Global Ag News for May 10.24

TOP HEADLINES

Palm Oil Reserves Unexpectedly Rise in Malaysia on Higher Output

Palm oil stockpiles in Malaysia surprisingly climbed in April after shrinking for five months as production in the world’s second-biggest grower swelled more than expected and exports declined.

Inventories advanced 1.9% from a month earlier to 1.74 million tons, according to data released by the Malaysian Palm Oil Board on Friday. That’s above estimates in a Bloomberg survey last week that predicted inventories to drop to a one-year low of 1.63 million tons.

“The report is slightly bearish as stockpiles and production were higher than market estimates,” said Anilkumar Bagani, head of research at Mumbai-based Sunvin Group. But that’s being priced in as prices have recently fallen, he said.

Crude palm oil output increased 7.9% to 1.50 million tons, higher than the earlier estimate of 1.45 million tons. Exports, meanwhile, fell 7% to 1.23 million tons, against the forecast of 1.21 million.

Palm oil could attract some bargain buying if it dips below 3,690 ringgit ($779) a ton, especially given that inventories in top producers Indonesia, Malaysia and Thailand are still relatively low, and China may replenish its palm oil stocks, Bagani said.

FUTURES & WEATHER

Wheat prices overnight are up 15 3/4 in SRW, up 17 3/4 in HRW, up 15 3/4 in HRS; Corn is up 3; Soybeans up 3; Soymeal up $1.60; Soyoil up 0.46.

For the week so far wheat prices are up 30 3/4 in SRW, up 19 1/4 in HRW, up 5 in HRS; Corn is down 3/4; Soybeans down 3 1/2; Soymeal up $2.30; Soyoil up 0.02.

For the month to date wheat prices are up 50 in SRW, up 34 1/4 in HRW, up 15 1/4 in HRS; Corn is up 12 3/4; Soybeans up 48 1/2; Soymeal up $22.60; Soyoil up 0.06.

Year-To-Date nearby futures are down 1.3% in SRW, up 5.3% in HRW, down 2.1% in HRS; Corn is down 5.9%; Soybeans down 7.5%; Soymeal down 4.7%; Soyoil down 12.2%.

Chinese Ag futures (JUL 24) Soybeans down 40 yuan; Soymeal down 46; Soyoil down 118; Palm oil down 112; Corn down 6 — Malaysian Palm is down 18. Malaysian palm oil prices overnight were down 18 ringgit (-0.47%) at 3813.

There were changes in registrations (9 Oats). Registration total: 1,479 SRW Wheat contracts; 18 Oats; 795 Corn; 469 Soybeans; 2,589 Soyoil; 226 Soymeal; 0 HRW Wheat.

Preliminary changes in futures Open Interest as of May 9 were: SRW Wheat up 3,862 contracts, HRW Wheat up 2,072, Corn up 12,537, Soybeans down 8,447, Soymeal down 21, Soyoil down 505.

Northern Plains: Rains will keep any fieldwork slow for the next couple of days as soils recover. Additional fronts and systems will move across the region through next week but contain more isolated showers as planting windows will open back up again. Temperatures will waffle around as these fronts come and go.

Central/Southern Plains: Some isolated showers will pop up for the rest of the week, but many areas will remain dry, which will help open up some planting windows for areas that have had some heavy rain lately. Wheat conditions in the southwest still are not great, even after some decent rainfall over the weekend. But the southern storm track may be more active starting this weekend that continues through next week, which may promote some better rainfall chances there. Areas farther north will see some rainfall as well, but is less likely to be heavy, allowing for planting windows to remain open just a bit.

Midwest: Recent rainfall has been too heavy in a lot of areas, slowing down or halting planting. After a cooler weekend, temperatures will likely waffle a bit through next week as the pattern remains active with fronts and systems. However, these systems are less likely to contain widespread heavy rain as they come from the northwest. Some areas may still get heavy rain, or at least enough to keep planting at a slower pace than optimal, though.

Delta: The region will stay active with another system for early next week and probably another for later next week. The active weather will ensure good soil moisture, but may be too wet in some areas for further planting. However, the region continues to see good planting progress in the face of the wetter conditions.

Brazil: Recent heavy rain over Rio Grande do Sul has produced catastrophic flooding over the last two weeks. The front responsible for the rain has shifted back into the area and will waffle around the state yet again through Monday. Flooding, mudslides and crop damage are all putting a damper on what was a pretty good crop season and making for massive delays in winter wheat planting. Safrinha corn in the central will continue to be very dry and hot as well. Southern corn areas may catch some of the rain from the front later next week.

