US farm markets pitted another crazy and volatile week, last week.
There were double digit gains and losses along the week and analysts tried to find a reason for that, although there was no a clear answer which rose on the top.
We’re in high priced markets of course.
The situation in Ukraine was still the main factor in the markets, especially about the uncertainty surrounding if farmers in Ukraine will be able to plant or not.
South America’s crop was also at play.
The acreage prospects in the United States.
There’s a lot of crops that need acres, and there’s a lot of crops that can afford to lose acres, but somebody is going to lose and it makes for a supportive situation in grain prices.
On the weather side, dry conditions are at a historic level.
Looking at the latest updates to the U.S. Drought Monitor, “drought creep” has been extremely slow but steady, moving from about 72% of the country affected at the start of 2022 up to 74% through March 15.
Regional differences are significant.
For example, 90% of the High Plains is experiencing some level of drought right now, while only 43% of the Midwest is currently affected.
And that, could hinder planting decisions, but it’s also impacting grain feed users.
So, as we can understand, there are many factors at play.
However it’s should to note that open interest and trading volumes has been down.
Also, it’s getting harder to deal in some of the world’s most important commodities as everything from geopolitical turmoil to exchange snafus prompt traders to rush for the exits, rapidly draining liquidity.
Prices of materials like crude, gas, wheat and metals have become alarmingly erratic, as a gulf emerges between buyers and sellers who are facing big financing strains.
And all these factors has led to more volatility past week.
Well, let’s move on our “Last Week Market Comment”.
May corn prices on Friday fell 1.69%.
For the week they sank 2.7%.
Soybean prices were substantially unchenged on Friday and lost 0.5% during the week.
Soybean meal was down 0.61% on Friday, but finished the week only marginally lower losing 0.02%.
Soy oil dropped 3.14% on Friday and 4.9% for the week.
Wheat contracts sold off again past week both in Chicago and Kansas City.
Particularly, CBOT wheat May contract was down 3.12% on Friday and 3.9% during the week, adding to the 8.5% losses the previous week.
KC HRW was down 1.99% on Friday and 1.7% for the week, adding to the 10.37% losses two week ago.
Minneapolis, was down 1.74% on Friday, but settled 0.81% higher for the week.
In energy markets, oil prices settled higher last Friday, although posted a second straight weekly loss.
Brent crude futures settled up $1.29, or 1.2%, to $107.93 a barrel, a day after surging nearly 9% in the biggest daily percentage gain since mid-2020.
U.S. West Texas Intermediate (WTI) crude futures settled up $1.72, or 1.7%, at $104.70 a barrel, adding to the previous session’s 8% jump.
Both benchmark contracts ended the week down around 4%, after trading in a $16 range.
Crude prices have been on a rollercoaster ride, boosted by the supply crunch from traders avoiding Russian barrels and dwindling oil stockpiles.
However, prices have been pressured down during the week by worries about demand with COVID-19 cases surging in China, while stumbling nuclear talks with Iran have been a wild cardon the market.
Also, the volatility has scared some investors out of the oil market, which has exacerbated price swings.
Meantime, the International Energy Agency said oil markets could lose 3 million bpd of Russian oil from April and there is no easy replacement for Russian barrels in a tight market.
U.S. oil producers have shown considerable constraint, since start the conflict.
U.S. energy firms past week reduced the number of oil rigs active in the country by 3 to 524 this week.
Consultancy FGE said on-land product stocks at key countries are 39.9 million barrels lower for this time of the year relative to the 2017-2019 average.
Meantime, oil prices jumped $3 on this morning, with Brent above $110 a barrel.
Indeed, Brent crude futures climbed $3.44, or 3.2%, to $111.37 a barrel by 04:43 GMT.
U.S. West Texas Intermediate (WTI) crude futures rose $3.54, or 3.4%, to $108.24.
This week will be talks between European Union governments and U.S. President Joe Biden, that aim to harden the West’s sanctions against Moscow.
EU governments will consider whether to impose an oil embargo on Russia.
