Grains, Seeds, Vegoils, Meals, Softs, Agri News

Aug 05 - Argentine truck strike hits Bahia Blanca grains port, halting export climb 

Arrival of freshly harvested soybeans and corn has been halted at the Argentine port of Bahia Blanca at the height of export season due to a protest by truckers who have blocked roads to press their demands for better pay, local officials said. No grain trucks have entered Bahia Blanca terminals since the strike began on Friday, bogging down operations just as the port was becoming more important due to logistical problems further north in the country's main grains hub of Rosario. 

Aug 05 - Millers, bakers fret as drought withers North America's spring wheat 

Millers and bakers are draining wheat reserves and paying more for spring wheat used in baking, as drought shrivels crops across the Canadian Prairies and northern U.S. Plains that produce more than half of the world's supply. U.S. and Canadian farmers are bracing for a sharply smaller spring wheat harvest due to the driest conditions in decades, as severe weather damages crops across the hemisphere, from heat scorching cherries in the U.S. Pacific Northwest to frost chilling sugarcane in Brazil.

Aug 05 - French 2021/22 wheat shipments outside EU hit decade-low in July 

French soft wheat shipments outside the European Union fell to their lowest in over a decade for July, Refinitiv data showed, as a rain-hampered harvest contributed to a slow start to the 2021/22 export season. Soft wheat exports to destinations outside the 27-country bloc totalled 349,200 tonnes in July, the first month of the 2021/22 season, an initial estimate based on Refinitiv loading data showed.

Aug 05 - Brazil's Anec forecasts corn exports to fall by half 

Brazilian corn exports will fall by half this season, as adverse weather hurt the country's crop and export prospects, according to a projection by grain exporter group Anec released on Wednesday. In a presentation, Luciano de Souza, president of Anec's board of directors, said Brazil was forecast to sell 17 million tonnes in export markets in the current cycle, down from 34.8 million tonnes in the last.

 

 

 

Aug 04 - Malaysian palm oil prices recover on output concerns, strong demand (Agricensus)
- Malaysian palm oil futures at the Bursa Malaysia rose sharply on Wednesday - with the front-month rising by nearly 4% on the day - on the back of lower output expectations, strong demand from India and political turmoil, industry sources have told Agricensus.
- The gains mean that the contract has now recovered much of the ground lost at the end of July and early August after disappointing export data had weighed on sentiment.
Palm oil’s most liquid October contract climbed by as much as 4.6% on the day, but had pared some of the gains by closing time to end at MYR 4,293/mt ($1,017/mt) on August 4, up 3.6% on the prior day’s settlement.
- Trailing contracts also traded higher, with the November contract up by 3.6% to close at MYR 4,146/mt ($982.1/mt), and the December contract up by 3.2% on the day to close at MYR 4,055/mt ($960.6).
“The BMD is rallying due to two major factors: a Dalian rally from Chinese funds pushing it up, and Indian physical buying this week,” Singapore-based broker Andy Soo, from Tropical Oil ACI, told Agricensus.
India’s demand for palm oil has returned in July following demand destruction in May-June due to record high prices for the tropical oil.
- And “with the festive season round the corner demand should continue to be robust along with prices,” the Solvent Manufacturers Association of India (SEA) said in a press release in late July.
“Renewed palm oil purchases from India and political uncertainty in Malaysia have contributed to the rise in BMD CPO futures on Wednesday," Anilkumar Bagani, research head at Mumbai-based vegetable oil broker Sunvin Group, said to Agricensus.
"[Palm oil] prices are also well supported by lower July palm oil output and better expectations of August 1-5 export numbers,” added Bagani.
- Provisional export volumes for August 1-5 from cargo inspector ITS is expected to show an increase of 15.4% on the month, higher on the July export data which showed a decline of around 5.2% on the month.
Another factor that may be influencing prices is the continued weakness of the Malaysian ringgit, which increases the competitiveness of Malaysian palm oil versus other origins.
“Political instability in Malaysia, with the incumbent government likely to be replaced, may be weakening the Malaysian Ringgit,” Sathia Varqa, owner and co-founder at Palm Oil Analytics, told Agricensus.

Aug 04 - German rapeseed meal exports hit record high - UFOP
- German rapeseed meal exports up 17% y/y to 2 million tonnes
- The Netherlands, Spain, Finland are top three destinations
- Germany's soybean meal sales at 1.7 million tonnes

German rapeseed meal exports rose by 17% y/y to 2 million tonnes in the period July 2020 to May 2021, the Union for the Promotion of Oil and Protein Plants (UFOP) stated, citing data from the Federal Statistical Office of Germany.
- The Netherlands was the main destination with over 949,000 tonnes, up 25% y/y, followed by Spain, up 29% y/y to 282,000 tonnes, and Finland with 141,000 tonnes, although a y/y decline of 12%. Exports to France increased marginally to over 138,000 tonnes, up 5% y/y.
- In addition, the UFOP stated that Germany exported 1.7 million tonnes of soybean meal in the same period, an increase y/y.

Aug 04 - EU 2021/22 soft wheat exports at 962,949 tonnes by Aug. 1 

Soft wheat exports from the European Union in the 2021/22 season that started in July had reached 962,949 tonnes by Aug. 1, data published by the European Commission showed on Tuesday. That was down from 1.48 million tonnes by the same week in 2020/21, the data showed.

Aug 04 - Egypt's Sisi calls for first bread price rise in decades 

Egyptian President Abdel Fattah al-Sisi said it was time to increase the price of the country's subsidised bread, revisiting the issue for the first time since 1977 when then president Anwar Sadat reversed a price rise in the face of riots. Sisi on Tuesday did not specify the amount of any potential increase, but any change to the food support system in the world's largest wheat importer would be highly sensitive.

Aug 03 - Argentine lorry drivers block Bahia Blanca port for sixth day (Agricensus)
- The port of Bahia Blanca, in the south of Argentina’s Buenos Aires province remains blocked for the sixth consecutive day by a group of lorry drivers demanding a fixed freight tariff, according to local media reports.
- The drivers are also demanding the suspension of a law regulating the weight and power of lorries transporting goods and has been running since last Thursday.
Local press reports said that representatives of the truckers would hold meetings with representatives of the port on Thursday.
- Current legislation has set a timeline to phase out low power trucks out of circulation in a bid to boost road safety on the routes.
- Gustavo Idigoras, head of the country’s grain export chamber CIARA-CEC told Agricensus that the protest had been some violence among some of the strikers, but authorities were slow to respond.
“The Ministry of Transport is currently intervening in this conflict as the authorities of the Buenos Aires Province are not taking any action at all to try to solve this conflict,” Idigoras said.
- The action targets port facilities at a key time in Argentina’s corn export programme, as mounting orders battle with historically low water levels along the key arteries that feed into the Up River network – particularly the Parana river.
- Research by Agricensus suggests that typically around 68% of total corn exports are handled by the Up River hub, but the low water has seen a shift in operations as Atlantic ports, like Bahia Blanca and Necochea, pick up extra work, with Up River declining to 55% of all loadings.

Aug 03 - Egypt's GASC buys 60,000 tonnes of Romanian wheat in tender 

Egypt's state grains buyer, the General Authority for Supply Commodities (GASC,) said on Monday it had bought 60,000 tonnes of Romanian wheat in an international tender. GASC had been seeking the grain for shipment between Sept. 24 and Oct. 4. 

Aug 03 - Brazil's second corn yields hit 10-year low – AgRural 

Unfavorable weather caused second corn yields in the center-south of Brazil to plunge to their lowest level in 10 years, agribusiness consultancy AgRural said on Monday, projecting productivity at 66.6 60-kilo bags per hectare. After drought then frosts spoiled much of the crop, Brazilian farmers are now expected to collect 51.6 million tonnes of second corn, almost 19 million tonnes below the 70.5 million from last season, AgRural said.

Aug 03 - Crop Watch: Need for rain escalates but some fields luck out - Braun 

The last few weeks have trended mostly drier for the U.S. Crop Watch corn and soybean fields, especially in the west, leaving many of the producers anxiously waiting for timely rains before yield potential shrinks. However, some locations enjoyed favorable rains last week, keeping overall yield expectations above average. Mild temperatures also prevented health declines in some of the drier areas.

Aug 02 - Argentina Bunge facility shut down after silo collapse: trade

An accident at a Bunge facility in Argentina’s Up River hub has led to suspension of activity and fears of injuries at one of the group’s main processing sites in the country, according to multiple trade sources.

The facility, thought to be the Puerto General San Martin (PGSM) industrial complex, was reported to have suffered the collapse of a silo earlier today, leading to reports of injuries among workers.

Maritime sources say the accident has not affected berths or loading operations at the facility, but the terminal has been shut down.

“It happened earlier today. I don’t have much info yet, but one person was transferred to hospital… the accident was in a big silo,” one source said, with other sources identifying the Pampa and Dempa terminals that make up part of the complex had been affected.

The facility is identified on the Bunge Argentina corporate website as a crushing plant, port terminal, and storage plant handling grains, meals and oils.

At full capacity, the crusher can handle 8,000 mt of soybeans a day, and offers 530,000 mt of storage, split between 370,000 mt of grains and 160,000 mt of by-products.

The facility can also store 48,000 mt of soyoil and has a soybean refining capacity of 500 mt per day, while its two berths are able to handle 3,000 mt loading per hour.  

Aug 02 - Pakistan said to buy about 220,000 tonnes wheat in tender - trade 

A government agency in Pakistan is believed to have bought about 220,000 tonnes of wheat in an international tender for up to 500,000 tonnes which closed this week, European traders said on Friday. The Trading Corporation of Pakistan (TCP) was believed to have bought all the wheat at an estimated $304 a tonne c&f all for September shipment, they said.

Aug 02 - Funds play 'wait and see' on CBOT corn, soy ahead of U.S. yield data - Braun 

Grain markets have recently been quieter than they have been for much of this year, but speculators are now looking ahead to the U.S. corn and soybean yield forecasts due on Aug. 12 from the Department of Agriculture. That report has delivered big surprises in the past, so unless there are demand developments or a major shift in the weather forecast, investors might be hesitant to make position adjustments ahead of time.

Jul 30 - Rapeseed harvest lag fuels price volatility, Ukraine export delays (Agricensus)
- A delay to the harvest of rapeseeds in Ukraine, caused by the late start of the campaign after heavy rain through the early planting period, and a major export line up are causing price volatility in the country's internal market, trade sources have told Agricensus Friday.
The shift in the timing of the harvest campaign has led to unstable oilseed supply which has been exacerbated by slow farmer selling amid a backdrop of price volatility in prices on the Euronext futures contract.
"The rains that were observed in a number of regions of Ukraine did not allow farmers to go to the fields, which shifted the pace of the harvesting campaign by an average of two weeks," a source at a crusher told Agricensus.
- As of July 29, Ukrainian farmers had completed the harvest on 568,500 ha, 56.5% of the expected area, and gathered 1.48 million mt of rapeseed. That is a 33 point lag behind the result for the same date last year and has fueled instability in the supply of the oilseed at fluctuations in the price, at a time when the number of vessels waiting in the line-up to load rapeseed is increasing.
- According to line-up data for Ukrainian ports, almost 95,000 mt of rapeseeds were exported in July, while 303,750 mt are already nominated for export in August.
“The need to load ships with rapeseed is driving prices up,” said a second market source.
“The market is unstable. The shift in harvesting dates has led to the simultaneous harvesting of wheat and rapeseed. Farmers are seeing an unstable Matif and are holding volumes in anticipation of price increases, leading to unstable supply and price fluctuations,” a trader said, referring to the old name of the Euronext exchange.
- The increase in prices in ports since the beginning of the week amounted to somewhere between UAH1000-1300/mt ($37-$48/mt) to UAH19,500/mt CPT ($727/mt) for the purchasing price paid in the national currency. The price paid in dollars also increased by around $20-30/mt to $625-630/mt CPT, while concerns over the health of supply in other producing regions is also raising fears.
“The downgraded forecast of the Canadian canola crop has an impact on the market, and many are manipulating this fact, pushing the prices higher,” added the trader.
- The Ukrainian export potential of rapeseeds this season, according to USDA expectations, will increase to 2.7 million mt, which is 10.7% higher than the 2020/21 season, but below the record of 3 million mt in the 2019/20 season.
- The 2021/22 marketing year output is expected to increase 11.3% year-on-year to 3.1 million mt.

