-USDA reports small soybean sales to China – market on lookout for much more
-Brazil lowers soybean crop estimate, ticks safrinha corn estimate higher
-China sees slightly higher corn/soybean imports in 20/21
-Malaysian April palm oil stocks higher than expected
-Russian/Ukraine wheat crop ideas lowered
-U.S. forecast turning favorably warmer
-USDA report day – trade estimate summary included
It’s report day. The USDA’s monthly WASDE report and Crop Production report will be out at 11:00 AM CT. Our pre-report commentary/analysis can be found on Market Insights at https://portal.rjobrien.com/MarketInsights/Blog/Read/40024. A summary of the average trade estimates is on the following page.
ï‚· There was talk yesterday during the session China bought at least 4 cargoes (240k tonnes), with ideas state buyers were seeking up to 20 cargoes (1.2 MMT) for July-Nov shipment periods. Accordingly, the market will be looking for confirmation of business by USDA over the coming days. This morning, USDA did report 136k tonnes of soybeans sold to China for 2019/20, but the market will be on the lookout for much more.
 CONAB lowered their estimate of this year’s Brazilian soybean crop to 120.3 MMT from 122.0 MMT previously (USDA 124.5 MMT/117.0 last year), with exports estimated to be 75-77 MMT (USDA 76.5 MMT/73.2 MMT last year) and could be as high as 12 MMT in May according to CONAB. Soybean crush this year was estimated at 44.5 MMT (USDA 44.3 MMT/43.4 MMT last year). They raised their estimate of safrinha corn crop to 75.9 MMT from 75.4 MMT previously, putting the total corn crop at 102.3 MMT vs 101.9 MMT last month (USDA 101.0 MMT), with exports estimated at 34.5 MMT (USDA 36.0 MMT/39.7 MMT last year), but with upside potential given the favorable exchange rate. Private estimates of the safrinha crop have been falling of late, with some now under 70 MMT.
 China’s monthly balance sheet updates included their first “official†estimates of the 2020/21 situation, putting this year’s corn production at 266.5 MMT (area up 1%) vs 260.8 MMT last year, total consumption at 285.5 MMT vs 278.8 MMT last year (274.8 MMT 18/19) and imports ticking up to 5.0 MMT from 4.0 MMT this year. This would result in 2020/21 corn ending stocks declining by 14.0 MMT from this year, the same estimated annual decline in stocks in 2019/20. China does
not provide official stocks estimates, but only the expected change in stocks year-over-year. China’s look at the 2020/21 soybean situation showed imports rising to 93.6 MMT from 91.0 MMT in 2019/20, which was revised higher from their estimate last month of 87.7 MMT and compares to 82.6 MMT in 2018/19. They see this year’s soybean crop at 18.8 MMT (area up 2.7%) vs 18.1 MMT last year, with total consumption rising to 111.1 MMT from 107.1 MMT this year (105.5 MMT
previously) and 102.9 MMT in 2018/19. China’s soybean ending stocks in 2020/21 are estimated to rise 1.2 MMT from this year after 2019/20 stocks rose 1.9 MMT (previous estimate flat on the year) and 2018/19’s 4.4 MMT decline. China estimated 2020/21 total edible oil imports at 7.7 MMT vs 7.9 MMT in 2019/20 and 8.6 MMT in 2018/19, with palm oil accounting for 4.2 MMT vs 4.4 MMT in 2019/20 and soybean oil at 700k tonnes vs 750k in 2019/20. Rapeseed oil imports
are estimated unchanged in 2020/21 at 1.40 MMT.
ï‚· The Malaysian Palm Oil Board reported end April palm oil stocks were 2.045 MMT, well above average expectations of 1.910 MMT, up sharply from 1.730 MMT in March and compares to year ago April stocks of 2.729 MMT. April palm oil production of 1.653 MMT was also above expectations of 1.606 MMT, rising notably from 1.397 MMT in March and little-change from year ago April production of 1.649 MMT. April palm oil exports of 1.236 MMT were in line with average expectations of 1.225 MMT and compared to March exports of 1.185 MMT and year ago exports of 1.651 MMT. Implied domestic usage of palm oil in April was down roughly 40% year-over-year.
 SovEcon lowered their estimate of the Russian wheat crop to 81.2 MMT from 84.4 MMT previously, due to dryness in southern growing regions. This would still be up considerably from last year’s USDA-estimated Russian wheat crop of 73.6 MMT.
 Ukrainian ag consultant ProAgro sees the country’s wheat crop this year at 25.4 MMT, down solidly from last year’s record 28.5 MMT, while the corn crop is seen rising modestly to 37.3 MMT from 35.9 MMT last year. As a result, they see 2020/21 wheat exports falling to 17.0 MMT from 20.2 MMT this year, with corn exports ticking up to 32.0 MMT from 30.5 MMT this year.
ï‚· U.S. corn planting progress of slowed a bit last week and is now 67% complete vs 71% expected, but remains solidly ahead of average of 56%. IA is 91% planted vs 66% avg, MN 89% vs 57% avg and WI 59% vs 39% avg. More typical progress numbers are being seen in the eastern belt. Soybean planting is 38% complete, a bit less than expectations of 42%, but also well ahead of average of 23%. IA is 71% planted vs 24% avg, MN 57% vs 30% avg, SD 23% vs 13% avg, NE 54% vs 23% avg, IL 43% vs 25% avg and IN 37% vs 18% avg. Spring wheat planting remains slow at 42% complete vs 49% expected and 63% avg.
ND is 27% planted vs 56% avg. Winter wheat conditions declined 2% good/excellent last week to 53% and compares to 64% at this time last year. Overall, HRW conditions are in line with the 5-year average, SRW conditions above the 5-year average and white wheat below the 5-year average.
 As a result of the decline in soft winter wheat area to 4.6 million hectares from 5.0 million last year given the very wet planting conditions in the fall, France expects this year’s corn area to rise nearly 11% from last year to 1.674 mil hectares (4.1 mil acres). Other smaller spring grains are also expected to see increases in area, as well.
 India suspended 39 import licenses for refined palm oil, totaling 452k tonnes of expected imports, following a recent surge in duty-free imports from countries such as Nepal and Bangladesh who are not traditional suppliers. These duty-free imports were negatively impacting domestic veg oil prices and India’s crushing industry, accordingly. India’s palm oil demand has fallen dramatically as a result of the coronavirus pandemic, with imports in April down 46% from last year.
ï‚· South Korea bought 67k tonnes of optional-origin feed wheat at $208.90/tonne c&f for Oct 30 arrival.
Weather
Rains of .50-1†are expected Wed-Thur south of a line from around Omaha to Green Bay, with under .35†expected to the north. An additional .35-.85†is expected later in the week. Temps will run below average for this week and then warm to average to even a bit above by the weekend and end up above average for most of
next week.