Over the weekend, attacks by Yemen’s Iran-aligned Houthi group caused a temporary drop in output at a Saudi Aramco refinery joint venture in Yanbu, feeding concern.
OPEC+ missed its production target by more than 1 million barrels per day (bpd) in February, three sources told Reuters.
Saudi Arabia and the United Arab Emirates, have so far resisted calls from major consuming nations to step up production faster to help drive down oil prices.
The poor supply outlook and high prices prompted the International Energy Agency to outline ways on Friday to cut oil use by 2.7 million bpd within four months, from car-pooling to lower speed limits and cheaper public transport.
That would help offset the 3 million bpd of Russian crude and products that the IEA estimated would be off the market by April.
In the freight market, the Baltic Exchange’s dry bulk sea freight index climbed last Friday, helped by a rise in rates across all vessel segments.
The overall index, which factors in rates for capesize, panamax, supramax and handysize shipping vessels, indeed, added 17 points or 0.7%, to 2,605 points.
However, the main index that was up 26.5% prior week, registered its first weekly dip in four, shedding 4.2% past week.
Particularly, the capesize index gained one point to 2,605 in Friday session.
But it fell 2.7% for the week.
Previus week had jumped 63.66%.
Average daily earnings for capesizes, which typically transport 150,000-tonne cargoes such as iron ore and coal, were up $8 at $21,604.
The panamax index was up 24 points, or 0.8%, at 2,874 points last Friday.
For the week was down 9.82%, however.
Average daily earnings for panamaxes, which usually carry coal or grain cargoes of about 60,000 to 70,000 tonnes, increased $219 to $25,868.
The supramax index rose 30 points to 2,922 points, on Friday.
For the week sheded 0.58%.
In other news, USDA said freight rates for shipping US grains from the Gulf of Mexico to Japan hit US$79/t, up 12pc from the start of the year, and 37pc from the same time last year.
Meantime, on week 11, a sharp increase in the level of freight is recorded in the Azov and Black Sea region.
While prior week deals were concluded in low 30ies, past week the rate for a 3,000K parcel of wheat from Azov to Marmara Sea ports reached $53 per ton, Sea Lines shipbrokers report.
Despite the unstable situation in the region, trade is getting more active every day.
The most popular destination for shipments at the moment is Turkey, but shipments to Egypt, Israel and Italy are also quite often considered by charterers.
It is worth noting that taking into account the incidents with merchant vessels in the area of Taganrog and Yeisk, some shipowners are afraid to call these ports, as well as Rostov and Azov, preferring to take cargo from Kavkaz, Novorossiysk or Temryuk.
This increases the gap in rates between the northern and southern ports of the Sea of Azov.
Sea Lines say, there is every reason to assume that the freight market will continue to grow in the near future, since the demand for grain products remains very high, and ship owners will need to cover the costs they have incurred over the past few weeks when ships were idle.
According to Sea Lines, on week 11, freight rates for wheat parcels from Azov made $51 to the Black Sea, $53 to Marmara, $66 to Mersin and $68 to Egypt.
Freight rates from Rostov AB (after bridge) are $1 above, from Rostov BB (before bridge) the same, from Yeisk and Taganrog $1 below, and from Temryuk $3 below those from the port of Azov.
In the Caspian, freight rates demonstrated a downward trend.
On week 11, freight rates for shipping corn by 3,000 dwt bulkers to Iran make $21 from Aktau, $26 from Makhachkala, and $32 from Astrakhan.
In equity markets, U.S. stock indexes last Friday climbed to 1-month highs and settled moderately higher.
Strength in technology stocks on Friday lifted the overall market.
Talks between U.S. President Joe Biden and Chinese President Xi Jinping over the Ukraine crisis ended without big surprises.
Xi called on NATO nations to hold a dialogue with Moscow, without assign blame to Russia for the invasion.
Also, expectations for China to soon increase stimulus measures to boost its economy pushed U.S.-listed Chinese stocks higher.
A negative for stocks was concern that the ongoing conflict in Ukraine will undercut global economic growth and boost inflation.
