ADMIS AM Comments

By ADM Investor Services Research Team


CBOT grain trade was closed overnight. Early calls are mixed. Could be some follow through from Wednesday. Wednesday trade was supported by talk China may buy US corn, soybean and pork as a goodwill gesture before US and China trade talks resume. Midwest rains over the Holiday and slowdown in US export activity could offer resistance. There were also report that China insists that tariffs be removed as part of a new deal. SX is near 9.08. CZ is near 4.41. WZ is near 5.25. US Dollar is higher.


For the week, Winter Wheat prices are down roughly 13 cents for Soft Red Winter, down 19 in the Hard Red Winter, and down 13 for Hard Red Spring; Corn is up 10 cents; Soybeans down 15; Soymeal down $7.00, and; Soyoil down 15 points (crushing margins are down 5 cents at $0.99, oil-share is up 1% at 31%).


The U.S. Midwest weather forecast has the 6 to 10 day period still looking at average to a bit below average precip and average to below average temps.


The Southern U.S. Plains continues with some hit and miss rains but be fairly quiet; limited rains are seen through next week—temps will be running average to a bit below.


The Northern U.S. Plains will see still see close to average rainfall through the next 10 days—-temps will be running average to below average.


The U.S. Delta and Southeastern states will see a seasonable pattern of isolated to scattered showers each day during the next two weeks.


The 11 to 16 Day Outlook still has not changed as it sees ridging in the west with the Midwest seeing average to a bit below average precip and average temps.


In deliveries, Soymeal totaled 298 lots; Soyoil 611; Rice 14; Corn 948; HRW Wheat ZERO; Oats 1; Soybeans 365, and; SRW Wheat ZERO, and; HRS Wheat ZERO.


The player sheet had funds net buyers of 4,000 contracts of SRW Wheat; bought 15,000 Corn; bought 5,000 contracts of Soybeans; net bought 1,000 Soymeal, and; bought 3,000 Soyoil.


We estimate Managed Money net long 13,000 contracts of SRW Wheat; net long 127,000 Corn; net short 53,000 contracts of Soybeans; net short 11,000 lots of Soymeal, and; net short 41,000 Soyoil.


Preliminary Open Interest saw SRW Wheat futures down roughly 3,500 contracts; HRW Wheat up 4,000; Corn up 5,900; Soybeans up 4,500 contracts; Soymeal up 3,900 lots, and; Soyoil down 3,600 lots.


There were changes in registrations (Rice up 12)–Registrations total ZERO contracts for SRW Wheat; 2 Oats; Corn 2,556; Soybeans 742; Soyoil 3,547 lots; Soymeal 745; Rice 975; HRW Wheat 5, and; HRS Wheat 1,176 contracts.





In tender activity—Tunisia was a buyer of 67,000t optional-origin wheat—Algeria bought 360,000t optional-origin wheat—Jordan passed on 120,000t optional-origin wheat—Egypt bought 30,000t optional-origin soyoil—


China insists US must remove all trade war tariffs as part of deal, says commerce ministry spokesman

  • US President Donald Trump previously said that he wanted some tariffs to remain in place for a ‘substantial period of time’, even extending beyond any agreement
  • Washington also urged to fulfil its promise made at the G20 summit to allow American firms to resume selling products to telecommunications firm Huawei


Trade estimates for USDA weekly grain, soy export sales

Trade estimates for 2018-19 Trade estimates for 2019-20
Wheat N/A 250,000-550,000
Corn 100,000-400,000 100,000-300,000
Soybeans 400,000-800,000 200,000-400,000
Soymeal 100,000-200,000 50,000-150,000
Soyoil 5,000-25,000 0


U.S. ethanol production for the week ended June 28th averaged 1.081 mil barrels per day (down 0.84% versus a week ago, up 1.31% versus a year ago); stocks totaled 22.844 mil barrels (up 5.92% versus a week ago, up 3.95% versus last year); corn use for the week was 111.6 mil bu (110.6 mil last week and versus the 94.1 mil bu needed to meet USDA projections).


