Concern that a new Covid variant identified in South Africa will lead to new outbreaks that derail the global economy hammered world equity and commodity markets yesterday, sparking the safe-haven demand of US T-notes, gold and cash.
But the US farm markets, all in all, reacted well to the global sell-off, ending the week in a mixed but mostly upward way.
Indeed, corn prices gained more then 2.8% for the week.
Soybeans slipped around 0.83% for the week.
Soybean meal weren’t so fortunate, suffered double-digit losses, declining around 4.2% week on week.
Soy oil, on the other hand was up more then 1.47%.
Wheat complex have seen new highs levels in KC, up more then 3.60% for the week.
Chicago rose 0.3%.
MPLS spring wheat was up 2.9%.
Particularly, CBOT corn futures were up 16 cents to $5.87/bu.
CBOT soybean futures fell 10,5 cents to close at $12.53/bu.
CBOT soft red winter (SRW) futures gained 2,5 cents to $8.26/bu.
KCBT hard red winter (HRW) futures were up 30,3 cent to end at $8.65/bu.
MGE hard red spring (HRS) futures lifted 29.3 cents to close at $10.40/bu.
Meantime, as of November 25, 2021, US corn 3YC (Gulf) was at $266/mt (up $4/mt from last week).
US soybean 2Y (Gulf) quoted at $502/mt (up $1/mt from last week)
US wheat No 2 Hard Red Winter (HRW) was valued at $396/mt (up $14/mt from last week).
US wheat No 2 Soft Red Winter (SRW) was at $361/mt (up $5/mt from last week).
On macro markets, oil prices plunged $10 a barrel on Friday, their largest one-day drop since April 2020.
In fact, Brent crude settled down $9.50, or 11.6%, to $72.72 a barrel, a weekly decline of more than 8%.
U.S. West Texas Intermediate (WTI) crude settled down $10.24 on Friday, or 13.1%, at $68.15 a barrel, declining more than 10.4% on the week.
The Baltic Exchange’s dry bulk sea freight index climbed on Friday, posting its biggest weekly gain since early October, steered by strong gains across vessel segments.
The overall index, (Baltic Dry Index – BDI) which factors in rates for capesize, panamax and supramax vessels, gained 89 points, or 3.3%, to its highest in two weeks at 2,767.
For the week, the main index the Baltic Dry Index (BDI) rose 8.4%, registering its biggest weekly rise since the one ended Oct. 1.
The capesize index rose 130 points, or 3.4%, to 3,906, and saw a weekly increase of 8.2%.
Average daily earnings for capesizes, which transport 150,000-tonne cargoes such as iron ore and coal, increased $2,672 to $27,027.
The panamax index gained 132 points, or 5.3%, to 2,621.
It posted a 14.9% weekly jump.
Average daily earnings for panamaxes, which ferry 60,000-70,000 tonne coal or grain cargoes, was up $1,182 at $23,586.
The supramax index increased 32 points, or 1.4%, to its highest in nearly three weeks at 2,316.
On equities markets, global shares fell 1.81% on Friday, their biggest down day in more than a year.
MSCI’s index of Asian shares outside Japan dropped 2.44%, its sharpest fall since late July.
US shares tumbled on Wall Street as they reopened after Thanksgiving, with the Dow Jones Industrial Average closed down 2.53% at 34,899.34 in its largest percentage drop in more than a year.
For the week the Dow lost 979,75 points or 2,73%.
The S&P 500 lost 2.27%, its worst one-day drop since Feb. 25, closing at 4.594,62.
For the week was fell 113,82 points or 2,42%.
The index was dragged lower by everything from banks, travel companies and energy companies (Exxon shares fell 3.5% while Chevron fell 2.3%).
The Nasdaq Composite dropped 2.23%, the biggest one-day route in two months, closing at 15.491,66.
For the week shedded 550,51 points or 3,43%.
Dec T-notes on Friday closed up +1-11/32 points, a 2-week high, and the 10-year T-note yield fell -15.4 bp to 1.48%, a 2-week low .
The U.S. Dollar Index, meantime, increased slightly from last week’s 96.028 to close at 96.104.
In Canada, Canadian wheat export price continued to rise last week.
As of November 22, N1 class CWRS with 13.5% prot. was valued at Cnd$539.28 – FOB West Coast – ,up C$11.54 per tonne.
