Global Ag News for Nov 7.23

TOP HEADLINES

China to require traders of key commodities to provide real-time information

China’s commerce ministry on Tuesday said it will require traders of crude oil, iron ore, copper concentrate and potash, which are subject to import licences, to submit real-time information on shipments as part of efforts to stabilize trade.

It will also require exporters of rare earths to submit information under the new rules effective from Oct. 31 this year for two years.

The goal is to “promptly and accurately grasp and scientifically judge the import and export status and trends of bulk products, guide foreign trade operators to import and export in an orderly manner, reduce blindness, provide a basis for risk avoidance, and do a solid job in stabilizing foreign trade”, the ministry said in a document on its website.

Buyers and sellers of the newly-added products will be required to provide real-time information on shipments, quantity and arrival times, the document added.

Reporting rules are already in place for a range of agricultural commodities, including soybeans, soymeal, milk powder and meat.

It was not immediately clear to what extent the rules would impact trade.

“I do not think the customs clearing pace will be much affected much by this,” said Cheng Peng, a Beijing-based iron ore analyst at Sinosteel futures.

“Many other agriculture products have already been on the list, indicating that the system should be relatively mature,” Peng added.

However, another analyst, on the condition of anonymity, said the data gathering could be a first step before the government takes greater control of trade in key commodities.

Beijing said last Friday it would promote “high-quality development” in the rare earths industry, putting the strategic mineral resources under the spotlight again.

In July, China had unveiled export restrictions on gallium and germanium, and in October another one for some graphite products, sparking concerns that rare earths might be next.

FUTURES & WEATHER

Wheat prices overnight are down 3 1/2 in SRW, down 5 1/4 in HRW, unchanged in HRS; Corn is down 4; Soybeans down 4; Soymeal up $1.00; Soyoil down 0.60.

For the week so far wheat prices are down 1/4 in SRW, down 3 in HRW, up 7 3/4 in HRS; Corn is down 4; Soybeans up 8 1/4; Soymeal down $3.60; Soyoil up 0.84.

For the month to date wheat prices are up 14 1/4 in SRW, up 11 1/4 in HRW, up 19 1/2 in HRS; Corn is down 5 3/4; Soybeans up 48 1/2; Soymeal up $7.00; Soyoil down 1.33.

Year-To-Date nearby futures are down 27.7% in SRW, down 27.9% in HRW, down 22.4% in HRS; Corn is down 30.3%; Soybeans down 12.0%; Soymeal down 8.4%; Soyoil down 21.3%.

Chinese Ag futures (JAN 24) Soybeans up 1 yuan; Soymeal up 38; Soyoil up 34; Palm oil up 60; Corn down 9 — Malaysian Palm is down 33.

Malaysian palm oil prices overnight were down 33 ringgit (-0.88%) at 3720.

Markets finished last week with wheat prices up 16 in SRW, up 11 1/4 in HRW, up 19 1/2 in HRS; Corn is down 5 1/2; Soybeans up 49 1/2; Soymeal up $7.50; Soyoil down 1.22.

There were no changes in registrations. Registration total: 3,005 SRW Wheat contracts; 607 Oats; 4 Corn; 598 Soybeans; 62 Soyoil; 0 Soymeal; 400 HRW Wheat.

Preliminary changes in futures Open Interest as of November 6 were: SRW Wheat up 4,475 contracts, HRW Wheat down 1,220, Corn up 814, Soybeans up 3,443, Soymeal down 6,177, Soyoil up 4,945.

Brazil: Southern areas finally got a break from the heavy rain this weekend, but it will not last long as another system moves in later this week and weekend with potential for more heavy rain. Central areas got a nice boost in precipitation coverage over the weekend, but that will move north for most of this week. Occasional showers through the weekend will be below-normal in coverage and intensity, causing a return to more concerns for the soybean crop. Soybean planting continues to be slow in central Brazil as the dryness has forced producers to wait for good soil moisture. This may lead to issues with the safrinha crop later this season. Flooding across the south has also produced issues for pulling wheat out and planting and developing corn and soybeans.

Argentina: It was dry over the weekend after a week of good rain in the country. A system will move through with scattered showers Tuesday and Wednesday, while another system will move through Friday through this weekend. Rainfall should be beneficial for most areas as the weather situation continues to take a positive turn for the country.

