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June 30 Global Ag News Headlines

Overnight trade has SRW down roughly 4 cents, HRW down 2; HRS Wheat up 2, Corn is down 1 cent; Soybeans down 1, Soymeal down $0.50, and Soyoil down 10 points. 

For the month, SRW Wheat prices are down roughly 43 cents; HRW down 42; HRS down 22; Corn is down 5 cents; Soybeans up 9; Soymeal down $3.00, and; Soyoil up 15 points. Crushing margins are down 4 cents at 85, Oil share up 1% at 33% .

Chinese Ag futures (Sep) settled up 41 yuan, down 5 yuan in Corn, up 10 in Soymeal, up 10 in Soyoil, and up 26 in Palm Oil.

Malaysian palm oil prices were up 13 ringgit at 2,354 (basis September) at midsession supported by rival oils, Asian equities.

U.S. Weather Forecast

Showers and thunderstorms look to bring moderate rainfall to the eastern sections of the Midwest over the next 2 ½ to 3 days, then dry weather looks to take over.

The GFS model for the 6 to 10 day forecast still indicates some rains to fall in this time frame with moderate amounts however, these rains are now indicated to fall mainly in the northern ½ to 2/3rd of MN, WI and MI, rather than north of I-80.

Conditions are still expected to be good across much of the Corn Belt, Delta, and southeastern states, with some pockets that are drier than preferred in the Corn Belt due to the erratic nature of the thunderstorm activity

The 6 to 10 day forecast for the Southern Plains sees most of KS to be dry through the period; showers and thunderstorms look to produce light to moderate amounts of rainfall in OK and northern TX.

Net drying will continue the next two weeks from West Texas through western Oklahoma and western Kansas; the drought in this area will likely worsen and expand some causing more stress in unirrigated summer crops, but provide a favorable environment for wheat maturation and harvest progress.

Last evening’s GFS model showed a system mostly off the Atlantic coast leading to a reasonable rainfall scenario for the Southeast.

The player sheet had funds net buyers of 11,000 contracts of SRW Wheat; net bought 33,000 Corn; bought 2,000 Soybeans; net sold 2,000 lots of soymeal, and; bought 4,000 Soyoil.

We estimate Managed Money net short 50,000 contracts of SRW Wheat; short 283,000 Corn; net long 34,000 Soybeans; net short 52,000 lots of Soymeal, and; short 7,000 Soyoil.

Preliminary Open Interest saw SRW Wheat futures down roughly 2,900 contracts; HRW Wheat down 1,900; Corn down 51,000; Soybeans down 7,900 contracts; Soymeal down 12,000 lots, and; Soyoil down 7,000.

Deliveries were 10 Soymeal (estimate was ZERO to 200); 2,402 Soyoil (600 to 3,500); ZERO Rice; ZERO Corn (ZERO to 400); ZERO HRW Wheat (ZERO to 400); ZERO Oats; 0 Soybeans (ZERO to 250), 151 SRW Wheat (ZERO to 200), and; 487 HRS Wheat (200 to 800).

There were changes in registrations (SRW Wheat up 151; Soyoil up 150; Rice down 100)—

Registrations total 162 contracts for SRW Wheat; ZERO Oats; Corn ZERO; Soybeans ZERO; Soyoil 3,645 lots; Soymeal 511; Rice 6; HRW Wheat 17, and; HRS 488. 

TODAY—FND JULY FUTURES—DELIVERABLE STOCKS—USDA QTR STOCKS/PLANTED ACREAGE 

Tender Activity—Thailand seeks 236,800t optional-origin feed wheat—

U.S. Winter Wheat harvested was 41% (trade estimate was 44%) versus 29% last week, 26% a year ago, 41% average.

U.S. Spring Wheat headed was 36% versus 12% last week, 20% a year ago, 45% average.

U.S. Corn silking was 4% versus 2% a week ago, 2% last year, and 7% average.

U.S. Oats headed were 74% versus 58% a week ago, 54% last year, and 75% average.

U.S. Soybeans blooming were 14% versus 5% a week ago, 2% a year ago, and 11% average.

Wire story reports warm and dry conditions were beginning to stress the U.S. Crop Watch corn and soybean fields earlier this month, but timely rains over the past several days have bolstered crop health in many areas; however, there are some spots for concern

Yesterday’s U.S. weekly export inspections had

—Wheat exports running unchanged on the year (10% behind last week) with the USDA currently forecasting a 2% decrease on the year

—Corn 20% behind a year ago (23% last week) with the USDA down 14% for the season

—Soybeans are down 1% on the year (unchanged last week) with the USDA having a 6% decrease forecasted on the year

The USDA’s weekly grain export inspections report showed only 342,512 metric tons of soybeans inspected for export this week–less than half of inspections at this time last year; additionally, China isn’t among the top destinations of US soybeans, with the top receivers being Egypt, Mexico and Japan.

Wire story reports industry analysts are expecting an unusually large decline in U.S. corn plantings on Tuesday when the U.S. government issues the results of its second acreage survey of the season; betting on the extremes does not generally bode well, but there is a decent chance for success this time based on 2020’s exceptionally low prices; the market was caught off guard earlier this year when the U.S. Department of Agriculture’s early March survey suggested farmers would plant 97 million acres of corn, an eight-year high; that was some 2.7% above the pre-report trade guess, among the biggest misses on record.

USDA May soybean crush seen at 180.7 million bushels – Reuters News

—The May U.S. soybean crush is expected to dip to 5.421 million short tons, or 180.7 million bushels,

Estimates ranged from 180.0 million bushels to 182.0 million bushels

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

If realized, it would be the largest May crush on record, topping the prior record of 172.4 million bushels set in May 2018; but it would be down from an April crush of 183.4 million bushels and the smallest monthly crush since February.

U.S. soyoil stocks at the end of May were projected to drop to 2.372 billion lbs from 2.602 billion lbs at the end of April, which was the largest end-of-month supply in two years

Soyoil stocks estimates ranged from 2.250 billion to 2.450 billion lbs

The National Oilseed Processors Association (NOPA), whose members account for 95% of all soybeans processed in the United States, reported a May crush of 169.584 million bushels and end-of-month oil stocks of 1.880 billion lbs.

Canadian farmers planted slightly more wheat overall in 2020 than in 2019, but the coronavirus outbreak will pose “unique challenges” in the production and distribution of crops, Statistics Canada said; armers planted 25.0 million acres of wheat, up 1.5% from 2019, thanks in part to a 16.2% boost in durum wheat, which Statscan linked to favorable prices

Canola plantings slipped 0.8% to 20.8 million acres as farmers shifted away from oilseeds, potentially because of high global supplies

North China’s Tianjin port handled a total of 2.72 million tons of soybean imports from January to May, up 62 percent year on year, according to the Tianjin customs; as domestic pig production and marketing have returned to normal, feed demand has increased significantly, driving the rapid growth of soybean imports via Tianjin Port; the main source of imports was the Americas, accounting for over 90 percent of the port’s total.

A new flu virus found in Chinese pigs has become more infectious to humans and needs to be watched closely in case it becomes a potential “pandemic virus”, a study said, although experts said there is no imminent threat.

Deforestation of the Brazilian Amazon and neighboring savannah may be hurting regional corn yields, according to a new study released; roughly one-fifth of Brazil’s Amazon has been cleared in the last 50 years, as the country went from being a food importer to a global farming powerhouse; in terms of corn, Brazil is now the world’s second largest exporter, after the United States.

Russian wheat export prices fell last week as the harvesting of the new crop started and global benchmark Chicago futures lost value; Russian wheat with 12.5% protein loaded from Black Sea ports was at $200.5 a ton free on board (FOB) at the end of last week, down $1.5 from the previous week, SovEcon agriculture consultancy said; another consultancy, IKAR, pegged wheat for supply in August at $197 a ton, down $2 from the previous week.

Russia may not apply grain export quotas in the new 2020/21 agricultural season, beginning on July 1, provided the grain harvest is above 125 million tons and export potential at least 45 million tons

Ukrainian wheat production could fall 7.2% to 26.25 million tons this year due to a lower planting area and significant damage in southern regions after a prolonged drought, French consultancy Agritel said; Agritel’s crop estimate, which followed a June 15-19 field tour in Ukraine, is above a Reuters poll average of 25.4 million tons released on June 11, but close to grain traders’ union UGA’s forecast last week of 26.5 million tons.

Indonesia will keep its export tax for crude palm oil at zero for a fourth month in July, a document from the country’s Trade Ministry showed; reference price for CPO is set at $622.47 per ton for July, below a $750 per ton price threshold for exports tax to be imposed. Indonesia also collects export levy of $55 per ton for CPO export.

Exports of Malaysian palm oil products for June rose 29.1 percent to 1,622,432 tons from 1,256,395 tons shipped during May, cargo surveyor Intertek Testing Services said

—Malaysia’s palm oil exports during the June 1-30 period are estimated up 28.7% on month at 1,629,086 metric tons, cargo surveyor AmSpec Agri Malaysia said

Futures and options trading involve significant risk of loss and may not be suitable for everyone.  Therefore, carefully consider whether such trading is suitable for you in light of your financial condition.  The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM.  The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared.  The information provided is designed to assist in your analysis and evaluation of the futures and options markets.  However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.

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