The N2 class CWRS with 13.0% quoted at C$529.01 – FOB West Coast -, up C$11.75/t w.o.w.;
The N3 class CWRS was pegged at C$487.96 – FOB West Coast -, up C$22.25;
The N1 class CWAD (Durum Wheat), was quoted at C$856.96 – FOB Great Lakes -, up C$11.59 per tonne.
Durum street prices, continued to quote at Cnd$716.88, unchanged from past week.
While export basis rose at CAD $140.09, up $11.59 from C$128.5/mt of previus week.
(1USD=Cnd$1.2648).
From South America, as of November 25, Argentina Wheat Grade 2 export price, (Up River) was at $319, up $10 from last week.
Argentina corn feed was up $1 for the week, closing at $252.
Brazilian corn feed (Paranagua) was at $268, down $2 from past week.
Argentina barley feed, was up $5 from last week, posting at $295.
Argentina soybean unchanged at $551.
Brazilian soybean gained $1 finishing the week at $513.
Even in Europe, where stocks saw their biggest sell-off in 17 months, the grain market held up the brunt.
In fact, the travel and leisure index plummeted 8.8% in its worst day since the COVID-19 shock sell-off in March 2020
The benchmark STOXX 600 index ended 3.7% lower on the day, leaving it down 4.5% for the week.
France’s CAC 40 shed 4.8%.
The UK’s FTSE 100 dropped 3.6%, while Germany’s DAX fell 4.2% and Spain’s IBEX lost 5.0%.
Meanwhile, Matif December wheat futures fell only 0.5 euros from last week, closing at €299.25/t.
Matif corn January futures were up 5.5 euros to close the week at €254.25/t.
Matif rapeseed February futures, eroded only by 4.50 euros, ending the week at €673.25/t.
Jan-21 UK feed wheat futures rose £8.35 from past week, closing at £234.6/t.
Meantime, as of November 25, FOB prices in US dollar for French wheat with 11.5% protein and Dec. delivery, were at $ 349/mt, up $2/mt from last week.
French durum wheat for human use, FOB Port la Nouvelle not quoted this week.
French durum wheat, feed use – basis La Pallice, quoted $509.87/mt, up $2.23 from prior week.
Spanish durum wheat Sevilla (DepSilo), not quoted this week.
Italian durum wheat Bologna (Delivered to first customer), valued at $602.88/mt, down $9.66/mt from last week.
German wheat (Depsilo) with 12.5 pro closed at $330.57, up $12.46/mt from last week.
Nov. Baltic with 12.5 pro wheat (Delivery First) was at $289.11/mt, down $0.8/mt.
Corn delivered Bordeaux Spot – July 2021 basis was at $295.83 per tonne, up $7.05 from last week.
FOB Rhin Spot – July 2021 basis was at $301.44 per tonne, up $7.01 week on week.
Feed barley delivered Rouen – July 2021 basis was at 307.04$/t, up $5.84.
Malting barley FOB Creil Spot – July 2021 basis was at $403.42 per tonne, up 8.59$ from past week.
Rapessed FOB Moselle Spot – Flat – 2021 harvest was at 773.21$/ton, down $14.2 compared to prior week.
Standard sunseed delivered St Nazaire Spot – Flat – 2021 harvest was up $22.2 from last week at $728.39 per tonne.
(EUR/USD=> US$1.1206).
From the Black Sea basin, Russian wheat prices gained for the 5th consecutive week last week.
Indeed, according to IKAR, Russian wheat with 12.5% protein loading from Black Sea ports for supply in the first half of December was $334 a tonne free on board (FOB) at the end of last week, up $6 from the previous week.
According to SovEcon, wheat export price was up $5 to $337 a tonne.
Barley rose by $8 to $304 a tonne.
According to the IGC, as of November 18, 2021 FOB Novorossiysk prices for the Russian 4-class wheat (protein 12,5%) were at 347 USD/ton (+12 USD/ton within 1 week).
As for barley were at 305 USD/ton (+10 USD/ton within 1 week).
As for corn price was 276 USD/ton (+1 USD/ton within 1 week).
Meantime, domestic 3rd class wheat, European part of Russia, excludes delivery, was valued at 15,225 roubles/t +125 rbls ($207.25) (Sovecon).
According to the Russian regional agribusiness management bodies, as of November 17, 2021, the average Russian prices for the 3-class wheat were 15,105 rubles/ton (-0.1 % within a week).
For the 4-class wheat price was at 14 211 rubles/ton (+0,2 % within a week), for the 5-class wheat at 13,604 rubles/ton (+0.1 % within a week).
