All grains prices were up for a second week in a row.
Soybeans grabbed double-digit gains during the week, carving around 2%.
Also corn prices, in spite faded for two consecutive session due another round of technical selling, finished the week strong, moving more than 1.5% higher thanks capturing big gains earlier in the week.
Meantime, even if wheat prices has seem narrowly mixed, all wheat contracts closed more higher from past week.
On Wall St. the Dow, for the week, added around 1,2%, on the wake of investor optimism on economic recovery.
China’s first-quarter gross domestic product jumped 18.3% year on year, official data showed.
That followed a big increase in U.S. retail sales and a drop in unemployment claims released on Thursday.
Strong economic data, spurred by the Biden $1,400 stimulus check, is a huge positive development for the energy patch.
This week, both the International Energy Agency and the Organization of the Petroleum Exporting Countries (OPEC) increased their forecasts for oil demand growth for 2021, citing the stronger-than-expected rebound in activity in certain economies.
Those forecasts were also supported by Wednesday’s US government data that showed overall U.S. crude inventories fell by 5.9 million barrels as refining activity picked up.
Consequently, energy prices jumped on the week, with Brent and WTI that carved both around 6% up.
The Baltic Dry Index (BDI), an assessment of the average cost to ship raw materials such as grains, coal and iron ore, gained 11% on the week to end at 2,323.
The U.S. Dollar Index decreased from last week’s 92.15 to close at 91.56
To note, that not all economies are recovering, however, as India’s coronavirus infection rate hit a record while Germany’s chancellor on Friday said a third wave of the virus had the country in its grip.
Grains market are having difficulty reconciling the USDA export forecast for Chinese corn imports of 24 million metric tonnes (945 mbu) and the fact that year-to-date “known” purchases from the U.S. are on the order of 920 million bushels.
It would appear there is room for another 200-225 mbu boost in the export forecast in the coming months.
Belt and forecasts for cool temperatures over the next two weeks should continue to turn talk in the grain market from tight old crop stocks to the potential for 2021 production.
However, a slow start to planting is raising questions about whether farmers will be able to increase acreage beyond the intentions USDA published at the end of March.
Soybean prices, indeed, bounced just on some emerging concerns that 2021 acreage won’t be high enough to fully replenish tight supplies.
China’s pork production for the first quarter of 2021 jumped 32% to reach two-year highs of 13.7 million tons.
That is a bullish fundamental, given the hungry herd’s feed needs.
On the other hand, recent shifts to wheat to hogs and poultry may be curbing soymeal demand in the short term.
Thanks to a friendly April 9 USDA report, May corn futures have been able to push higher to the $6 per bu. level.
Old crop futures are well supported now that ending stocks for the 2020/21 crop year have been reduced to 1.352 billion bushels, down from 1.5 billion bushels the month prior.
All demand aspects on the April USDA supply/demand report for corn were increased.
More corn is expected to be used for ethanol, feed, and exports.
Planters have begun to roll for the 2021 crop season, even if a bit more slowly than analysts were anticipating, per the latest crop progress report from USDA, out Monday afternoon and covering the week through April 11.
The latest grain export inspection report from USDA held some mixed but mostly disappointing data for traders to digest.
However, even if corn, soybeans and wheat all trended lower week-over-week, these three crops still stayed within the range of trade estimates, and corn and soybean volume still hold a commanding lead over last year’s pace for the 2020/21 marketing year.
The latest round of export sales data from USDA didn’t have a lot of helpful data for traders to digest.
Corn, soybeans and wheat all fell lower week-over-week, with old crop wheat sales landing at a marketing-year low for the second consecutive week.
Sorghum sales, in contrast, offered a pleasant surprise, rising to a marketing-year high.
Increased concern over dryness in wheat key growing areas coupled with cold weather in the Midwest, will rally also export basis if conditions stay the same and even if the supply of exportable row crops is weakening basis.
USDA reported total U.S. winter wheat conditions unchanged week-on-week.
Winter wheat reported as good or excellent was 53 percent compared, the same as last week.
However, dry weather is creating some anxiety among farmers, while the cold weather forecast in the next week is also of concern.
Drought conditions in the Dakota’s, indeed, worsened over the week despite widespread precipitation and cooler than average temperatures.
Only some eastern North and South Dakota areas and western Minnesota got enough rain to improve conditions there.
Meantime, in much of Texas and Oklahoma, warm, dry weather increased long-term moisture deficits and further dried out soils.
Dry conditions expanded also in the western U.S., with drought conditions reported to worsen in all states.
Only north-central Wyoming and southern Montana saw relief following snowfall last week.
