USDA announced export sales yesterday morning:
239,486 mts of old crop soybeans were sold to Mexico
126,000 mts of old crop grain sorghum were sold to unknown
Yesterday at mid-day, NOPA members reported they crushed 186.438 million bushels of soybeans in December. The market was expecting 185 million. This crush amount is up 4% from last November, up 2% from a year ago and it is the largest crush any month ever by NOPA members.
Ukraine's corn exports, at 9.75 million mt (384 million bushels) were 11% more the first four months of this marketing year than last year.
The third largest trucking company in North America, Schneider Transport, has put its Guelph, Ontario property up for sale and informed associates it is closing its Canada-based operations. Another causality of a government’s response to COVID.
Carolina Rios Thomson is a farmer in Central Brazil. Last evening he wrote:
Rains now won't do miracles in the South. The damage is already way bigger than CONAB admits - as usual. On the other hand, rain is also starting to be too much around here, in the middle-west of Brazil. Fungus on many crops I've seen and early harvests might be compromised. I am wondering why anyone would be an optimist at this point. Probably not a farmer. I'm far from the South, but we all know the damage of drought from previous seasons.
Kory Melby is a former Minnesota farmer who immigrated to Brazil 21 years ago. He has become a consultant about everything agriculture in Brazil. Last evening, his report included these comments:
Given what I am hearing on fertilizer for 2023, I doubt expansion. Price is one thing, but farmers are needing to beg, borrow, and steal to even get an order placed for 2023 now. I think they will be happy just to maintain area. If left takes over, please pray for Brazil. One needs to keep in mind that in Parana and other areas farmers stopped spending. Less herbicides and insecticides. Why poor money in a dying crop? A positive feedback loop starts with lower and lower yield potential. It is a salvage operation for many.
Daniele Siqueira is a market analyst with Ag Rural. She wrote last evening:
Up to 40 mm (1.6 in) in 10 days following 3 months of below-normal rains and a week of 35º-40ºC in Brazil's Rio Grande do Sul. Recovery ahead for soybeans? Or not enough? Seven-day forecast not exactly great.
US HRW wheat is $12 to $13 cheaper per metric ton than Russian & Romanian wheat.
Wheat futures had their biggest up day in three months yesterday. Some say it was because of the Russia, Ukraine tensions; others say it was because wheat is cheaper than it has been in three months. I am sure it is some of both, but mostly because of price.
China imported a record 9.77 million mt of wheat in 2021, up 16.6% from 2020. You already knew China imported three times more corn than ever before in 2021. The really bullish wheat news is China sold 100% of the 501,000 mt of government wheat it put out for auction last week at an average price of $11.63 per bushel. China hoards about half of the world’s carryover of corn, wheat and beans. They sell at auction government stocks to get the older grain out of the bin to be replenished with new grain in the bins. Seldom does 100% of the grain put out for a weekly auction get sold; 501,000 mt tons (18.4 million bushels) of wheat is a lot of wheat to sell to the public in one week. A lot of public auction wheat has been used to feed the hogs to replace expensive corn, so this 100% of wheat sale at $11.63 per bushel is bullish wheat and corn.
Even with the sharply higher beans and wheat futures yesterday, basis at the Gulf was steady last evening for both as well as corn.
West Texas Intermediate Crude Oil (WTI) Crude oil is up $1.13 at $86.56 this morning the highest trade since October 2014... that would be more than 7 years ago, bullish corn and beans.
The Dollar Index is trading at 95.68, down 0.05.
March palm oil gapped higher on the opening last night, making a new contract high at 5,346 MYR and currently trading at 5,321 MYR, up 131 MYR. Palm oil has 32% and soyoil has 28% share of the world vegetable oil market.
March cotton is up 18 cents per cwt at $121.26 after making a new contract high by 3 cents a pound at $121.40 per cwt pound overnight. Cotton competes with soybeans for acres.
March Natural Gas is down $0.002 at $4.046 per Metric Million Btu. The contract high was made October 6th at $6.132 per MMBtu. Natural gas is the primary input cost of nitrogen fertilizer.
March Oats are up 5¼ cents at $6.52. The contract high is $7.78 made November 22nd.
Rondonópolis, Mato Grosso, in the heart of Brazil's most productive soybean area, received no rain rain yesterday; 3.8 mm of rain a year ago and 15.4 mm two years ago (25.4 mm = one inch). Day time highs the next ten days will range from 89 to 96°F. (100°F = 38°C)
Yesterday, in the dry areas of south America:
Santa Maria high temperature 41°C with 0.1 mm rain.
Cordoba high 16°C with 11.6 mm rain.
Salto high was 20°C with 3.3 mm rain.
Total rainfall and temperatures expected in the next ten days:
Santa Maria 1.02 inches 90 to 104°F
Cordoba 4.12 79 to 88°F
Salto 4.52 85 to 91°F
The Eastern Corn Belt has 2 more rain days than yesterday in the 10 day forecast. The Western Corn Belt has the same number of rain days as yesterday, which is none.
Corn and soybean export inspections yesterday were both above the high end of the range of estimates: