Global Ag News for June 3.24

TOP HEADLINES

River Rhine in Germany closed to shipping after rain raises water level

Parts of the river Rhine in southern Germany were closed to cargo shipping on Monday after heavy rains raised water levels, navigation authorities said.

Rhine river shipping stopped around Maxau and Mannheim in south Germany, the German inland waterways navigation agency WSA said.

The high levels of water leave vessels insufficient overhead space to sail under bridges, and prevents vessels sailing to Switzerland.

Shipping on northern sections of the river is operating normally, including the important points of Duisburg and Cologne.

The Rhine is an important shipping route for commodities including minerals, coal and oil products such as heating oil, grains and animal feed.

FUTURES & WEATHER

Wheat prices overnight are up 4 3/4 in SRW, up 6 in HRW, up 4 1/2 in HRS; Corn is down 2 1/4; Soybeans down 12; Soymeal down $3.50; Soyoil down 0.61.

Markets finished last week with wheat prices down 14 in SRW, down 6 1/2 in HRW, down 8 1/2 in HRS; Corn is down 20 3/4; Soybeans down 55; Soymeal down $25.30; Soyoil down 0.04.

Year-To-Date nearby futures are up 8.8% in SRW, up 11.3% in HRW, up 2.9% in HRS; Corn is down 5.8%; Soybeans down 7.8%; Soymeal down 6.4%; Soyoil down 6.1%.

Chinese Ag futures (JUL 24) Soybeans up 1 yuan; Soymeal down 19; Soyoil down 100; Palm oil down 38; Corn up 3 — Malaysian Palm is up 83. Malaysian palm oil prices overnight were up 83 ringgit (+2.08%) at 4076.

There were no changes in registrations. Registration total: 1,479 SRW Wheat contracts; 39 Oats; 747 Corn; 469 Soybeans; 2,589 Soyoil; 15 Soymeal; 0 HRW Wheat.

Preliminary changes in futures Open Interest as of May 31 were: SRW Wheat up 1,908 contracts, HRW Wheat up 2,209, Corn up 18,916, Soybeans up 4,810, Soymeal up 2,291, Soyoil up 127.

 

Northern Plains: A system brought scattered showers through the region this weekend. Another will move through Monday night and Tuesday with more showers. Drier weather is expected afterward for the rest of the week, though we may see some showers over southern areas this weekend. Another system moves through early next week. Though the pattern is turning less conducive for precipitation, it still seems some rainfall will be passing through some areas over the next week. Temperatures will generally be mild to cool, but not cold enough for frosts.

Central/Southern Plains: The pattern stayed active over the weekend with scattered showers and thunderstorms moving through a lot of the area, including over the southwestern drought areas. A couple of fronts moving through will bring additional showers through Tuesday before a brief break develops. A stalled front means that showers and thunderstorms likely return on Friday with potential continuing into early next week. Though some areas of flooding have and will continue to develop, and those left to plant may have some difficult conditions, the rainfall is good for early growth for crops.

Midwest: Scattered showers went through over the weekend, including some areas of heavy rain. A system moving through Monday and another moving through Tuesday and Wednesday will bring more scattered showers. Cooler and drier weather should follow, though an upper-level low may continue showers around the Great Lakes the rest of the week and a stalled front may bring more showers to southern areas this weekend. Those with planting left to do will find some more difficult conditions, though some drier weather later this week should be helpful. Soil moisture remains high in many areas for early growth.

Delta: Scattered showers and heavy rain moved through over the weekend and chances for more continue through Wednesday. Drier conditions should develop afterward, though a stalled front near northern areas could produce more rainfall this coming weekend.

Canadian Prairies: Isolated to scattered showers went through the region over the weekend and another system moving through Monday and Tuesday should bring more widespread rainfall. Northern and eastern areas may see showers continuing, but drier conditions are likely through the weekend. But another system will move through early next week. Recent showers may not have been enough to delay the rest of planting, but may have been an annoyance for those doing work. Soil moisture is much improved and early growth should find mostly good conditions.

