Global Ag News for May 31.24

TOP HEADLINES

US Farm Bill to Deliver Internet Boost for Smart Tractors: BNEF

• Around 60% of farmers have insufficient internet access
• Precision farm tech is held back by rural service levels

A draft of the long-awaited US Farm Bill contains unexpected measures to improve internet connectivity in rural communities, which would lower one barrier to adopting precision agriculture technologies including intelligent vehicles.

The Republican-led House Committee on Agriculture on May 24 voted to advance the Farm, Food and National Security Act, better known as the Farm Bill, for consideration by lawmakers on the House floor by a margin of 33-21, with support from four Democrats. An alternative bill is being developed by the Democrat-chaired Senate Committee on Agriculture, Nutrition and Forestry. The two bills must be reconciled and it’s unclear if either will be tabled before the Nov. 5 presidential election.

The House bill includes provisions to increase 5G penetration across the country. This addresses existing connectivity barriers in deploying precision agriculture technologies such as smart farm vehicles, soil monitoring systems and yield mapping. Many precision technologies require a stable internet connection to function.

US crop growers are plagued with poor internet connectivity, through low speeds or lack of coverage. Around 60% of US farmers say their web connection is insufficient to run their business, according to research by the United Soybean Board. This is particularly apparent for grain farmers, whose operations could arguably benefit the most from precision tech. Montana, the third-largest US wheat grower, has the worst internet in the country. The state has less than 70% coverage with a measly speed of 20.3 Mbps, far behind 52 Mbps in New Jersey, the best performing state.

FUTURES & WEATHER

Wheat prices overnight are up 6 1/4 in SRW, up 8 3/4 in HRW, up 8 1/2 in HRS; Corn is up 2 1/4; Soybeans up 9; Soymeal up $3.10; Soyoil up 0.39.

For the week so far wheat prices are down 9 in SRW, down 2 1/4 in HRW, down 2 1/4 in HRS; Corn is down 13 1/4; Soybeans down 28 3/4; Soymeal down $19.40; Soyoil up 1.20.

For the month to date wheat prices are up 84 in SRW, up 83 in HRW, up 46 1/4 in HRS; Corn is up 4 1/4; Soybeans up 55 3/4; Soymeal up $14.80; Soyoil up 3.10.

Year-To-Date nearby futures are up 9.6% in SRW, up 12.0% in HRW, up 3.7% in HRS; Corn is down 4.2%; Soybeans down 5.7%; Soymeal down 4.9%; Soyoil down 3.5%.

Chinese Ag futures (JUL 24) Soybeans down 17 yuan; Soymeal down 1; Soyoil down 24; Palm oil up 10; Corn up 3 — Malaysian Palm is up 86. Malaysian palm oil prices overnight were up 86 ringgit (+2.15%) at 4079.

There were changes in registrations (-70 Soymeal). 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 30 were: SRW Wheat up 6,404 contracts, HRW Wheat down 4,013, Corn up 18,624, Soybeans up 5,610, Soymeal up 1,094, Soyoil up 4,795.

 

Northern Plains: Isolated to scattered showers through Monday. Temperatures near to below normal Friday, near normal Saturday, near to above normal Sunday-Monday. Outlook: Isolated to scattered showers Tuesday. Mostly dry Wednesday-Saturday. Temperatures near to above normal Tuesday-Saturday.

Central/Southern Plains: Isolated to scattered showers through Monday. Temperatures near normal through Saturday, above normal Sunday-Monday. Outlook: Isolated to scattered showers Tuesday-Wednesday. Mostly dry Thursday-Saturday. Temperatures near to above normal Tuesday-Saturday.

Midwest: West: Isolated to scattered showers through Monday. Temperatures near to above normal Saturday, above normal Sunday-Monday. East: Mostly dry Friday. Isolated to scattered showers Saturday-Monday. Temperatures near to below normal through Saturday, near to above normal Sunday-Monday. Outlook: Isolated to scattered showers Tuesday-Saturday. Temperatures near to above normal Tuesday-Thursday, near to below normal Friday-Saturday.

Brazil: Rio Grande do Sul and Parana:  Dry through Saturday. Isolated showers south Sunday-Monday. Temperatures below normal through Friday, near to above normal Saturday-Monday. Mato Grosso, MGDS and southern Goias:  Dry through Monday. Temperatures below normal south and near to above normal north through Friday, near to above normal Saturday, above normal Sunday-Monday.

Argentina: Cordoba, Santa Fe, Northern Buenos Aires:  Mostly dry through Saturday. Isolated showers north Sunday. Mostly dry Monday. Temperatures near normal Friday, near to above normal Saturday, near to below normal Sunday, below normal Monday. La Pampa, Southern Buenos Aires:  Mostly dry through Monday. Temperatures near normal Friday, near to above normal Saturday, near to below normal Sunday, below normal Monday.

The player sheet for 5/30 had funds: net sellers of 7,000 contracts of SRW wheat, sellers of 11,000 corn, sellers of 3,500 soybeans, sellers of 3,000 soymeal, and sellers of 2,500 soyoil.

 

TENDERS

• MILLING WHEAT SALE: The Taiwan Flour Millers’ Association purchased an estimated 96,850 metric tons of milling wheat to be sourced from the United States in a tender on Thursday
• FEED WHEAT SALE: An importer group in Thailand is believed to have purchased about 60,000 metric tons of animal feed wheat sourced from optional origins on Wednesday.
• FEED WHEAT TENDER: South Korea’s Major Feedmill Group (MFG) has issued an international tender to purchase up to 132,000 metric tons of animal feed wheat.