Australia: Scattered showers developed in eastern areas over the weekend, producing some areas of heavy rain. Scattered showers continue here for most of the week as the hot and dry El Nino pattern takes a break. The rain is too late for winter wheat and canola and will hamper harvest instead. In contrast, the rain will benefit cotton and sorghum planting and establishment. Dryness elsewhere is unfavorable for all crops.

Northern Plains: Isolated showers fell over the region this weekend, being very light and mostly rain. Temperatures rose significantly and melted a lot of the snowpack in the region, though some remains over northeast North Dakota, where remaining fieldwork will be slow. A couple of disturbances will move through this week, with mixed precipitation and continued difficulties in accomplishing the remaining fieldwork.

Central/Southern Plains: Some showers went through Nebraska this weekend, but most areas stayed dry. A front will move through the region this week but be mostly dry until Thursday when a disturbance develops along it, bringing showers to southern areas which should be helpful for winter wheat where they hit. Temperatures will be mostly near or above normal for the next couple of weeks, making moisture important for root development before it goes dormant for winter.

Midwest: Isolated light showers moved through the region this weekend until a system moved through northern areas Sunday night, which continues to bring light to moderate rain across Wisconsin and Michigan Monday, slowing progress for fieldwork. Temperatures have risen and will be warm this week until another front moves through Wednesday and Thursday. That front will bring some showers through the region and bring temperatures back down to normal but any chilly air will not last long with warmer temperatures building again next week. The up-and-down temperature pattern and occasional precipitation will make the remaining fieldwork difficult in some cases, especially across the north, but could help with water levels on the Mississippi River.

The player sheet for Nov. 6 had funds: net buyers of 1,250 contracts of SRW wheat, buyers of 1,500 corn, buyers of 6,000 soybeans, sellers of 2,000 soymeal, and  buyers of 2,500 soyoil.

TENDERS

• SOYBEAN SALE: The U.S. Department of Agriculture (USDA) confirmed private sales of 126,000 metric tons of U.S. soybeans for shipment to China in the 2023/24 marketing year.
• CORN SALE: The USDA confirmed private sales of 289,575 metric tons of U.S. corn for shipment to Mexico in the 2023/24 marketing year.
• WHEAT PURCHASES: Saudi Arabia’s General Food Security Authority (GFSA) said on Monday it bought 710,000 tonnes of wheat from Saudi producers based overseas.
• 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: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) is looking to buy a total of 108,890 metric tons of food-quality wheat from the United States, Canada and Australia in a regular tender that will close on Thursday.

PENDING TENDERS

• OFFERS RECEIVED ON WHEAT TENDER: The lowest offer in an international tender from Bangladesh’s state grains buyer to purchase and import 50,000 metric tons of wheat which closed on Oct. 30 were assessed at $294.95 a metric ton liner out
• RICE TENDER: South Korea’s state-backed Agro-Fisheries & Food Trade Corp issued an international tender to purchase an estimated 177,000 metric tons of rice, largely from the United States.
• 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, European traders said. The deadline for submission of price offers in the tender is Nov. 7.

TODAY

China October Agricultural Imports: Customs

General Administration of Customs says on website.

• Soybean Imports 5.158m Tons
  • Soybean imports YTD rose 14.6% y/y to 82.415m tons
• Edible vegetable oil imports in Oct. 945,000 tons
  • Edible vegetable oil imports YTD rose 82.7% y/y to 8.091m tons
• Meat (including offal) imports in Oct. 552,000 tons
  • Meat (including offal) imports YTD rose 3.8% y/y to 6.259m tons
• Fertilizer exports in Oct. 3.103m tons
  • Fertilizer exports YTD rose 28.2% y/y to 25.77m tons

China Oct soybean imports surge 25% y/y on strong Brazilian arrivals

China imported 5.16 million metric tons of soybeans in October, customs data showed on Tuesday, a 25% surge from a year earlier but lower than analysts expectations as Brazilian soybeans continued to arrive at ports later than usual.

Freshly harvested U.S. soybeans usually dominate the global export market from September while the Brazilian export season winds down, but a record crop in the South American country is expected to dominate China’s imports in the last three months of the year.