Brazil: Drier weather over the weekend allowed flooding to recede while it was unfavorable for safrinha corn areas that are heading more toward maturity. A front will bring isolated showers to the far south on Monday, but dry weather should continue thereafter.

Argentina: Dry conditions have continued to favor corn and soybean harvest, but not winter wheat planting and establishment. A front brought limited showers through the region over the weekend, but most areas have stayed dry. Another couple of fronts could produce showers over southern areas later this week and weekend but generally look light, still unfavorable for wheat.

Europe: Scattered showers continued over much of central Europe over the weekend due to an upper-level low. The low will slowly drift eastward early this week but another front will push through the continent and settle west-east from northern Spain to Ukraine, a zone which will see scattered showers continuing. Some of these areas will welcome the rain while others will not. Heat south of the front may be stressful for those that are drier.

Black Sea: Some isolated showers continued over eastern areas over the weekend, which was helpful in some areas, but was overall pretty light in most areas. A front will move into northwestern areas and stall this week, bringing favorable showers through. Most wheat areas will stay unfavorably dry going into the weekend. Instead, heat continues to build throughout much of the region, producing stress for both winter and summer crops that are struggling in many areas.

Australia: Showers continued in eastern areas late last week and more came through western areas over the weekend, both being favorable for winter wheat and canola establishment. The western system will bring some rainfall to eastern areas through midweek and another front looks like it’ll go through western areas late week with another over the weekend. With the switch to La Nina continuing to develop, the prospect for rainfall should continue to increase over the next few months, very favorable for crop establishment and development.

The player sheet for 5/31 had funds: net sellers of 8,000 contracts of SRW wheat, sellers of 10,000 corn, sellers of 5,000 soybeans, and sellers of 2,000 soyoil.

TENDERS

• FEED WHEAT SALE: South Korea’s Major Feedmill Group (MFG) purchased an estimated 63,000 metric tons of animal feed wheat in an international tender on Friday seeking up to 132,000 metric tons
• SOYMEAL SALE: The Korea Feed Association (KFA) in South Korea purchased around 60,000 metric tons of soymeal to be sourced optionally from the United States, South America or China in a tender on Friday.
• WHEAT PURCHASE: Leading South Korean animal feed group Nonghyup Feed Inc. (NOFI) purchased around 60,000 metric tons of animal feed wheat in a private deal on Friday without issuing an international tende
• FAILED CORN TENDER: The Korea Feed Association (KFA) is believed to have rejected all offers and made no purchase in a tender on Friday to buy up to 68,000 metric tons of animal feed corn sourced from the United States, South America or South Africa only

PENDING TENDERS

• WHEAT TENDER: Algeria’s state grains agency OAIC has issued an international tender to buy soft milling wheat to be sourced from optional origins.
• WHEAT TENDER: Jordan’s state grain buyer has issued an international tender to buy up to 120,000 metric tons of milling wheat sourced from optional origins.

 

 

TODAY

US Export Sales of Soybeans, Corn and Wheat by Country

The following shows US export sales of soybeans, corn and wheat by biggest net buyers for week ending May 23, according to data on the USDA’s website.

• Top buyer of soybeans: Unknown Buyers with 148k tons
• Top buyer of corn: Mexico with 568k tons
• Top buyer of wheat: Unknown Buyers with 71k tons

 

US Export Sales of Pork and Beef by Country

The following shows US export sales of pork and beef product by biggest net buyers for week ending May 23, according to data on the USDA’s website.

• Mexico bought 23.2k tons of the 44.6k tons of pork sold in the week
• Japan led in beef purchases

 

USDA April soy crush estimated at 175.5 million bushels, analysts say

The U.S. soybean crush likely dropped in April to a seven-month low of 5.265 million short tons, or 175.5 million bushels, according to analysts surveyed by Reuters ahead of a monthly U.S. Department of Agriculture report due on Monday.

If the average estimate, gathered from eight analysts, is realized, it would be down 13.9% from 203.7 million bushels crushed in March and down 6.1% from the April 2023 crush of 187.0 million bushels.