Friday’s U.S. economic data was negative for stocks after U.S. Feb existing home sales fell -7.2% m/m to a 6-month low of 6.02 million, weaker than expectations of 6.10 million.
St. Louis Fed President Bullard said he dissented at past week’s FOMC meeting because he wanted a 50 bp rate hike against 25 and recommended that the FOMC try to achieve a policy rate level above 3% this year.
Many are open to half-point moves on rate increases if price pressures fail to ease or if inflation expectations move up meaningfully.
In this context, the Dow Jones Industrial Average rose 274.17 points, or 0.8%, to 34,754.93, the S&P 500 gained 51.45 points, or 1.17%, to 4,463.12 and the Nasdaq Composite added 279.06 points, or 2.05%, to 13,893.84.
Wall Street’s three main indexes boasted their biggest weekly percentage gains since early November 2020 with the S&P adding 6.2% while the Dow rose 5.5% and the Nasdaq jumping 8.2%.
Meantime, global equity markets gained last Friday after traders cheered a Russian bond payment that averted a historic sovereign default.
The Russian finance ministry, indeed, announced last Thursday that it had sent funds to cover $117 million in coupon payments on two dollar-denominated sovereign bonds that came due past week.
Thus, MSCI’s gauge of world stocks, which tracks equities in 50 countries across the globe gained 0.89%, while MSCI’s broadest index of Asia-Pacific shares outside Japan had closed 0.25% higher overnight on Friday.
European stocks also closed higher as peace talks to end the Russia-Ukraine conflict continued amid heavy fighting.
The pan-European STOXX 600 index rose 0.91%.
Meantime, Asian stock markets declined on this morning.
Investors are watching efforts to mediate a settlement to Russia-Ukraine conflict.
Thus, the Shanghai Composite Index lost less than 0.1% to 3,248.87 and the Hang Seng in Hong Kong shed less than 0.3% to 21,344.09.
The Kospi in Seoul lost 0.6% to 2,688.95 and Sydney’s S&P-ASX 200 declined less than 0.1% to 7,291.80.
India’s Sensex opened down 0.4% at 57,621.80.
New Zealand and Singapore gained while Jakarta and Bangkok retreated.
In currency markets, the U.S. dollar index bounced back from recent declines, on Friday, as Federal Reserve officials said the central bank may need to be more aggressive to deal with inflation.
Thus, the dollar index, rose 0.269% last Friday, with the euro down 0.34% to $1.1051, while the yen tumbled to a 6-year low when the Bank of Japan maintained stimulus measures following its last week’s policy meeting.
The Japanese yen, indeed, was down 0.47% at 119,14 yen vs US dollar last Friday.
However, for the week, the dollar index fell 0.96% to close at 98.227.
On the weather side, conditions across wheat growing states was dry past week.
In the High Plains, high winds led to deteriorating conditions in many areas.
Much of the area has received just 5% to 20% of normal precipitation over the last 120 days.
West Texas and Oklahoma also saw conditions decline.
Only northern Colorado, central Montana, and central Wyoming received any meaningful rainfall this past week.
Conditions in wheat growing areas of the western U.S. were also dry.
Past week’s Drought Monitor noted that in the PNW winter started wet before rapidly progressing to a dry 2022.
On the supply side, the National Agriculture Statistics Service (NASS) updated Field Crops Reports.
Past week winter wheat crop conditions, were evolving into those dry conditions, causing crop assessments to deteriorate again in Kansas and Texas.
Consequentially, weekly crop report, rated 23% of the Kansas winter wheat crop in good to excellent condition, down from 24% a week earlier.
Kansas is the biggest U.S. winter wheat producer.
Also, the USDA reported that topsoil moisture was short or very short in 72% of the state, an improvement from 81% the previous week.
For Texas, the No. 2 winter wheat state by planted area, the USDA rated just 6% of the crop as good to excellent, down from 7% the previous week.
The USDA rated 75% of the Texas crop as poor to very poor, steady with the previous week.