Jul 30 - Market Briefing: Oilseeds (IHSmarkit)

- Canadian rapeseed supply down 6% y/y to 23 million tonnes in 2020/21
- Indian vegetable oil imports fell by 20% m/m to 996,014 tonnes in June
- Brazil’s soy prices fell by 0.8% w/w to BRL169.07 (USD32.41)/60-kilo bags

Production

- IHS Markit expects total Canadian rapeseed supply at 23 million tonnes, down 6% y/y in 2020/21, and expects a further decline in 2021/22, -15% y/y to 19.2 million tonnes, due to a substantial fall in carry-in stocks in both crop years. Gloomy prospects are likely to be exacerbated by massive wildfires currently impacting the country.
- USDA projects China’s soybean production at 17.5 million tonnes in 2021/22, down 5% y/y, and a fall of 1.5 million tonnes compared to a previous estimate. The decline reflects a switch to corn encouraged by higher prices in 2020/21, and increased subsidies for 2021/22.
- Global soybean production was lowered marginally from a previous estimate of 385.5 million tonnes to 385.2 million tonnes for 2021/22 in USDA’s latest WASDE report. Global oilseed production was revised up by 2.5 million tonnes to 635.4 million tonnes for 2021/22, on greater volumes of sunflower seed, rapeseed, cottonseed, and peanuts oils.

Demand

- Iran has recently announced its intention to increase its palm oil imports from Malaysia to reach 1 million tonnes and above per year to meet demand, according to local news reports. Iran is currently the largest importer of palm oil in the Middle East. The Islamic Republic of Iran embassy in Kuala Lumpur reported that the country purchased a total of 310,000 tonnes of palm oil between January-May 2021, a five-fold increase y/y.
- Indian vegetable oil imports (edible and non-edible) fell by 20% m/m to 996,014 tonnes in June, the Solvent Extractors’ Association of India (SEA) stated.
- In Ukraine, sunflower seed stocks totaled 943,800 tonnes as of July 1, down 34% y/y, APK-Inform stated, citing data from the State Statistic Service. This includes 559,200 tonnes located in storing and processing companies, and 384,600 tonnes for producers.

Trade

- Ukraine exported 4.7 million tonnes of sunflower oil, as of July 1, 2020/2021, which is 88.2% of the export quota agreed by the Economy Ministry and Ukroliyaprom (industry association of major oil crushers and processors), according to a local news report citing data from the association.
- As part of the 2019 UK-Tunisia Association Agreement which came into force on January 1, 2021, Tunisia's olive oil export quota to the UK has gone from 600 tonnes to 7,723 tonnes tariff-free since January 1, 2021. The agreement came as the UK started to look for new trade partners ahead of the Brexit.

Prices

- The Malaysian’s CPO reference price was reduced by RM692.23 to RM3,975.92/tonne for August, according to data from the Royal Malaysian Customs Department. Consequently, the export duty rate is maintained at 8%.
- Brazilian soy prices fell by 0.8% w/w to BRL169.07 (USD32.41)/60-kilo bags in the week ending July 23 at the Paranaguá port, and by 0.6% w/w to BRL164.31 (USD31.50)/60-kilo bags in the state of Paraná, due to a drop in CBOT futures prices.

Jul 30 - Market Briefing: Grains and Feed (IHSmarkit)

- China’s corn imports down by almost 30% y/y to 20 million tonnes in 2021/22
- US sorghum exports at 8 million tonnes in 2020/21
- EU wheat output up 10% y/y to 138.4 million tonnes in 2021/22

Production

- USDA reduced US all wheat production by 152 million bushels to 1.7 billion bushels in 2021/22, while carry-in stocks were adjusted downwards by 8 million bushels to 844 million bushels in its latest WASDE report. This will result in a lower supply of 2.73 billion bushels against a previous estimate of 2.87 billion bushels.
- South Korea will terminate its ‘rice reduction program’ in 2021/22, otherwise known as the project to 'Support for crop cultivation other than rice in rice paddy’, dedicated to providing subsidies for rice farmers who cultivate other crops on paddy land previously used for rice.
- EU wheat output is forecast to surge by 10% y/y to 138.4 million tonnes in 2021/22, according to USDA’s data. As a result, total supply should rise by 6% y/y to 153.3 million tonnes, raising export availabilities, and despite reduced carry-in stocks and imports.

Demand

- Following record corn shipments in 2020/21, up 20.4 million tonnes to 28 million tonnes, China is projected to reduce imports by almost 30% y/y to 20 million tonnes in 2021/22. The decline is a result of an expected rise in domestic production, up 4% to 272 million tonnes, USDA revealed.
- North African wheat consumption (Algeria, Egypt, Libya, Morocco, and Tunisia) should record 48 million tonnes in 2021/22, on population growth supplied by domestic production which accounts for 40%, while the remainder is filled by imports. Egypt will account for nearly half of North Africa wheat imports especially from Russia and Ukraine.
- Brazil resorts to corn imports amid prospects for lower second crop. Imports should reach 2.6 million tonnes in 2020/21, which, if realized, will be the largest volume recorded.

Trade

- Total US corn shipments are projected at 73 million tonnes in 2020/21, which would be a historical high, if realized. USDA reported solid US corn shipments in the first seven months of the current year (October 2020-April 2021), due partly to limited competition from Ukraine, which supplies Asia, North Africa, and the Middle East.
- USDA also forecasts US sorghum exports at 8 million tonnes in 2020/21, its highest level since 2015/16, and reported that 95% of its exports, during the first seven months of 2020/21, were destined to China.

Prices

- FAO’s All Rice Price Index (2014-2016=100) declined to 108.3 points in June 2021, down 2% m/m, and 5.3% y/y, driven by losses in Indica and glutinous rice. Indica prices were affected by reduced trading activity, while poor demand put pressure on glutinous rice prices.
- Thai rice export prices of all grades fell by 1% in the week ending July 19, due to a further weakening of the Thai baht. Thailand’s benchmark 5% broken white rice price stood at USD412, and parboiled 100% rice at USD416/tonne.
- Frosts in several Brazilian producing regions in the beginning of last week, lent support to domestic corn prices, up 3% w/w to BRL99.99 (USD19.17)/60-kilo bags on July 23, in the city of Campinas.

Jul 30 - Market Briefing: Meat and Livestock (IHSmarkit)

- Chinese pork production up 36% y/y in first half of 2021.
- Higher demand lifts Brazilian pork prices.
- Thai chicken meat exports rise despite slowdown in Chinese demand.
- Argentine beef export ban fails to contain local price hikes.

Production

Chinese pork production increased by 36% y/y in the first half of 2021, but pig farmers are reported to have suffered heavy losses to recent floods in Henan province. The USDA’s Foreign Ag Service (FAS) expects Chinese production to reach 43.75 million tonnes (cwe) in 2021, some 20% higher y/y. Elsewhere, pork production in the EU and Brazil started the year at a good pace but high feed costs will likely constrain growth in the second half of the year. Total US pork in cold storage at the end of June was just 442 million pounds, putting significant reliance on fresh available product likely through the end of the year. Meanwhile, meat industry figures in the US and UK this month warned that production facilities could soon be forced to shut down due to a critical shortage of labor.

Demand

Prices for pork and pigs moved upwards in Brazil in July amid higher domestic demand and strong export sales. Brazilian fresh pork exports earned USD10 million per day in the first half of July, up 18% y/y. On Brazil’s domestic market, wholesale pork prices in Paraná state surged to BRL11.00 per kg ($2.11/kg) on 22 July, up 12% w/w. With Chinese consumers set to eat more pork than expected, Chinese imports are now on course to reach 5 million tonnes (cwe) this year – only slightly down on the record volume imported in 2020.

Trade

Thailand strengthened its position on world poultry markets in the first half of this year as higher sales to Japan offset a decline in shipments to mainland China. Total Thai chicken meat exports reached a record 545,123 tonnes in the Jan-June period – a rise of 7% y/y. Total Chinese chicken meat imports fell to 86,555 tonnes in June – down 35% y/y and the lowest monthly volume since February 2020. Chinese imports from top supplier Brazil have fallen steadily since March and amounted to just 38,357 tonnes in June – a decrease of 26% y/y. Purchases from the US have also hit reverse gear after rising sharply earlier this year. According to Chinese customs data, imports of US chicken meat fell 44% y/y to 23,944 tonnes in June.

Prices

Beef prices continued to rise in Argentina last month despite the government imposing a 30-day export suspension. The move proved counterproductive as local beef prices in June were up 8% m/m and 90% y/y. Meanwhile, EU pig prices fell again in July with decreases reported in all of the bloc’s largest pork producing countries. The EU average price for Class E pigs slid to EUR151 per 100kg in the third week of July, a decrease of 6% m/m. Pork prices also fell in China after briefly being stabilized by government moves to build up pork reserves. Wholesale pork prices decreased to CNY20.90 per kg (USD3.23/kg) on 16 July – down 52% y/y and the second lowest figure recorded since mid-2019.

Jul 30 - Black Sea wheat price surges as dry weather slashes crop outlooks (Agricensus)
- Black Sea wheat prices surged on Thursday amid another raft of production downgrades for Russian wheat by local analytical agencies, as hot, dry conditions hit yields across key producing regions.
- The Russian 12.5% wheat offer price increased by at least $7/mt to $255/mt FOB NTT and has the potential to move even higher, while the bids also followed and increased respectively to $250/mt FOB for September loading.
Ukrainian wheat also followed the move with 11.5% bids for September gaining around $3-$5/mt to $240-$243/mt FOB HIPP, but as the move gained momentum, a lack of offers was reported through the second half of the day.
- The movement followed two Russian analytical agencies downgrading their forecasts for Russian wheat output. Moscow-based Ikar downgraded its previous production outlook by 4.5 million mt to 77 million mt - a 5% reduction.
Alongside that, local consultancy Prozerno also cut its estimate by between 3-4 million mt to 77-78 million mt amid hot and dry conditions observed in parts of the country, including the South, the Volga, and the Ural regions.
- Currently, the USDA holds an 85 million mt production outlook, but local trade is starting to fret that the final figure could come in below that.
“Yes, the prices moved sharply higher. It might be a reaction to the crop forecast decrease from Russian analytics,” a trader said.
“All international markets also went up… more analysts talking crop is not more than 80 million mt, but below,” a second trader said.
- Last year Russia harvested 85.9 million mt of wheat, and the official forecast from the agriculture ministry for the 2021/22 marketing year stands at 81 million mt.
The ongoing harvest now has a lag from last year and the crops show lower yields than the same period last year.

Jul 30 - IGC trims forecast for 2021/22 global wheat crop  

The International Grains Council (IGC) on Thursday trimmed its forecast for the 2021/22 global wheat crop, with drought driving downward revisions for the United States and Canada. In its monthly update, the inter-governmental body cut its 2021/22 world wheat crop outlook by 1 million tonnes to 788 million with the diminished outlook for North America partially offset by improved prospects in the European Union.

Jul 29 - Bunge lifts profit outlook as food and fuel demand for vegetable oil grows  

U.S. agricultural commodities trader Bunge Ltd raised its full-year adjusted profit outlook on Wednesday after stronger-than-expected food and renewable fuel demand for its vegetable oils drove a 41% jump in quarterly income. Shares jumped 3% in morning trading after the company projected full-year 2021 adjusted income of at least $8.50 per share, up from its previous estimate of about $7.50 per share.

Jul 29 - Drought cuts spring wheat yields in northwest North Dakota - tour  

Spring wheat yields across the northwest quarter of North Dakota are well below average this year as severe heat and long stretches of dry weather sapped crop potential, scouts on an annual tour of the country's top producing state said Wednesday. The tour estimated the average yield at 24.6 bushels per acre (bpa) on the second day of the three-day Wheat Quality Council tour, down from 40.8 bpa in 2019 and the five-year average of 42.4 bpa. The tour was canceled last year because of the coronavirus pandemic.

Jul 28 - Egypt's GASC buys 180,000 tonnes of wheat in tender  

Egypt's state grains buyer, the General Authority for Supply Commodities (GASC), on Tuesday said that it bought 180,000 tonnes of wheat in an international tender for shipment over Sept. 20-30. The purchase comprised 120,000 tonnes of Ukrainian wheat and 60,000 tonnes of Romanian wheat, GASC said.

Jul 28 - ADM quarterly profit surges amid strong U.S. corn exports to China  

U.S. grain merchant Archer-Daniels-Midland Co on Tuesday reported quarterly profit leapt 52% due to strong exports and oilseed crushing margins. The bigger-than-expected earnings sent shares to a two-week high and extended a recovery from the COVID-19 pandemic, which last year hurt demand for the company's ethanol and food products. Shares were up 1% at $59 at midday.

Jul 28 - Southern, eastern North Dakota spring wheat yields hurt by drought -tour  

Spring wheat yields in southern and east central North Dakota are well below average as a severe drought slashed production potential in the country's top producing state, scouts on an annual crop tour said on Tuesday. Crop scouts calculated an average spring wheat yield at 29.5 bushels per acre (bpa) in 100 field stops on the first day of the Wheat Quality Council's (WQC) annual tour, below the tour's day-one findings in 2019 of 45.6 bpa and below the five-year average of 43.3 bpa. The tour was canceled last year due to the coronavirus pandemic.

