Global Ag News for July 18.24

TOP HEADLINES

U.S. soybean production up on high condition scores and rising vegetation density levels

2024/25 U.S. SOYBEAN PRODUCTION: 121 [117–126] MILLION TONS, UP 1% FROM LAST UPDATE

Overwhelmingly favorable early-mid July weather and higher than expected condition scores/vegetation density levels in core producing areas of central Soy Belt increase 2024/25 U.S. soybean production by 1% to 121 [117–126] million tons. In July’s WASDE (12 July), USDA placed U.S. soy production at 120.7 million tons, slightly below our median projection. Our current estimate puts planted area at 86.8 million acres, unchanged from last update, which stays above last season’s 83.6 million acres and the USDA’s latest projection of 86.1 million acres in its June Acreage report (released on 28 June). The next USDA survey-based estimate of acreage (harvested area, as well as yield and production) will be released in its August Crop Production report, which is scheduled for 12 August. The latest Reuters Poll of Analysts (09 July) set production at 4.40 [4.34–4.45] billion bushels, with yield at 51.6 [51.0–52.0] bushels per acre, largely in line with our current outlook of 4.45 billion bushels and 52.1 bushels per acre, respectively.

The latest Crop Progress report (15 July) indicated national-level soybean blooming at 51%, on par with last year’s 51% and the 5-year average of 44%. Setting pods was pegged at 18%, also ahead of last year’s 17% and the 5-year average of 12%. Crop conditions continue to show an overall healthier than expected crop despite early season delays, with now 68% in the good-to-excellent category (vs. last year’s 55%). Vegetation densities from satellite imagery remain surprisingly high, maintaining above historical median levels across the key “I” states (i.e. Illinois, Iowa and Indiana) despite severe lack of moisture (e.g. Indiana), excessive moisture/flooding concerns (e.g. Iowa) and delayed plantings (e.g. Illinois) earlier in the season. The only struggling region among the top producers at the moment appears to be Minnesota, where vegetation density levels are currently hovering below historical medians, conforming well with its underwhelming conditions scores. Looking ahead, a favorable wet-east dry-west weather pattern is expected to remain in place at least through next week, which should help replenish soil moisture across eastern Soy Belt while alleviating moisture extremes in its western counterpart, hinting a positive yield outlook.

 

FUTURES & WEATHER

Wheat prices overnight are up 1/4 in SRW, down 1 1/2 in HRW, up 2 in HRS; Corn is down 2 3/4; Soybeans down 7; Soymeal down $3.30; Soyoil up 0.27.

For the week so far wheat prices are down 11 1/4 in SRW, down 8 1/4 in HRW, down 3 3/4 in HRS; Corn is down 5 3/4; Soybeans down 31 1/4; Soymeal down $5.30; Soyoil down 1.33.

For the month to date wheat prices are down 34 in SRW, down 26 3/4 in HRW, down 19 1/4 in HRS; Corn is down 11 3/4; Soybeans down 70; Soymeal down $26.70; Soyoil up 0.47.

Year-To-Date nearby futures are down 14.1% in SRW, down 12.9% in HRW, down 17.9% in HRS; Corn is down 16.2%; Soybeans down 15.5%; Soymeal down 12.6%; Soyoil down 3.0%.

Chinese Ag futures (SEP 24) Soybeans down 14 yuan; Soymeal down 23; Soyoil down 10; Palm oil up 2; Corn unchanged — Malaysian Palm is up 8.

Malaysian palm oil prices overnight were up 8 ringgit (+0.20%) at 3961.

 

There were changes in registrations (-8 Corn). Registration total: 424 SRW Wheat contracts; 7 Oats; 64 Corn; 55 Soybeans; 1,182 Soyoil; 0 Soymeal; 0 HRW Wheat.

Preliminary changes in futures Open Interest as of July 17 were: SRW Wheat up 2,477 contracts, HRW Wheat up 2,738, Corn up 6,493, Soybeans up 5,694, Soymeal up 3,559, Soyoil up 5,737.

 

Northern Plains: Drier conditions continue the next couple of days, but a trough will move into the region on Friday and settle to the south for the weekend into next week. Occasional showers will be possible, but amounts are likely to be below normal. Montana may stay warm to hot though eastern areas will be milder underneath the trough. Temperatures are forecast to rise later next week with heat for the end of July, which is somewhat needed with crop development still behind from late planting.

Central/Southern Plains: Scattered showers and thunderstorms continue to move through the region with a front sagging south the next couple of days. That is followed by an upper-level low that will move in and park itself in the region this weekend, offering widespread showers and thunderstorms through much of next week, especially south. Temperatures are becoming mild behind the front and will persist through next week underneath the trough, a good combination for crop development.

Midwest: Scattered showers and thunderstorms continue to follow a front south on Wednesday with much drier conditions behind it for a few days. Temperatures will be much milder behind the front as well. An upper-level low settling off to the west this weekend through next week may or may not bring showers into the region through next week. Models are mixed on the prospect. Some areas in the southeast that are still struggling with soil moisture and drought may not get much rain while other areas that are wet in the northwest are going to see some favorable dryness. The quieter conditions should allow for those to assess recent storm damage.