For Oklahoma, the USDA rated 24% of the winter wheat crop in good to excellent condition, up from 15% a week earlier.
The USDA said 8% of Oklahoma’s wheat had reached the “jointing” stage of growth, behind the five-year average of 14%.
For Colorado, the USDA rated 18% of the winter wheat as good to excellent, a decline from 21% in the state’s previous report, released in late February.
In Arkansas, where farmers grow soft red winter wheat used to make cookies and snack foods, the USDA rated 71% of the state’s wheat as good to excellent.
The USDA rated 66% of the Louisiana winter wheat crop and 64% of Mississippi’s wheat as good to excellent.
Meantime, the Texas corn crop was 27% planted, matching the state’s five-year average.
Corn planting was 11% complete in Louisiana and 1% complete in Mississippi.
U.S. farmers are expected to plant 92.421 million acres of corn in 2022 and 89.281 million acres of soybeans, according to an annual survey conducted by commodity brokerage and analytical firm Allendale Inc and released last Wednesday.
Projected corn plantings would be above the U.S. Department of Agriculture’s Outlook Forum forecast for 92.0 million acres but below the 93.357 million acres planted in 2021.
Projected soybean plantings would top the latest USDA forecast for 88.0 million acres and exceed the 87.195 million acres planted to soy in 2021.
Allendale’s survey of farmers in 27 states was conducted from Feb. 28 through March 11.
Allendale projected all U.S. wheat plantings at 48.892 million acres, above the USDA’s forecast for 48.0 million and above the 2021 planted area of 46.703 million acres.
Allendale estimated U.S. winter wheat seedings at 34.620 million acres.
“Other spring” wheat acreage was seen at 12.450 million and durum plantings were seen at 1.822 million acres.
For the coming days, heavy to excessive rainfall and severe thunderstorms likely Monday-Tuesday across portions of the Deep South.
Critical risk of fire weather continues Monday for parts of the southern Plains.
On the demand side, the February U.S. soybean crush declined to the lowest in five months but was in line with trade expectations, while the end-of-month soyoil supply rose to a 22-month high, according to National Oilseed Processors Association (NOPA) data released last Tuesday.
Particularly, NOPA members crushed 165.057 million bushels of soybeans last month, down 9.4% from the January crush of 182.216 million bushels but up 6.4% from 155.158 million bushels in February 2021.
It was the second-largest NOPA February crush on record, behind only 2020, when has been 166.3 mbu .
The crush had been expected to drop to 165.024 million bushels, according to the average of estimates from nine analysts.
Estimates ranged from 161.980 million to 169.132 million bushels, with a median of 165.000 million bushels.
Soyoil yiled was 11.93 lbs/bu, matching the record 11.9s from the spring of 2013.
Also, NOPA said soyoil supplies among its members as of Feb. 28 rose to 2.059 billion lbs, which was 500m above the average trade guess and the largest end-of-month stocks since April 2020.
Meantime, the stocks were up 1.6% from 2.026 billion lbs at the end of January and up 17.2% from the end of February 2021, when NOPA members held stocks of 1.757 billion lbs.
Soyoil supplies at the end of February were expected to have tightened to 1.985 billion pounds, according to the average of estimates gathered from six analysts.
Estimates ranged from 1.900 billion to 2.036 billion, with a median of 2.000 billion.
Ethanol production shifted slightly lower for the week ending March 11, with a daily average of 1.026 million barrels, per the latest data from the U.S. Energy Information Administration.
That was 2k bpd lighter on the week.
Despite the modest move lower, weekly production remained near the best levels since late January.
Stocks, indeed, increased another 674k barrels or 3% to 25.945 million, and are at the highest level in nearly two years.
Particularly, in the PADD 2 Midwest stocks remain at record levels, with 10.43m reported compared to the all time record 10.79m in Feb.
However, ethanol stocks in all PADD districts are still down from the Covid record of 27m barrels in April of 2020.
Weekly Export Sales report from USDA showed 1.836 MMT of old crop corn was sold for export during the week that ended 3/10.
