August 29, 2023 – Market Focus

Good morning, Farmer Family …

Main Markets

US farm markets were mixed but mostly higher on Monday.
Corn prices jumped 1.65%.
Soybean prices followed corn higher, rising 1.03%.
The rest of the soy complex also was in the green, as soymeal was up 0.69%, and soyoil picked up 0.25%.
Wheat losses were variable, as Chicago SRW dropped 0.88%, Kansas City HRW lost 2.19%, and Minneapolis spring wheat fell 1.35%.
World Weather Inc reported parts of the US Midwest received welcome rain over the weekend.
USDA’s weekly Export Inspections report had 597,144 MT of corn shipments for the week ending 8/24, and the season total at 36.779 MMT.
Soybeans inspected were 322,149 MT, and total shipments at 51.87 MMT.
USDA reported 390,364 MT of wheat inspections, and accumulated shipments for 4.03 MMT.
Separately, via mandatory announcement, US private exporters reported the sale of 123,000t corn to Mexico in the 2023-24 marketing year and 296,000t soybeans to unknown destinations.
In this context …
Corn basis bids were steady to mixed after firming 2 cents at an Ohio elevator while trending 5 to 15 cents lower at two Midwestern processors.
Soybean basis bids were steady to soft across the central U.S., after dropping 5 cents at an Ohio river terminal and 30 cents at an Indiana processor.
Commodity funds were net buyers of CBOT soybean, corn, soymeal and soyoil futures and net sellers of wheat futures.
After the sessions close, the Crop Progress report showed corn crop ratings at 56% as good to excellent, and soybeans at 58%.
For spring wheat, the USDA rated 37% of the crop as good to excellent, while the harvest was at 54% complete.
This morning, Chicago soybean and corn prices dropped, while wheat inched higher.
South America
Brazilian farmers had harvested 83% of the area planted for their second corn crop in the center-south region by Aug. 24, consultancy AgRural said.
AgRural forecasted Brazil’s total corn crop to reach 135.4 million metric tons in 2022/23, with the second crop totaling 105.6 million tons.
AgRural also said that 7.5% of the areas projected for the center-south’s first 2023/24 corn crop had been planted by last Thursday.
BAGE reported 55% of soy crush facilities were idle through July, citing the drought reduced domestic supply.
BAGE estimates crush to run at 30% capacity by December through 23/24 harvest.
Argentina announced fourth soy dollar scheme to boost sales.
Production and consumption of bioethanol for fuel is projected at a record 1.2 and 1.17 billion liters respectively.
Biodiesel 2023 production is forecast at 1.0 billion liters, the lowest in 15years.
European wheat prices fell for a second consecutive session, ending down 2.2% at the bell.
Germany’s grain harvest will fall 2.9% year-on-year the agriculture ministry said, and winter wheat crop is expecting to fall 6.0% on the year.
Traders reported some recent EU sales of 11.5% protein wheat believed to be for shipment to Morocco and Indonesia.
Hefty global supplies, and heavy Black Sea export competition, overshadowed EU smaller crops.
European Commission Executive Vice President Valdis Dombrovskis, urged Russia on Saturday to renew the grain deal to allow the safe export of Ukrainian grain through Black Sea ports.
Turkey’s President Erdogan reportedly, on his way to the G20 Summit in India, is going to meet President Putin in Russia on 8 September to discuss reviving the Black Sea grain deal.
Ukraine strongly opposes the imposition of any restrictions on the import of its grain by neighbouring countries after a European Union ban ends on Sept. 15, Foreign Minister Dmytro Kuleba said on Monday.
Ukrainian farmers plan to increase the sown area of winter rapeseed for 2024 and may cut the sown area of winter wheat and barley, an agriculture ministry survey showed.
The survey also highlighted, there are issues with acquiring crop inputs, such as fertilizer, plant protection products, fuel and seeds.
Sovecon raised its wheat forecast to 92.1 million tonnes.
The wheat harvest as of Aug. 24 totalled 70.6 million tonnes from 61% of the total area.
Russia exported 1.24 million tonnes of grain last week, of which 1.15 million tonnes of wheat, port data showed.
Sovecon estimates total Russian wheat exports in August at 5.1 million tonnes.
Russian wheat export prices held steady last week. According to the IKAR, the price of 12.5%-protein Russian wheat scheduled for free-on-board (FOB) delivery in September was $246 per tonne last week, menwhile Sovecon seen the price for this class of wheat at $250-$254 per tonne.
Russia lowered their corn export tax to 1,932 rubles/MT.
On supplies from Ukraine, the Kremlin said the passage of a second ship along a temporary Black Sea corridor had nothing to do with the prospects for reviving a grain deal involving Russia.
China soybean gross crush margins for October have rebounded from negative to positive territory, with soybean oil and meal, the byproducts of soybean crushing, posted gains of 5%-9% over the past two weeks.
Market sources estimated domestic crushing volume in China to hover at 1.8 million-2 million mt for the week of Aug. 28 – Sept. 1.
Live hog prices were heard to maintain within Yuan 17-17.2/kg ($2.3/mt).
South-East Asia
Malaysian palm oil prices finished more than 1% lower.
Exports of Malaysian palm oil products during Aug. 1-25 were seen falling between 4.3% and 7.8% from a month-ago period.
Storm activity in the last 24 hours delivered some patchy rainfall in parts of northern NSW.
Wheat and barley markets, current and new crop, started the week mostly unchanged.
Canola new crop was firmer.
The pulse market continued to gain more upside.
Australia has shipped the first barley cargo to China since tariffs imposed in 2020 were lifted earlier this month, the country’s minister for agriculture said on Tuesday.



Energy markets
Oil prices held steady.
Still there are some worries further U.S. interest rate hikes could dent demand. Personal consumption expenditures price index, the Fed’s preferred inflation gauge, is set for release on Thursday and non-farm payrolls data is due on Friday.
On the other hand …
China halved stamp duty on stock trading.
Tropical Storm Idalia lashed western Cuba on Monday and was almost a hurricane as it headed toward Florida.
This morning, oil prices slipped.
Ocean freight markets
The Baltic Exchange’s main sea freight index in London was not quoted.
Equity markets
On Wall Street, US stock indexes posted moderate gains.
The yield on the 10-year Treasury slipped to 4.21%.
The yield on the 2-year Treasury fell to 5.06%.
The August Dallas Fed manufacturing outlook level of general business activity rose to a 5-month high.
This morning Asian shares mostly rose, as Japan’s benchmark Nikkei 225 edged up 0.4%, Australia’s S&P/ASX 200 added 0.5%, South Korea’s Kospi edged up 0.3%, Hong Kong’s Hang Seng jumped 2.0%, while the Shanghai Composite gained 1.1%.
U.S. Commerce Secretary Gina Raimondo said she and her Chinese counterpart agreed Monday to exchange information on U.S. export controls and set up a group to discuss other commercial issues.
Currency trading
The dollar index slipped on lower T-note yields and strength in stocks.
This morning, the U.S. dollar inched down to 146.39 Japanese yen from 146.54 yen. The euro cost $1.0833, up from $1.0823.

That’s all, thank you.
We wish you a nice day.

Author: Sandro F. Puglisi

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