AM Comments 053119

By ADM Investor Services Research Team


Wheat prices overnight are down roughly 4 cents in the SRW Wheat, down 1 in HRW, and down 1 for HRS; Corn is down 3 cents; Soybeans down 3; Soymeal down $1.00, and; Soyoil down 10 points.


For the week, Winter Wheat prices are up roughly 22 cents for Soft Red Winter, up 35 in the Hard Red Winter, and up 19 for Hard Red Spring; Corn is up 29 cents; Soybeans up 56; Soymeal up $25.00, and; Soyoil up 70 points (crushing margins are up roughly 6 cents at $1.33, oil-share is down 2% at 29%).


For the month, Winter Wheat prices are up roughly 76 cents for Soft Red Winter, up 82 for Hard Red Winter, and up 54 for HRS; Corn is up 67 cents; Soybeans up 38; Soymeal up $27.00, and; Soyoil down 20 points (crushing margins are up 20 cents at $1.33, oil-share is down 2% at 29%).


For the year, Winter Wheat prices are up roughly 8 cents for Soft Red Winter, down 10 for Hard Red Winter, and up 14 for Hard Red Spring; Corn is up 58 cents; Soybeans up 4; Soymeal up $20.00, and; Soyoil up 15 points (crushing margins are up 41 cents at $1.35, oil-share is down 2% at 29%).


Chinese Ag futures (September) settled down 31 yuan in Soybeans, down 9 in Corn, up 15 in Soymeal, down 4 in Soyoil, and unchanged in Palm Oil.


The Malaysian Palm Oil market was down 13 ringgit at 2,071 (basis August) following rival oils again.


Latest weather forecast in the Midwest has showers and thunderstorms that will limit drying through the June 9 period but, conditions won’t be as bad as they were over the past week.


The U.S. Delta, Southeast still has a dry outlook.


The player sheet had funds net buyers of 13,000 contracts of SRW Wheat; bought 48,000 Corn; bought 16,000 contracts of Soybeans; net bought 7,000 lots of Soymeal, and; bought 2,000 Soyoil.


We estimate Managed Money net short 21,000 contracts of SRW Wheat; net long 33,000 Corn; net short 102,000 contracts of Soybeans; short 6,000 lots of Soymeal, and; net short 56,000 Soyoil.


Preliminary Open Interest saw SRW Wheat futures up roughly 6,300 contracts; HRW Wheat up 1,500; Corn up 12,500; Soybeans down 1,200 contracts; Soymeal down 1,700 lots, and; Soyoil down 2,700 lots.


There were no changes in registrations—Registrations total 98 contracts for SRW Wheat; 2 Oats; Corn 1,036; Soybeans 640; Soyoil 3,547 lots; Soymeal ZERO; Rice 663; HRW Wheat 5, and; HRS Wheat 376 contracts.





In tender activity—Tanzania to export 700,000t corn to Zimbabwe—S. Korea bought 60,000t each of optional-origin corn, feed wheat, soymeal—


President Trump said Thursday the U.S. would impose escalating tariffs on all Mexican imports beginning June 10, in an effort to push the country to deter the flow of asylum-seeking Central American families to the southern border.


Wire story reports U.S., China firms scramble as new tariffs hurt business; new Chinese tariffs start June 1, after latest US tariffs began May 9; many companies absorbed first 10% tariff imposed in Sept; now importers seeking to pass on costs, seek alternatives



The Trump administration has decided to approve expanded use of ethanol fuel, a move that will help corn farmers hurt by the trade conflict with China — and that might pay political dividends for President Trump in farm-belt states such as Iowa; under the decision to be made public Friday, the Environmental Protection Agency will allow gasoline with a 15% mix of ethanol to be sold year-round, instead of just eight months a year, effective as soon as it is published in the Federal Register, which officials expect to happen within days.