Argentina: A front was pushed back north into Paraguay and Brazil on Wednesday. Colder and drier conditions are following that. That may be able to increase corn and soybean harvest, but may mean widespread frosts for any immature crops for several days going into next week. The drier pattern lasts through at least next week.

The player sheet for 5/9 had funds: net buyers of 2,000 contracts of SRW wheat, sellers of 1,000 corn, buyers of 6,000 soybeans, sellers of 2,000 soymeal, and sellers of 3,500 soyoil.

TENDERS

• CORN SALE: The U.S. Department of Agriculture confirmed private sales of 132,080 metric tons of U.S. corn to Mexico including 60,960 tons for delivery in the 2023/24 marketing year that began Sept. 1, 2023, and the remaining 71,120 tons for 2024/25 delivery.
• CORN PURCHASE: The Korea Feed Association (KFA) purchased an estimated 65,000 metric tons of animal feed corn in an international tender on Thursday seeking up to 69,000 tons
• VEGETABLE OILS PURCHASE: Egypt’s state grains buyer, the General Authority for Supply Commodities, said it bought 102,000 metric tons of vegetable oils in an international tender. The purchase comprised 73,000 tons of sunflower oil and 29,000 tons of soyoil, GASC said.
• WHEAT PURCHASE: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) bought 114,077 metric tons of food-quality wheat from the United States, Canada and Australia in a regular tender that closed on Thursday.

PENDING TENDERS

• WHEAT TENDER: Jordan’s state grain buyer issued an international tender to buy up to 120,000 metric tons of milling wheat which can be sourced from optional origins.
• FEED WHEAT AND BARLEY TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) said it will seek 65,000 metric tons of feed wheat and 25,000 tons of feed barley to be loaded by Aug. 31 and arrive in Japan by Oct. 31, via a simultaneous buy and sell (SBS) auction that will be held on May 15.

 

 

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 2, according to data on the USDA’s website.

• Top buyer of soybeans: Unknown Buyers with 169k tons
• Top buyer of corn: Mexico with 236k tons
• Top buyer of wheat: Mexico with 129k tons

China’s Corn Imports Set to Drop by a Third in Coming Year

Corn imports by China, the world’s top buyer, are poised to fall by a third in 2024-25 from a year earlier as the gap narrows between demand and local production, according to the nation’s agriculture ministry.

Soybean purchases from overseas are likely to decline by 1.6% in the coming crop year from a year earlier, due to a shrinking hog herd and falling use of soybean meal in feed, it said in a monthly report.

The lower imports come as a recovery in the world’s second-largest economy struggles to gain momentum, casting a shadow over consumption of farm products from pork to edible oils. Fewer Chinese purchases on the world market may pressure prices of agricultural commodities.

Domestic corn output in 2024-25 is set to climb by 2.8%, reflecting an increase in planting acreage and higher yields, while consumption of corn is seen rising 1.6%, according to the latest China Agricultural Supply and Demand Estimates.

The ministry has said previously that only a limited amount of corn imports in the current year are expected to circulate in the market, signaling that a significant quantity would probably be destined for state stockpiles.

Key CASDE figures for 2024-25 Corn imports seen at 13 million tons, down from 19.5 million tons in the previous year

• Corn output forecast at 297.01 million tons, up 2.8% on a year earlier; consumption seen rising 1.6% to 299.64 million tons
• Soybean imports forecast at 94.6 million tons, down 1.6% on year
• Cotton output seen at 5.58 million tons, down 0.7% on year; consumption expected to be 7.8 million tons, up 1.4%
• Edible oils consumption seen down 700,000 tons from a year earlier, at 36.65 million tons, due to a falling population and increased health awareness
• Sugar production seen at 11 million tons, up from 9.95 million tons, as farmers plant more of the crop because of higher profits

Argentina Soy Forecast May Be Cut Due to Slow Harvest: Bourse

The soy harvest is picking up but continues to trail the average for this time of year by 13 percentage points, the Buenos Aires Grain Exchange said in a weekly report.

• “If the progress rate of fieldwork continues like this, our forecast of 51m metric tons may be affected”: Bourse
• Soy harvest is 48% complete

Argentine Soybean, Corn Estimates May 9: Exchange

The Buenos Aires Grain Exchange releases weekly report on website.