China is the world’s top soy buyer and Brazil its largest supplier. Soybeans are crushed into meal for animal feed and oil for cooking.

The October arrivals were lower than some traders’ expectations of about 6.5 million to 7 million tons. In September, imports of soybeans fell 7.3% from a year earlier.

“The import volume is a little less than expected due to delays in loading at Brazilian ports. In October, many were still loading for September shipments,” said Yuyun Chen, trader with Mingsui International（Shanghai) Trading Co.

He said delayed October cargoes will arrive in November and further lift November imports to about 12 million metric tons.

“We are headed for record high imports this year,” Chen said.

China’s soybean imports are on course for an all-time record of around 105 million tons, according to forecasts last week by traders and analysts.

Around 26 million tons will be imported during the last three months of the year, with around 45% from Brazil, the traders added.

Soy imports in the first 10 months of the year rose 14.6% year-on-year to 82.42 million tons, the customs data showed. CNC-SOY-IMP

Lacklustre demand from loss-making hog farms is seen limiting purchases in early 2024.

US Inspected 535k Tons of Corn for Export, 2.085m of Soybeans

In week ending Nov. 2, according to the USDA’s weekly inspections report.

• Wheat: 72k tons vs 198k the previous wk, 182k a yr ago
• Soybeans: 2,085k tons vs 2,050k the previous wk, 2,608k a yr ago
• Corn: 535k tons vs 541k the previous wk, 254k a yr ago

US Corn, Soybean, Wheat Inspections by Country: Nov. 2

Following is a summary of USDA inspections for week ending Nov. 2 of corn, soybeans and wheat for export, from the Grain Inspection, Packers and Stockyards Administration, known as GIPSA.

• Soybeans for China-bound shipments made up 1.55m tons of the 2.09m total inspected
• Mexico was the top destination for corn inspections, and also led in wheat

Brazil Soybean Planting at Slowest Pace Since 2020/21: AgRural

Planting is 51% complete as of Nov. 2, which compares with 40% a week earlier and 57% last year, according to an emailed report from AgRural consulting firm.

• Current pace is the slowest since the 2020/21 season, as works affected by drier conditions in Mato Grosso state and excessive rainfall in Parana
• Summer corn planting in Brazil’s Center-South region is 66% done, vs 53% the week prior and 63% a year before

Ukraine keeps 2024 winter wheat sowing area forecast unchanged – ministry

Ukraine’s agriculture ministry said on Monday it was keeping its winter wheat sowing area forecast for the 2024 harvest unchanged at 4.36 million hectares versus 4.46 million hectares in 2023.

Ukraine is a traditional grower of winter wheat, which accounts for at least 95% of its overall wheat output.

“We’re not revising (wheat sowing forecast) yet,” Taras Vysotskiy, the first deputy minister, told Reuters.

The ministry data showed farmers had sowed 3.87 million hectares of winter wheat as of Nov. 6, or 88.8% of the expected area.

The ministry said a total of 4.39 million hectares of winter crops were sown as of Nov. 6, or 85.5% of the forecast, and the area also included 442,300 hectares of barley and 76,100 hectares of rye.

Farmers also sowed 1.14 million hectares of winter rapeseed.

Ukraine is expected to harvest 79 million metric tons of grain and oilseed in 2023, with a 2023/24 exportable surplus of about 50 million tons, the ministry has said.

WHEAT/CEPEA: Weather still concerns in Brazil; in Argentina, volume to export may shrink

Weather conditions remain unfavorable in most important wheat-producing areas in Brazil, a scenario that concerns producers. In Argentina, an important producer, the dry weather in part of the areas reduced the local production and may limit the volume available to export.

The USDA indicates that production in Argentina may total 14.5 million tons, 2 million tons less than the report released in October. Therefore, shipments are likely to amount 10 million tons, below the 10.5 million tons projected in the month before.

In this scenario, wheat prices are moving up, and players expect this trend to remain firm in the coming weeks. In this early November, price averages in Rio Grande do Sul, São Paulo, Paraná and Santa Catarina are higher than those verified in October. In Paraná, monthly averages had been registering decreases since December/22.