Jul 27 - Malaysian palm oil prices jump on lower output expectations (Agricensus)
Malaysian palm oil futures at the Bursa Malaysia jumped in late July, testing new highs on the back of lower production expectations for the month amid lower yields and labour shortages, industry sources told Agricensus.  
The most liquid October contract closed at MYR 4,422/mt ($1,044.8/mt) on July 27, up 0.9% on the prior day and the highest level since May 19.
The settle was only 82 points below the record high reached on May 12.
“CPO futures are racing higher and faster, mainly due to lower than expected production estimates for July and the extension to lower production outlook for the year,” Sathia Varqa, owner and co-founder at Palm Oil Analytics, said to Agricensus.
“Sharp increases in soyoil on CBOT and palm olein traded triple-digit high is helping to sustain the elevated crude palm oil prices,” Varqa added.

Fundamentals igniting prices

Malaysian palm oil production for July is expected to be lower on the month on lower oil yields and labour shortages at palm plantations.
Furthermore, industry analysts are also expecting a decline in ending stocks for July, after rising for four consecutive months, maintaining the bullish momentum on prices.
Crude palm oil output for the first six months of this year is already 8% down on the same time last year, with steep output declines seen in the past three months, according to data from the Malaysian Palm Oil Board (MPOB).  
“Analysts are likely to revise their 2021 production estimates lower, and Malaysia could potentially see the lowest annual output since 2017,” Varqa told Agricensus.
Palm Oil Analytics has already revised its crude palm oil production for 2021 lower, expecting it to come in within the range of 18.5-18.7 million mt, down from 19 million mt originally. If realised, this would be down between 2.3-3.3% on 2020.
“Palm oil production will be under earlier estimates of 19.2 to now firmly under 19.0m,” a second industry source told Agricensus.
The USDA forecast Malaysian crude palm oil production at 19.7 million mt in 2021, at an increase of 8% on the year.

Jul 27 - EU monitor tweaks 2021 crop yield forecasts as rains hit quality  

The European Union's crop monitoring unit MARS made limited changes to its yield forecasts on Monday, saying exceptionally high rainfall in several countries was likely to hit grain quality rather than yields. Torrential rain in several West European countries this month caused deadly floods and raised concern over damage to crops, but MARS said that, although the wet weather hampered the harvest of winter crops, it had limited impact on yields.

Jul 27 - Brazil's JBS imports 30 shiploads of corn from Argentina  

The world's largest meatpacker JBS SA has imported 30 ship loads of corn into Brazil from Argentina after a drought and an ill-timed frost caused crop failure in its home market, according to a statement sent to Reuters. JBS, which did not provide an exact figure for total imported corn, noted purchases from suppliers outside Brazil already represent 25% of the corn it is using as feed, with volumes surpassing 1 million tonnes.

Jul 27 - Argentina declares state of water emergency due to shallowness of Parana River  

The government of Argentina on Monday declared a 180-day "water emergency" for the Parana River, which is suffering a historic bout of shallowness that has affected the amount of grains that can be shipped from the country's key ports hub of Rosario. The country is a major international food supplier. The Parana, which originates in a drought-hit part of Brazil, carries about 80% of Argentina's agricultural shipments, which are the country's main source of export dollars.

 

Jul 26 - EU Black Sea wheat production on the edge of 18.5m mt record (Agricensus)
- Romania and Bulgaria are expected to harvest a record wheat crop in the 2021/22 marketing year after both countries received abundant rainfall after last year’s drought, trade sources told Agricensus.

- The Romanian wheat crop is expected to reach at least 11 million mt, given planted area estimates of around 2-2.2 million ha and an estimated increase in yields from last year’s drought-hit 3 mt/ha to 5 mt/ha.
“11 million mt would be a record for wheat,” Thomas Deevy, risk manager for Cerealcom Dolj, told Agricensus, with the production expected to broadly fall into around 80% milling wheat, with protein between 11.5-12%, and the rest feed wheat. According to sources, around 80% of the Romanian harvest is already complete, but no official data is currently available.

- Bulgaria, where the harvest is also almost finished, is also on its way to posting record wheat production, but sources in the market expect a much bigger portion of the output to fall into feed wheat grades this marketing year, after heavy and prolonged rains.
“We will have record crop - like 7.5 million mt,” Petar Dimitrov, senior broker and founder of Agricore said.
“Quality, of course, is predominantly feed, as you can imagine,” Dimitrov told Agricensus, referring to a yield expectation of 6.5-6.8 mt/ha, as the average, versus the expected 5.5 mt/ha in Romania. It is still unclear what the distribution between 12.5% and feed wheat will be, but trade sources say it is already very hard to find high protein grades in Bulgaria.

- The official estimates from the European Commission for the two countries are much lower than on-the-ground reports, with the bloc's central governing body putting Romanian wheat output at 9.76 million mt, up 52% year-on-year based on the 2.2 million ha planted area.
Bulgarian wheat production is forecasted at 6 million mt, 28% up year-on-year, and planted area estimated at 1.19 million ha.

Jul 26 - Protein pinch: China's soybean imports to slow over rest of 2021 on curbed meal use  

China's soybean imports are set to slow sharply in late 2021 from a record first-half tally, confounding expectations for sustained growth from the top global buyer and denting market sentiment just as U.S. farmers look to sell their new crop. A collapse in hog sector profitability and a sharp rise in wheat feed use are crimping demand in China, where imports this year may now be less than 100 million tonnes, compared with a recent U.S. forecast of 102 million tonnes.

Jul 26 - Global supply chains buckle as virus variant and disasters strike  

A new worldwide wave of COVID-19. Natural disasters in China and Germany. A cyber attack targeting key South African ports. Events have conspired to drive global supply chains towards breaking point, threatening the fragile flow of raw materials, parts and consumer goods, according to companies, economists and shipping specialists. Given ships transport around 90% of the world's trade, the crew crisis is disrupting the supply of everything from oil and iron ore to food and electronics.

Jul 26 - Historic low river levels force Argentine grains ships to cut cargoes by 25%, ports chamber says  

Ships leaving the Argentine grains hub of Rosario on the Parana River are having to cut cargoes by 25% due to severely low water levels, the head of the local ports chamber said on Friday, with no relief in sight and the area expected to stay dry for months. The Parana, which carries some 80% of Argentina's farm exports, is at a 77-year low level amid prolonged dryness upriver in Brazil, which has impacted shipments of the country's key exports, including soy, wheat and corn.

 

Jul 23 - Market Briefing: Oilseeds (IHSmarkit)
 


- Canadian rapeseed production to fall to 18 million tonnes in 2021/22
- Iran to increase its palm oil imports from Malaysia to 1 million tonnes+
- Ukraine exported 4.7 million tonnes of sunflower oil, as of July 1, 2020/2021

Production

Canadian rapeseed production will decline to 18 million tonnes in 2021/22, down 1.5 million tonnes y/y. If realized, this would be the lowest level achieved since 2014. Yields are seen at 2.02 tonnes/hectare, down 14% y/y. As a result, IHS Markit predicts Canadian rapeseed supply at 19.2 million tonnes in 2021/22, down 3.5 million tonnes compared to the previous year, while crush levels should reach 10.5 million tonnes against 10.4 million tonnes in 2020/21.

Demand

- Iran has recently announced its intention to increase its palm oil imports from Malaysia to reach 1 million tonnes and above per year to meet demand. The Islamic Republic of Iran embassy in Kuala Lumpur reported that the country purchased a total of 310,000 tonnes of palm oil between January-May 2021, a five-fold increase y/y, compared to 63,039 tonnes last year. Iran is seeking to buy an additional 650,000 tonnes this year.
- Swedish oils and fats giant AAK reported record-high Q2 financial results with sales volumes for the Group reaching 550,000 tonnes, up by 14% y/y, though lower than Q1’s 569,000 tonnes. Operating profit amounted to SEK541 million, a record high for a second quarter.

Trade

- Ukraine exported 4.7 million tonnes of sunflower oil, as of July 1, 2020/2021, which is 88.2% of the export quota. As the current export cap for sunflower oil is set at 5.4 million tonnes for the current 2020/21 crop year, Ukrainian exporters can ship another 630,000 tonnes.
- Tunisia's olive oil export quota to the UK has gone from 600 tonnes to 7,723 tonnes tariff-free since January 1, 2021. From November 2020-April 2021, Tunisia exported 124,700 tonnes of olive oil, valued at TND991 million, including 111,700 tonnes of olive oil in bulk and 24,000 tonnes of packaged oil.

Price

- Soybean futures closed lower on Thursday (July 22) in a volatile session extending losses for the second day. The nearby August soybean contract lost 23 cents to end the session at $14.16½ while November was down 27½ cents at $13.62¼.
- Meanwhile in Brazil, domestic soy prices went up by 3.3% w/w to BRL170.39 ($33.28)/60-kilo bags at the Paranaguá port, and by 3.1% w/w in the state of Paraná to BRL165.25 ($32.28)/60-kilo bags in the week ending July 16.

Jul 23 - Market Briefing: Grains and Feed (IHSmarkit)

- Pakistan’s wheat production seen at 27 million tonnes in 2021/22, up 8% y/y
- North African wheat consumption projected at record 48 million tonnes in 2021/22
- China imported over 2.2 million tonnes of rice from January to May 2021

Production

USDA projects Pakistan’s wheat production at 27 million tonnes in 2021/22, up 8% y/y, on higher harvested area, up 4% to 9.2 million hectares. As a result, yields are estimated at 2.93 tonnes/hectare against 2.83 tonnes/hectare in 2020/21, and total supply at 3.2 million tonnes, up 8% y/y. Ending stocks are forecast to rise sharply, by almost 50% y/y to 5 million tonnes, aided by a higher supply.

Demand

USDA forecasts North African wheat consumption (Algeria, Egypt, Libya, Morocco, and Tunisia) at a record 48 million tonnes in 2021/22, on population growth supplied by domestic production which accounts for 40%, while the remainder is filled by imports. Imports are forecast at 29.15 million tonnes in 2021/22, against 29.10 million tonnes, a slight increase y/y. Egypt will account for nearly half of North Africa wheat imports especially from Russia and Ukraine which holds nearly 90% of the import market. Shipments are forecast at around 12 million tonnes in 2021/22.

Trade

- USDA indicated China imported over 2.2 million tonnes of rice from January to May 2021, over three quarters of its total rice imports from 2020, as prices grew significantly. USDA expects China to import 4 million tonnes of rice in 2021, up 20% y/y, favoring long-grain and broken rice over medium-grain rice, especially from South Asian suppliers. China added Burma and Pakistan to its list of providers, and has started importing rice from India for the first time in years, totaling almost 300,000 tonnes in the first quarter of 2021.
- Brazilian corn exports are expected to hit 3 million tonnes in July, while 2.4 million tonnes were forecast last week, Anec estimated.

Price

- Corn futures were lower on Thursday (July 22) on weaker soybean prices and poor demand from exports. September corn was down 7¼ cent at $5.64½, while December was also down 7¼ cents at $5.61¼. USDA reported net cancelations of 88,500 tonnes (down 3.5 million bushels) for the 2020/21 week ending July 15.
- Corn prices continue to rise in the Brazilian market. In Campinas city, they were up 1.2% w/w, to BRL97.34 ($19.01)/60-kilo bags on July 16. Given low stocks of summer corn production and concerns surrounding yields, Brazilian producers limited corn supplies available for the domestic spot market, in order to comply with the delivery of futures contracts.

Jul 23 - Market Briefing: Meat and Livestock (IHSmarkit)

- Chinese pork production in 2021 now expected to be 20% up on last year.
- Slowdown in Chinese demand for chicken affecting all top poultrymeat exporters.
- Brazil reports strong exports of all types of meat in early July.
- Pork prices set to stabilize in EU despite spread of ASF to German pig farms.

Production

The USDA’s Foreign Agricultural Service (FAS) has raised its forecasts for Chinese pork production in 2021 to 43.75 million tonnes (cwe), up 8% from its previous forecast and 20% higher than production last year. Elsewhere, broiler chicken numbers in South Korea recovered to 109.7 million in the second quarter of 2021 after millions of birds were lost to avian flu in the previous two quarters. This was only 1% lower y/y and represents a significant increase on the 96.4 million recorded in Q1. Meanwhile, the presiden of poultry giant 2 Sisters has warned that the UK could see its worst food shortages in 75 years unless fundamental issues are quickly solved by the government.

Demand

Chinese chicken meat imports fell sharply in June with all of the country’s main suppliers losing out as a result. Imports for the month amounted to 86,555 tonnes – down 35% y/y and the lowest monthly volume since February 2020. Imports from top supplier Brazil have fallen steadily since March while purchases from the US and Russia have also hit reverse gear after earlier rises. Domestic demand for chicken has reportedly slowed in China in recent weeks – partly because of increased competition from pork, prices of which have fallen in line with higher supplies.