PENDING TENDERS

• 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

GRAIN EXPORT SURVEY: Corn, Soy, Wheat Sales Before USDA Report

Estimate ranges are based on a Bloomberg survey of four analysts; the USDA is scheduled to release its export sales report on Friday for week ending May 23.

• Corn est. range 650k – 1,400k tons, with avg of 988k
• Soybean est. range 250k – 650k tons, with avg of 388k

 

DOE: US Ethanol Stocks Fall 4.2% to 23.207M Bbl

According to the US Department of Energy’s weekly petroleum report.

• Analysts were expecting 24.052 mln bbl
• Plant production at 1.068m b/d, compared to survey avg of 1.031m

 

Argentina Farmers Kick Off Wheat Planting in Prime Conditions

Good soil moisture and improving profit margins “are spurring farmers to expand wheat acreage” in the 2024-25 season, the Buenos Aires Grain Exchange said in a weekly report.

Farmers have planted 9.7% of an estimated 6.2m hectares (15.3m acres), a y/y increase of 5.1%

 

Argentine Soy, Corn, Wheat Estimates May 30: Exchange

The Buenos Aires Grain Exchange releases weekly report on website.

• Corn and soybean production estimates maintained
• Corn harvesting advanced to 30.1% complete, while soybeans are 86% harvested

 

Canada Crushed 958K Tons of Canola in April: StatsCan

Canola processing rose 8% in April from a year ago, according to Statistics Canada data released Thursday on agency’s website.

• Oil production totaled 413k tons, and meal output at 556k tons
• Aug.-April crushings up 10.9% from year ago to 8.331m tons

 

CROP SURVEY: US Soybean Crush and Corn for Ethanol

The following is from a Bloomberg survey of six anlaysts.

• Soybean crush seen at 175.3m bu in April, a 6.2% drop from a year ago
• Crude and once-refined soybean-oil reserves at end of April seen at 2.225b lbs, down from 2.54b
• Corn used in ethanol production seen up 4.6% y/y to 433m bu

 

Rusagrotrans Sees Russia 2024 Wheat Harvest at 84m Tons: IFX

Russia’s wheat harvest may total 84m tons, Interfax reports, citing comments from the head of the analytical center of railway operator Rusagrotrans.

• Igor Pavensky said at a conference in Sochi that 84m tons is his optimistic estimate, with the minimum being about 77.5m tons
• Sees wheat exports at 50.5m tons in 2023/24 season
• Drought and May frosts affected regions that account for 40% of winter wheat: IFX

 

Russia Maintains 2024 Wheat Harvest Forecast at 85M Tons: Tass

Russia keeps 2024 wheat production forecast at 85m tons, despite frosts in May that damaged large growing areas, Tass reports citing comments from Deputy Prime Minister Dmitry Patrushev.

• Sees 2024 total grain harvest at 132m tons
• Almost a million hectares of crops are lost due to May frosts, including 850,000 hectares (2.1 million acres) of wheat, Patrushev said according to Interfax
• Base price used to calculate export duty will be increased by 1,000 rubles ($11.075) for all types of grain, Patrushev said according to Tass
• Russia doesn’t plan to prolong ban on durum exports, Interfax reports

 

EU 2024-25 Wheat Crop Estimate Steady; Corn Forecast Cut

The EU’s soft-wheat harvest is seen at 120.2m tons in the 2024-25 season, steady from an April estimate, the European Commission said in a report.

• Ending stockpiles raised to 13.5m tons from 12.2m tons, exports forecast at about 31.1m tons
• Barley crop seen at 53.9m tons this year, slightly up from last month’s estimate
• Corn crop estimate cut to 68.6m tons, slightly below the earlier forecast
• Total grains production seen at 278.2m tons, down from an April estimate of 278.5m tons

 

US Agricultural Trade Deficit Seen Widening on Strong Dollar

The US sees the agricultural trade deficit widening more than previously expected to a record in fiscal 2024, as a strong dollar keeps fueling imports while the value of exports slides.

The deficit is projected at $32 billion for the 12 months ending in September, up from a previous estimate in February for a shortfall of $30.5 billion, according to a US Department of Agriculture report Thursday.

Purchases overseas of everything from beef to fresh fruits and vegetables are seen rising for an eighth straight year to $202.5 billion, up $1.5 billion from February’s forecast. At the same time, the USDA reaffirmed its prediction for a 5% decline in the value of agricultural exports to $170.5 billion.

 

New Zealand Institute Sees La Niña Developing in Third Quarter

NZ’s National Institute for Water and Atmospheric Research comments in seasonal outlook, published Friday in Wellington.

• El Niño has ended, and ENSO neutral conditions are seen prevailing through the winter, June-August period
• See a 60-70% chance of La Niña conditions developing in spring, September-November period
• Winter air pressure is expected to be higher than normal in North and lower than normal in South, resulting in more westerly winds while southerly winds are expected to occur less frequently in winter than they did during autumn
• Soil moisture levels are most likely to be below normal in the north and east of the South Island but near normal elsewhere

 

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

The following shows the percent of US agricultural production within an area that experienced drought for the week ending May 28, according to the USDA’s weekly drought report.

• Corn area experiencing moderate to intense drought fell to 5% vs 10% in the previous week
• Has dropped 19 percentage points since early April
• Soybean area in drought declined by 4 percentage points to 3%

 

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

Barge shipments down the Mississippi river declined to 548k tons in the week ending May 25 from 710k tons the previous week, according to the USDA’s weekly grain transportation report.

• Barge shipments of corn fell 29% from the previous week
• Soybean shipments down 15% w/w
• St. Louis barge rates were $8.82 per short ton, a decline of $0.40 from the previous week

 

 

 

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