-Argentina replaces corn export ban with cap
-Malaysian Dec palm oil slightly above expectations
-China approves additional GMO varieties
-Argentina sees decent rains, but more needed
-USDA reports tomorrow, trade estimate summary included
USDA will release the annual Crop Production report, quarterly Grain Stocks report, WASDE supply/demand report and Winter Wheat Seedings report tomorrow at 11:00 AM CT. Our pre-report commentary/analysis can be found on Market Insights at
https://portal.rjobrien.com/MarketInsights/Blog/Read/42557. A summary of the average trade estimates is on the following page.
ï‚· Argentina lifted the complete ban on corn exports through March 1 announced in late December, replacing it with a temporary capping of daily sales at 30k tonnes (~900k tonnes/month).
ï‚· Safras & Mercado estimated Brazilian farmers have sold 58% of expected new crop soybean production, sharply above 43% last year and average of 39%. They see the Brazilian soybean crop at 132.5 MMT (USDA 133.0 MMT/126.0 MMT last year USDA).
ï‚· The Rosario Grains Exchange said roughly 65% of Argentine corn areas are suffering from drought conditions, with rains being crucial in the coming weeks.
ï‚· USDA reported the sale of 132k tonnes of soybeans to China and 109k tonnes of corn to Colombia this morning.
ï‚· The Malaysia Palm Oil Board reported end December palm oil stocks were 1.265 MMT, down sharply from Nov stocks of 1.562 MMT and significantly below year ago Dec stocks of 2.011 MMT, but above average market expectations of 1.219 MMT. December palm oil production of 1.334 MMT was in line with average market expectations of 1.326 MMT, but down from 1.492 MMT in November and exactly on par with year ago Dec production of 1.334 MMT. December palm oil exports were stronger than expected at 1.625 MMT vs average expectations of 1.500 MMT and up from 1.303 MMT in Nov and 1.398 MMT last year. Malaysia imported 282k tonnes of palm oil in December vs expectations of 100k tonnes, 113k in Nov and 123k tonnes last year. The MPOB said they anticipate a solid recovery in palm oil stocks to 2.0 MMT by the end of 2021 as crude palm oil production is expected to rise to 19.7 MMT from 19.4 MMT in 2020, with mostly stagnant exports at 17.5 MMT vs 17.4
MMT in 2020. Benchmark palm oil futures are expected to average around 3,000 ringgit/tonne ($742) in 2021 vs 2,686 ringgit/tonne ($664) in 2020 according to the MPOB.
ï‚· Russian export values of 12.5% protein wheat at Black Sea port locations for mid-February shipment are up $13/tonne from the end of 2020 at $275/tonne fob according to IKAR.
 China approved another domestically-produced GMO variety of corn (fall armyworm resistance) and soybeans (herbicide tolerance) following last year’s approval of three varieties, which most see as a sign they are likely to approve domestic cultivation of GMO crops for the first time. Currently, China only allows imports of GMO corn and soybeans for use specifically in feed.
 Friday’s CFTC Disaggregated COT data for futures/options combined for the week ended 01/05/21 showed funds net buyers of 18k contracts of corn, well below wire service estimates of 50k contracts bought during the week, putting their net long at 350k contracts, which is historically large but still moderately below the 429k contract record. Funds were net sellers of 21k contracts in soybeans for the week, in sharp contrast to wire service estimates of funds being net buyers of 45k contracts during the week, reducing their net long to 176k contracts and remaining well below the 254k contract record. Funds were net buyers of 12k contracts in CBOT wheat (wire service estimate 33k) and are net long only 25k contracts. Funds were net sellers of 5k contracts in SBM (wire service estimate 10k net buying) and are net long 85k contracts (134k record), while they were net even in SBO for the week (wire service estimate 15k net buying), maintaining the net long at 113k contracts vs the 127k contract record.
Weather
Brazil saw .30-1â€+ in Mato Grosso, MGDS, Minas Gerais and Goias over the weekend, with totals of .20-.60†in RGDS, Santa Catarina and Parana. Sao Paulo was the only state that did not see much rainfall activity. Solid, widespread rains are expected over the next five days with .75-1.5â€+ of nearly 100% coverage through Friday, with the heavies amounts of 1-3†expected in Minas Gerais, Goias and Sao Paulo. Continued rains in the 6-10 day period are expected of 1-3â€+ for most regions, with totals of .50-1.5†in RGDS. Argentina saw .50-1â€+ rains with nearly 100% coverage over the weekend. An additional .50-1â€+ is expected for majority of growing regions over the next 24 hours, with only the southern ½ of Buenos Aires to be dry. Some 1-3†totals will fall in the northern 1/3 of Entre Rios and Santa Fe. Tues-Fri then looks mostly dry. Rains look limited in the 6-10 day period with only .25-.75â€+ seen for Entre Rios and Corrientes at this time.