Between October 27 and November 3, the prices paid to wheat farmers (over-the-counter market) in Paraná rose 7.8%, 3.5% in Santa Catarina and 2.65% in Rio Grande do Sul. In the wholesale market (deals between processors), values increased 1.3% in São Paulo, 0.43% in Paraná and 1.8% in Santa Catarina. Quotations dropped 1.7% in RS.

Despite the rainfall, crop activities continue to advance, and the national average of the harvest hit 67% until October 29, according to data from Conab.

The demand for wheat bran continues firm, keeping prices high. As for wheat flour, values are stable, and liquidity is low.

USDA attaché sees Brazil 2023/24 corn crop at 130 mln tons

Following are selected highlights from a report issued by the U.S. Department of Agriculture’s (USDA) Foreign Agricultural Service post in Brasilia:

“Brazil has recently started planting its corn crop for the 2023/24 season. However, due to high production costs and lower expected earnings, profit margins are under pressure. As a result, Post predicts a decrease in planted area, with production for the next season estimated to drop from 135 MMT (million metric tons) (MY 2022/23) to 130 MMT (MY 2023/24). In addition, the El Niño weather phenomenon is anticipated to continue having an impact on crops in the southern region of Brazil, particularly affecting wheat farms, which will likely result in lower yields. As such, wheat production for MY 2023/24 is predicted to decrease by 7% to 10.2 MMT. Meanwhile, rice market prices have started to rise while production costs are easing, making it more attractive for farmers to sow rice for the upcoming harvest. Post forecasts rice harvested area at 1.5 million hectares for MY 2023/34, a 2% increase over the previous season.”

USDA attaché sees China 2023/24 soybean imports at 100 mln T

Following are selected highlights from a report issued by the U.S. Department of Agriculture’s Foreign Agricultural Service (FAS) post in Beijing:

“Strong exports from Brazil pushed China to a record 100.85 million metric tons (MMT) of soybeans imports in marketing year (MY) 22/23. Imports are forecast to reach similar levels in MY 23/24 on sustained demand from the feed sector. After reaching a record 5.3 MMT in MY 22/23, rapeseed imports are forecast to decline on high carry-in stocks. The People’s Republic of China (PRC) efforts to incentivize domestic soybean cultivation through various local and national policies continue to support production, though lower prices for soybeans for food use may pose a challenge to sustaining higher volumes…. Post raised soybean imports for MY 23/24 to 100 MMT, up from the previous Post estimate of 98.5 MMT.”

Ukraine winter crops can pass winter, produce good harvest – scientists

Ukrainian winter crops sown for the 2024 harvest are able to successfully pass the winter and can produce a good harvest, scientists of the Academy of Agrarian Sciences of Ukraine was quoted as saying on Tuesday.

Ukraine is a traditional grower of winter wheat, which accounts for at least 95% of its overall wheat output. It also plants winter barley, rye and winter rapeseed.

“Given the current state of winter grain crops in Ukraine and comparing it to last year, we can make a preliminary assumption that the plants will overwinter successfully and will be quite productive next year,” the APK-Inform consultancy quoted scientists as saying.

Ukrainian farmers in recent years have often sown winter crops in dry soil in the hope that a wet autumn and mild winter will give the plants a chance to germinate and pass the winter.

The agriculture ministry’s data showed that despite the fact that the optimal time for sowing winter crops has already passed, farmers are still sowing and last week sowed about 175,000 hectares of winter crops, mostly winter wheat.

The ministry said on Monday it was keeping its winter wheat sowing area forecast for the 2024 harvest unchanged at 4.36 million hectares versus 4.46 million hectares in 2023.

The ministry data showed farmers had sowed 3.87 million hectares of winter wheat as of Nov. 6, or 88.8% of the expected area.

Ukraine is expected to harvest 79 million metric tons of grain and oilseed in 2023, with a 2023/24 exportable surplus of about 50 million tons, the ministry has said.

Kazakhstan Harvests 16.4m Tons of Grain, Minister Says

About 99% of the planted area, or 16.9m hectares, has been harvested, Agriculture Minister Aidarbek Saparov tells government meeting, according to his presentation.