Trade estimates for USDA weekly grain, soy export sales – Reuters News

Trade estimates for 2018-19 Trade estimates for 2019-20
Wheat 50,000-250,000 150,000-350,000
Corn 350,000-650,000 100,000-200,000
Soybeans 250,000-450,000 0-200,000
Soymeal 100,000-250,000 50,000-125,000
Soyoil 8,000-22,000 0


Ethanol production and inventories were both down this week, according to data from the EIA; ethanol production came in at a rate of 1.057M barrels per day, down slightly from 1.071M barrels last week; inventories dropped 780,000 barrels to 22.624M barrels.


Global grain consumption will grow faster than supply in the 2019-20 season, the International Grains Council said Thursday, a combination that would squeeze inventories for a third straight year; the intergovernmental organization forecast that grain consumption would rise 1.2% from a year prior to 2,192 million tons, driven by a 1.5% increase in industrial grain usage; total grain supply, a combination of production and the previous year’s stockpiles, is expected to grow by only 0.4%; as a result, the IGC said grain inventories will continue to run down, falling by 2.4% to 602 million tons at the end of the 2019-20 season.


Poultry processor Sanderson Farms is bracing for higher feed prices thanks to the delayed planting of corn in the Midwest; only sees its average feed price rising by less than a cent per pound through 2H of the year, although it is paying close attention to the factors pushing up corn futures currently; the company’s feed costs were roughly 25 cents per pound for the first half of the year; in 3Q, the company expects an average price of 25.25 cents per pound, and for 4Q the company expects a price of 25.85 cents per pound–a rise of 3.4%.


CME Group announced an all-time daily volume record for agricultural futures and options of 3,228,143 contracts traded on May 29, surpassing the previous record of 3,197,646 set on June 19, 2018; since the end of 2018, the open interest (OI) in CME Group agricultural futures and options has grown 30% to 9,353,259 contracts.


Saskatchewan crop report

— Seeding of the 2019 crop is nearing completion, with the majority of the crop being planted this month; ninety-two per cent of the crop is now seeded, up from 73 per cent last week and well ahead of the five-year average (2014-2018) of 83 per cent for this time of year


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

—The Fall Armyworm – a crop-eating pest – first detected in China in January 2019 has now spread across 15 Chinese provinces and currently impacts about 90,000 hectares (1.35 million mu) of grain production


Recent dry weather in Argentina gave momentum to wheat planting for the 2019-20 season, which began last week and would cover 6.4 million hectares, the Buenos Aires Grain Exchange said; by Wednesday, farmers had planted 7.7% of the planting area

—The grains exchange said that 90.7% of the soybean planting area for the 2018-19 had already been harvested; production is expected to total 56 million tons

—Argentine producers have also harvested 37.4% of the commercial corn planting area for the 2018-19 season, which will produce a record harvest of 48 million ton


Brazilian mills will buy at least 5.5 million tons of wheat from Argentina in 2020 and 2.25 million tons of the grain between June and November this year, the Argentine government said after a meeting with counterparts in Brazil; the announcement comes months after Brazil spooked Argentine farmers when it agreed to import 750,000 tons of wheat from the United States and other countries outside the regional Mercosur block, waiving the 10% levy normally applied.


Farm office FranceAgriMer estimated in a weekly report on Friday that 79% of soft wheat in France, the European Union’s biggest crop producer, were in good or excellent condition by May 20, unchanged from a week earlier; that compared with an 80% score for soft wheat crops at the same stage last year

—rated 76% of French winter barley as good/excellent, up from 75% a week earlier, while the equivalent spring barley rating was stable at 88%.

—For corn, the good/excellent score declined to 81% from 83%; sowing of grain maize was 99% complete versus 97% a week earlier


South Korea said Friday that it is scrambling to prevent the spread of the highly contagious African swine fever on its pig industry after North Korea confirmed an outbreak at a farm near its border with China.


Exports of Malaysian palm oil products for May rose 6.5 percent to 1,688,104 tons from 1,584,660 tons shipped during April, cargo surveyor Societe Generale de Surveillance said

—Malaysia’s palm oil exports during the May 1-31 period are estimated up 7.1% on month at 1,688,422 metric tons, cargo surveyor AmSpec Agri Malaysia said




World Weather, Inc.