Processing plant downtime for seasonal maintenance and repairs slashed crushing rates last month following a brisk crush pace since last autumn’s harvest, analysts said.

Crush estimates ranged from 173.4 million to 177.5 million bushels, with a median of 175.8 million bushels.

The USDA is scheduled to release its monthly fats and oils report at 2 p.m. CDT (1900 GMT) on Monday.

U.S. soyoil stocks as of April 30 were estimated at 2.229 billion pounds based on the average of estimates from five analysts.

The stocks, if realized, would be down 5.9% from 2.369 billion pounds at the end of March and down 12.2% from stocks totaling 2.540 billion pounds at the end of April 2023.

Estimates ranged from 2.173 billion to 2.275 billion pounds, with a median of 2.225 billion pounds.

The National Oilseed Processors Association reported that its members, which account for about 95% of soybeans processed in the United States, crushed 166.034 million bushels last month, while end-of-month oil stocks fell for the first time in six months to 1.755 billion pounds.

 

Argentina Soy Sales Picks Up on Better Prices Amid Brazil Floods

Farmer selling is accelerating as the harvest comes to a close thanks to better prices paid by crushers/exporters amid flooding that’s wiped out some of Brazil’s crop, the Rosario Board of Trade said in a weekly newsletter.

• Argentine farmers locked in prices for 1.7m metric tons of soy in the week ending May 22, a weekly record for the current trading season
• Prices paid for beans in Rosario have jumped by ~$30/ton in May from April, and premiums over Chicago have risen, despite downward pricing pressure that harvest season usually brings
  • Higher prices are luring farmers even though many consider the FX rate too strong
• NOTE: Farmers traded 18.2m tons of soy through May 22, according to government data
  • Of those trades, more than half remain unpriced. Dollars from soy exports aren’t generally sold on Argentina’s FX market — boosting reserves at the central bank — until farmers fix prices

 

Below-average rain forecast for Argentina’s key farm areas in next three months

Rainfall will likely be below normal in the western part of Argentina’s agricultural heartland over the next three months, the country’s National Weather Service said on Friday, forecasting normal to below-normal rainfall for the rest of the Pampas region.

The decrease in precipitation will occur during the closing of Argentina’s 2023/24 soybean and corn harvest, and wheat planting for the new 2024/25 season.

Below-normal rainfall will be beneficial for Argentine farmers finishing the delayed soybean and corn harvest, and will allow wheat planting to move forward at a steady pace. Soil moisture for wheat is good.

The areas of Argentina’s agricultural heartland that will see a greater drop in rainfall will be northwest Buenos Aires province, southeast Cordoba province and west Santa Fe province.

However, scarce rainfall could hamper wheat development late in the period, as well as cause delays or difficulties in the planting of soybean and 2024/25 corn in September and October.

According to the U.S. government weather agency NOAA, a La Niña weather phenomenon is expected in the Equatorial Pacific starting in June.

The atmospheric impact of La Niña – a warming of the surface temperature of the equatorial Pacific Ocean – in Argentina is a decrease in the usual precipitation levels.

COLDER WINTER

For June to August, during the Southern Hemisphere winter, the National Weather Service said it foresees below-normal temperatures in much of Argentina’s core agricultural area.

Cold weather would help combat the spread of leafhoppers, an insect that is a vector of diseases and caused serious damage to corn this season, because they do not tolerate temperatures below 4 degrees Celsius.

The National Weather Service report also forecast below-normal temperatures in the north and northeast of Argentina – which are more marginal agricultural areas, but where the highest number of leafhoppers was.

 

Australia’s Wheat Crop to Rise as Much as 5.7% on Rain: Rabobank

Australia’s 2024-25 wheat crop could increase 5.7% y/y to 27.4m metric tons, dependent on higher rainfall mid-to-late in the year, Rabobank analyst Vitor Pistoia said in an report on Monday.

