-Strong winter wheat conditions weight on market overnight
-French soft wheat area estimated at 17-year low
-South Korea buys corn – unlikely U.S.
-Palm oil strong on continued production concerns
-Trade estimate summary for Thursday USDA report
USDA will release the monthly WASDE report on Thursday, April 9.
We would note wire services issued a revision to the U.S. wheat ending stocks estimate due to one of the estimates provided being changed and is updated in the summary on the next page.
The USDA’s first weekly Crop Progress report of the year yesterday afternoon put U.S. winter wheat conditions at 62% good/excellent vs 60% a year ago, which was much better than wire service-reported average expectations of 56%, and put overall conditions right in line with the best levels over the last 10 year for early April – essentially matching those of last year, 2016 and 2012. HRW conditions are slightly below last year, but historically good, while SRW conditions are the best in 4 years to start the spring growing season.
Corn planting delays are being seen in Arkansas at just 3% vs 32% average and Mississippi at 15% vs 46% average, but other states across the south are ahead of average. Specifically, TX is 57% planted vs 49% avg, LA 87% vs 79% avg, AL 42% vs 25% avg and GA 62% vs 52% avg. The USDA’s first U.S.-wide corn planting progress update will be provided next week.
More details on yesterday’s Crop Progress report are in our Market Insights post at https://portal.rjobrien.com/MarketInsights/Blog/Read/39674.
Adding to the list of moderate revisions being made to Brazilian soybean production ideas, AgRural lowered their estimate of the crop to 128.3 MMT from 124.3 MMT previously and compares to USDA last at 126.0 MMT and CONAB at 124.2 MMT.
France’s ag ministry estimated this year’s soft wheat area at 4.6 million hectares (11.4 million acres), down 7.5% from last year and a 17-year low following poor planting conditions in the fall. Rapeseed area is estimated down 2.8% from last year, while barley area is estimated up 2.8% from last year.
Ethiopia postponed their tender for 400k tonnes of milling wheat likely to April 23 from today’s initial plan. A separate tender for 200k tonnes of wheat is still set to close April 15.
South Korean feed mills bought around 189k tonnes of corn overnight at prices ranging from $181.82-$187.15/tonne c&f for arrival periods in August and mid/late September and is unlikely to be U.S. origin.
Palm oil was solidly higher overnight on concerns additional coronavirus-related restrictions will further reduce palm oil production in the near term. The Malaysian Palm Oil Association estimates the loss of 189k tonnes of crude palm oil production as a result of the current 14-day shutdown in the county’s largest palm oil-producing state.
Glencore bid $325 million for the remaining 1/3 share of the Renova soybean crushing plant in Argentina still held by bankrupt Vicentin, which will give them full ownership if/when approved by the court. The plant has a daily crush capacity of 20k tonnes.
Weather Yesterday/overnight, rains of .30-.80” fell across central MN as well as into northern IL and IN. Several more waves of rains will bring totals of .30-.80”+ to the northern 1/3rd of IL and northern ½ of IN, as well as most of WI and MI. Amounts in the rest of the Midwest through Friday will run generally less than .50”. Coverage between the two looks to be widespread. A system is seen for the weekend and the models remain mixed, with the European indicating rains of .40-1”+ to fall in of the region, with some snows possible in MN and NW IA. The GFS sees rains of .50-1” to fall east of a line from Kansas City to Milwaukee, with totals less than .25” to the west. The Southern Plains look mostly quiet until Saturday when .40-1” is expected for most of TX and OK, along with the eastern half of KS. The 6-10 day sees a system to bring more rains for Sunday and Monday. The models do differ some on the rainfall with these. Both indicate fairly limited results for KS. The European indicates totals of .40-1”, isolated to 1”+ to fall far northern TX, as well as far eastern OK and TX. The GFS sees some light rains in northern KS, with totals of .30-1” in OK and the TX panhandle. Temps will run near average through this week and then below average by the weekend into early next week. Most lows look to bottom out around 30 degrees at this point.