Trade

Brazilian meat exports continue to perform well despite a dip in demand from mainland China. In the first seven working days of July, Brazil’s fresh beef exports amounted to 7,571 tonnes/day, up 2.9% y/y and 13.3% m/m. Fresh chicken meat shipments averaged 18,187 tonnes per day in the same period, an increase of 24% y/y, while Brazil’s fresh pork exports averaged 4,442 tonnes per day – an increase of 13% y/y. Meanwhile, the USDA’s Foreign Agricultural Service (FAS) lowered its 2021 estimate for total Chinese beef imports to three million tonnes (cwe), down 3% on its previous estimate but still up on last year’s 2.78 million tonnes.

Prices

EU pig prices fell again last week with decreases reported in all of the bloc’s largest pork producing countries. With supplies still tight however, markets are expected to stabilize despite the spread of African Swine Fever (ASF) to pig farms in Germany. The EU average price for Class E pigs in the week ending 18 July was EUR150.28 per 100kg, a decrease of 3.9% w/w. Denmark, France and Spain have all seen prices decrease by about 8% over the past month. The official German price notified to the European Commission fell to EUR151.29 per 100kg – down 2% w/w. The spread of ASF from wild boar to pig farms is not expected to have a major impact on markets in Germany as key Asian markets are already closed to German pork.

Jul 23 - Strategie Grains cuts French wheat crop estimate  

Consultancy Strategie Grains cut its estimate for France's 2021 soft wheat harvest on Thursday after a crop tour showed lower than expected yields in the northeastern grain basket and said the overall quality of the harvest was also disappointing. Strategie Grains now expects the soft wheat harvest at between 37 million and 37.5 million tonnes, down from nearly 38 million tonnes forecast last week.

Jul 22 - Four Ukrainian ports restrict grain operations due to poor weather  

Four major Ukrainian Black Sea ports have restricted grain loading operations due to poor weather, the state seaport authority said on Thursday. The restrictions applied to the ports of Odessa, Chornomorsk, Mykolayiv and Pivdeny, the authority said without elaborating.

Jul 22 - Canadian crop debacle may force a reroute of wheat, canola trade: Braun  

Severe drought has slashed expected U.S. spring wheat output to a three-decade low and across the border on the Canadian Prairies, crops are in similarly tough shape. With little relief in sight, production forecasts should fall, and other global export markets will likely have to pick up Canada’s slack. A significant amount of Canada’s annual wheat and canola output go to exports, and those products are important on the world stage. Top customer China is among those that may need to seek supplies elsewhere, and trade rival Australia could be a good candidate to help fill that gap.

Jul 22 - Putin's drive to tame food prices threatens grain sector  

During a televised session with ordinary Russians last month, a woman pressed President Vladimir Putin on high food prices. Valentina Sleptsova challenged the president on why bananas from Ecuador are now cheaper in Russia than domestically-produced carrots and asked how her mother can survive on a “subsistence wage” with the cost of staples like potatoes so high, according to a recording of the annual event.

Jul 21 - China's June soybean imports from Brazil fall as crushing margins decline  

China's soybean imports from Brazil slipped in June from a year earlier, customs data showed on Tuesday, as poor crushing margins weighed on demand. China, the world's top buyer of soybeans, brought in 10.48 million tonnes of the oilseed from top supplier Brazil, slightly down from 10.51 million tonnes the previous year, a record high, according to customs data.  

Jul 21 - EU grain harvest picks up after downpour with crop quality in focus  

Grain farmers in western Europe are taking advantage of a warm, dry spell to make headway in harvesting, but the clear skies may have come too late to prevent some rain damage to crop quality, especially in wheat, analysts and traders said. Torrential rain, which caused deadly floods last week in Germany and Belgium, is not expected to have cut yields significantly and European crops remain in better shape than drought-ravaged North American spring wheat and canola. 

Jul 21 - Frosts hit Brazil's cane, coffee and orange crops, says weather expert  

Frosts hit crops including sugar cane, coffee and orange in the center-south region of Brazil on Tuesday, according to a report by a Rural Clima meteorologist. Marco Antonio dos Santos, a meteorologist who is a partner and director at the weather service consultancy, said earlier on Tuesday that he had received multiple videos showing frosts, but noted it was too early to determine the exact damage to these crops. Temperatures should rise starting on Wednesday as a cold front moves away, he said.

Jul 20 : Russian wheat export prices rise with global benchmark  

Russian wheat export prices rose last week on the back of sharply higher prices in Chicago and expectations of a less impressive crop in Russia, analysts said on Monday. Chicago wheat futures recorded their largest weekly gain in six years last week as parched conditions for North American spring wheat and adverse weather in Europe and Russia stoked concern over global supplies.

Jul 20 - U.S. corn rated 65% good-excellent, soybeans 60%  

The U.S. Department of Agriculture (USDA) said 65% of the U.S. corn crop was in good-to-excellent condition as of Sunday, largely unchanged from a week earlier despite rains across much of the Midwest last week. Analysts polled by Reuters had, on average, expected the corn crop condition to improve by 1 percentage point.

Jul 20 - New Argentina biodiesel law to weigh on international soyoil prices - industry  

Argentine soyoil exports will likely rise, driving down prices internationally, due to a new law cutting the amount of soyoil-based biodiesel blended into common diesel fuel sold domestically, industry officials said on Monday. Lawmakers in Argentina, the world's No. 1 soyoil exporter, last week approved a measure allowing a reduction in the amount of soy-based biofuel to be mixed into domestically-consumed diesel.

Jul 19 - Historic crop loss expected as new frosts hit Brazilian corn areas

The week has begun with the already-shattered corn market in Brazil enduring  another blow as a new cold wave swept the centre-south of Brazil bringing frosts to corn-producing states and raising fresh concerns about export volumes and contract breaches.

On Monday, frosts hit parts of the states of Paraná and Mato Grosso do Sul, with late planted corn areas likely affected.

The cold wave is expected to reach its peak on Tuesday, with forecasts showing potential fresh frosts in the states of Paraná, Mato Grosso do Sul, São Paulo and Minas Gerais.

“It is going to be a historic crop loss,” Daniele Siqueira from local consultancy Agrural told Agricensus.

The second Brazilian corn crop safrinha has been severely affected by dry and warm weather during key development stages, and crop conditions worsened further in some regions that were hit by frosts for three days in the end of June.

As a result, Agrural has lowered its estimates of Brazil’s safrinha output to 59.1 million mt in early-July, 22 million mt below the initial crop potential and the new frosts could mean these estimates are dampened even further.

As the Brazilian crop outlook continues to deteriorate, analysts believe exports might take the bulk of the hit.

“Output losses will be extremely large across all producing states apart from Mato Grosso… Paraná and Mato Grosso do Sul will have no export capacity whatsoever,” Siqueira said.

“Trading companies continue to wash out corn contracts to the domestic market due to price differentials between ports and the interior market and to quality issues,” Victor Martins from Hedgepoint Global Markets said.

Besides volume losses, grain quality is a major concern among farmers, traders and exporters.

“Exporters seem to be cornered, having to pay a quality premium to lift corn standards to fulfil agreements and to outbid the domestic market,” Martins added.

In many cases, producers will need to blend lower quality product with high quality corn to meet export standards.

According to Siqueira, some producers are trying to hoard higher quality first crop corn to blend further ahead, while others are looking to source corn from Mato Grosso or from Paraguay and Argentina.

Although Mato Grosso’s corn production has been impacted by dry weather conditions, it’s crop loss will not be as severe as in other states.

“As Mato Grosso is Brazil’s main exporter, this makes the analysis even harder,” Siqueira said, adding that the big question now is how much of the state’s production will remain in the country and how much will be exported.

Meanwhile, contract breaches are another major concern that has been on the radar since dry conditions slashed domestic production estimates.

“With this week’s frosts, odds are increasing of even more contracts being breached,” Martins told Agricensus.

"This is affecting both exports and domestic deliveries... many producers had committed up to 80% of their crop in forward sales but are harvesting 30-50% less than expected and cannot purchase volumes from other producers to honour contracts,” Martins said.

The lack of good quality products to meet contract standards increases contract breach risks even further.

According to Martins, the situation is so dramatic that "there will not be any corn left in the market in September and the country will need to import much more from Argentina."

Jul 19 - EU egg prices slip to six-month low (IHSmarkit)

EU egg prices fell further last week against a backdrop of weakening demand and ample supplies.

The EU average price for Class A eggs in packing stations was EUR122.27 per 100kg, down by 2.1% on the previous week, and the lowest price recorded since late January. Notable price falls were recorded in Poland (-6.6%) and France (-4.1%). Meanwhile, EU broiler prices have fallen for a second week in a row as the markets continues to gradually move back from recent record highs.

Production volumes are gradually recovering after the disruptions earlier this year caused by an avian influenza outbreak. According to the European Commission’s latest short-term market outlook report, total poultrymeat output in 2021 is forecast to decrease by around 0.9% year-on-year, after initially dropping by 4.4% in the first quarter of this year.

In the week ending 11 July, the EU average broiler price was EUR204.97 per 100kg, down by 1.7% week-on-week. The picture across Europe was mixed, but particularly sharp downturns were noted in Poland (-10.4%) and Denmark (-9.4%).

Jul 19 - Canadian canola crop in trouble
(IHSmarkit)

Surging rapeseed/canola prices this week showed the extent of trade concern about the drought/heat-weave impacted Canadian crop.

Winnipeg and Paris futures both traded new ‘life-of-contract’ highs as the markets began to build in the prospect of significantly lower production in Canada, where the government had been looking for a 20 million-tonnes-plus outcome. Some private analysts had even expected more from under-rated planted acres – before the extreme weather struck.

The USDA’s update this week shaved a mere 300,000 tonnes of its previous 20.5 million tonne forecast. However, bigger yield loss seems on cards after reports of stunted, yellowing and prematurely drying down crops, even in top state Saskatchewan. In much of Western Canada, rain was reported 40% or less of normal over the past month, leaving topsoil moisture as much as 80% short/very short. Smaller canola producing provinces Alberta and Manitoba have also been hard hit. With the forecast dry and hot for much of the Prairies into next week, further crop deterioration seemed likely.

Canola was also boosted by a weaker Canadian dollar and by the firmer CBOT soy complex, spilling strength into the European market, where the 2021/22 supply outlook is not much better.

Jul 19 - Taiwan buys 50,000 tonnes wheat of U.S.-origin in tender  

The Taiwan Flour Millers' Association purchased an estimated 50,000 tonnes of milling wheat to be sourced from the United States in a tender which closed on Friday, European traders said. The wheat was bought in one consignment comprising various wheat types for shipment from the U.S. Pacific Northwest coast between Aug. 31 and Sept. 14.

Jul 19 - Ukraine grain exports rise to 926,000 T so far 2021/22  

Ukraine's grain exports rose to 926,000 tonnes in the first half of July, the first month of the new 2021/22 July-June season, up 206,000 tonnes from a year earlier, agriculture ministry data showed on Friday. That included 248,000 tonnes of wheat, 180,000 tonnes of barley and 488,000 tonnes of corn, the data showed.

Jul 19 - French soft wheat crop rating declines as heavy rain slows harvest  

The condition of French soft wheat declined in the week to July 12 while farmers made little progress in harvesting during unusually wet weather, data from farm office FranceAgriMer showed on Friday. Some 76% of soft wheat was in good or excellent condition against 79% a week earlier, it said in a cereal crop report.

Jul 19 - Funds back away from corn as bullish bets reach nine-month low: Braun  

Chicago corn futures rebounded last week as drier weather forecasts maintained uncertainty over the U.S. harvest. However, speculators continued the selling trend they started three months ago. Most-active corn futures rose fractionally in the week ended July 13, but they had surged more than 4% in the final two days of that period. Money managers reduced their net long in corn futures and options to 208,799 contracts from 219,371 a week earlier according to data from the U.S. Commodity Futures.

Jul 16 - Market Briefing: Grains and Feed (IHSmarkit)

- US all wheat production cut by 152 million bushels to 1.7 billion bushels in 2021/22
- US corn production to rise by 175 million bushels to 15 billion bushels
- Thai 5% broken white and parboiled 100% rice prices down 3% w/w

Production

- USDA’s WASDE reduced US all wheat production by 152 million bushels to 1.7 billion bushels in 2021/22, while beginning stocks were adjusted downwards by 8 million bushels to 844 million bushels. US corn production is expected to rise by 175 million bushels to 15 billion bushels, due to greater planted and harvested area from the June 30 Acreage report.
- USDA increased US rice supplies to 284.3 million cwt, up 1.3 million cwt in 2021/22, as higher carry-in stocks and imports more than offset reduced output.
- The UK’s area planted to wheat should increase by 26% y/y to 1.7 million hectares in 2021, on improved weather and higher prices, according to a survey from the Agriculture and Horticulture Development Board (AHDB).

