Video Review of USDA report
This week’s video addresses discrepancies in USDA report, talks charts and strategy for farmers and end users. Special guest Brent Baker from JSA Corporate.
https://register.gotowebinar.com/recording/4130799615659700227
Note: you have to use a computer to view this – not a phone. Also you have to sign in but your names are not shared. This is strictly a compliance requirement.
Bill Biedermann
By ADM Investor Services Research Team
Wheat prices overnight are down roughly 1 cent in the SRW Wheat, down 1 in HRW, and down 1 for HRS; Corn is down 11 cents; Soybeans up 7; Soymeal up $2.00, and; Soyoil down 5 points.
Chinese Ag futures (January) settled up 14 yuan in Soybeans, down 13 in Corn, up 39 in Soymeal, down 4 in Soyoil, and up 20 in Palm Oil.
The Malaysian Palm Oil market was up 12 at 2,191 (basis October), a 3 month peak at midsession on stronger soyoil, weaker ringgit.
For the first time USDA NASS did not use objective yield survey data on August yield projection. This was replaced by satellite imagery analysis. USDA will take objective field yield data in September. USDA ECB soybean yield was still 1.2 bpa above trend. This is the 6th straight year ECB yield has been above trend . This has not appended since 1968-1973. Some feel give the US 2019/20 corn demand outlook, a final corn yield of 155 or carryout below 1,400 is need for a bull price rally.
The U.S. Midwest weather forecast models were again a bit wetter, especially for the far south with close to average rains falling over the region the next 10 days—-temps will be going from average to below average over the near term, to above average over the weekend, then back to cooling back off the first half of next week.
The U.S. Delta and Southeastern states has a two-week outlook that is drier overall for the central and northern Delta into northern Alabama; most other areas will see regular rounds of showers and thunderstorms through the next two weeks.
The 11 to 16 Day Outlook for the Midwest has the models differing again—the GFS has above average temps and below average precip—the European below average temps and average to below average precip.
In deliveries, Soymeal totaled 66 lots; Soyoil 25; and; Soybeans 182 contracts.
The player sheet had funds net sellers of 13,000 SRW Wheat; sold 60,000 Corn; net sold 11,000 soybeans; sold 5,000 Soymeal, and; net bought 6,000 lots of Soyoil.
We estimate Managed Money net long 2,000 contracts of SRW Wheat; net long 33,000 Corn; net short 70,000 contracts of Soybeans; net short 41,000 lots of Soymeal, and; net short 12,000 Soyoil.
Preliminary Open Interest saw SRW Wheat futures up roughly 1,200 contracts; HRW Wheat up 3,100; Corn down 1,700; Soybeans down 4,500 contracts; Soymeal up 5,100 lots, and; Soyoil up 3,200.
There were changes in registrations (Soyoil down 50)—
Registrations total ZERO contracts for SRW Wheat; ZERO Oats; Corn 1,251; Soybeans 1,227; Soyoil 2,104 lots; Soymeal 820; Rice 1,036; HRW Wheat 5, and; HRS Wheat 1,176 contracts.
TODAY—–DELIVERABLE STOCKS—
In tender activity—–S. Korean feed groups seek 68,000t optional-origin corn, bought 128,000t optional-origin corn, bought 60,000t optional-origin soymeal—
U.S. Winter Wheat harvested was 89% (trade estimate was 90%) versus 82% last week, 93% a year ago, 96% average.
U.S. Spring Wheat harvested was 8% (trade estimate was 11%) versus 2% last week, 32% a year ago, 30% average.
Spring Wheat was rated 69% good to excellent (trade estimate was 72%) versus 73% last week, and 75% average; 23% fair (22% a week ago, 20% a year ago), and; 8% poor to very poor (5% last week, 5% a year ago).
U.S. Corn denting was 7% versus N/A% a week ago, 24% last year, and 16% average.
Corn was rated 57% good to excellent (trade estimate was 56%) versus 57% last week, and 70% a year ago; 30% fair (30% last week, 20% last year), 13% poor to very poor (13% last week, 10% last year).
U.S. Oats harvested was 48% versus 32% a week ago, 65% last year, and 64% average.