• Area of wheat planted to increase 7.7% to 13.48m hectares (33.3m acres)
• Wheat exports to reach 19.8m tons
• Australian premium wheat port prices could be between 8-12% lower than on Dec. 1 last year
• Canola production to fall 11% to 5m tons
  • Area of canola planted to decrease 13% to 3.11m hectares
  • Canola exports to reach 3.6m tons
• Barley production forecast to fall 7.2% to 10m tons
  • Area of barley planted to increase 5.1% to 4.33m hectares
  • Barley exports to reach 3.9m tons

 

SOYBEAN/CEPEA: Prices drop due to supply in South America and planting in the US

Soybean prices decreased in this late May because of the high supply in South America and of the good pace of sowing activities in the United States. In spite of the decrease of the output in Brazil this season, the final stage of the harvest and attractive prices have been leading sellers to increase the availability of soybean in the spot market.

According to data from Conab, 98.1% of the 45.7 million hectares planted in Brazil had been harvested up to May 26.

In Argentina, the 2023/24 harvest reached 86% of the area until May 29. In the US, planting activities of the 2024/25 season hit 68% of the total up to May 26.

The ESALQ/BM&FBovespa Index (Paranaguá) downed 1.7% from May 23-29, closing at BRL 137.75 per 60-kg bag on May 29. In the partial of this month, the average is at BRL 135.92/bag, the highest of this year, in real terms (IGP-DI April).

The CEPEA/ESALQ Index (Paraná) dropped 1.1% comparing May 23-29, to close at BRL 133.36 per 60-kg bag. The average in the partial of May is at BRL 130.84/bag, also the highest of 2024, in real terms.

On the average of the regions surveyed by Cepea, soybean prices moved down 0.9% in the over-the-counter market (paid to farmers), but rose 0.3% in the wholesale market (deals between processors).

BYPRODUCTS – Soybean meal values are moving up due to the firm demand, both international and domestic. On the average of the regions surveyed by Cepea, soymeal prices increased 3% between May 23 and 29. As for the soy oil, the firm demand from the food industry sustained quotations. The price upped 0.2%, at 5.330,59 BRL per ton (in São Paulo city with 12% ICMS) on May 29.

 

CORN/CEPEA: Harvest advances; prices register distinct trends

The harvest of the first and second corn crops continue to progress in Brazil. However, players are uncertain about the second crop production in some regions. The weather in May did not bring relief for crops conditions, especially in the South, Southeast and in parts of the Central-West.

Prices, in turn, have been presenting distinct behaviors among regions surveyed by Cepea, influenced by different conditions of supply and demand. In Goiás and Mato Grosso, where the weather has been more favorable for crops, the higher supply has pressed quotations down. On the other hand, in Paraná, Mato Grosso and Rio Grande do Sul, unfavorable weather conditions concern players and boost values, as the supply of high-quality cereal has decreased. In consuming areas, such as in parts of São Paulo, prices dropped because purchasers refrained from closing deals.

In general, purchasers indicate to have stocks. Most sellers, in turn, evaluate local conditions in order to offer new batches.

From May 23-29, the ESALQ/BM&FBovespa Index (Campinas, SP) dropped 0.8%, closing at BRL 59.29 per 60-kilo bag on May 29 – in the accumulated of the month, however, the Index rose 2.3%. On the average of the regions surveyed by Cepea, corn values moved up 0.7% in the wholesale market (deals between processors) and 2.6% in the over-the-counter market (paid to farmers) between May 23 and 29.

At the port of Paranaguá (PR), values closed at BRL 61.64/bag on May 29, for a decrease of 0.9% in relation to May 23.

Data from Secex indicate that Brazilian corn shipments totaled 277.72 thousand tons in 17 producing days of May, against 384.88 thousand tons observed in May 2023 (22 working days).

Conab says that, up to May 26, the harvest of the second crop reached 1.1% of the total; in the same period of 2023, activities were at 0.4%. As for the summer crop, the harvest hit 78.4% of the area until May 26.

 

Strategie Grains cuts rapeseed crop forecast to 10% below 2023

Consultancy Strategie Grains cut its forecast for this year’s rapeseed output in the European Union by 180,000 metric tons to 17.94 million tons, now 10% below last year’s harvest, due to wet weather in France and frosts in central Europe.