Japan, Unknown, Mexico, Colombia, and South Korea had all booked more than 100k MT, led by 538k MT from Japan.
For new crop corn sales, China was the exclusive buyer for the week that ended 3/10 with 204k MT.
Corn exports were at 1.273 MMT.
That was down from last week’s 1.7 MMT and was 43% under shipments from the same week last year.
US old crop corn export commitments (shipped plus outstanding sales) are now at 52.039 MMT, now just 14% below last year at this time.
They are 82% of the full year WASDE forecast, still ahead of the average pace of 81%.
Accumulated corn exports reached 28.8 MMT (1.134 bbu), or 45% of USDA’s forecasted total.
Matching the average pace.
As for soybeans, the report showed 1.253 MMT of old crop beans were sold during the week that ended 3/10.
New crop sales were 477k MT, with analysts’ expectations for at least 500k MT.
Soybean exports from the week came in at 714k MT, for a season total of 42.325 MMT (1.555 bbu).
That is 74.4% of USDA’s forecast and with the average, suggesting the shipments may be for later in the MY.
US soybean exporters have either sold or shipped 53.624 MMT of the 21/22 crop, now only 11% smaller than last year’s record buying pace.
However, total export commitments are 94% of the USDA full year estimate, outpacing the 90% average for this date.
As for the products, USDA reported 147,363 MT of soymeal was sold during the week that ended 3/10.
That was 56% below last week and 44% below the same week last year.
Soymeal exports were 252k MT for a MYTD total of 5.69 MMT.
Soy oil bookings were reported at 22,639 MT.
Soy oil shipments were a 6-week low of 6.6k MT, leaving accumulated shipments 17% behind last year’s pace at 415.7k MT through 3/10.
As for wheat, USDA reported weekly wheat export sales of 145,930 MT.
That was down 53% from the previous week and 67% below the same week last year.
Old crop export commitments are now 18.993 MMT, or 87% of USDA’s full year forecast, still lagging the average pace by 10%.
New crop sales were better, at 325,600 MT.
Wheat export were at 249,466 MT.
That was down 35% from last week and 62% from the same week last year.
Shipments to date are still 21% smaller than a year ago, at 14.969 MMT.
That is 68% of the USDA projection vs the average of 74% by now.
There are less than 3 months until the end of the MY!
The USDA, has a 19.4% dip yr/yr built into their March forecast.
Meantime, weekly CFTC data showed managed money firms were 4,125 contracts more net long past week in corn futures and options, going to 372,909 contracts as of 3/15.
Commercial corn hedgers were adding long hedges to reduce their group net short by 5.7k contracts to 726,318.
As for soybeans, report showed soybean spec traders were 1,024 contracts less net long at 170,690 contracts through the week that ended 3/15.
Commercial soybean hedgers reduced 6.7k short hedges for a 295,542 net short.
In the products, managed money was shown 6,532 contracts more net long in meal and extended the net long 3,502 contracts in soy oil.
That left the funds at 103,159 and 89,171 contracts respectively.
As for wheat, the Commitment of Traders report showed wheat specs were reducing exposure in the winter wheats and buying the spring wheat.
Managed money firms closed more shorts than longs in Chicago wheat, expanding their net long to 22,945 contracts, as added 2,737 contracts to their net long during the week despite extreme duress.
In KC wheat the funds’ 5k contract cut 470 contracts from their net long position taking it to 44,236 contracts as of 3/15.
Spring wheat spec traders added 1,464 new longs alongside just 9 fewer shorts for a 14,387 contract net long as of 3/15.
In this context, corn basis bids were mostly steady to firm last Friday after rising 2 to 15 cents higher across five Midwestern locations.
An Ohio elevator bucked the overall trend, slipping a penny lower.
Soybean basis bids trended 4 to 10 cents higher at two interior river terminal and dropped 2 cents lower at an Ohio elevator while holding steady elsewhere across the central U.S..
As for wheat, basis was mixed in both the Gulf and Pacific Northwest (PNW) past week.