Delta: A front sagging south through the region will continue to create showers and thunderstorms going into the weekend as it settles across the south and an upper-level low will move off to the west and continue chances through next week. Though showers and thunderstorms will be in the forecast, coverage and intensity may be limited in some areas. Milder temperatures are settling in behind the front and should continue through next week underneath the trough. Overall, this should be a good setup for developing crops.

Canadian Prairies: Recent heat caused more rapid growth of crops over the last week. Some isolated showers will move through over the next week, but the dryness continues, a concern for some areas that need the rain from the recent heat. A ridge over Alberta that is producing more heat will continue through next week, with warmer conditions over eastern areas as well. The combination of heat and dryness is not favorable for developing crops.

Brazil: After a run of heavier rainfall, drier conditions over the country persist into next week, favorable for the remaining corn harvest. Wheat planting is behind schedule from the wet conditions of the last couple of months, especially in Rio Grande do Sul in the far south. The drier weather should help in that regard.

Argentina: Frosts and mostly dry conditions have been unfavorable for developing wheat over the last week. More soil moisture is needed for the developing crop. Rainfall chances increase with a front moving into northern areas on Friday into the weekend with more for southern areas possible next week. Temperatures are more seasonable or even warm despite the front.

Europe: It is drier in western Europe through the rest of the week, which is favorable for harvest. A system will move through the continent this weekend into early next week with unfavorable showers for the northwest, but with needed showers for the southeast that has been very hot and dry this season. Showers will be sporadic behind the system for next week, but many areas will remain dry while temperatures become more seasonable for most areas.

Black Sea: A front will bring sporadic showers through the region through Friday, but mostly to western areas that have had much better success finding some rain. Eastern Ukraine and southwestern Russia continue to deal with hot and largely dry conditions which have been unfavorable for corn and sunflowers. Chances may improve somewhat next week as a couple of systems will move through, but the forecast is not favoring the widespread heavy rain that is needed. Wheat harvest should continue to increase.

The player sheet for 7/17 had funds: net buyers of 3,500 contracts of SRW wheat, buyers of 3,000 corn, buyers of 2,500 soymeal, and sellers of 3,500 soyoil.

 

TENDERS

• MILLING WHEAT PURCHASE: Algeria’s state grains agency OAIC has bought at least 600,000 metric tons of milling wheat in an international tender that closed on Wednesday.
• CORN PURCHASE: Taiwan’s MFIG purchasing group bought about 65,000 metric tons of animal feed corn expected to be sourced from the United States in an international tender on Wednesday
• MILLING WHEAT PURCHASE: A group of South Korean flour mills bought an estimated 40,000 metric tons of milling wheat to be sourced from the United States in an international tender on Wednesday
• WHEAT TENDER: Japan’s Ministry of Agriculture, Forestry and Fisheries (MAFF) bought a total of 115,208 metric tons of food-quality wheat from the United States and Canada
• MILLING WHEAT TENDER: Jordan’s state grain buyer has issued an international tender to buy 120,000 metric tons of milling wheat which can be sourced from optional origins
• NO PURCHASE IN FEED WHEAT TENDER: A group of importers in Thailand is believed to have rejected all offers and made no purchase in an international tender for up to 175,200 metric tons of animal feed wheat which closed on Wednesday.
• NO PURCHASE IN BARLEY TENDER: Jordan’s state grain buyer is believed to have made no purchase in an international tender for 120,000 metric tons of animal feed barley which closed on Wednesday.

PENDING TENDERS

• VEGETABLE OILS TENDER: Egypt’s state grains buyer, the General Authority for Supply Commodities (GASC), said it was seeking vegetable oils in an international tender for arrival Sept. 1-15 and/or Sept. 16-30. The deadline for offers is July 18.

 

 

TODAY

DOE: US Ethanol Stocks Fall 1.9% to 23.16M Bbl

According to the US Department of Energy’s weekly petroleum report.

• Analysts were expecting 23.712 mln bbl
• Plant production at 1.106m b/d, compared to survey avg of 1.065m

 

GRAIN EXPORT SURVEY: Corn, Soy, Wheat Sales Before USDA Report

Estimate ranges are based on a Bloomberg survey of six analysts; the USDA is scheduled to release its export sales report on Thursday for week ending July 11.

• Corn est. range 550k – 1,200k tons, with avg of 804k
• Soybean est. range 300k – 900k tons, with avg of 510k

 

Inform cuts Ukraine sunseed, soybean crop forecast due to hot weather

Analyst APK-Inform on Wednesday cut its 2024 sunseed and soybean crop forecast for Ukraine due to record high temperatures and drought across the country.

The consultancy sees the 2024 sunseed harvest 1% down at up to 14.5 million metric tons, while the forecast for the soybean crop was reduced by 2% to 5.9 million tons, it said in a report.

 

India June Oilmeals Exports Rise to 335,196 Tons

India’s oilmeals exports rose to 335,196 tons in June from 302,280 tons in May, according to the Solvent Extractors’ Association of India.