U.S. May Grain Exports


——- In Bushels, CWT or Pounds ——-

May 19         Apr 19         Mar 19      May 18(*)

Barley                  191,798        197,829        191,919         95,852

Corn /1             184,630,486    215,428,039    187,810,070    309,787,478

Sorghum              10,641,762      4,892,873      6,120,875      3,596,687

Oats                    133,848        105,850        208,428        137,657

Wheat /1            102,922,098    104,459,822     72,372,666     67,094,555

wheat flour /1        480,645        505,650        504,242        585,739



U.S. May Oilseed, Meal, Oils/Fats Exports


——- In Bushels, Pounds or Short Tons ——-

May 19          Apr 19          Mar 19     May 18(*)

soybeans             94,078,987      88,156,670     136,190,846   109,892,136

soyoil              205,734,111     148,284,184     271,839,200   431,435,700

crude             177,052,804     120,920,201     233,515,039   377,098,745

refined               180,054         593,846         284,465     1,274,874

other/1            27,677,926      25,926,437      36,553,251    52,454,015

hydrogenated          823,327         843,700       1,486,445       608,066

soymeal                 903,258       1,110,812         842,082     1,027,044

soymeal flour/me        204,202         274,766         328,606       292,313

soymeal hulls            13,521          14,890           6,883        16,386



On Wednesday, a Bloomberg News report citing anonymous sources says that the Chinese government is again considering purchasing US agricultural products, which was fueling trader optimism and pushing grains futures higher — particularly corn.


—China said it will tap into the global market, including the U.S., to help relieve a pork shortage amid an outbreak of a deadly virus across the country’s pig farms; China will continue importing pork to help ensure supply, the Vice Agriculture Minister told reporters; there are many sources of pork in the global market and the U.S. is one of them


Wire story reports with just eight weeks left in the current marketing year, U.S. soybean exports could be on pace to top government forecasts, but corn may have a tougher time meeting the expectations; data published on Wednesday by the U.S. Census Bureau showed that May corn reached 4.7 million tons, the smallest for that month in six years








Wire story reported on Wednesday that pudgy poultry weighs on Tyson profits; broiler chickens went to slaughter at a higher average weight in June, Credit Suisse analysts say, adding to poultry meat supplies at a time when the US meat sector has been trying to recover from a period of low poultry prices; part of the reason behind the weight gains was the cool US spring and year-to-date US chicken production now is running 1% ahead of last year’s total at this point; Credit Suisse still figures chicken prices will rise enough this summer to offset an anticipated $250M in higher corn costs — used in chicken feed — but dials down EPS projection for Tyson’s fiscal 2019 to $5.83 from $5.91.


Weekly U.S. Poultry Stats

—Broiler-Type Eggs Set in the United States Up Slightly

—Broiler-Type Chicks Placed in the United States Up 1 Percent


Global food prices slipped in June, the Food and Agriculture Organization of the United Nations said snapping five consecutive months of inflation; declines in dairy and vegetable-oil prices more than offset rising cereal, sugar and meat prices; as a result, its headline food-price index fell 0.3% from May and was roughly level with where it stood in June 2018.


Saskatchewan crop report; scattered showers this past week brought more moisture to many areas of the province; although this additional rainfall has alleviated concerns of dry conditions in some areas, more will be needed to help crops develop; the majority of crops in the province are in poor to good condition, but crop conditions have improved with the recent moisture; provincially, crops are behind to normal in their stages of development for this time of year; sixty-six per cent of the fall cereals, 56 per cent of the spring cereals, 42 per cent of the oilseeds, and 70 per cent of the pulse crops are at their normal developmental stages for this time of year.




