Regular US weekly export sales figures were mixed yesterday.
Wheat 0.33 million tonnes (Mt) and bean 0.35Mt figures were strong, but corn was weaker at just under 0.4Mt.
New business of 30,000t old crop soybeans to China plus a boat of unknown destination switched to China, but the weekly sales figures were nothing like as large as rumoured amid reports of Chinese buyers shopping for prompt cargoes following Brazilian harvest delays.
Milo sales had a new Chinese old crop boat in the mix, plus a new crop sale, following the previous week’s Chinese old crop cancellation.
In this context, Chicago some grains prices rebounded yesterday a little bit, after Wednesday’s big selloff.
In fact, corn prices managed to move around 0.5% higher after fighting through a choppy session, although a longer-term look reveals that prices have struggled to find any significant forward momentum since early February.
Soybean prices inched 0.2% higher on some light technical buying.
Meanwhile, wheat prices continued to push lower, with most contracts suffered double-digit losses on a round of technical selling as more rainy weather makes its way to the Central Plains.
The bulls, was resilient to sustained downside old crop corn price pressure, but they have not been able to show the power to sustain price rallies.
New-crop corn bulls are in a stronger position, having pushed prices to a new contract high this week.
Brazil continues to fight wet conditions for planting safrinha corn.
Corn production, indeed, is still vulnerable to late-season dryness, depending on when the summer monsoon will end.
However, Brazil’s Conab hiked its corn crop forecast by 2.59 MMT from February, pushing it to 108.07 MMT.
Safras & Mercado estimates Brazil’s corn crop at 113.5 MMT, up from 106.8 MMT last year.
Brazil’s government statistics agency also forecast that the country’s soybean crop will be at 135.13 MMT, a 1.31-MMT increase from its projections last month.
However, crop estimates are falling farther south.
Argentina is expected to harvest 44 MMT of soybeans, down from 46 MMT forecast earlier, the Buenos Aires Grains Exchange said on Thursday.
The Rosario Grains Exchange, in deed, cut its estimate for Argentina soybean production to 45 MMT, down from 49 MMT earlier.
So, in this context, soybeans bounced in a tepid rally following Wedsneday’s rout, in fact, fund selling appears to have abated for now as higher crop estimates from Brazil.
Soyoil continued to rally, jumping 110 points to 54.61 cents, on spreading against soymeal and crush spreads were slightly better.
May meal was down.
This type of price action we believe that may persist up until the all-important March 31 USDA planting intentions and quarterly grain stocks reports.
On the other hand, wheat futures continued to trend lower with SRW futures falling to a one-month low and HRW dropping to the lowest in more than eight weeks.
Prices felled, extending this week’s declines, as rains headed for the dry U.S. winter wheat belt.
Meanwhile, weather concerns across the Northern Hemisphere are also receding.
The Russian Agricultural Ministry has stated that approximately 80% of winter grain crops are in good condition, with spring grain sowings set to begin in the next week.
Alternating periods of rain and sunshine in northern China will maintain wetter than usual soil conditions for use by winter wheat in the warmer days of spring.
On European scenario, Coceral, on the contrary, has revised downwards its estimate for the future production of wheat in the EU27 to 126.6 Mt from 127.9 Mt estimated in December.
Coceral has also revised downwards the estimate of rapeseed production for 2021 to 17.7 Mt from 17.8 Mt estimated in December for the EU27 + UK.
The group also lowered its production estimates for EU’s barley crops this season.
Inspite this, in Paris, european grains finished in the red again, with wheat in particular that suffered further more losses after the last Egyptian tender.
Egypt’s GASC tender last night saw them book six boats at a US$297/t C&F, all Romanian.
Indicatively there was $4-5/t discount on the FOB markets vs earlier this week, given that with better payment terms the GASC costings would be lower this time.
In add, this price was down $ 14 / t compared to its previous deal.
Russian-origin offers were $5/t or so higher, plus the extra couple bucks in freight.
But freight values in general were much more “normal” than we’ve seen in recent weeks around the world.
Due to a lack of sufficient stocks, French offers have lost all competitiveness towards Egypt.
The grain is for shipment starting on April 15.
Meantime, Egypt’s supply ministry also reported that the country’s strategic wheat reserves are sufficient for five months following this purchase.
Rapeseed, on the contrary, benefits from the recovery in oil offering a vigorous rebound after its stall the day before.
Also Aussie canola markets have remained on a bull run with both old and new crop demand.
New crop delivered markets saw some interest as east coast crush bids pushed towards $630/t January 2022 delivery.
On this wake, also Winnipeg canola futures May was up C$24.80/t closing to $801.50.
On the other hand, Australian wheat markets were bid $1-2/t lower but offers held firm and little traded on the east coast.
WA did see some bids firm on ASW though, with volumes moving later in the day.
On the international commodity trades scenario, South Korea purchased 7.8 million bushels of animal feed corn from optional origins in an international tender that closed earlier today. The grain is for arrival starting in early July.
Another South Korean buyer purchased 2.4 million bushels of corn likely sourced from the United States in a separate deal today.
A South Korean animal feed maker has purchased 12,000 metric tons of soyoil, sourced from China, in an international tender that closed earlier today.
The grain is for arrival around April 15.
Buyers in the Philippines likely passed on all offers in a tender to purchase 14.1 million bushels of animal feed wheat that closed earlier today, with prices regarded as being too high.
On news that stimulus could arrive in some people’s bank accounts by the weekend, was boosting many investor confidence.
On this wake, energy futures continued to shift higher, with crude oil jumping up 2.5%.
Gasoline and diesel saw similar gains.
Meantime, with this new US stimulus bill now in play, the European Central Bank announced that it will be increasing its bond buying program to try and keep pressure on lending costs – in a direct recognition of the ongoing challenges in the economic recovery because appears to be a double dip recession here.
There was confirmation of anti-dumping duties by the US International Trade Commission on phosphate imports from Morocco/Russia.
While not something US farmers will appreciate, it’s of little impact elsewhere in the global ag sector.
Daylight saving time will commence this weekend, which will push market opening and closing time forward.
Tonight we will see how they will close the sessions, and thus the week.