• 2023-24 corn and soybean production estimates maintained
• Corn harvest at 23.4% complete vs 22.1% in the previous week
• The following table compares most current data to previous week and last year’s crop:

Argentina 2024-2025 Wheat Output Seen Rising 20% to 18.1m Tons

Argentina’s 2024-2025 wheat crop is estimated to yield 20% more than the previous harvest, thanks in part to recent plentiful rains that have set farmland up well for the growing season, according to the Buenos Aires Grain Exchange.

• Farmers benefiting from a recent price rally and reduced import tariffs on chemical inputs will expand acreage by 5.1% to 6.2m hectares (15.3m acres), the exchange’s chief economist Ramiro Costa said in a report
• NOTE: Argentina wheat planting mainly happens in June and July, with the bulk of harvesting in Nov. and Dec.
• The barely crop is expected to be 5.1m metric tons, a y/y increase of 2%
• Argentina is seen exporting 11.5m tons of 24-25 wheat, up 24% y/y
• The combined value of 24-25 wheat and barley shipments would be $3.8b, up 21% y/y

Spoiled soy in Brazil flood-hit state affects national soy forecast -AgResource

Devastating floods that hit Brazil’s Rio Grande do Sul state should cause farmers to lose an estimated 1.32 million metric tons of soybeans there, affecting overall soybean output in the world’s largest producer and exporter of the oilseed, consultancy AgResource said on Thursday.

The new estimate puts soybean production in Brazil’s southernmost state at 20.1 million tons, which still ranks it as the second biggest soybean producer in Brazil, behind only Mato Grosso.

Brazil’s total soybean crop is now forecast at 144.59 million tons, compared with 145.46 million tons projected previously, a 870,000-ton difference, AgResource said.

The reduction in the national harvest estimate is smaller than the total losses projected for Rio Grande do Sul because AgResource rose the estimated size of soy planted area in other parts of country, the consultancy’s general-director Raphael Mandarino said.

AgResource also cut the corn harvest of Rio Grande do Sul by around 830,000 tons. The state is now expected to produce 4.4 million tons of the cereal.

The unprecedented weather events that swept southern Brazil caught farmers in the finishing stages of the corn and soy harvests. Over the past days, heavy downpours left farmland and entire towns under water, killing people, livestock and destroying critical infrastructure.

Rio Grande do Sul, which does not plant a second corn crop like farmers in Central Brazil, is the country’s largest corn producer in summer.

AgResource also revised Brazil’s total corn harvest estimate, putting it at 113 million tons, a reduction of 0.95% compared to the previous forecast.

Argentina grains ports, soy crushing plants idle due to general strike

Argentine grains ports and soybean crushing plants in the area surrounding the major Rosario hub are standing idle due to a nationwide strikelaunched on Thursday, the head of the major grains exporting nation’s oilseed export chamber said.

“None of the ports and factories are operating,” according to chamber president Gustavo Idigoras. “There aren’t any problems or disturbances but everything is closed.”

Guillermo Wade, who leads the CAPyM chamber of port and maritime activities, confirmed the stoppage.

“The unions have all joined, so activity is totally affected,” he said.

Unions called a 24-hour general strike against the harsh austerity measures implemented by libertarian President Javier Milei.

The spending cuts, which appear to be slowing the country’s near 300% inflation rate and have momentarily eliminated the fiscal deficit, are also increasing poverty and unemployment as consumption collapses.

The strike action comes as farmers reap the country’s major soybean and corn harvests, bringing ports into what is traditionally one of the busiest times of the year.

While crushing and port worker groups are participating in the strike the farmers’ Argentine Rural Confederations (CRA) said it was not striking: “To overcome our Nation’s crisis we must keep working,” the group said on X.

Bunge Halts Soybean Crushing Plant in Southern Brazil on Floods

Bunge has suspended operations at its Rio Grande, Rio Grande do Sul-based soybean crushing plant amid forecasts for more rains and floods over the next few days, the company said in a statement.

• Activities at Bunge’s terminal at the port of Rio Grande have also been halted
• Decision was taken as a precautionary measure
• Operations will remain halted until a safe return is possible

Brazil soy, corn harvesting in flood-hit state advances slowly

Soy and corn harvesting in Rio Grande do Sul state has progressed slowly, according to fresh estimates by crop agency Emater on Thursday, which confirm fears that floods continue to disrupt field work and will impose heavy losses on local farmers.