• Average grain yield is 970 kg/hectare
• This year’s harvest is seen at 16m tons this year, including 11.3m tons of wheat; still has 3m tons from last year’s crop: Saparov
• NOTE: Kazakhstan harvested 22.2m tons of grain as of Nov. 7 last year from 16.1m hectares
• Kazakhstan sees grain exports potential at 5m tons

Palm Oil May Surge to 4,000 Ringgit/Ton by Year-End, MPOB Says

Prices may climb to around 4,000 ringgit/ton by the end of 2023 as festive-season buying is set to increase, according to the Malaysian Palm Oil Board.

• The tropical oil may also get support if any policy from neighboring Indonesia limits supplies, Ahmad Parveez Ghulam Kadir, director general of the board, said on the sidelines of an industry conference in Kuala Lumpur Tuesday
  • NOTE: Benchmark palm oil prices traded 0.6% higher at 3,775 ringgit on Tuesday
• Production of crude palm oil in Malaysia, the world’s second-biggest grower, may be steady at around 18.5 million tons in 2023; output in the first nine months of 2023 has been 0.5% lower from a year earlier
• Production growth is curbed by labor shortages and floods earlier this year, as well as old palm trees
• Any El Nino impact on Malaysian palm oil production is unlikely this year; the weather event may not affect the whole country, the impact has not been severe so far
• The cost of palm oil output has climbed due to costlier fertilizers and labor

India loses 22% of its grain output annually

Around 74 million tonnes of food is lost in India every year, which is 22% of the country’s foodgrain output or 10% of its total foodgrain and horticulture production, put together, in 2022-23, reports Vishwa Mohan. The loss accounts for roughly 8% of the total 931 million tonnes of food waste globally, said scientists from Indian Council of Agricultural Research (ICAR).

ICAR chief Himanshu Pathak said inadequate storage facilities is one of the key reasons behind food losses.

India’s SEA sign MoU with Brazil’s ABIOVE for soyabean oil imports

Cooking oil industry body, the Solvent Extractor’s Association of India (SEA) and Brazilian Association of Vegetable Oil Industries (ABIOVE) have signed a memorandum of understanding (MoU) for soyabean oil imports.

India is the largest Importer of edible oils in the world and imports nearly 15-16 million tonnes of Various Edible Oils including 3.5 to 4.0 million tonnes of soyabean oil mainly from Latin America.

“Brazil is one of the major suppliers of soyabean oil to India. In 2022, Brazil exported 1.4 million tonnes and in the current year till September, it has exported 1.2 million tonnes of soyabean oil to India,” said SEA in a media release.

Ajay Jhunjhunwala, president, SEA and Andre Meloni Nassar, president, ABIOVE, signed a MoU on November 2, 2023.

Both Associations agreed to cooperate with the supply, use, and trade of soybean, soymeal, soybean oil, as well as other oilseeds and their derivatives.

“The objective of the MoU is to create a common platform to facilitate the joint interaction of both institutions under the governmental spheres of both countries and promoting public-private partnerships of mutual interes

US Farmers Get Phosphate Supply Break as Duties Shift Lower

The global nitrogen market was steady last week in the wake of India’s tender and rising European natural gas prices. The US autumn fertilizer season is set to kick off as harvests near completion and soil temperatures drop. US farmers will get a phosphate cost break after the US Commerce Department lowered duties on Morocco.

Phosphate Spreads in US to Correct on Duty Revision

A record phosphate spread in the US Corn Belt is set to collapse after the US Department of Commerce (DOC) lowered the duty on Moroccan phosphate imports. Duties imposed by the DOC on Russian and Moroccan producers in 2021 raised the global price floor for phosphates, making the US the world’s price-setter while restricting imports. Morocco effectively ceased phosphate exports to the US, accounting for about 8% of the latter’s imports in fertilizer-year 2023 vs. 50% in 2019. A spread of $95 a short ton between phosphate products in the US developed in 2H, reflecting a shortage of monoammonium phosphate — a product harder to source in Morocco’ absence.

China leaves 2024 fertiliser import quota unchanged to 2023 – commerce ministry

China has set its 2024 fertiliser import quota at 13.65 million metric tons, unchanged from 2023, the nation’s Ministry of Commerce said on Tuesday.

 

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