For feed barley price was at 13,075 rubles/ton (+0,8 % within a week), for food rye at 11,608 rubles/ton (+0.9 % within a week), for corn at 13,359 rubles/ton (+0,5 % within a week).
Price of sunflower seed were at 35,650 rbls/t -400 rbls (Sovecon).
Sunflower oil domestic price was unchanged at 87,675 rbls/t (Sovecon).
Export price for sunflower oil was at $1,400/t +$25 (Sovecon).
Export price for sunflower oil was at $1,400/t +$30 (IKAR).
Soybeans were at 49,575 rbls/t -125 (Sovecon).
White sugar, Russia’s south, was at $633.6/t +$8.6 (IKAR).
($1 = 74,6450 roubles).
Meantime, Russian Agriculture Ministry has amended export duties for wheat, barley and corn for the period Dec. 01-07, 2021.
As for wheat the export duty continue to increase from 78.3 USD/t the prior week, to 80.80 USD/t for the referred period.
The indicative price moved up from 311.9 USD/t to 315.5 USD/t.
As for corn, the export duty will increase to 54.30 USD/t from 53.60 USD/t prior week.
The indicative price moved up from 261.6 USD/t to 262.7 USD/t.
At the same time, also the tariff for barley will increase to 68.30 USD/t from 65.30 USD/t prior week.
The indicative price moved up from 278.3 USD/t to 282.6 USD/t.
In Australia, indicative delivered prices in Australian dollars per tonne were last week:
Barley Downs: (Nearby) $288 up $2 – $288 steady Jan;
SFW wheat Downs: (Nearby) $310 down $5 – Steady $320 Jan
Sorghum Downs: (Nearby) $$340 up $10 – $312 up $2 Mar;
Barley Melbourne: (Nearby) $320 up $10 – $320 up $20 Jan;
Wheat Melbourne: (Nearby) $408 up $8 – $375 down $10 Jan.
(AUD/USD=> US$0.7190).
On the international trade scenario, GASC on search for wheat on Monday 29th of November.
Delivery is for 9-20.01.2022
Payment is at sight.
In Germany, this week, standard 12% protein wheat for January onwards delivery in Hamburg was offered for sale at around 5 euros over Euronext March, with buyers offering around 1 euro over.
Algeria led German wheat exports in November, with four ships having each loaded about 30,000 tonnes and another set to load about 30,000 tonnes next week, traders said.
One ship has loaded 63,000 tonnes for Iran, with single shipments of 50,000 tonnes for Nigeria, 30,000 tonnes for Morocco and 30,000 tonnes for Guinea.
Jordan buys about 120,000 tonnes feed barley in tender:
- 60,000 tonnes at $331.50 a tonne c&f for shipment in the second half of March 2022 from Viterra.
- 60,000 tonnes at $332 a tonne c&f for shipment in the first half of April 2022 from Bunge.
Bangladesh’s state grains buyer received the lowest price offer estimated at $409.77 a tonne CIF liner out in an international tender to purchase and import 50,000 tonnes of wheat which closed on Monday.
The lowest offer was believed to have been submitted by trading house Bagadiya Brothers.
Traders reported three other offers in the tender: GTCS offered $441.00, Agrocorp $437.47 and Aston $431.83 all per tonne CIF liner out.
Liner out costs include ship unloading costs for the wheat seller.
Shipment is sought 40 days after the date of contract signing.
The wheat can be sourced from any worldwide origins except Israel and is sought for shipment to two ports, Chattogram and Mongla.
Ethiopia cancelled their 300 KMT wheat tender (held Nov 9th 2021) purportedly as the price of the lone offer was “too high”.
The offer was $379/MT CFR from Huyton for 150 KMT.
Turkey ‘s state grain board TMO has provisionally bought about 385,000 tonnes of milling wheat.
Traders reported the following provisional purchases:
25,000 t with 13.5% protein, offered by Aston at $381.79 per tonne, exw Turkish warehouse, (CFR Iskenderun $376,79);
25,000 t with 13.5% protein, offered by Grainstar at $381.69/mt, exw Turkish warehouse (CFR Iskenderun 376,69);
25,000 t, with 13.5% prot. offered by Aston at $384.00, exw Turkish warehouse (CFR Mersin $379);
50,000 t, with 13.5% protein, offered by GTCS at $390.90/mt, CFR Bandirma;
25,000 t with 13.5% protein, offered by Aston at $380.00/mt, exw Turkish warehouse (CFR Tekirdag $375);
25,000 t with 13.5% protein, offered by Yayla at $387.70, exw Turkish warehouse (CFR Samsun 382,70);
10,000 t, with 13.5% protein offered by GTCS at $390.80 CFR Trabzon.