As of April 12, farmers had planted 11 percent of the country’s total intended spring wheat area, up from last year’s 5% and well ahead of the 5-year average of 6%.
This week’s U.S. wheat commercial sales of 56,600 metric tons (MT) were down 31% from last week’s 82,000 MT and in line with trade expectations of 50,000 MT to 200,000 MT.
Year-to-date commercial sales for delivery in 2020/21 total 25.1 million metric tons (MMT), 1% lower than last year.
USDA expects total 2020/21 U.S. wheat exports will reach 26.8 MMT,
2% higher than last year, if realized.
Net Sales of new crop wheat were 274,400 metric tons (MT) for delivery in 2021/22.
In this context, CBOT soft red winter (SRW) futures rose 14 cents to close at $6.52/bu.
KCBT hard red winter (HRW) futures were up 23 cents to end at $6.09/bu.
MGE hard red spring (HRS) futures gained 10 cents to close at $6.64/bu.
CBOT corn futures jumped 26 cents to end at $5.85/bu.
CBOT soybean futures gained 31 cents to close at $14.33/bu.
Germany’s 2021 all-wheat production is expected to increase 2.2% from a year ago to 831.5 million bushels, according to the country’s association of farm cooperatives.
French consultancy FranceAgriMer reported that the cold snap slightly lowered quality ratings, with 86% of the crop still rated in good-to-excellent condition through April 12.
Spring barley conditions fell four points, with 88% rated in good-to-excellent condition.
However, France’s farm office said this week that it is too soon to estimate the impact of a severe freeze event on grain crops.
Temperatures were below zero (32 degrees Fahrenheit) for several nights.
Areas in central and southern France were primarily affected.
European Union corn imports for the 2020/21 marketing year have reached 11.97 million tonnes through April 11, per the latest data from the European Commission.
That’s 27% below last year’s pace so far.
European Union soybean imports for the 2020/21 marketing year are at 422.6 million bushels through April 11, trending slightly above last year’s pace so far.
Rapeseed / canola imports, on the other hand, remain very dynamic (5.3 Mt since the start of the season) and are now clearly exceeding the record rate set last year (5.1 Mt), while EU soymeal imports down moderately from a year ago.
European Union soft wheat exports for the 2020/21 marketing year have reached 20.81 million tonnes through April 11, trailing last year’s pace by 24.5% so far.
EU barley exports this marketing year are fractionally above last year’s pace, with 6.10 million tonnes.
In this context, Euronext ended the week with Matif May wheat futures prices gained 5,0 euros to end at €217,75/t.
Matif corn June futures raised 3,25 euros to close at €220,25/t.
While, Matif rapeseed May futures, fell 1,25 euros to end the week at €509,25/t.
From Black Sea basin, for more than 2 weeks now, Russia has been engaged in large-scale military troop movements in order to strengthen its presence on the outskirts of the Ukrainian borders.
The international community represented by the G7 foreign ministers calls on Moscow to cease its provocations and to engage in de-escalation at the borders.
President Zelensky wishes to meet Emmanuel Macron this week, who along with German Chancellor Angela Merkel is the conflict mediator.
Planting delays on some spring crops are being reported in parts of the EU/Black Sea region after the recent cold snap, raising questions about acreage shifts as ideal planting windows start to slowly tick by.
Meantime, improved Russian whinter crop condition, and IKAR upped its 2021 production forecasts to 81 MMT.
Also SovEcon raised its forecast for Russia’s 2021 wheat crop by 1.4 MMT to 80.7 MMT on improved crop conditions in the south.
The head of SovEcon noted that “wheat entered last winter in the worst shape in a decade.”
However, healthy precipitation led to a dramatic improvement in recent months.
In this context, Russian wheat with 12.5% protein loading from Black Sea ports for supply in April was at $ 247 a tonne free on board (FOB) at the end of last week, up $ 2 from the previous week.
Meantime, according to Sovecon, another consultancy, barley prices fell by $ 2 to $ 233 a tonne.
According to APK-Inform, Ukrainian wheat export prices have decreased by a further $7 a tonne over the past week amid a positive outlook for the 2021 wheat harvest.
The Ukrainian government, indeed, has said good weather is likely to help farmers increase their grain crop to at least 75 million tonnes this year from about 65 million tonnes in 2020.
Meantime, Ukraine’s grain exports have fallen by almost 23% to 36.5 million tonnes so far this season, which runs from July 2020 to June 2021, .
Traders, indeed, exported 14.5 million tonnes of wheat, 17.3 million tonnes of corn and 4.1 million tonnes of barley, it said.
In this context, bid prices for high-quality soft milling wheat decreased by $7 past week to $232-$237 a tonne FOB Black Sea port.