Demand

- China is expected to purchase 9.5 million tonnes of barley in 2020/21, against 6 million tonnes in 2019/20. Imports are projected to increase slightly to 10 million tonnes in 2021/22.

Trade

- USDA adjusted US rice exports upwards by 2 million cwt to 90 million cwt (all long-grain) in 2021/22, on prospects of continuous paddy rice exports to Venezuela and other Latin American countries.
- Concerns remain among Thai rice exporters due to the current container shortage which has led to delayed shipments and higher freight costs.
- USDA projects US sorghum exports at 7.8 million tonnes in 2020/21, its highest level since 2015/16, and reported that 95% of its exports, during the first seven months of 2020/21, were destined to China.

Price

- Thailand’s benchmark 5% broken white rice price, and parboiled 100% rice were down 3% w/w to USD424/tonne and USD433/tonne, as the Thai baht continue to depreciate to THB31.97/USD1.00 from the previous week’s exchange rate of THB31.87/USD1.00.
- US wheat futures were higher on Wednesday (July 14) on projections for dry weather in the US Corn Belt. Chicago December wheat rose 19 1/2 cents at USD6.62 1/4, Kansas City rose 16 1/4 cents at USD6.38 3/4 and Minneapolis was up 13 cents at USD8.59 1/2. A weaker dollar supported grain prices overall.
- Brazil’s corn prices rose by 4.5% w/w to BRL96.21 (USD18.36)/60-kilo bags in Campinas city, in the week ending July 9. Frosts continued to affect the Centre-South (CS) region in late June and early July.

Jul 16 - Market Briefing: Oilseeds (IHSmarkit)

- Global soybean production lowered to 385.2 million tonnes for 2021/22
- Indian vegetable oil imports down 20% to 996,014 tonnes in June
- Brazil’s soy prices rose by 0.5% w/w to BRL165.02 (USD31.50)/60-kilo bags

Production

- Global soybean production was lowered marginally from a previous estimate of 385.5 million tonnes to 385.2 million tonnes for 2021/22 in USDA’s latest WASDE report. Global oilseed production was revised up by 2.5 million tonnes to 635.4 million tonnes for 2021/22, on greater volumes of sunflower seed, rapeseed, cottonseed, and peanuts oils.
- USDA projects US soybean production at 4.40 billion bushels in 2021/22, unchanged from last month. It also estimated 59% of soybean as ‘good-to-excellent in the week ending July 11, unchanged w/w, while analysts polled by Reuters expected on average a rate of 60%.
- IHS Markit projects Canadian rapeseed production to fall to 18 million tonnes in 2021, on dry soil moisture conditions in key growing areas and above normal temperatures. These factors affected Western Canada and North Dakota, the largest US canola producing state. If realized, this would be the lowest volume since 2014.

Demand

- Indian vegetable oil imports (edible and non-edible) fell by 20% to 996,014 tonnes in June, the Solvent Extractors’ Association of India (SEA) stated.
- Russia purchased 423,100 tonnes of palm oil in January-May 2021, up 2.6% y/y, and up 38.5% in value to USD437.2 million, the Federal Customs Service reported. Russia also imported 757,000 tonnes of soybeans in the first five months of 2021, down 6.1% y/y, for a value of USD462.5 million, up 48% y/y.

Trade

- China is expected to import 2.5 million tonnes of rapeseed oil in 2020/21, against 1.9 million tonnes in the previous year. Imports should decline in 2021/22 to 2.2 million tonnes.

Price

- Brazil’s soy prices rose by 0.5% w/w to BRL165.02 (USD31.50)/60-kilo bags at the Paranaguá port in the week ending July 9, while prices in Paraná increased by 1% w/w to BRL165.02 (USD31.50)/60-kilo.
- August soybean futures were up 38 1/4 cents to end the session (July 14) at USD14.53 while November gained 31 1/2 cents at USD13.83 1/4. Soybean and soybean oil futures extended gains Wednesday supported by concerns that a drier and warmer weather outlook in US Corn Belt and Northern Plains increases the risk of crop condition deterioration during late July and August, with August the critical time frame to define soybean yields.

Jul 16 - Strategie Grains lifts EU grain crop and export forecasts  

Strategie Grains on Thursday further increased its monthly production forecasts for all three major cereals in the European Union in the current 2021/22 season, which it said will help the bloc to meet higher projected demand on the global market. However, the consultancy also echoed mounting concerns over the potential impact on grain quality from recent wet weather in southeastern and western areas of the EU.

Jul 16 - Record U.S. corn crop hinges on southern, eastern growers amid western drought  

Timely planting, good spring rains and mild summer temperatures have raised expectations for a bumper harvest in eastern and southern parts of the U.S. Corn Belt, where massive production of the yellow grain will be needed to make up for drought-stressed crops in the west. With corn prices hovering near eight-year highs, the world is depending on a massive U.S. harvest to make up for shortfalls in Brazil, the world's No. 2 supplier after the United States, where the crop was hit by drought and an ill-timed frost.

Jul 15 - Parched Argentine river cuts into grains exports, environmental worries mount  

Ships leaving the Argentine agricultural ports hub of Rosario on the Parana River are having to reduce cargos by thousands of tonnes due to low water levels, the local head of logistics said on Wednesday, amid growing environmental concerns. Dryness in Brazil, where the Parana originates, has diminished cargo traffic and sparked worries by environmentalists about dredging the river below certain depths. The dryness has reduced the amount of cargo that can be carried by ships at the height of the Argentine corn and soy export season.

Jul 15 - Germany’s 2021 wheat and rapeseed harvest seen up on year  

Germany's 2021 wheat harvest of all types will increase 3.2% on the year to 22.80 million tonnes although some crops have suffered from a recent heatwave, the country's association of farm cooperatives said on Wednesday. The association forecast Germany's 2021 winter rapeseed crop will rise 4.7% from last summer’s crop to 3.68 million tonnes.

Jul 14 - Turkey buys 395,000 tonnes of milling wheat in tender - trade  

Turkey's state grain board TMO has purchased an estimated 395,000 tonnes of milling wheat in an international tender for the same volume that closed on Tuesday, traders said. The amounts purchased and prices are provisional and still subject to final confirmation in coming days. No more purchases are now expected on Tuesday, traders said.  

Jul 14 - French wheat exports, stocks seen rising as big harvest looms  

Farm office FranceAgriMer on Tuesday projected a sharp rise in French soft wheat exports and stocks as the European Union's biggest grain grower is set for a rebound in harvest production. Soft wheat exports outside the 27-country EU were forecast to reach 10.5 million tonnes in 2021/22, up 40% from 7.50 million in 2020/21, FranceAgriMer said in its first outlook for the new crop year that started on July 1.

Jul 14 - South African farmers dream of drought cover on climate front line  

Happy Letsitsa hasn't paid off the money he borrowed to survive a 2019 drought that ravaged his maize and sunflower farm in the South African province of Free State. He has no drought insurance. If rains fail again, they could spell the end of his business, which supports his wife, child, father and extended family. This precarious livelihood is common among the hundreds of thousands of small farmers in South Africa. Most can't access any drought cover in a country that feeds the wider region with staples like maize but is increasingly beset by extreme weather on the front lines of climate change.

Jul 13 - 'Wither away and die:' U.S. Pacific Northwest heat wave bakes wheat, fruit crops  

An unprecedented heat wave and ongoing drought in the U.S. Pacific Northwest is damaging white wheat coveted by Asian buyers and forcing fruit farm workers to harvest in the middle of the night to salvage crops and avoid deadly heat. The extreme weather is another blow to farmers who have struggled with labor shortages and higher transportation costs during the pandemic and may further fuel global food inflation.

Jul 13 - China's June soybean imports jump 11.6% from May on surging demand  

China's soybean imports in June rose 11.6% from May, customs data showed on Tuesday, continuing the trend of resurgent demand in the world's top buyer as it strives to meet meal demand for its burgeoning hog herds. China took in 10.72 million tonnes of soybeans in June, up from 9.61 million tonnes in May, and the third-highest monthly amount on record, data from the General Administration of Customs showed.

July 12 - Turkey’s TMO poised to buy 440k mt barley in buy tender (Agricensus)
- Turkey’s state-backed grain importer TMO is expected to pick up 17 cargoes or 440,000 mt of barley at an import buy tender, trade sources have told Agricensus Monday.
- The results to date are awaiting final confirmation, but suggest TMO has booked slots into all the ports it was looking to supply. Early indications suggest the agency had settled on VA trading and local company Bek Tarim to sell a 25,000 mt cargo apiece into Derince, with price said to be $236.70/mt CFR for VA and $236.90/mt CFR for Bek Tarim.
- Two 25,000 mt positions for delivery into Iskenderun were awarded to Erser at $237.40/mt CFR and Yayla Agro at $237.30/mt.
- Alongside that, Viterra is thought to have secured a 50,000 mt parcel into Mersin at $236/mt CFR.
- For the port of Izmir, Agrozan is thought to have offered 25,000 mt of barley out of a bonded warehouse at $242/mt - equivalent to $236.80/mt CFR - with Yayla Agro also selling another 25,000 mt into the same port at the same level.
- In Bandirma, Bek Tarim secured 25,000 mt at $236.70/mt CFR, with AP Zerno selling another 25,000 mt at $236.50/mt. Bek Tarim also secured another 25,000 mt cargo into Tekirdag at $237/mt where it shared the spoils with Agrozan, who sold another 25,000 mt at $242/mt basis a bonded warehouse, equating to $237/mt CFR.
- The Black Sea port of Samsun also landed two 25,000 mt cargoes, the first from Meke at $237.40/mt with the second said to be awarded to Promaks at $242.40/mt ex-bonded warehouse, or $237.40/mt CFR equivalent.
- For Trabzon, two 20,000 mt parcels were agreed with Meke selling one at $237.70/mt and Prime selling the second at $237.50/mt, both on a CFR basis.
- Finally Meke also sold one 25,000 mt position into Karasu, on the Black Sea coast, at $238.90/mt CFR, with GTCS selected for the final 25,000 mt cargo into the same port at $239/mt CFR.    
These are the first results and are pending the confirmation of TMO’s chair. The tender had looked for 50,000 mt of barley to be supplied in two 25,000 mt parcels into Derince, Iskenderun, Izmir, Tekirdag, Samsun and Karasu, with 40,000 mt to be delivered into Trabzon and one 50,000 mt parcel into Mersin.

Jul 12 - Algeria buys about 30,000 T milling wheat in tender for two ports - trade  

Algeria’s state grains agency OAIC has purchased a small volume of optional-origin milling wheat in an international tender which closed on Thursday which sought shipment to two ports only, European traders said on Friday. Estimates of volumes bought were around 30,000 tonnes and price was put at around $288 a tonne c&f. More details are possible later.

Jul 12 - Argentine agricultural sector holds protest against export caps  

Argentine grain farmers and cattle ranchers protested on Friday in the town of San Nicolas in Buenos Aires province to voice complaints about export taxes and limits placed on beef shipments that critics say are bad for investment in the farm sector. Thousands of farmers showed up in tractors and trucks and bearing Argentina's pale blue and white flags, for the roadside demonstration, which was organized by the rural associations of Buenos Aires and La Pampa, or CARBAP, to coincide with Argentina's Independence Day holiday.

Jul 12 - EU and UK ready for big wheat crop amid concerns about quality - Poll 

Wheat production in the European Union and Britain is set to rebound this year as the crop area and yields recover from weather woes the previous growing season, a Reuters poll showed. But the rain that has benefited European crops since spring was now creating concern about harvest quality and raising a question mark over export prospects, traders and analysts said.

Jul 09 - China turns its attention to Ukrainian barley as prices drop (Agricensus)
- Chinese importers are said to be in the market looking for Ukrainian barley production for August-October loading dates, with trade sources claiming that at least three and as many as 10 cargoes have been traded recently after prices softened and amid relatively high corn prices.  
“Around 10 cargoes trades were made on markets. All within the recent week,” a China-based trader said, while European traders reported rumours of fewer cargoes.
“People are speaking about 500,000-600,000 mt. We saw 5-6 cargoes,” a second trader, based in Europe said.
- Trade prices were thought to have been concluded at levels around the $284-$287/mt CFR range, all for August loading dates, which equated to around $209-$212/mt on an FOB basis given current freight rates of around $75/mt.
For now, offers for barley out of the Black Sea with the required Chinese documents have been heard in the range of $217-$220/mt FOB, with bids around $10/mt lower.
- Barley prices have also been dropping rapidly over the last week and a half, with offers to China losing around $20/mt during the period, as the ongoing harvest brings pressure to values and more offers appear on the domestic market.
Prices had started to fall even before the harvest pressure mounted after rumours surfaced in the market that barley cargoes heading to China had been washed out or deferred to later dates as queues mounted at Chinese ports and traders sought to heavy demurrage costs.
China is one of the biggest barley importers in the world, and second-biggest importer of Ukrainian barley, after importing 2.9 million mt during the July-April period.

