748 mln USD) are the largest importers of Russian fat&oil products.
According to State Custom Service of Ukraine, since the beginning of 2021/22 MY and as of September 29 Ukraine exported 13.611 mln tonnes of grains and pulses, up 1.833 mln tonnes year-on-year, reported the press-service of Ministry of Agrarian Policy and Food of Ukraine.
Particularly, Ukraine has exported 4.845 mln tonnes of grain in September.
In particular, Ukraine exported 8.417 mln tonnes of wheat (+176 thsd tonnes y-o-y), 3.596 mln tonnes of barley (+724 thsd tonnes), 30.9 thsd tonnes of rye (+29.2 thsd tonnes) and 1.395 mln tonnes of corn (+764 thsd tonnes).
Moreover, Ukraine exported 34.7 thsd tonnes of flour (-13.9 thsd tonnes) including 34.4 thsd tonnes of wheat flour (-13.9 thsd tonnes).
Wheat prices in the Black Sea region also rose sharply yesterday in Ukraine, while they stalled in Russia.
In maize, there was little change in prices on the long term in Ukraine, while the harvest is still behind schedule, but prices on the short term are tightening.
Belarus will complete winter grain planting by October 1.
There is no sizable delay of field works.
As of September 29, farmers planted winter grains throughout 849.6 thsd ha or 58.4% of the plan (1.456 mln ha).
As of September 28, farmers of Kazakhstan harvested 15 mln tonnes of grains and pulses throughout 15.5 mln ha (97.9% of the plan) with the average yield of 0.97 t/ha.
Particularly, wheat crop amounted to 11.7 mln tonnes, declared the First Deputy Minister of Agriculture, Aydarbek Saparov.
He reminded that Kazakhstan would harvest about 16 mln tonnes of grains and pulses with the average yield of 1.01 t/ha.
From the Middle Kingdom, China on this morning set its low tariff rate quota for wheat, corn and rice imports in 2022 at the same volumes as the previous year.
The Tariff Rate Quote (TRQ) for wheat imports in 2022 was set at 9.636 million tonnes, according to a notice published on the website of the National Development and Reform Commission.
Import quota for corn and rice were set respectively at 7.2 million tonnes and 5.32 million tonnes, according to the state planner.
Import quota for cotton was set at 894,000 tonnes, a separate notice on the state planner’s website said.
From Australia, local markets remained quiet yesterday with everyone focused on the rains.
A solid inch was reported across most of NSW through yesterday and sentiment improved across the state though there are a few localised flooding concerns.
Rain in the north and dry conditions in the south have seen feedgrain trade mostly sideways to firmer in the past week as growers remain reluctant sellers based on uncertainty about wheat yield and quality.
Current-crop barley remains the volume seller in the domestic market, and loads from central and southern New South Wales are continuing to price into Queensland feedlots now that rain has halted new-crop deliveries.
Meanwhile, nearby wheat in Queensland has rallied sharply as traders accumulate new crop for prompt export, and this has further increased the attractiveness of barley at maximum inclusion rates.
Internationally, updated estimates on Algeria’s OAIC tender are talking up to 600,000t bought, but the talk is that it was mostly French origin with OAIC accepting some lower grade specs to get it bought.
Prices were pegged in the mid $360s to $370s levels per tonne.
Jordan made no purchases in its international tender to purchase 120.000 t of milling wheat from optional origins that closed earlier yesterday.
The country could issue a similar tender that expires next Wednesday.
Bangladesh has decided to import 100,000 tonnes of wheat from Russia to meet the growing demand for the staple food in the country.
The government took the decision during a meeting on Wednesday, according to Shamsul Arefin, additional secretary of the Cabinet Division.
The price would be finalised later by the Cabinet Committee on Public Purchase, he said.
In the meeting, the state-run Karnaphuli Fertilizer Company Limited (KAFCO) was also given the nod to buy 100,020 tonnes of urea fertilizer from Qatar and Saudi Arabia.
Pakistan got offers for the new wheat tender.
The cheapest one was Solaris at $377.
The most expensive was GrainExport at $410.
Most participants were between $383-$393.
We wish you a good day.