The northern Chinese province of Hebei issued an extreme heat ‘red alert’ on Thursday, with temperatures set to soar beyond 40 Celsius (104 Fahrenheit) in its major cities and putting the area’s corn crop at risk, the local government said; China’s weather bureau on Tuesday said that climate change could cause more extreme weather events, with rainfall breaking records in some regions and as many as 40 weather stations this year already registering their hottest temperatures ever.


—A tornado swept through the northeastern Chinese province of Liaoning on Wednesday, killing six and injuring 190, the state broadcaster said, amid a series of “extreme” weather events that government forecasters have linked to climate change.


—China says African swine fever cases slowing; pig output returning; Vice minister says pig output gradually returning to normal; comments made after asked about reports of fresh outbreaks; the number of fresh outbreaks of African swine fever in China has dropped this year and pig production is slowly returning to normal, its vice agriculture minister said, amid suspicions that the full extent of the disease is not being reported.


—China exempts state meat, soybean stockpilers from some taxes; China has decided to exempt companies stockpiling commodities including soybeans and meat in state reserves from certain taxes for three years, the country’s Ministry of Finance said; stockpilers including Sinograin, China Merchandise Reserve Management Center and storage facilities under their management will be exempt from stamp duties on trading contracts established in the process of stockpiling the commodities


POLL-EU wheat harvest set to rebound, export growth more modest

  • Poll average puts soft wheat crop up 10% from 2018
  • Heatwave impact seen moderate vs last year’s drought
  • EU exports to be capped by Russia flows, less corn supply

—on course to harvest 141.7 million tons of common wheat – or soft wheat – this year; that compares with a six-year low of 128.8 million in 2018 when severe drought ravaged northern Europe


The condition of French cereal crops declined in the week to July 1, farm office FranceAgriMer said, suggesting a negative impact from a record-breaking heatwave

—in a weekly crop report, FranceAgriMer estimated that 75% of soft wheat was in good or excellent condition by Monday, down from 80% a week earlier although still above a year-earlier score of 73%

—spring barley saw the sharpest deterioration, with the good/excellent rating losing 10 points to 76%


Kazakhstan plans to harvest 20.3 million tons of grain this year, the same level as in 2018, the Agriculture Minister said; after exporting 10.8 million tons of grain in the 2018/19 season, the Central Asian nation sees 2019/2020 season exports at 10 million tons


Bulgaria has confirmed two cases of African swine fever among backyard pigs


Selected highlights from a report issued by a U.S. Department of Agriculture attache in India


—On June 3, 2019, the Ministry of Agriculture raised its estimate of grain production for the Indian Crop Year (ICY) 2018/19 (July-June) to a near-record 283.4 MMT on record production of rice and wheat

—MY 2018/19 corn production is estimated at 26.5 MMT on lower planting and expected lower yield; MY 2019/20 corn production is still forecast at 27 MMT from 9.5 million hectares on lower yield due to the new pest, fall army worm.


India’s oilmeal exports dropped 56% in June from a year ago to 114,972 tons as shipments of soymeal and rapeseed plunged

—soymeal exports during the month plunged 83% to 18,185 tons, while rapeseed meal shipments fell 41% to 54,247 tons, the Solvent Extractors’ Association (SEA) said

—In the first three months of 2019/20 fiscal year started on April 1, India’s oilmeal exports fell 24% to 571,325 tons


India’s monsoon rains in the week ending on Wednesday were below average for the fifth time in a row, although the deficit was the lowest since the start of the season, after it revived in central and western regions


Malaysia June palm stocks seen dropping to nearly 1-yr low -Reuters survey

  • June stocks seen falling 4% to 2.35 mln T -survey
  • Output seen down 8% at 1.54 mln T -survey
  • Exports forecast to decline 19% to 1.39 mln T -survey
  • Malaysian Palm Oil Board data due July 10
Range Median
Production 1,469,000 – 1,585,594 1,538,000
Exports 1,380,000 – 1,453,721 1,386,624
Imports 55,000 – 80,000 61,951
Closing Stocks 2,316,000 – 2,401,000 2,350,000


US Weather looks near ideal