Heavy rains in the European Union’s largest rapeseed grower France since the autumn have delayed sowings, flooded fields and is hurting grain quality.

In contrast, late frosts recorded in April were not expected to have as much of a negative impact in France as in central EU countries such as the Czech Republic and Slovakia, the consultancy said in a report.

“The crops (in France) are mainly penalised by the frequency of rainfall and the waterlogging of fields,” it said, adding that some fields will need to be replanted.

In the second-largest rapeseed producer Germany, conditions were satisfactory for flowering with average temperatures close to seasonal norms.

Strategie Grains noted that the rapeseed balance would be tight next season due to the anticipated fall in output and low carry-in stocks, which would only be partly offset by higher imports from third countries, mainly from Ukraine and Australia.

Strategie Grains slightly lowered its projection for the EU sunflower harvest in 2024 to 10.72 million tons, down from 10.75 million previously, but still 10% above 2023.

Its soybean output forecast was slightly cut to 3.06 million tons, from 3.11 million earlier, up about 5% from last year’s 2.9 million tons.

 

Heat Wave to Continue Over India’s Northwest, Central Regions

Heat-wave conditions over India’s northwest, central and eastern regions are likely to continue with reduced intensity during next three days, according to the India Meteorological Department.

• Conditions are favorable for the further advance of the southwest monsoon into parts of the central Arabian Sea, Karnataka and Andhra Pradesh during next two to three days: IMD

 

US Beef Production Up 1.7% This Week, Pork Down: USDA

US federally inspected beef production rises to 516m pounds for the week ending June 1 from 507m in the previous week, according to USDA estimates published on the agency’s website.

• Cattle slaughter up 1.5% from a week ago to 607m head
• Pork production down 1.3% from a week ago, hog slaughter falls 1.2%
• For the year, beef production is 2% below last year’s level at this time, and pork is 0.2% above

 

China’s grain storage capacity exceeds 700 mln tonnes by end of 2023: official

China’s continued construction of grain warehouses, including green facilities, brought the national grain storage capacity to over 700 million tonnes by the end of 2023, an increase of 36 percent from 2014, according to an official of the National Food and Strategic Reserves Administration.

Since the start of the 14th Five-Year Plan period (2021-2025), China has built and upgraded grain storage facilities with a total capacity in excess of 65 million tonnes. Key performance indicators such as airtightness and thermal insulation levels have significantly improved, said Zhou Guanhua, director of the administration’s safe storage and technology department, as quoted in a report published by Science and Technology Daily on Friday.

In recent years, China has established a comprehensive grain storage system that is compatible with grain production, reserves and distribution, Zhou said, adding that China’s grain storage facilities have met the country’s grain purchase and storage needs in terms of overall capacity.

Outdated means of storing grain, including stack storage and open-air piles, have been largely eliminated across the country, while “four-in-one” grain storage technologies — covering mechanical ventilation, fumigation, monitoring and cooling — have been applied as a standard in state-owned grain warehouses, improving grain storage quality and freshness further, the official said.

China has also been promoting green grain storage technologies in its grain warehouses, covering such areas as temperature control, internal circulation and comprehensive pest control.

By the end of 2023, the total storage capacity of low-temperature and near-low-temperature grain warehouses nationwide had climbed to 200 million tonnes, and the comprehensive loss rate of state-owned grain warehouses remained within a reasonable range of 1 percent, Zhou said.

 

US Nitrogen Prices Slip as Market Shifts to Seasonally Slower 2Q3

Prices for ammonia were down at Tampa and in the US Midwest as spring demand slows. New Orleans and inland urea was also lower, while urea prices continued to climb in several international markets. Global nitrogen and phosphate imports are sluggish, while those for potash are surging in year-to-date trade.

 

Brazil Fertilizers Stable to Firm as Soybean Demand Continues

Fertilizer prices in Brazil were steady for potash and higher for urea, ammonium sulfate and phosphates in an active buying period, with sellers focused primarily on potash and phosphates for soybean demand. Nitrogen increases were fueled by firming international prices in late May.

 

 

 

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