25,000 t, with 13.5% protein offered by GTCS at $394.90/mt CFR Karasu.
50,000 t with 12.5% protein, offered by Cargill at $381.90/mt CFR Derince;
25,000 t with 12.5% protein, offered by Yayla at $379.90/mt, exw Turkish warehouse (CFR Mersin $374.90);
25,000 t, with 12.5% protein offered by Yayla at $387.40/mt, exw Turkish warehouse (CFR Izmir $382.40);
25,000 t, with 12.5% protein offered by Yayla st $385.80 CFR Izmir;
25,000 t with 12.5%, offered by Aston at $376.00/mt, exw Turkish warehouse (CFR Tekirdag $371.00);
25,000 t with 12.5% protein offered by Rolweg at $383.60/mt, exw Turkish warehouse (CFR Samsun $378.60);
The tonnages purchased are provisional and subject to final confirmation in the coming days.
Purchases can be reduced or cancelled completely.
The shipment is sought between Jan. 10 and Jan. 31.
In its previous wheat tender on Oct. 21, the TMO purchased an estimated 300,000 tonnes at a lowest price of $338.68 a tonne c&f.
Egypt’s state grains buyer GASC had bought 30,000 tonnes of soyoil in an international tender for arrival Jan. 15-31.
Traders gave the following breakdown of the purchase in dollars per tonne:
ADM: 30,000 tonnes of soyoil at $1,468 per tonne with payment at sight.
The authority also made the following purchases at the local production tender for arrival Jan. 5-25.
– Alex: 5,000 tonnes of soyoil at $1,426.40;
– Soyven: 10,000 tonnes of soyoil at $1,426.40;
– Safa: 6,000 tonnes of soyoil at $1,426.40;
– C3M: 3,000 tonnes of soyoil at $1,426.40;
– Maged: 12,000 tonnes of soyoil at $1,426.40;
– Evergreen: 3,000 tonnes of soyoil at $1,426.40.
South Korea’s largest animal feed maker Nonghyup Feed Inc. (NOFI) has bought animal feed corn in an international tender which closed on Tuesday but rejected offers and made no purchase of 65,000 tonnes of animal feed wheat also sought.
Traders said wheat prices offered were regarded as too high following sharp rises this week.
The lowest wheat offer was said to be $357.86 a tonne c&f for the full 65,000 tonnes.
On the other hand, the precise tonnage of corn bought was unclear but said to be close to the total 138,000 tonnes sought with the purchase made in two roughly equal consignments.
The first consignment was bought at an estimated $317.99 a tonne c&f plus a $1.50 a tonne surcharge for additional port unloading for arrival in South Korea around March 5, 2022.
Seller was believed said to be trading house Cargill.
The second consignment was bought in the combination of a premium of an estimated premium of 219.82 U.S. cents over the Chicago March 2022 corn contract CH2 and an outright price of $317.90 a tonne c&f plus a $1.50 a tonne surcharge for additional port unloading.
The second consignment was believed to have been sold by trading house Viterra for arrival in South Korea around March 15, 2022.
Also, South Korea’s Feed Leaders Committee (FLC) purchased around 50,000 to 65,000 tonnes of animal feed corn in a deal on Wednesday.
The corn was purchased in combination of an outright price estimated at $319.76 a tonne c&f but with about 5,000 tonnes also bought at a premium of $2.24 over the Chicago March 2022 corn contract CH2.
Seller was believed to be trading house CHS.
The corn was sought for arrival in South Korea about March 1 if sourced from South America or March 5 if from other destinations, traders said.
The Philippines purchased 100.000 t of animal feed wheat in an international tender that recently closed.
The grain was likely sourced from Australia and is for shipment in February and March.
Watching the text week market, the week starts off the typical Monday morning release of the Export Inspections report.
NASS will also release their final Crop Progress report of the year on Monday afternoon.
Tuesday marks the last day of November and first notice day for December corn and wheat futures. Wednesday transitions to December with the weekly ethanol production and stocks report from EIA.
We also get the slew of domestic usage report from USDA on Wednesday via Grain Crushing, Fat & Oils, and Cotton Systems reports.
The weekly Export Sales report will be back on the Thursday schedule next week at 7:30 AM CST.
Finally, Friday marks the expiration for December live cattle options.
Author: Sandro F. Puglisi