Oats were rated 64% good to excellent versus 65% last week and 71% a year ago; 28% fair (27% last week, 22% a year ago), and; 8% poor to very poor (8% last week, 7% a year ago).
Soybeans setting pods was 54% versus 37% a week ago, 83% last year, and 76% average.
Soybeans were rated 54% good to excellent (trade estimate was 53%) versus 54% a week ago, and 66% a year ago; 33% fair (33% last week, 24% a year ago), and; 13% poor to very poor (13% last week, 10% a year ago).
USDA 2019-20 U.S. wheat production
| USDA Aug. | Average of | Range of | USDA | |
| 2019-20 | analysts’ | analysts’ | July | |
| estimate | estimates | estimates | estimates | |
| All wheat | 1.980 | 1.925 | 1.873-1.990 | 1.921 |
| Winter wheat | 1.326 | 1.294 | 1.270-1.324 | 1.291 |
| Hard red winter | 0.840 | 0.809 | 0.799-0.834 | 0.804 |
| Soft red winter | 0.257 | 0.257 | 0.250-0.259 | 0.259 |
| White winter | 0.229 | 0.228 | 0.220-0.257 | 0.227 |
| Other spring | 0.597 | 0.569 | 0.542-0.583 | 0.572 |
| Durum | 0.057 | 0.057 | 0.053-0.060 | 0.058 |
USDA 2019-20 U.S. corn and soybean production
| USDA Aug. | Average of | Range of | USDA July | |
| 2019-20 | analysts’ | analysts’ | 2019-20 | |
| estimate | estimates | estimates | estimate | |
| Corn | ||||
| Planted acres | 90.0 | 87.998 | 83.494-89.800 | 91.700 |
| Harvested acres | 82.0 | 80.050 | 76.114-81.900 | 83.600 |
| Yield | 169.5 | 164.9 | 161.0-167.2 | 166.0 |
| Production | 13.901 | 13.193 | 12.723-13.550 | 13.875 |
| Soybeans | ||||
| Planted acres | 76.7 | 81.006 | 78.000-83.500 | 80.000 |
| Harvested acres | 75.9 | 79.890 | 77.300-82.800 | 79.300 |
| Yield | 48.5 | 47.6 | 46.0-49.0 | 48.5 |
| Production | 3.680 | 3.800 | 3.633-3.974 | 3.845 |
USDA 2019-20 U.S. grain and soybean ending stocks
| USDA Aug. | Average of | Range of | USDA July | |
| 2019-20 | analysts’ | analysts’ | 2019-20 | |
| end-stocks | estimates | estimates | end-stocks | |
| estimates | estimates | |||
| Wheat | 1.014 | 0.999 | 0.918-1.072 | 1.000 |
| Corn | 2.181 | 1.620 | 1.281-1.900 | 2.010 |
| Soybeans | 0.755 | 0.821 | 0.607-0.950 | 0.795 |
USDA 2019-20 world grain and soybean ending stocks
| USDA Aug. | Average of | Range of | USDA July | |
| 2019-20 | analysts’ | analysts’ | 2019-20 | |
| end-stocks | estimates | estimates | end-stocks | |
| estimates | estimates | |||
| Wheat | 285.40 | 284.08 | 273.00-290.00 | 286.46 |
| Corn | 307.72 | 290.09 | 278.00-298.70 | 298.92 |
| Soybeans | 101.74 | 104.77 | 101.00-108.50 | 104.53 |
- BRAZIL 2018/19 SOYBEAN CROP 117.00 MLN TONNES -USDA
- BRAZIL 2019/20 SOYBEAN CROP 123.00 MLN TONNES –USDA
- BRAZIL 2018/19 CORN CROP 101.0 MLN TONNES -USDA
- BRAZIL 2019/20 CORN CROP 101.0 MLN TONNES -USDA
- ARGENTINA 2018/19 SOYBEAN CROP 56.00 MLN TONNES -USDA
- ARGENTINA 2019/20 SOYBEAN CROP 53.00 MLN TONNES -USDA
- ARGENTINA 2018/19 CORN CROP 51.0 MLN TONNES – USDA
- ARGENTINA 2019/20 CORN CROP 50.0 MLN TONNES -USDA
- 2018/19 ARGENTINA WHEAT CROP 19.50 MLN TONNES – USDA
- 2019/20 ARGENTINA WHEAT CROP 20.50 MLN TONNES – USDA
Yesterday’s U.S. weekly export inspections had
—Wheat exports running 28% ahead of a year ago (25% last week) with the USDA currently forecasting a 4% increase on the year
—Corn 16% behind a year ago (15% last week) with the USDA down 14% for the season
—Soybeans 22% behind a year ago (22% last week) with the USDA having a 20% decline forecasted on the year
Farmers participating in U.S. crop subsidy programs reported “prevented plantings” for Aug. 1 of 11.211 million acres of corn, 4.351 million acres of soybeans and 2.209 million acres of wheat, the U.S. Department of Agriculture (USDA) said
—Producers enrolled in subsidy programs for Aug. 1 reported planted acreage, including failed acres, at 85.871 million acres of corn, 74.005 million acres of soybeans and 46.302 million acres of wheat.