Feed wheat also fell by $7 a tonne to $228-$233 FOB Black Sea.
Corn export prices were flat over the week at $252-$258 FOB, while bid prices for Ukrainian-origin barley decreased by $8 and stood at $227 to $235 per tonne FOB Black Sea.
Ukrainian crude sunfloweroil rose this week after export prices being locked within $1500-1520 per tonne FOB range during previous 2 weeks.
News on possible limiting or capping the sunflower oil exports from Ukraine made the market extremely nervous with offers rallying to $1570-1600 for May-June delivery. Stronger vegoils also were also supportive.
To note, that traders and officials said last week that escalating tensions on Ukraine’s eastern border with Russia had not yet affected domestic grain exports and prices.
According to the U.S. Department of Agriculture, rainfall was scarce for most of the winter in the main grain growing regions in Turkey.
In MY 2021/22, total wheat planting area is projected down to 7.05 million hectares, with total production at 17.6 million metric tons (MMT).
Barley area and production for MY 2021/22 are projected at about 3.8 million hectares and 7.7 MMT.
The #corn production estimate is 6.2 MMT due to decreased planting area.
Turkey struggles with food inflation, which is exacerbated by a weak Turkish Lira and high international commodity prices.
Turkey reduced almost all grain tariffs until the new harvest.
Some product exports and imports continue to be affected by COVID-19 related issues.
The Ministry of Agriculture and Forestry approved new genetically engineered (GE) soybean and corn events for feed use in January and February 2021.
From China, in a statement attributed to two anonymous sources, Reuters reported China may use up to 40.0 MMT of wheat for feed in the 2020/21 crop year displacing corn and soymeal in animal feed.
Corn carries a premium to wheat, leading many Chinese feed producers to look for cheaper grain as the country attempts to build back the pig herd culled by African swine fever.
Wheat, a high protein grain, is also displacing some soymeal, the main protein source in animal feed.
According to the National Grain Trade Center, China sold 515,209 tonnes of wheat, or 12.81% of the total on offer, at an auction of state reserves last week, on Monday.
The volume sold, at an average price of 2,349 yuan ($358.19) per tonne, declined from more than 1.5 million tonnes sold in the prior week, as corn prices fell.
According to the Australian Bureau of Statistics, AUSTRALIA exported 2,684,884 tonnes of wheat in February.
This is up 12% from 2,401,367t shipped in January.
February exports, had Indonesia as the major destinations with 419,730t, followed by Vietnam on 327,566t, The Philippines on 231,204t and Thailand on 167,740t.
Bangladesh, Japan, SouthKorea and SriLanka were also volume buyers.
Italy on 84,375t has been the main volume buyer of durum wheat.
In this context, ASX wheat futures jumped 7,00$ from past week, to close at $291,00.
On the international trade scenario, Algeria’s state grains agency OAIC is believed to have purchased durum wheat in a tender which closed on Wednesday.
The volume bought was unclear but was thought to be around 200,000 tonnes.
Its estimated that two Panamax bulk carrier shipments were bought, one at $351 to $352 a tonne c&f and another of Canada western amber durum (CWAD) at a slightly higher price.
In add, two to three handysized bulk carrier shipments were bought in the high $350 levels at around $358 a tonne c&f.
Shipment was sought between May 1-15 and May 15-31.
In its last reported durum tender on March 4, Algeria bought between 180,000 and 240,000 tonnes at the lowest estimated price of $372 a tonne c&f.
South Korea passed on all offers for its international tender to purchase 2.2 million bushels of corn that closed yesterday.
The grain would have been for shipment in July.
Indonesian flour mills purchased 4.4 million bushels of wheat sourced from the Black Sea region in a tender that closed earlier this week.
Buyers in the Philippines passed on all offers for its tender to purchase 14.0 million bushels of milling and animal feed wheat that closed yesterday.
Prices were thought to be higher than expected.
According to the U.S. DEPARTMENT OF AGRICULTURE this week there were two outstanding export sales activity.
One Export sales of 132,000 metric tons of soybeans for delivery to China during the 2021/2022 marketing year, and one export sales of 110,000 metric tons of soybeans for delivery to Bangladesh.
Of the total, 55,000 metric tons is for delivery during the 2020/2021 marketing year and 55,000 metric tons is for delivery during the 2021/2022 marketing year.
Watching to the next week market, it starts off with trade activity putting more focus on the US crop planting progress.
USDA will release the weekly Export Inspections report on Monday morning, with the Crop Progress report that afternoon.
Wednesday, EIA will release their weekly hetanol report.
Thursday is slated to have the Export Sales report in the morning and the NOPA crush report at 11:00 AM CDT.