• Rapeseed meal exports rose to 159,447 tons from 133,263 tons in May
• Soymeal exports rose to 152,351 tons from 144,706 tons in May
• Castorseed meal exports fell to 21,388 tons from 23,000 tons in May

 

Indonesia June Palm Oil Exports Rise 58.8% M/m: Intertek

Indonesia’s palm oil exports rose 58.8% m/m in June versus -4.5% in May, according to Intertek Testing Services.

• Palm oil exports rose to 2.797m tons from 1.761m tons in May
• Crude palm oil shipments rose to 538,755 tons from 82,245 tons in May
• RBD palm olein shipments were 1.090m tons
• RBD palm oil shipments rose to 518,047 tons from 305,650 tons in May
• Palm oil sales to European Union fell to 297,531 tons from 424,549 tons in May
• Palm oil sales to India rose to 1.099m tons from 417,864 tons in May
• Palm oil sales to China rose to 483,529 tons from 295,586 tons in May

 

Russian Trader Grain Gates Boosted Exports Last Season: IFX

Grain Gates boosted its grain exports about 80% to 14.1m tons in the 2023-24 season that ended in June, Interfax reported, citing a statement from the company.

• The company expanded the number of countries it shipped to, and main export destinations were Egypt, Turkey, Libya, Algeria and Indonesia
• Revenue jumped to 241.9 billion rubles ($2.7b) in 2023
• NOTE: Grain Gates and trading house RIF, which has changed its name to Rodnie Polya, were the biggest Russian grain exporters in the first half of the 2023-24 season

 

Argentina wheat production to rebound greatly in 2024/25 season

2024/25 Argentina: 18.2 [15.2–21.4] MILLION TONS

2024/25 Argentina wheat production is preliminarily set at 18.2 [15.2–21.4] million tons, up 14.9% from last season’s drought reduced crop, thanks to much healthier early season soil moisture conditions, steady sowing progress, and overall increased planted area compared to last season. In July’s WASDE (12 July) USDA placed Argentina wheat production at 18 million tons, up from its previous estimate of 17.5 million tons. Much of the increase is attributed to higher expected yield, which is currently estimated at 3.07 tons per harvested hectare (tph), significantly up from last season’s 2.84 tph. Planted area is projected to expand as well, to 6.2 million hectares (up 5% from last year), owing to good early season weather conditions and farmers’ need to rotate crops after the impact from the corn crop disease carried by leafhoppers, despite recent volatile prices. Bolsa de Comercio in Rosario and Bolsa de Cereales in Buenos Aires currently project wheat planted area at 6.7 and 6.3 million hectares respectively, slightly above our median estimate. Plantings are nationally 86% complete so far according to the Ministry of Agriculture, largely in line with last year’s pace. Latest long-term weather forecasts from the LSEG weather research team indicate a mixed trend of cool/dry conditions throughout the Pampas during the crop’s prime growth period (September–November), in which case the yield and production should not deviate too much from the current initial projections.

 

Biofuel Tax Credits Need Safeguards, Farmer Groups Claim

Clean fuel tax credits could be a boon for U.S. farmers in the future, but without policy safeguards, that benefit may be mitigated by competition from overseas exporters, says a coalition of groups representing farmers. In a letter addressed to Treasury Secretary Janet Yellen and U.S. Office of Management and Budget Director Shalanda Young, a coalition of four groups representing U.S. farmers–the American Farm Bureau Federation, American Soybean Association, National Corn Growers Association and National Farmers Union–say that credits need to include a requirement for domestic-only feedstock. Biofuel feedstocks include corn, soybeans, and other biomasses. “Without clear domestic feedstock requirements, the benefits of this policy are at risk of being diverted from American farmers,” the coalition said in its letter.

 

Chinese researchers find new gene enhancing wheat yields in saline soils

Chinese researchers have decoded a novel salt-tolerance gene in wheat, resulting in yield increases of 5 percent to 9 percent in experimental varieties grown in saline-alkali soils.

The study findings have been published in the journal Nature Genetics.

Wang Meng, corresponding author of the study, from the Institute of Soil Science (ISS), Chinese Academy of Sciences (CAS), said that China’s primary wheat-growing regions coincide with high occurrences of soil salinization. Spring marks a crucial growth period for wheat, characterized by jointing and grain filling, yet it aligns with peak soil salinity, severely impacting wheat growth and yield.

Researchers from the ISS, Northwest A&F University and Qingdao Agricultural University analysed over 500 wheat varieties and lines cultivated for years in saline-alkali fields and identified TaSPL6-D, a transcriptional suppressor of critical salt-tolerance genes in wheat.

The research team found that due to natural genetic variation, there exists a natural variant of TaSPL6-D, termed TaSPL6-D-In in landraces, which loses its ability to suppress key salt-tolerance genes in wheat.

Using molecular-assisted breeding method, researchers introduced TaSPL6-D-In from a landrace into a leading wheat cultivar, successfully improving the yield in saline-alkali soils.

Zhao Zhendong, an academician with the Chinese Academy of Engineering, and Cao Xiaofeng, an academician with CAS, both said that this research provides pivotal design targets for advancing molecular breeding in salt-tolerant wheat and other crops.

 

 

 

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