Jul 09 - Market Briefing: Grains and Feed (IHSmarkit)

- US corn output up 4% y/y to 14 billion bushels in 2020/21
- China’s corn imports down by almost 30% y/y to 20 million tonnes in 2021/22
- Cumulative Thai rice exports down 24% y/y at 1.6 million tonnes

Production

- US corn production is estimated at 14 billion bushels in 2020/21, up 4% y/y, and at 15 billion bushels in 2021/22, up 5% y/y, according to IHS Markit’s latest data.
- Brazil’s corn output is forecast at 87 million tonnes in 2020/21, down 16% y/y, but will rebound in 2021/22, up 38% to 120 million tonnes.

Demand

- China’s corn consumption is set to rise by 5% to 298 million tonnes in 2021/22 led by feed use, up 8% to 211 million tonnes, due to the rebuilding of the swine herd, and feed mills returning to corn, USDA said.
- However, China should reduce corn imports by almost 30% y/y to 20 million tonnes in 2021/22, as a rise in domestic output is expected, up 4% to 272 million tonnes, according to USDA. High prices and government policies supporting or mandating the planting of additional corn acreage should push area planted upwards, by 2.1 million hectares.

Trade

- China’s wheat imports are forecast to decline by 24% to 8 million tonnes, due to an increase in production, up 1% to 136 million tonnes in 2021/22.
- Cumulative Thai rice exports from January 1 - June 27, 2021, reached 1.6 million tonnes, down 24% from the same period last year.
- Russia exported 28,500 tonnes of wheat to Algeria earlier last week, the first shipment since December 2016, and is expected to ship up to 1 million tonnes in 2021/22, according to Eduard Zernin, who heads the Russian union of grain exporters.

Price

- Brazil’s corn prices rose by 6% w/w to BRL92.10 (USD18.24)/60-kilo bags in the week ending July 2, in the city of Campinas.
- FAO’s All Rice Price Index (2014-2016=100) fell by 2% m/m to 108.3 points to a fifteen-month low in June, and down 5.3% y/y, driven by losses in indica and glutinous rice. Indica prices were affected by a slow trade pace, while poor demand put pressure on glutinous rice prices.
- Russian wheat prices continued to fall last week on foreign and domestic markets, SovEcon reported. Russian export prices for 12.5% protein wheat in deep-water ports fell by USD4.5 to USD246/tonne on an FOB basis, due to strong competition with other suppliers.

Jul 09 - Market Briefing: Meat and Livestock (IHSmarkit)

- EU sheep meat production to stabilize after Q1 spike.
- Demand for chicken wings keeping product supplies tight in the US.
- Brazilian pork and poultry exports perform well in June.
- Wholesale pork prices in China increase for first time since mid-January

Production

- EU sheep and goat meat production increased by almost 9% in the first quarter of 2021 but new forecasts from the European Commission suggest this may not last. In a report, the EU executive says relatively high sheep prices since the start of the year helped drive up sheep slaughterings in France, Spain and Italy. On the other hand, production in Ireland faces a challenging time with the uncertainties related to trade with the UK. Despite favorable prices, the structural decline of the EU flock size will limit any substantial increase in slaughterings for 2021 as a whole. As a result, production will be basically stable, with a 0.1% increase.

Demand

- The combination of chicken sandwich ‘wars’ and demand for wings is keeping poultry product supplies tight in the US. As the industry and the wider US economy emerges from the pandemic, product demand continues to outpace front-half part reserves and hourly worker availability. Meanwhile, European cattle prices continued to move upwards in late June, as tight supplies act as a counterweight to fairly sluggish demand. The shortage is being felt in particular for sub-prime cattle, with prices for cull cows continuing to rise strongly.

Trade

- Brazil exported 97,766 tonnes of fresh pork in June, up 12% y/y, and the highest monthly total ever recorded. From January to June 2021, a historical record of 500,530 tonnes was exported, a 19% hike on the same period in 2020. Brazilian exports of unprocessed poultrymeat also performed well in June with shipments rising 14% y/y to 363,289 tonnes. The June total lifted total poultrymeat exports in the first half of 2021 above two million tonnes, a rise of 5% y/y. Brazilian exporters can expect to build on recent gains in Mexico after the country last week opened up a new 30,000 tonne tariff-free quota for suppliers outside North America.

Prices

- Prices of pigs and pork rose in China last week as markets responded to news that the government would build up pork reserves to help stabilize markets. Wholesale pork prices rose for the first time since mid-January to reach CNY21.21 per kg (USD3.27/kg) – up 9% w/w. Live hog prices were up 16% w/w at CNY16.29 per kg. Even with last week’s rebound, prices are still more than 50% down since the start of this year. With African Swine Fever still a threat, officials are concerned that small and medium farmers will exit the sector as they can no longer make a profit. It remains to be seen if government measures will do enough to stabilize pig prices as reports suggest slaughterhouses are already putting up resistance to paying higher prices.

Jul 09 - Market Briefing: Dairy (IHSmarkit)

- US cheese and butter outputs up 5-7% in May
- China’s dairy imports rise 77% y/y in May, Brazil’s up 11%
- GDT Price Index plunges 4%, reflecting a weakening international market tone

Production

- US total cheese output was 1.16 billion pounds in May, up 5% y/y and 2% m/m, which is consistent with IHS Markit expectations. American type cheese production totaled 473 million pounds, up 7% y/y and flat m/m. Butter production reached 185 million pounds, rising 8% y/y and 1% m/m. The report looks bearish for cheese, butter, whey, and non-fat dry milk (SMP).

Demand

- China’s dairy import volumes in May have grown by 77% y/y, to 362,600 tonnes, while value climbed 82% y/y to USD911 million, as the country continues to buy its way out of the effects of the pandemic. The cumulative January-May dairy imported volumes reached 1.7 million tonnes up 44% y/y, which is a new record for the period. As in previous months, import growth continued to be fueled by liquid milk and whey, which in May have risen by 92% and 40%, respectively.
- Brazilian dairy imports increased 15% m/m and 11% y/y in May, to 8,400 tonnes of all dairy products, which mirrors the narrowed domestic supply, worsened by drier, and more than 5% below-average US dollar versus the local currency in May compared to prior month. The imported milk powder volumes (WMP and SMP) totaled 4,200 tonnes – 50% of the total – were up 26% m/m and 16% y/y.

Trade


- Argentina exported a total of 155,139 tonnes of dairy in January-May, 21% higher y/y. Among the main products exported in the first five months of 2021, powdered milk (whole and skimmed) accounted for 47% of the total, 25% came from cheeses and 28% were from condensed milk, butter, whey and yogurt.

Prices

- After a three-week hiatus, the GDT auction has returned with a clearer direction, as declines in WMP, SMP, butter and cheddar determined the almost 4% decline in GDT Price Index. The event has intensified the ongoing price declines that have been observed in the international markets for some weeks now.
- Cheddar was the biggest loser at the event, dipping by 9% to USD3,949/tonne. The cheese was followed by SMP, which saw a 7% plunge to USD3,126/tonne. The average for WMP fell by 3.3% to USD3,864/tonne, while butter also decline by 3.3% to USD4,485/tonne. AMF, on the other hand, remained resilient and was down by a mere 1% to USD5,632/tonne.

Jul 09 - Market Briefing: Oilseeds (IHSmarkit)

- China’s soybean production down 5% y/y to 17.5 million tonnes in 2021/22
- Sunflower seed crushing in Ukraine down 25% m/m to 793,400 tonnes in May
- Brazil’s soy prices rose by 9% w/w at Paranaguá port and Paraná state

Production

- China’s soybean production should decline by 5% y/y to 17.5 million tonnes in 2021/22, reflecting a switch to corn supported by higher prices in 2020/21, and increased subsidies for 2021/22.
- Malaysian crude palm oil (CPO) output is forecast to drop by 3% y/y to 18.7 million tonnes in 2020/21, due to restrictions on travel of foreign migrant workers, as a result of the current pandemic. This is expected to affect palm fruit collection. In 2021/22, CPO output is projected at 19.3 million tonnes, a decline on a previous estimate of 19.7 million tonnes.
- Ukraine’s sunflower seed processing slipped by 25% m/m to 793,400 tonnes in May, the lowest May figure in 8 years, APK-Inform reported.

Demand

- As output is projected to drop, China’s soybean imports should increase by 2 million tonnes to 102 million tonnes in 2021/22, USDA reported. The rise in imports also echoes China’s growing demand for soybean meal and soybean oil.
- USDA expects China’s soybean meal use for feed to rise to 77 million tonnes in 2021/22 against 75 million tonnes in the previous year, as the country continues to rebuild its hog herd. This will be reflected by higher crush levels at 100 million tonnes, up 3% y/y.
- Chinese rapeseed oil imports are forecast at 1.9 million tonnes in 2021/22, compared to 2.1 million tonnes in 2020/21, while sunflower seed oil imports are projected at 1.7 million tonnes in 2021/22, unchanged y/y.

Trade

- The US Court of International Trade established that the US Commerce Department’s reasoning behind the 35% duty imposed on black Spanish table olive imports in August 2018, was arbitrary and not in accordance with law, as per a court order document. The ruling may lead to a tariff reduction to 20%, allowing Spanish olive producers to regain a significant part of the US market.

Price

- Brazil’s soy prices rose by 9% w/w at the Paranaguá port and in Paraná state, respectively, to BRL164.28 (USD32.54)/60-kilo bags and BRL158.69 (USD31.44)/60-kilo bags in the week ending July 2. This was due to USDA’s latest reports indicating lower than expected planted area and stocks in the US.
- FAO’s Vegetable Oil Price Index averaged 157.5 points in June, down 10% m/m (17.2 points) due to lower prices of palm, soy and sunflower oils.

Jul 09 - Japan buys 108,175 tonnes of food wheat via tender  

Japan's Ministry of Agriculture bought 108,175 tonnes of food-quality wheat from the United States, Canada and Australia in a regular tender. Japan, the world's sixth-biggest wheat importer, keeps a tight grip on imports of the country's second-most important staple after rice, and buys the majority of the grain for milling via tenders typically issued three times a month.

Jul 09 - Clashing visions of Mexico's GMO corn ban cloud impact 

A clash at the top of Mexico's agriculture ministry over the scope of President Andres Manuel Lopez Obrador's push to prohibit genetically-modified corn has cast uncertainty over the farm and food industries in the country that first developed the grain. If liberally interpreted and successfully implemented, the new rules could ban imports of GMO corn by 2024, ending a dependence that last year stood at some 16 million tonnes of imported yellow corn, almost all of it from American farmers and used to feed Mexico's massive livestock sector.

Jul 09 - 'Hanging on by a thread': Canadian farmers hope for rain as canola, wheat wither 

Andy Keen's canola crop appears picturesque, bursting with yellow flowers that normally go on to produce pods of valuable seeds. But to Keen's eye, it is a disaster in the making. Extreme heat and drought has accelerated development of his 1,700-acre (688 hectares) canola crop near Manitou, Manitoba, resulting in flowers appearing weeks early and leaving them vulnerable to shedding petals in the heat before they produce pods containing the small dark seeds crushed for their oil.

Jul 08 - German farmers expect to harvest more wheat, rapeseed in 2021 

Germany's wheat and rapeseed harvests are expected to increase in 2021 as rain helped crops recover from a hot, dry start to the summer, the association of German farmers said. As well as being the European Union's second largest wheat producer after France, in most years Germany is the bloc's largest producer of rapeseed, which is Europe's main oilseed for edible oil, biodiesel and animal feed meal production.

Jul 08 - Explosive CBOT summer rolls on as light acres battle vital rains - Braun 

Volatility has been a top theme this year for Chicago corn and soybean futures, and that was on display within the last week as huge gains from lighter-than-expected U.S. plantings were basically wiped out by a favorable forecast for parched crops. In the week ahead of the June 30 acreage report from the U.S. government, hedge funds did not make significant changes to their bullish views on corn and soybeans, though their optimism has waned in the last couple of months.

Jul 08 - Jordan buys about 60,000 tonnes feed barley in tender - trade  

Jordan's state grain buyer has purchased about 60,000 tonnes of animal feed barley to be sourced from optional origins in an international tender which closed on Wednesday, traders said. It was bought at an estimated $271.95 a tonne c&f for shipment in the first half of November. The seller was believed to be trading house Cargill.

