-Palm oil rallies on lower than expected production – SBO pulled along
-South Korea buys corn – expected to be US
-Germany remains on high alert for ASF as findings move closer to border
-USDA/EIA reports delayed one day this week
Due to Monday’s Martin Luther King, Jr. holiday, this week’s regular data releases will all be delayed by one day. Accordingly, the EIA’s weekly ethanol/petroleum data will be out Thursday and Export Sales on Friday. CFTC data will still be out Friday, as usual. Another light news day… Corn and soybeans remain focused on prospects/hopes/dreams of Chinese business developing, while wheat continues to march higher with ongoing firm global values. Unfortunately, the continued price gains in wheat certainly aren’t helping U.S. export prospects any.
Last July, China issued a policy stating all slaughterhouses must test for African swine fever in every batch of pigs processed. A notice posted by the Ministry of Agriculture regarding the latest results showed 5% of all samples taken from eight provinces in November 2019 tested positive for ASF. Issues with the testing continue, though, with untrained personnel, poor record keeping and insufficient biosafety measures being among them, highlighting what is likely to be a rather long-term fight against the disease. Separately, but relatedly, Italy confiscated and destroyed 9.5 tonnes of pork smuggled from China in a shipment of vegetables as global safety monitors stand on high alert for any risks of the disease’s potential spread.
The latest finding of ASF in a wild boar in Poland (55 cases in December alone) was just 7 miles from the German border as they remain on high alert as the EU’s largest pork producer.
Malaysian palm oil was sharply higher overnight following estimates the country’s palm oil production during Jan 1-20 was down 17% vs general ideas for a 5-10% decline. There was also talk/optimism India may lower veg oil import duties as part of its annual budget on February 1. The strength in palm oil prompted overnight gains in soybean oil, as well.
South Korea bought 134k tonnes of optional-origin corn (tendered for 207k) at $218.88-$219.55/tonne c&f for March shipment with ideas it could/should be off the PNW.
Egypt said they are studying adding Indian wheat to the list of acceptable origins for GASC tenders.
Algeria bought roughly 400-450k tonnes of optional-origin milling wheat as a result of their recent tender, priced around $245/tonne c&f, with France, as usual, expected to be the main supplier. Shipment will be March if from France/EU/Black Sea and February if South American. In their previous purchase in early December, they paid around $227.50/tonne c&f for 500k tonnes.
There were no USDA sales announcements this morning.
Weather Argentina saw rains of .50-1” across far northern Santa Fe and Entre Rios, as well as most of Corrientes yesterday. The next event is expected early next week with widespread .40-1” amounts expected for nearly all growing areas. Rains of .50-1.5” fell across the Brazilian growing regions from northern sections of MGDS and Sao Paulo north, with totals of .25-.75” in RGDS, Santa Catarina and southern Parana. Tropical, hit and miss, showers and thunderstorms will bring rains of .50-1.5” to most of the Brazilian growing from Parana north over the coming days, with a front to bring .25-.75” to areas from Parana south today. In the 6-10 day period, 1- 2” is expected for areas from northern MGDS/Sao Paulo north with totals of .30-1” elsewhere.