-Winter wheat conditions generally decline over last month
-Brazil corn exports strong again in Dec
-Attache sees slightly higher Brazilian soybean crop, but lower exports than USDA
-Attache sees lower Malaysian palm oil production/stocks than USDA
-Chinese seed company stocks sore on GMO optimism
-Export Sales poor in holiday week
EIA ethanol data will be out today at 10:00 AM CT, while the CFTC COT data is delayed until Monday. Energy markets are sharply higher/equities lower this morning on rising Middle East tensions following the U.S. airstrike on a Baghdad airport which killed a top Iranian general.
ï‚· Several major winter wheat producing states issued their monthly crop condition updates yesterday afternoon as is done during the winter months on the first Monday of each month. Kansas winter wheat conditions slipped to 40% good/excellent from 44% in late November, as did NE to 70% g/e vs 74% in late Nov, OK to 40% g/e vs 52% late Nov, SD to 73% g/e vs 78% late Nov and CO to 57% g/e vs 65% late Nov. IL conditions improved slightly to 48% g/e from 45% late Nov, while KY improved to 90% g/e from 80% late Nov. Montana saw conditions fall to 55% g/e as of late Dec from 68% a month earlier. Comparisons to year ago conditions are not available as the government shutdown was in effect at the time. Winter wheat condition updates during the winter months are worthy of note, but spring weather conditions are much more important to yield prospects.
 Brazil exported 4.4 MMT of corn in December, the 2nd highest on record for the month, and slightly up from Nov exports of 4.3 MMT and solidly above last year’s 3.6 MMT. Marketing year to date (Mar-Dec) exports of 37.8 MMT are more than double last year’s 18.7 MMT during the same period. Soybean exports in December were 3.4 MMT, down from 5.2 MMT in Nov and 4.1 MMT last year, with marketing year to date (Feb-Dec) exports of 74.6 MMT down from 81.7 MMT last year.
 The USDA ag attaché in Brazil sees the coming soybean crop at 123.5 MMT, marginally above the USDA’s latest official estimate of 123.0 MMT and up from last year’s 116.0 MMT (USDA 117.0 MMT). The attaché sees new crop soybean exports at 75.0 MMT vs USDA last at 76.3 MMT and up modestly from this year’s 73.0 MMT, with new crop crush at 44.0 MMT vs USDA at 43.9 MMT and 42.6 MMT this year.  The USDA ag attaché in Malaysia sees the country’s 2019/20 (Oct-Sep) palm oil production at 20.6 MMT, moderately below the USDA’s official estimate of 21.2 MMT and down slightly from last year’s 20.8 MMT. The attaché estimates exports at 18.2 MMT, a bit above USDA’s 18.0 MMT, and would be nearly unchanged from last year’s 18.3 MMT attaché estimate, which is well above the USDA’s current official estimate of 2018/19 exports of 17.5 MMT. Accordingly, the attaché sees 2019/20 Malaysian palm oil stocks dropping to 1.764 MMT from 2.449 MMT last year and well below the official USDA estimate of 2.840 MMT.
 Equity share prices of Chinese seed producers surged today following Beijing’s announcement of the plan to allow domestic cultivation of GMO corn and soybean crops. Shares of three leading seed companies all rallied the daily allowed limit of 10%. Depending on the degree of GMO seed cultivation, this development could very well mark a game-changing event in Chinese grain production moving forward.
ï‚· Please see our Market Insights post at https://portal.rjobrien.com/MarketInsights/Blog/Read/38507 for details on the USDA Export Sales report.
ï‚· U.S. soybean sales were a marketing year low at just 330k tonnes (12.1 million bushels), below market expectations of 350k-1.0 MMT, down from the previous week’s 27.1 million bushels and last year’s same-week sales of 38.6 million bushels. Net sales to China for the week were just 28.2k tonnes. ï‚· U.S. corn sales last week were an 8-week low of 531k tonnes (20.9 million bushels), which were within market expectations of 300-750k tonnes and in line with last year’s same-week sales of 19.8 million bushels. The overall weak export sales week isn’t all that surprising given the Christmas holiday. ï‚· U.S. wheat sales last week of 313k tonnes (11.5 million bushels) were a 4-week low and at the bottom end of market expectations of 250-800k tonnes, while falling notably from the previous week’s 26.3 million bushels and last year’s same-week sales of 21.8 million.
ï‚· U.S. soybean meal sales last week of 95k tonnes were at the bottom of market expectations of 75-250k tonnes and down from the previous week’s 138k tonnes. SBM sales have slowed of late, averaging 105k tonnes/week over the last three weeks, below the roughly 158k tonnes/week we estimate is needed to reach the USDA’s export projection. Soybean oil sales were minor net cancellations of 2k tonnes vs market expectations of sales of 5-30k.
Weather Argentina is expected to see rains of .50-1â€, with areas of 1â€+, across most areas on Sunday. Conditions look mainly dry for the first half of next week, with rains of .50-1â€+ to fall across most of Santa Fe, Entre Rios and Corrientes by Thursday and Friday of next week. In Brazil, dry weather dominated RGDS, Santa Catarina and Parana yesterday, with rains of .25-.75â€+ falling across around 75% of the rest of the Brazilian growing regions. Rains of 2-3†are expected for most of Minas Gerais and Goias in the next 5 days, with totals of .50-1â€+ in Mato Grosso, MGDS, Sao Paulo and Parana, with Santa Catarina and RGDS dry. Widespread .50-1.5â€+ amounts are expected in the 6-10 day period.