| U.S. grain and soy plantings | ||
| Prevented plantings | ||
| (thousands of acres) | ||
| Crop | Aug 2019 | Aug 2018 |
| Corn | 11,211 | 918 |
| Soybeans | 4,351 | 271 |
| Wheat | 2,209 | 363 |
| U.S. plantings including failed acres | ||
| Crop | Aug 2019 | Aug 2018 |
| Corn | 85,871 | 85,770 |
| Soybeans | 74,005 | 86,954 |
| Wheat | 46,302 | 44,510 |
A fire that shut Tyson Foods’ Garden City, Kan. beef-processing plant over the weekend is set to tighten US beef supplies and boost profit margins for rivals; the plant had employed more than 3,000 people and processed 6,000 cattle per day, representing roughly 5% of total US beef processing capacity.
Argentina is the world’s largest exporter of soymeal and the third-largest exporter of corn, hence Monday’s’s slump in the peso against the dollar is hurting the price of soymeal and corn futures trading in Chicago; the nose-dive in Argentina’s currency could prompt a wave of exports from Argentina, weighing on international soymeal and corn prices; a weaker local currency boosts the number of pesos Argentine farmers receive for selling their produce.
Argentina’s key grains export sector became instantly more competitive on Monday when the local peso weakened over 15% against the U.S. dollar, but farmers said they would wait to see where the currency settles before selling; with some analysts forecasting an even weaker peso ahead and growers fearing a return to interventionist economics under the opposition Peronists, selling was muted as Argentines processed President Mauricio Macri’s shockingly poor primary performance against challenger Alberto Fernandez.
Russian wheat export prices fell slightly last week, hurt by strong competition from neighbouring countries also exporting via the Black Sea and a decline in wheat futures in Chicago and Paris, analysts said; Black Sea prices for wheat with 12.5% protein content fell $1 to $194 a ton on a free on board (FOB) basis by the end of last week, Russian agricultural consultancy SovEcon said; IKAR, another Moscow-based consultancy, and Refinitiv both quoted FOB wheat at $194 a ton, down $1.
European Union soft wheat exports in the 2019/20 season that started on July 1 had reached 1.33 million tons by Aug. 11, down 30% compared with a year earlier, European Commission data showed
—EU barley exports stood at 389,000 tons, down 59% compared with a year earlier.
—EU maize imports had reached 2.5 million tons, up 83% from a year ago
European Union soybean imports in the 2019/20 season that started on July 1 had reached 1.52 million tons by Aug. 11, down 2% compared with a year earlier, European Commission data showed
—EU soymeal imports had reached 2.11 million tons, up 7% from a year ago.
—For palm oil, EU imports were down 34% from a year earlier at 433,000 tons
Malaysia end-July palm oil stocks slip to one year low- MPOB
- Malaysian palm imports drop, contribute to stocks decline
- Exports in July beat earlier forecasts
- Production set to rise in 2H in line with seasonal trend
| July 2019 | July 2019 poll | June 2019 | July 2018 | |
| Output | 1,738,356 | 1,692,000 | 1,510,835* | 1,503,220 |
| Stocks | 2,391,677 | 2,468,000 | 2,410,746* | 2,231,550 |
| Exports | 1,485,216 | 1,435,000 | 1,383,216* | 1,196,672 |
| Imports | 36,664 | 80,000 | 101,250 | 44,030 |