Continued poor performance across all freight rail in the U.S. continues to challenge logistics.
Labor shortages, high secondary rail markets, and fuel surcharges are all adding to wheat basis.
Meantime, the weekly USDA Grain Transportation Report showed average March shuttles in the secondary rail market were up 161% between March 3 and March 10, and 342% year-over year.
The funds were net sellers last Friday for 7,500 lots of corn, 5,000 lots of soybeans and 12,000 lots of wheat.
From Canada, wheat exports for week 31 were at 215,7k, vs 281,6 the prior week.
Year to date they reached 7.082,8k vs 11.766,8k a year ago.
That was 39% below the same time last year according to data from Canadian agriculture ministry.
As for durum, exports for week 31 were a tiny 13.8k mt vs 34.3k prior week.
Year-to-date the total durum export is 1.5 million mt, compared to 3.6million mt last year-to-date.
This is now just 42% of last year’s pace, or down 58% since August 1.
Meantime, Canadian Pacific Railway (CP) halted operations and locked out workers over a labor dispute early on Sunday, with each side blaming the other for a halt that will likely disrupt shipment of key commodities.
The dispute affects 3,000 engineers, conductors and yard workers.
The key bargaining issue is the union’s request for higher pension caps.
Chief Financial Officer Nadeem Velani told a New York investor conference on Tuesday that the railway was unwilling to accept that demand.
Thus, the union said in a statement that it had begun to strike across the country.
Canada’s second-biggest railroad operator, meantime, accused the union of misrepresenting the company’s position.
In this context, Canada’s Nutrien said this week it may need to reduce potash production at its mines in the province of Saskatchewan if the shutdown lasts longer than a few days.
From South America, according to Agroconsult, Brazil’s soybean area will likely grow at a slower pace than in previous years because farmers face a looming fertilizer shortage.
Brazil’s soy area has been consistently growing between 1 million and 1.5 million hectares (3.7 million acres) annually, a level unlikely to be seen for next crop.
The consultancy now, indeed, estimate between 500,000 hectares and 1 million hectares of soy area growth, but given the current scenario, it would be closer to 500,000 hectares.
After surveying soybean fields in large farm states, Agroconsult experts said Brazil’s soy production will fall almost 11% to just below 125 million tonnes in 2022.
Crops in Paraná and Rio Grande do Sul, have seen average yields fell by 38.7% and 56.2%, respectively although in top grain supplier Mato Grosso, average yields rose almost 5% to 60.7 60-kilo bags per hectare.
The consultancy also estimated Brazil’s second corn production at 92.2 million tonnes this season, referring to the cereal that is planted after soy is reaped on the same fields, and which represents 70-75% of total corn output in a given year.
Meantime, Brazil’s Agroconsult predicts the country’s 2022 soybean exports will total 78 MMT.
Agroconsult also estimates that Brazilian corn exports will total 41.6MMT this year.
Meantime, private firm Anec had Brazilian soy shipments at 12.9 MMT for March, which is down from their prior forecast of 13.77 MMT.
Brazilian export data showed 55k MT of corn was shipped last week, up from 0 MT the week prior.
In Argentina, farmers could be hit by a third straight La Nina weather phenomenon, the Rosario grains exchange said, a potential blow for the upcoming 2022/23 season.
The climate pattern generally brings lower rainfall in key farming regions.
Meantime, corn harvest in Argentina reached 6.9% complete.
The BAGE reduced Argentina bean production estimates by 1.1 to 42 MMT.
Expected average yield was improved on lower acres.
On the other hand, Argentina said on Saturday that it was increasing its annual wheat export quota for the 2022-2023 season by 8 million tons to a total of 10 million tons to take advantage of high international prices.
Argentina, had limit exports of wheat in a bid to ensure domestic supply and to avoid local price hikes.
However, the new increased export quota remains lower than in the previous 2021-2022 cycle, in which Argentina allowed exports of 14.5 million tonnes of wheat.
Argentina’s next wheat season will only begin when planting starts in May but sales are often decided months in advance, especially in times of high prices.
In Europe, the German Raiffeisen Association (DRV), an association of German agricultural companies, said the European Union’s restrictions on fertilizer use would keep annual German grain production capped at 2.5% in 2022.
DRV said cereal production in Germany will reach 43.2 MMT in 2022, below previous estimates.
DRV noted that even with “optimal weather conditions” the fertilizer restriction would keep production lower than previous years.
Stratégie Grains lifted its estimate for wheat shipments from the European Union this week by 2 MMT to 32.5 MMT.
French livestock feed producers this week asked the government to reserve 800,000 MT to 1 MMT of cereals each month to cover their needs as French wheat exports pick up pace.
FranceAgriMer saw new crop wheat conditions as 92% good/very good as of 3/14.
Spring barley sowing was 90% complete compared with 76% a week earlier but lagging compared to 96% progress seen a year ago, FranceAgriMer said.
This week’s high pressure conditions should allow this work to be completed.
From North Africa, Egypt’s cabinet last Wednesday agreed to add 65 Egyptian pounds ($4.15) per ardeb (150 kilograms) to its procurement price of local wheat as an incentive for farmers to sell more of the local crop to the government ahead of the harvest.
The government will now pay 865-885 Egyptian pounds per ardeb depending on purity levels, the cabinet said.
The government has also asked the supply minister to set a pricing mechanism for unsubsidised bread, following orders from Egypt’s president Abdel Fattah al-Sisi to control the price after it surged.
On this wake, Egypt’s Prime Minister Moustafa Madbouly set on this morniong the price of unsubsidized bread at 11.5 Egyptian pounds ($0.66) per kilogram, according to a statement from his office.
Meantime, Egypt has strategic wheat reserves sufficient for 3.4 months, supply minister Ali Moselhy said in an interview with local television on Saturday.
($1 = 17.4200 Egyptian pounds).
From Levant, Jordan’s wheat and barley reserves are enough for a year of consumption, state television reported citing the industry and trade minister on Sunday.
Jordan has no plans to increase bread prices, the minister said.
Syria’s ministry of internal trade said there are no concerns about wheat reserves in the country, state news agency (SANA) reported on Saturday.
Wheat season is approaching and it (the crop) will be bought from local farmers with better prices compared to market prices.
There are no concerns about wheat and bread, reported the ministry as saying.
The Saudi Grains Organization (SAGO) stated that Saudi Arabia’s total production of flour reached 27 million tons.
There are four milling companies in the Kingdom that produce a total of 60 million bags of flour, SAGO said.
The storage capacities of the four milling companies in the Kingdom amount to about 745,000 tons of wheat, while the operational capacity of wheat milling is 151500 tons per day.
The flour-milling sector is one of the targeted sectors for privatization under the Saudi Vision 2030 realization programs.
MC-1 is the largest of the four milling companies and is part of SAGO’s privatization plan of Saudi flour mills and grain silos.
From the Black Sea basin, Russia is gradually resuming wheat exports from its BlackSea ports while navigation in the Azov Sea remains restricted.
According to the IKAR, indeed, exports are ongoing from all the five Black Sea (grain export) terminals.
However, prices for Russian wheat remain extremely volatile.
And rising prices, can lead to new export restrictions, market participants fear.
On this wake, the Russian Ag. Min has amended the export tax for wheat, barley and corn for the week of March 23 – 29, 2022.
Particularly, the export duty will be $86.4 on wheat, $79.6 on barley and $53.2 on corn.
Indicative prices will be $323.5 for wheat, $298.8 for barley and $261.1 for corn.
That is compared, with prior week (March 16-22) when the tax was $86.3 for wheat, $77.4 for barley and $54.1 for corn, while indicative price were $323.3 for wheat, $295.7 for barley and $262.3 for corn.
According to Andrey Sizov, Russia still has 7-8 million tons of grain to export before the end of the season, including 5-6 million tons of wheat.
Sovecon, however, raised the estimate of wheat exports from Russia in March from 1.6 million tons, to two million tonnes.
