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Tidbits, Brazil Harvest & Plantings, Spreads, Markets & Rain Days Update 2/19/23

Monday is a holiday. CBOT trading will resume Monday evening at 7 PM Central.


Highlights


CF Industries is the world’s largest nitrogen fertilizer producer; they expect US corn acres in 2023 to be 91 to 93 million acres, up as much as 5% from the 88.6 million planted in 2022.

Corteva expects 91 million acres of corn and a Farm Futures survey was 90.5 million.

IMEA, the Institute of Mato Grosso Agriculture Economy, reports Mato Grosso's soybean harvest is now 60% done vs 58% average & 68% in 2022, a record pace. Safrinha (2nd crop) corn planting is still lagging at 50% done vs 63% average and 68% last year, which produced a record crop. The ideal planting window for safrinha closes on Wednesday (the 22nd) and the door slams shut on February 28th. Check the number of days with rain in the 10 day forecast for Rondonópolis below.

Eduardo Vanin is a grain trader with Agrinvest of Brazil. Yesterday Eduardo reported:


"China bought 28 soybean boats this week, 2 in the US and 26 in Brazil. In the US again for February shipment and in Brazil for March, April and May. There are rumors that China also bought for August/September in the US – not confirmed...

Soy Premiums in Brazil made new lows. March was traded yesterday at -4h. April ended the day offered at +4k and May at +10k, also new lows...

The Cereals Exchange yesterday spoke of a probable further reduction in soybean and corn production. Bad and awful conditions rose again. For soy 8 points and corn 9 percentage points...

Avian flu arrived in South America. Corn futures fell well on the B3, especially in May. The longer ones remain firm due to the delay and the risk that this brings... (https://agrinvest.agr.br/en/home-en/)"

 

Tidbits


Yesterday morning, the USDA announced the sale of 120,800 mts of old crop corn to unknown.

Frost this morning is expected in some areas of Argentina where soybean crop ratings were down 4% this week to 9% good to excellent.

Brazil’s biggest grain farmer, Coamo Cooperative, based in the state of Parana, said growers are hoarding harvested crops amid a drop in prices.

Analysts expect China’s crude oil imports to increase 500,000 to 1 million barrels per day to as much as 11.8 million bpd in 2023.

Negotiations to extend the Ukraine grain export corridor deal will start this coming week.

EU natural gas is under 50 euros per megawatt hour for the first time in 18 months, down 85% from its peak in August = more and cheaper N fertilizer.

Did you notice in our report yesterday morning that July natural gas futures contract was down $3 per MMBtu (Metric Million British Thermal Units) from its high in September?

Roger was mistaken about the Cattle on Feed Report release date. It was not yesterday, it will be next Friday.

The “dark fleet” transporting mostly Russian crude and other sanctioned cargo to and from places like Iran, Cuba, and North Korea has more than 300 mid-range ships sailing the high seas without a cargo manifest or designated destination compared to just 14 ships at any given time prior to 2023.

We recommend you save these addresses to track the corn spreads provided by Clear Focus Hedging, c/o Allen Gard, Palmyra, MO 63461 Phone: 573-769-4193, agard730@gmail.com and Mike Daube, Walkerton, Indiana 46574 Phone: 574-586-3784, off419@outlook.com :

March 23 - July 23

May 23 - July 23

July 23 - December 23

December 23 - July 24

This is the return to storage for 2023 corn; the most it will ever reasonably get is 28 to +30 cents, full carry and that only occurs with a carryover in excess of a 55 day supply.


 

Market Data


This morning:

Crude oil settled at $76.33, down $2.16

The dollar index settled at 103.88, up 0.03

July palm oil settled at 4,083 MYR, up 52. The contract high was made September, 1st at 4,365 MYR. Palm oil owns 61% and soybean oil owns 14% world market share.

July cotton settled at $82.35, down $0.41 per cwt. The contract high was made September, 1st at $101.64 per cwt. Cotton competes with soybeans and corn for acres.

July natural gas settled at $2.878, down 0.133. The contract high was made September, 6th at $5.938. Natural gas is the primary cost to manufacture nitrogen fertilizer.

July ULSD settled at $2.6480 per gallon, down 0.0573. The contract high was made November, 4th at $3.1450. ULSD stands for Ultra Low Sulfur Diesel.

March Dow Futures settled at 33,866, up 127. The lifetime high is 36,832 on January 5th, 2022.


 

Rain Days Update


The 6 to 10 day forecast updated every day at: https://www.cpc.ncep.noaa.gov/products/predictions/610day/

Explanation of Rain Days


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