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Rain Days & Tidbits 01/25/2022

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One hour ago, Elena Faige Neroba of MaxiGrain in Kiev, Ukraine reported massive power outages Kazakhstan, Uzbekistan and Kyrgyzstan. Water, air traffic and mass traffic service has stalled. Is this a the work of Russia? Putin will be the first suspect and therefore wheat prices will probably rip higher for a couple hours at least. A great time to price 2022 wheat.

USDA announced export sales yesterday morning: 150,000 mts of old crop corn to unknown 66,000 mts of old crop soybeans to China. 66,000 mts of new crop soybeans to China

Argentine soybean futures hit an all-time high today at US$368 per mt for May delivery as total production this year may be less than 40 million mt. The previous high was set in 2011 at $357 per mt.

Russian News Source yesterday morning:

The threat of an armed offensive by Ukraine in the Donbas is now very high, said presidential spokesman Dmitry Peskov, TASS reports. The Ukrainian authorities are concentrating a huge amount of forces and means on the border with the self-proclaimed republics on the line of contact, indeed, the nature of this concentration indicates preparation for offensive actions, and, indeed, such a threat exists now. According to him, the supply of Western weapons to Ukraine "once again inspires hotheads in Kiev to start this operation," and the threat of military provocation is growing.

The Donbass Republic aka DPR (Eastern Ukrainian land occupied by Russia in 2014) authorities also claim that the Ukrainian army is preparing for an offensive. The deputy head of the People's Militia Department of DPR said Ukraine has moved divisions of the tanks, motorized infantry brigades, and mechanized brigades of the Armed Forces of Ukraine. He added all liberty vacations of military personnel were suspended and commanders of all degrees were ordered to go to temporary deployment points. Tanks and artillery crews are being transferred to the line of contact.

Ukraine’s side of the story lays the responsibility for what is happening on Russia. The country's Foreign Ministry said that the dissemination of messages about the aggravation of the situation is a campaign to escalate tensions "in order to sow panic among Ukrainians and foreigners, frighten businesses, and undermine the economic and financial stability of the state." Ukraine’s government urges people to remain calm.

NATO also announced the transfer of military contingents to Eastern Europe. Family members of Western diplomats are leaving Kiev, the capital city of Ukraine.

US per capita flour consumption in 2020 was 132.1 pounds, up 1.3 pounds from 2019, but the second smallest since 1989 according USDA’s Economic Research Service. The gain of 1.3 pounds was the largest jump in more than 10 years when per capita consumption jumped 2.5 pounds in 2008 to 138.3 pounds. The 2021 numbers are expected in the a few weeks now that a few government workers are back in the office at a nearly two years of working from home.

Reuters’ Karen Braun assembled this information showing the US winter wheat condition has declined significantly since last fall. This is already priced in to the price, Folks.

U.S. winter wheat conditions (% good or excellent): (note * denotes hard red winter wheat states)

Texas* wheat is 7% good or excellent and 71% poor or very poor.

Kansas* Jan 23: 30% Jan 2: 33% Dec 12: 51% Nov 28: 62%

Oklahoma* Jan 23: 16% Jan 2: 20% Nov 28: 48%

Colorado* Jan 23: 20% Jan 2: 25% Nov 28: 38%

Nebraska* Jan 23: 36% Jan 2: 39% Nov 28: 64%

Illinois Jan 23: 42% Jan 2: 75% Nov 28: 79%

Montana* Jan 23: 14% Jan 2: 12% Nov 28: 7%

South Dakota* Jan 23: 31% Jan 2: 38% Nov 28: 36%

Kentucky Jan 23: 85% Jan 2: 91% Nov 28: 75%

Algeria is one of the largest milling wheat importers in the world, bringing in about 6 million mt of milling wheat and taking 40 to 50% of France’s non-EU wheat exports, but...

Algeria has halted imports of French wheat, leaving France with a large surplus. Algeria has excluded French offers from the past three milling wheat import tenders. In October, French President Emmanuel Macron reminded Algeria there would be no Algerian nation if not for French colonial rule. That comment did not help relations. Algeria responded by closing airspace to France’s military and recalled its ambassador from Paris.

To make matters worse, the major competitor for wheat, namely rice, world production is forecast at 511 million mts, an all-time high crop.

Yesterday morning, Dow was down 1115 points, but it finished up 99 points. Maybe someone at the Fed whispered to Wall Street the easy money will continue.

Malaysia will receive 10,000 planation workers from Indonesia to provide labor to harvest palm oil. That news put an end to the five consecutive days of contract highs in palm oil futures.

West Texas Intermediate Crude Oil (WTI) Crude oil is up $1.09 at $84.40 this morning.

The Dollar Index is trading at 96.13, up 0.21.

March palm oil made a new contract high yesterday at 5,509 MYR; last trade is 5,423, up 18 MYR from Monday's settlement. Palm oil has 32% and soyoil has 28% share of the world vegetable oil market.

March cotton is up 94 cents per cwt at $121.22. The contract high was made last Wednesday and Thursday at $124.78. Cotton competes with soybeans for acres.

March Natural Gas is down $0.057 at $3.818 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 down a quarter cent $6.31½. The contract high is $7.78 made November 22nd.

Rondonópolis, Mato Grosso, in the heart of Brazil's most productive soybean area, received 0.1 inch of rain yesterday; 0.9 inch a year ago and 0.2 inch two years ago (one inch = 24.5 mm). Yesterday's high temperature was 93°F. Day time highs the next ten days will range from 83 to 91°F (100°F = 38°C).

Yesterday, in the dry areas of South America: Santa Maria high temperature 108°F with no rain. Cordoba high temperature 75°F with 0.6 inch rain. Salto high temperature 90°F with no rain.

Total rainfall and temperatures expected in the next ten days: Santa Maria 2.35 inches 78 to 98°F Cordoba 1.22 inches 74 to 89°F Salto 0.97 inches 77 to 90°F

The Eastern Corn Belt has 3 more rain days in the 10 day forecast than yesterday and the Western Corn Belt also has the 3 more rain days as yesterday.

Yesterday's Inspections for export and tracker:

Explanation of Rain Days 
Every day, every place in the world has a ten day weather forecast issued.

By a "place", we mean a Findlay, Ohio; Arcadia, Minnesota; Atlantic, Iowa; Fullerton, Nebraska; Cordoba, Argentina; Craig, Colorado, Saratov, Russia and ten million localities we have never heard of.
The ten day forecast predicts the high and low temperature for each day as well as whether rain is predicted for each of the ten days, likewise cloudy, partly cloudy, sunny, etc.

We look at the ten-day forecast and if we see rain is predicted for 4 of the next 10 days, we record a "4" and that is what is reported to you. It does not matter whether if it is one-hundredth of an inch or 5 inches. We realize the amount of rain is incredibly important expect a few key days of the growing season, which we keep you informed.

Below is the link for the ten-day forecast for Campo Grande, Mato Grosso do Sul, Brazil. At this moment, it predicts rain 10 of the next 10 days. Thus, this morning, we wrote a "10". Of course, we scan the temperatures and the amounts of rain just to see if anything is getting way out of the norm. By the time you click on this link, the number of days expected to see rain very well may be different than now.


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