According to customs data, on the other hand, from the beginning of the season to March 10, Russia exported 28.1 million tons of grain, including 23 million tons of wheat – about 30% less than last season.
According to the Minister of Agriculture Dmitry Patrushev, in 2022 the grain harvest can amount up to 123 million tons, as the area of arable land will increase by 1 million hectares, and the condition of winter crops is above the average annual level.
The gross harvest of oilseeds, according to Patrushev, can amount up to 22.6 million tons, sugar beet – 41.5 million tons, potatoes in the organized sector – 6.8 million tons, open-ground vegetables – 5.2 million tons.
Livestock and poultry production in 2022 is projected at 16 million tons, milk – 32.5 million tons.
The increase in yield is predicted based on several factors. “19 million hectares have been sown with winter crops, more than 96% of them are in good and satisfactory condition.”
The head of the Ministry of Agriculture clarified that spring sowing was carried out on an area of more than 200 thousand hectares, about 3 million hectares of winter crops were fertilized.
The total sown area in 2022, according to plans, should be 81.3 million hectares.
The Minister also once again drew attention to the fact that Russia fully covers its own needs for all major types of products.
In addition, they are ready to continue fulfilling export obligations, the Ministry added.
According to the Ministry of Agriculture of Russia, currently the availability of grain in Russia exceeds 150%.
In Ukraine, trade on Ukrainian export market has started growing past week.
Meantime, Ukraine’s agriculture minister last Thursday announced farmers started sowing spring grain crops, but said it was impossible to forecast how much would be planted.
Stratégie Grains cut its forecast for Ukrainian wheat production in 2022/23 by 40% without estimating total production volume.
Meantime, a World Food Programme official said on Friday food supply chains in Ukraine were collapsing, with key infrastructure such as bridges and trains destroyed by bombs and many grocery stores and warehouses empty.
The war between Ukraine and Russia, could lead to a food crisis “on the global” scale, French farming minister Julien Denormandie said in Brussels on this morning ahead of a EU agriculture meeting.
EU ministers will discuss the food situation with their Ukrainian counterpart in a video call, he added.
From the Middle Kingdom, USDA’s Beijing ag attaché forecasted China’s 2022/23 soybean imports at 100 MMT.
That would be a 5 MMT boost from their 95 MMT estimate for 21/22 – citing hog herd expansion.
Meantime, China’s soybean imports from Brazil in the first two months of 2022 rose significantly from the corresponding period last year, customs data showed on Sunday.
The world’s top buyer of soybeans, China brought in 3.51 million tonnes of the oilseed from Brazil, up 241% from 1.03 million tonnes in the previous year.
Chinese imports from the USA, on the other hand, fell to 10.04 million tonnes in January and February compared to 11.9 last year.
Domestic production is estimated higher at 62.4 MMT, from 61 MMT in 21/22 – citing trend yields and government expansion efforts.
Chinese wheat imports from all sources were seen as 680k MT in February.
That is down 30.4% from Feb ’21 and compares to 1.51 MT in Jan.
From Australia, local markets remained relatively steady towards the back end of last week.
Barley values along the east coast continue to firm, with Downs feedgrains stronger over the week.
South Australian values for wheat and barley took a breather and the liquidity was limited, while canola bids softened.
Growers are now focused on getting ready for planting, and some have already started.
The latest eight-day Bureau of Meteorology forecast looks promising for 10-25 millimetres of rain in the Western Australian wheatbelt.
Northern New South Wales and southern Queensland are forecast to receive 25-50mm.
Watching this week’s market, we have a typical start with the weekly Export Inspections report released on this afternoon.
Skip ahead to Wednesday EIA will publish their weekly ethanol production and stocks report.
We will also get the Cold Storage report on Wednesday afternoon.
The USDA weekly Export Sales data will be released on Thursday morning.
On Friday, Cattle traders will be blessed with the monthly Cattle on Feed report from NASS.
That’s all.
To all of you I wish you a good day and a good start to the week.
Author: Sandro F. Puglisi