Jul 07 - Argentina union workers block access to all ports around Rosario (Agricensus)
- Argentinian workers of the union UOCRA have blocked access to all ports around Rosario on Wednesday following after a protest that started early on Tuesday in Molinos Agro spilt over to impact wider port activity, industry sources have told Agricensus.
"The strike started on Tuesday morning in the port of Molinos Agro in the north of Rosario, but it had extended to other ports by the evening, affecting several ports," an Argentinean industry source told Agricensus.
- It is understood that the ports of San Martin, San Lorenzo and Timbues are being affected by the protest action, affecting several port terminals. The protest follows worker's union strike activity that started on Tuesday morning, when the workers of UOCRA blocked access to the installations of the exporter Molinos Agro, located in the Up River hub city of San Lorenzo.
Workers were demanding a bonus for subcontractors that provide a yearly maintenance services to export plants.  
"The industry is used to these sort of protests unfortunately," a second Argentinean trade source told Agricensus.  
- But blocking other ports will impact export activity in the key export hub of the Up River complex.
"Not letting trucks in with primary products [to be processed and exported] makes the ports inoperable," said the first industry source.  
- Tuesday's protest led to all trucks carrying grains and other commodities into Molinos Agro being stopped, with the company only able to process volumes held in stock, while all the daily arrivals were cancelled, according to local press reports. Union workers are demanding a ‘stoppage premium’, an extra payment for subcontractors that carry out yearly maintenance at plants, and is triggered when a production line is stopped to undergo cleaning, maintenance and adjustment.
- Argentina is one of the key exporters of agricultural commodities globally, trading corn, wheat, soyoil and meal, animal feed amongst other commodities.

Jul 07 - Algeria issues wheat tender for shipment to small ports - trade  

Algeria's state grains agency OAIC has issued an international tender to buy milling wheat to be sourced from optional origins, European traders said on Tuesday. The tender sought a nominal 50,000 tonnes to shipment to two ports only: Mostaganem and/or Tenes.

Jul 07 - China's farmers dump other crops for corn on bumper profit pull 

Chinese farmers have sharply increased corn planting this year to cash in on demand-fuelled record prices, a trend that is likely to cool the country's recent rampant appetite for imports heading into 2022.  The expansion, which comes mainly at the expense of soybeans and other crops including sorghum and edible beans, would boost China's maize output in 2021/22 by at least 6%, according to market participants.

Jul 06 - India resumes refined palm oil imports after gap of a year – traders 

Indian buyers have resumed purchases of refined palm oil after a gap of a year as New Delhi removed restrictions on the imports and reduced import taxes last week, four industry officials told Reuters. The renewed purchases come as India, the world's biggest buyer of palm oil, is trying to augment supplies to calm near-record local edible oil prices. 

Jul 06 - Agriculture prices to ease but hunger and climate goals are far off - FAO/OECD 

Food commodities are likely to become cheaper in the coming decade as productivity grows, but global targets on reducing hunger and emissions are unlikely to be met under current policies, the U.N. Food and Agriculture Organisation and the OECD said on Monday. Agricultural commodity prices have surged since last year due to a boom in Chinese imports and tightening inventories, leading the FAO last month to forecast record costs in 2021 for food importers.

Jul 05 - Egypt's GASC takes 240k Russian, Romanian wheat at $269.83/mt CFR (Agricensus)
- The Egyptian state grain buyer booked 240,000 mt of Russian and Romanian milling wheat after concluding a buy tender, and paid $269.83/mt CFR and $238.38/mt FOB, an official note showed on Monday.
General Authority for Supply Commodities (GASC) booked 60,000 mt of Russian wheat from GTCS paying $240/mt FOB and $267.70/mt CFR.
The other three Romanian cargoes were secured by Viterra, CHS, and Ameropa at the same $237.84/mt FOB and $270.54/mt CFR.
- All the volume was sought for shipment during September 1-15 dates with payment payment via a 180-day letter of credit.
It was the second tender issued for wheat after the agency announced a change to its tender process allowing traders to pitch offers with an accompanying freight element.
But today's was the first tender where a trading company, GTCS, showed an offer with linked freight, with the indication some $2.27/mt below the lowest rate offered by the shipping company.
- At its previous tender, which closed on June 28, GASC booked 180,000 mt of Romanian milling wheat for August 25-September 5 shipment paying $242.93/mt FOB and $270.78/mt CFR.

Jul 05 - French wheat crop rating stable, barley harvest stalls 

Crop conditions for French soft wheat were stable in the week to June 28 while farmers made little progress with winter barley harvesting in wet weather, data from farm office FranceAgriMer showed on Friday. France, the European Union's largest grain producer, is widely expected to see reap bigger cereal crops this year after more favourable weather than in the previous growing season. However, frequent showers since late June have raised concern about late damage to crops. 

Jul 05 - Syngenta looks to China's farmers for growth ahead of mega-IPO 

Agrichemicals giant Syngenta Group is rapidly expanding its rollout of farm services in China ahead of a huge stock market listing, as it seeks to meet surging demand from farmers crucial to Beijing's increasing focus on food security. The world's biggest crop-protection maker and No. 3 seed supplier says it is boosting grain yields and raising farmers' incomes just as the pandemic fuels government worries about food supplies and pushes up the cost of key farm materials.

Jul 05 - Ukraine cancels lower VAT rate on milk and meat products (IHSmarkit)

- Meat and dairy processors to see the return of 20% VAT rate on supply-import of products
- The reversal of the law will ease the high production cost burden off enterprises

Ukraine’s Verkhovna Rada adopted draft law 5425-d on the return of the 20% VAT rate on some agricultural products, nine months after it was passed, after the dairy and meat industries have been lobbying for its reversal due to damaging increases to production costs.

The introduction of a one-off reduction in the VAT rate in only one link of the supply chain has caused the financial losses for dairy and meat processors and the revival of shadow operations in the market.

Draft Law 5425-d ‘On Amendments to the Tax Code of Ukraine regarding the rate of value added tax in operations for the supply of certain types of agricultural products’ was adopted on 1 July and will see the reinstatement of the initial 20% VAT rate from the 14%
adopted in February 2021.

The bill restores the VAT rate of 20% when taxing operations on the supply/import of agricultural products into the customs territory of Ukraine on such products as live cattle, live pigs, live sheep, whole milk, rye, oats, flax seeds, seeds and fruits of other oil crops, sugar beets. Accordingly, the 14% VAT rate will continue to be applied on wheat, a mixture of wheat and rye, barley, corn, soybeans, rapeseed and sunflower.

The legislators noted that all goods for which the VAT rate was reduced are raw materials produced domestically, which therefore has created a situation when processing industries that rely on the purchase of raw materials have found themselves “in unequal competitive conditions compared to with producers of goods that process their own raw materials”. Enterprises were forced to raise the selling prices for their manufactured products, since they had to cover the difference that arose from the application of different rates of value added tax with their own funds.

Dairy and meat industries relieved

The reversal of the law was heavily insisted on by the Union of Dairy Enterprises of Ukraine and the Meat Industry Association.

Before the law was adopted, dairy producers said there would be an increase in production costs and the state budget’s losses would reach around UAH5.5 billion as a result.

In a June appeal to the Rada, the Meat Industry Association estimated that in three months of the reduced VAT rate on raw materials, Ukrainian consumers overpaid UAH656 million on pork alone.

In addition, the country was estimated to may have lost up to UAH20 billion in VAT annually due to shadow schemes, which in return would have increased the amount of counterfeit goods. Therefore, end consumers, whose purchasing power is currently low due to the pandemic, have found themselves in an extremely disadvantageous situation: either buying meat from legal processors that is 6-10% more expensive or meat at a lower price from an illegal business, exposing themselves to the risk of buying counterfeit product.

Jul 02 - Market Briefing: Oilseeds (IHSmarkit)

- India cuts CPO import duty by 5% to 10% effective from June 30
- Export duties to drive Russian sunflower seed and oil exports down by 42% y/y
- Malaysian reference price on crude palm oil raised to RM4,668.15/tonne in July

Production

Argentina soymeal output is expected to increase by 12% y/y to 32.1 million tonnes in 2020/21, and by 10% to 35.4 million tonnes in 2021/22, IHS Markit reported. Meanwhile, its soy oil production is forecast at 8.1 million tonnes in 2020/21, up 7% y/y, and should rise by 10% to 9 million tonnes in 2021/22.

Demand

India has reduced its import duty on crude palm oil (CPO) by 5% to 10%, effective from June 30. Consequently, the duty on crude palm oil will decline from 35.7% to 30.2%, while for refined palm oil it would be 41.2%, from 49.5%. The new tax system will last until the end of September 2021.

Trade

- USDA estimated that Russian sunflower seed and oil exports should decline by 42% y/y to 800,000 tonnes, and by 8% y/y to 3 million tonnes in 2021/22, respectively, limited by recent export taxes. Sunflower seeds export duty will rise to 50% at a minimum level of EUR320/tonne from July 1, 2021 to September 1, 2022, while a formula-based export tax on sunflower oil will be introduced from September 1.
- Belarus could ban rapeseed exports according to a recent local news report. President Alexander Lukashenko stated: “It is necessary to address prices in general and to ban rapeseed exports.” According to Lukashenko, it is unfortunate to export raw materials that could be processed into oil locally, as rapeseed oil production is a highly profitable business.

Price

- Malaysia raised its July’s reference price on crude palm oil at RM4,668.15/tonne, up by RM40.7 m/m. The export duty rate will remain at 8%.
- Brazil’s soy prices decreased by 3% w/w to BRL148.74 (USD30.04)/60-kilo bags at the Paranaguá port, and fell by 2% w/w BRL144.53 (USD29.19)/60-kilo bags in the state of Paraná, in the week ending June 25.
- The nearby July soybean contract gained 90 1/4 cents to end the session at USD14.50 while new-crop November was up 86 1/2 cents at USD13.99. Soybean complex futures closed sharply higher across the board with soybean and soybean meal leading the gains after USDA’s long-awaited Grain Stocks and Acreage reports showed lower soybean acreage and lower stocks than anticipated.

Jul 02 - Market Briefing: Grains and Feed (IHSmarkit)

- Australia to export 500,000 tonnes of barley to Vietnam in 2020/21
- US corn stocks down 18% y/y to 4.1 billion bushels as of June 1, 2021
- Brazil’s corn prices down 4% w/w to BRL86.27 (USD17.42)/60-kilo bags

Production

- USDA projected US corn planted area at 93 million acres in 2021, up 2% y/y, an equivalent of 2 million acres, in its latest acreage report. In addition, the area harvested was estimated at 84.5 million acres, up 2% y/y. Corn area left to be planted is currently projected at 2.2 million acres.
- All wheat planted area is expected to reach 47 million acres, up 5% y/y in 2021, the fourth lowest area ever recorded. In particular, the 2021 winter wheat planted area was projected at 34 million acres, up 11% y/y, and up 2% from a previous estimate.

Demand

- Egypt’s wheat imports are forecast at 13 million tonnes in 2020/21, and at 12.5 million tonnes in 2021/22, while Indonesia’s wheat imports should reach 11 million tonnes in 2020/21, and 12 million tonnes in 2021/22, according to IHS Markit’s data.
- USDA estimated corn stocks at 4.1 billion bushels, down 18% y/y, and old crop all wheat at 844 million bushels, down 18% y/y, as of June 1, 2021.

Trade

- USDA projects Australia will export 500,000 tonnes of barley to Vietnam in 2020/21, up from 200,000 tonnes last year. The Australian Bureau of Statistics (ABS) reported that Vietnam imported over 50,000 tonnes of Australian barley each month since December 2020, up until April 2021.
- Russia shipped 28,500 tonnes of wheat to Algeria earlier last week, the first shipment since December 2016, and is forecast to export up to 1 million tonnes in 2021/22, according to Eduard Zernin, head of the Russian union of grain exporters.

Price

- Brazil’s corn prices declined by 4% w/w to BRL86.27 (USD17.42)/60-kilo bags in the week ending June 25, in the city of Campinas, due to increased supply and lower demand.
- USDA reported that Thai rice export prices of all grades decreased again by 4-5%, in the week ending June 21, due to the depreciation of the Thai currency. The baht fell against the US dollar to THB31.47/USD1.00 compared to the previous week’s exchange rate of THB30.95/USD1.00. Thailand’s benchmark 5% broken white rice price fell by 5% to USD439/tonne, and parboiled 100% rice price fell by 4% to USD446/tonne.

Jul 02 - Market Briefing: Meat and Livestock (IHSmarkit)

- German pig herd continues long-term decline.
- Meat exporters concerned by signs of slowing Chinese demand.
- Indian beef exports rebound after 2020 slowdown.
- EU broiler prices rises to new record high.

Production

Total pig numbers in Germany stood at 24.6 million at the start of May – down by 5.5% on November and 3.3% below levels at the same time last year. The number of fattening pigs in Germany stood at 11.2 million on 3 May, up 1.2% y/y. But this was outweighed by a sharp decline in numbers of breeding sows and piglets. Meanwhile, the number of pig farms continued its long-term decline – dropping 3.2% y/y to 19,800 as of 3 May. The latest figure means almost 2,000 German pig farms have closed their doors in the past two years.

