-China think tank sees large corn production increase
-Canada quarterly grain stocks widely lower than expected
-USDA reports sizable new crop corn sale to China
-Argentine soybean harvest moving very quickly – yields better than expected
-Trade estimate summary for USDA reports
The forecast for Brazilian safrinha corn areas remains mostly dry through the 15-day period, although some rains for Parana appear possible over the next five days. USDA monthly WASDE and Crop Production reports will be out next Wednesday. Our pre-report commentary/analysis can be found at https://portal.rjobrien.com/MarketInsights/Blog/Read/43806. A summary of the average trade estimate is on page 3.
ï‚· USDA reported the sale of 1.360 MMT of corn to China for 2021/22, new crop, delivery this morning. They also reported sales of 188k tonnes of corn to unknown, with 87k tonnes for old crop and 102k tonnes for new crop delivery.
 China’s government think tank supported previously-expressed ag ministry views of a solid increase in expected corn production this year to 272 MMT from last year’s 261 MMT as planted area is expected to be increased 3.3% to 42.6 million hectares (105.3 mil acres), which would be the first increase in corn area in five years following the policy in recent years to reduce production and reduced state reserves. China appears to be making a policy shift back to supporting corn vs soybeans as soybean area is expected to decline 6.9% this year to 9.2 mil hectares (22.7 mil acres), prompting a decline in
production to 18.4 MMT from 19.6 MMT last year. This year’s wheat crop is expected to rise 1.6% from last year to 136.4 MMT, while rapeseed production was estimated at 14.5 MMT, up 2.8% from last year.
ï‚· Statistics Canada released their quarterly grain stocks report this morning, providing data for stocks as of March 31. Canadian wheat stocks as of March 31, 2021 were reported 16.231 MMT, a bit below the average trade estimate of 16.7 MMT (15.2-19.6 MMT range of ideas) and down notably from 18.781 MMT last year, with the durum wheat stocks at 2.753 MMT vs the average estimate of 2.6 MMT (1.9-3.1 MMT range) and 3.305 MMT last year. March 31 canola stocks of 6.572 MMT were slightly below the average estimate of 6.7 MMT (6.1-7.2 MMT range) and down sharply from 10.554 MMT
last year, while March 31 oat stocks of 1.844 MMT compared to the average estimate of 1.9 MMT (1.7-2.3 MMT range) and 1.846 MMT last year. March 31 barley stocks were 2.806 MMT, sharply below average expectations of 3.3 MMT (2.7-4.6 MMT range) and 3.531 MMT last year.
 Preliminary trade data showed China imported 7.45 MMT of soybeans in April vs 7.77 MMT in March and last year’s 6.71 MMT in April, putting Oct-Apr marketing year to date imports at 54.4 MMT vs 48.4 MMT last year. Total edible oil imports in April of 980k tonnes compared to 780k in March and 660k last year April. Calendar year-to-date imports of 3.80 MMT are up 47.4% from last year.
ï‚· The Buenos Aires Grains Exchange maintained their estimate of the Argentine soybean crop at 43.0 MMT (USDA 47.5 MMT), but said their estimate may be increased as a result of better than expected yields in Cordoba and Santa Fe as harvest progresses. They put the soybean harvest at 53%, jumping a significant 20% in the week following ideal harvest weather. They pegged the corn harvest at 23% complete, with their estimate of the crop at 46.0 MMT (USDA 47.0 MMT). Declining water levels on the Parana River are of increasing concern and are unlikely to improve in the months ahead, reducing vessel loadings.
 As a result of this year’s bumper cereals crop, estimated at 9.8 MMT, up 206% from last year, with wheat at 7.2 MMT vs last year’s drought-stricken 2.6 MMT, Morocco will reinstitute a wheat import tax effective June 1. The last time Morocco had a wheat crop in excess of 7.0 MMT three years ago, annual imports were only 3.7 MMT vs last year’s 6.5 MMT.
 IKAR ticked their estimate of the Russian wheat crop down to 79.0 MMT from 79.5 MMT previously and compares to USDA’s estimate of last year’s crop of 85.4 MMT.
ï‚· French soft wheat crop conditions declined for the 4th consecutive week, down 2% in good/excellent to 79%, but remain sharply better than 57% g/e at this time last year. Better rains were seen during the week, with forecasts for additional precip the next two weeks which should help stabilize, if not improve conditions in the near term.
ï‚· The CME again raised maintenance margins for May corn to $2125/contract from $2050 previously effective at the close to business today.
Weather
NOTE: We have added weather model-estimated precip summary tables to our daily comments. The tables summarize the GFS and European model’s estimated precip by region and by period, along with the change in estimated precip from the forecast 24 hours prior. The U.S. table below compiles estimated state-average precip forecasts into regional averages: WCB (NE, MN, IA, MO), ECB (IL, IN, OH, WI), S. Plains (KS, OK, TX), N. Plains (ND, SD).
On the following page, tables including precip estimates by state, as well as Brazilian safrinha corn areas and Ukraine production areas are also available.
Precip activity over the last 24 hours in the corn belt included .25-.75†with 20% coverage (eastern ½ IL, most of IN and OH). The Central/Southern Plains were dry, as were the Northern Plains.