In a weekly report issued Thursday, Emater calculated 78% of the soy area had been reaped so far in Brazil’s southernmost state, short of the 89% historical average for the period.

Emater also said local growers harvested 86% of the corn area, an advance of just three percentage points from a week ago.

“Farmers were able to harvest some areas on the west frontier,” Claudinei Baldissera, an official with Emater, told Reuters, referring to soybeans. He noted the largest areas yet to be harvested are where the worst the flooding occurred.

“The quality of the grains taken from mature fields, which received rains for several days, is inappropriate,” Emater’s new report said. It concluded many fields will not be harvested because the grains “are unusable”

“The ideal stage for harvesting has been considerably exceeded,” Emater wrote, meaning soy farmers face significant discounts if they reap grains from fields under the present conditions. Weather forecasts call for more rain, Emater said.

In the region of Santa Maria and in the south of the state, growers delayed soy planting due to excess showers when fields were being sowed, Baldissera said. These are areas where most of the state’s soy remains in the fields, he noted.

The flooding of farmland and towns in southern Brazil killed people, livestock, crippled infrastructure and is hampering shipping of grains to local processors and the Rio Grande port.

In the Campanha region, harvesting resumed in areas with better drainage, Emater said. However, severely damaged roads are full of heavy trucks stuck in the mud. Transportation hiccups may further hinder soybean quality, the agency said.

According to Emater data, farmers planted corn on about 812,000 hectares (2.0 million acres) and soybeans on almost 6.7 million hectares in Rio Grande do Sul.

So far, Emater has not been able to calculate exact ouptut losses for soy and corn farmers, though it said they are likely to be high due to the elevated loss of yield potential.

Also, Baldissera said Emater needs more time to assess the extent of damage done to food silos in lower areas, some of which were full with recently harvested rice and soy.

Dry Weather in Australia’s Top Grain State Raises Crop Concerns

• Soil moisture profiles are historically very dry, GIWA says
• Group cuts planted wheat forecast to 4.7 million hectares

Persistent dry weather in parts of Western Australia has raised concerns over the outlook for the upcoming season as crop planting continues, according to a monthly industry report.

Farmers in the northern and eastern growing regions will pull back on intended plantings and leave some paddocks to fallow if they don’t get rain over the next two weeks, according to the Grains Industry of Western Australia. The state is the nation’s biggest grain producer.

Australia is a major exporter of grains from wheat to barley and any impact to production could underpin some tightening of the market and boost prices. Wheat futures recently rallied to the highest level since August due to dry weather, while war continues to threaten supplies elsewhere.

“Soil moisture profiles are historically very dry this year and the light falls of rain are either being sucked up like a sponge or are evaporating before it soaks in,” the Western Australian industry group said.

Most regions in Western Australia have sown over 50% of their intended area, but a lack of rain in coming weeks could reduce the planting scope by several hundred thousand hectares, the association said. However, that could swing the other way by a similar margin if there is decent rainfall.

The association trimmed its estimate for planted wheat in 2024 to 4.7 million hectares, compared with an April forecast of 4.96 million. The projection for overall planted grains was cut to about 8.5 million, from 8.6 million.

El Nino to end by June, La Nina seen in second half of 2024, says U.S. forecaster

The El Nino weather pattern should fade out by June but could be replaced by the La Nina phenomenon by the second half of the year, a U.S. government forecaster said on Thursday.

There is a 49% chance that the La Nina weather pattern may develop during the June to August period, rising to 69% in July-September, the National Weather Service’s Climate Prediction Center (CPC) said in its monthly forecast.

US Miss. River Grain Shipments Fall, Barge Rates Increase: USDA

Barge shipments down the Mississippi river declined to 421k tons in the week ending May 4 from 442k tons the previous week, according to the USDA’s weekly grain transportation report.

• Barge shipments of corn rose 5.6% from the previous week
• Soybean shipments down 43% w/w
• St. Louis barge rates were $9.14 per short ton, an increase of $0.72 from the previous week

Drought Continues to Ease in US Corn and Soybean Regions: USDA

The following table shows the percent of US agricultural production within an area that experienced drought for the week ending May 7, according to the USDA’s weekly drought report.

• Corn area experiencing moderate to intense drought fell to 14% vs 19% in the previous week
• This comes after last week’s report showed a 4 percentage point drop
• Soybean area in drought declined by 6 percentage points to 11%
• Spring wheat declined by 12 points to 15% in drought

 

 

Interested in more futures markets?  Explore our Market Dashboards here.