Demand

Meat exporters in Europe and the Americas are concerned over a potential decline in demand in the key Chinese market, where prices of pigmeat and hogs have collapsed over the past three months. The USDA’s weekly export sales report on 1 July showed that China bought just 1,500 tonnes of US pork. Brazilian exports to China are also starting to slow, giving credence to Chinese claims that its hog herd has bounced back more rapidly than anticipated from losses caused by African Swine Fever.

Trade

Exports of bovine meat from India rebounded strongly in the first quarter of this year after dropping to multi-year lows in 2020. India exports buffalo meat as the slaughter of cattle is prohibited for religious reasons. High prices and tight supplies of beef in countries such as Brazil and Australia have boosted demand for Indian carabeef. Shipped volumes rose to 280,837 tonnes in the Jan-March period – an increase of 11% y/y. This reverses the downward trend seen in 2020, when shipments fell 12% y/y. The value of shipments rose even more sharply in the first quarter of 2021, surpassing USD800 million – up 18% y/y.

Prices

Chicken meat prices have risen once again in Europe as low levels of supply encounter growing demand for grilling pieces in particular. The latest weekly increase in the EU average broiler price established another multi-year high of EUR206 per 100kg, for the week ending 27 June. This is now some 13% above the price level recorded this time last year. Tight supplies of frozen poultry are also keeping prices at high levels in the US, where whole frozen hens hit an annual high of almost USD1.25 per pound last week, which compares with just USD1.10 per pound a year earlier.

Jul 02 - Market Briefing: Dairy (IHSmarkit)

- Milk production gains in May reported in the US and New Zealand
- Australian consumers switch preference from private label dairy products to branded variants
- Import demand improves in Latin America and the Middle East and Africa
- Brazilian raw milk prices on the rise again

Production


- US milk production in May totalled 19.9 billion pounds, 5% higher y/y as moderate weather helped to push production to the sixth highest growth level in the last 16 years.
- Milk production in Fonterra’s New Zealand operations increased for the sixth consecutive month in May, up 8% y/y on a litres basis. Despite severe flooding in Canterbury, continued warm temperatures throughout the North Island and Marlborough have offset the negative weather effects. This brought the company’s total 2020/21 season production up 3% y/y, while collections reached 1,539.2 million kgMS, 2% ahead of last season.

Demand

- In Australia demand increased on branded products over private label variants in Q1. This is significant as branded products sell at higher average prices compared with private label. Butter sales grew 9% in volume in the past year to 18 April, mainly due to a surge in demand for branded packs, which were up 16%. In comparison, private label butter sales dipped 23% in the same period.
- Sales of ice cream in Russia increased by 30% y/y in volume and 49% y/y in value. Popsicle sales were leading in May, overtaking the traditional best seller of ice cream in cups. Popsicle sales increased by 96% in unit terms and by 97% in value terms, helped by the end of lockdown restrictions.

Trade

- Exports from New Zealand, Australia, the EU and the US have increased in March. Import demand in March bounced back to growth in Latin America and the Middle East and Africa region, up by 19% and 3% respectively. The increase was driven by higher volumes of liquid milk products to Peru, cheese to Mexico and Chile and WMP to Brazil. In the Middle East, growth was spurred by stronger volumes of liquid milk products to Libya, infant formula to Nigeria and cheese to Bahrain.

Prices

- Brazil’s raw milk prices have increased in May for the second month in a row, to BRL2.04 (USD0.40)/litre, up 3% m/m and 48% y/y. The bullish trend is owed to drier weather conditions, mainly in Brazil’s Central-South region, and feed costs which are at their highest on record. Some domestic prices have started to fall due to lower consumer purchasing power: mozzarella quotations were 2% lower m/m in April to BRL22.60 (USD4.47)/kg.
- European dairy commodities have weakened over the past week. Trading in dairy commodities in Europe is quiet, and this is likely to remain the case as the summer holiday period approaches. Butter is now trading at below EUR4,000/tonne in both the Netherlands and Germany, while whey has dipped below EUR1,000/tonne in both countries for the first time since March.

Jul 02 - Ukraine grain crop could reach record high above 75 mln T 

Ukraine's 2021 grain harvest could reach record volumes above 75 million tonnes thanks to favourable weather, Ukrainian agriculture officials, weather forecasters and analysts said on Thursday. "We see a record harvest, which will exceed 75 million tonnes and together with oilseeds could be around 100 million tonnes," agriculture minister Roman Leshchenko told Reuters. He decline to give detailed forecasts, saying that the next two weeks would be critical for harvest volume.

Jul 02 - Brazil beef exports to U.S. rise amid China-Australia trade spat 

Strained trade relations between China and Australia have prompted Chinese importers to buy more U.S. beef, making room for Brazil to increase exports to the United States, trade data show. The trend helps JBS SA, Marfrig Global Foods SA and Minerva SA, which have multiple plants approved to ship products to the United States and could benefit from more export permits.

Jul 01 - Fonterra reports 3% higher 2020/21 milk production in New Zealand (IHSmarkit)

- NZ milk collections in 2020/21 totalled 1,539.2 million kgMS
- Demand up across all major import hubs
- Fonterra offloads Shandong-based JVs in China

New Zealand’s dairy giant Fonterra has reported higher milk production in May, its last month of the 2020/21 season, finishing the period on a high note.
- According to Fonterra’s latest Global Dairy Update, milk production saw a sixth-consecutive 8% y/y increase in May on a litres basis, while the rise in milk solids rose 9.4% y/y. Despite severe flooding in Canterbury during the second part of the month, continued favourable warm temperatures throughout the North Island and Marlborough have offset the negative weather effects.
- Fonterra’s New Zealand production in 2020/21 reported a 3% y/y increase, while collections reached 1,539.2 million kgMS, 2% ahead of last season.
- New Zealand’s milk production growth has coincided with other global origins, with EU production up 1% y/y in April, US volumes up 5% y/y in May and Australian remaining flat y/y in April.
- The current supply and demand situation is favourable. Exports from the world’s main exporting hubs, including New Zealand, Australia and the US have increased by double digits – with the exception of the EU, where exports grew by 8% in March.
- Import demand in March bounced back to growth in Latin America and the Middle East and Africa regions, up by 19% and 3% respectively. The increase was driven by higher volumes of liquid milk products to Peru, cheese to Mexico and Chile and WMP to Brazil. In the Middle East, growth was spurred by stronger volumes of liquid milk products to Libya, infant formula to Nigeria and cheese to Bahrain.
- Asian (excluding China) imports continued building momentum and were up 9% in March, driven primarily by SMP and liquid milk to the Philippines, lactose to Japan and cheese to Korea. China’s May imports have slowed in May to being only 1.3% up in May, slowing from the 26% growth achieved in April. Volumes rose across most categories, with SMP and WMP volumes hitting record levels.

Sale of JVs in China agreed

- Fonterra has announced that it agreed the sale of its two joint venture farms in Shandong, China to Singapore-based AustAsia Investment Holdings for USD115.5 million.
- The sale of Fonterra’s 51% stake in the business will lead to the company receiving NZD 88million (based on currency conversion) in total asset sale proceeds, which includes cash on completion. The deal is expected to be completed on 30 June.
- Miles Hurrell, Fonterra ceo, said the sale is another important milestone which aligns to its strategy of prioritising New Zealand milk.

The sale is Fonterra’s continued effort to cut ties with local production in China, as last year it had offloaded its China Farms in Shanxi and Hebei provinces to Inner Mongolia Youran Dairy, NZD552 million.

Jul 01 - Turkey buys about 395,000 tonnes milling wheat in tender - trade  

Turkey's state grain board TMO has provisionally purchased an estimated 395,000 tonnes of wheat in an international tender for the same volume which closed on Wednesday, traders said. The tonnages purchased and prices are provisional and still subject to final confirmation in coming days, they said.

Jul 01 - U.S. corn and soybean plantings below market forecasts - USDA 

U.S. farmers seeded the second-largest combined corn and soybean acreage ever this spring, as concerns about global food security pushed prices for the crops to their highest in more than eight years, the U.S. Agriculture Department said on Wednesday. But the total for each crop fell below trade expectations, sparking a rally in futures prices after the data hit.

Jul 01 - ChemChina seeking $10 bln in Syngenta IPO, likely world's biggest float of 2021 

ChemChina is aiming to raise around $10 billion from a Shanghai IPO for Swiss agrichemical giant Syngenta Group, in what is set to be the world's largest flotation this year, sources with direct knowledge of the matter told Reuters. ChemChina, which became part of Sinochem Holdings Corp last month, is also considering a secondary listing for Syngenta that could take place less than a year after its debut, with exchanges in Zurich, London and New York among the options being examined, sources said.

Jun 30 - USDA planting rattles soybean, corn outlooks as futures hit limits (Agricensus)
The USDA’s influential quarterly update on planting has tripped off another huge rise in corn and soybean futures, as the agency failed to deliver an expected massive increase in planted area for both crops.
- Average expectations had looked for corn plantings to increase from 91.1 million acres, as set out in the March update, to 93.8 million acres, with beans expected to jump from 87.6 million acres to 88.9 million acres.
- However when the report was unveiled, soybean area was left unchanged at 87.6 million acres – up 5% on the previous marketing year, but well short of expectations.
- Corn was pushed higher, but only by 1.6 million acres to 92.7 million, with the harvested area at 84.5 million acres – up just 2% on the previous year despite futures prices hitting multi-year highs.
- The response from investors was instantaneous, reversing sharp losses in both corn and soybeans in the run-in to the report’s release, to drive both contracts towards trading limits.
- New crop corn’s September contract, which had dipped as low as $5.40/bu earlier in the day, surged to hit the 40 cents up limit as prices rebounded sharply, while the September soybean contract moved from $12.96/bu at one point to hit $14/bu.
- Wheat figures were also released, with the total planted area expected to come in at 46.7 million acres, just above the 46.2 million acres that analysts polled by Agricensus had looked for.
Nonetheless, the area amounts to the fourth smallest wheat area ever recorded, the USDA notes.

Nightmare scenario

For corn and soybeans, analysts had been warning that farmers had only limited space to raise their planted area given the price strength in both US staples – and historically the US has never planted over 180.3 million acres of combined corn and soybeans.
Expectations had looked for combined area of 182.7 million acres, but the USDA’s figures now pare than back to the 180.3 million acres – on par with the previous record.
The nightmare scenario for investors to contemplate now is that, with the Great Plains and parts of the Midwest facing drought conditions and more heat expected in the days ahead, the crops may struggle to hit record yields that underpin strong supply outlooks.
Currently the USDA is forecasting a corn yield of 179.5 bushels per acre, which would deliver a crop of 15.16 billion bushels (385 million mt), but any slip in that outlook will deliver a markedly smaller crop and place additional burden on already slim stocks.
In a parallel report, the USDA also slashed its outlook for corn and bean ending stocks to 4.1 billion bu (104.4 million mt) and 767 million bu (20.8 million mt) respectively.

Jun 30 - India cuts crude palm oil import tax, potentially boosting imports 

India on Tuesday cut the base import tax on crude palm oil to 10% from 15% for three months, the government said in a statement, as the world's biggest vegetable oil buyer tries to dampen near record high prices. The tax cut could make palm oil more attractive than rival soyoil and sunflower oil for Indian refiners and boost imports of the tropical oil in the next three months, supporting benchmark Malaysian prices.

Jun 30 - EU 2020/21 soft wheat exports 25.38 million tonnes by June 27 

Soft wheat exports from the European Union in the 2020/21 season that started last July had reached 25.38 million tonnes by June 27, data published by the European Commission showed on Tuesday. That was down from 34.64 million tonnes cleared by the same week last season, the data showed.

Jun 30 - Frost rekindles Brazil corn fears as B3 hits limits (Agricensus)
Frost across parts of Brazil’s corn-producing states and expectations of heavier frosts to come in the days ahead have sent corn futures on primary domestic exchange B3 to limit up for a second consecutive day, trade sources told Agricensus Tuesday.
“B3 is on the maximum high limit for the first (prompt) contracts. We woke up with lots of corn with frost images running the market. The forecasts shows that tomorrow will be even worse,” one Brazil-based trade source said.
The front-month July, September, November 2021 and January 2022 contracts all hit the 5% trading limit at Monday’s close as fears mounted that a significant proportion of this year’s late-planted corn crop could now face risk from the cold.
In early trading on Tuesday, the contracts again raced to the 5% limit.
Weather data from Maxar shows temperatures are expected to be up to four degrees Celsius below seasonal norms (8 degrees F) across much of the main producing regions over the next five days, with the peak of the cold wave expected on Wednesday.
This year’s Brazilian corn crop has already been hit hard by delays to the soybean planting programme followed by prolonged hot, dry weather. That slashed production outlooks from around 110 million mt to now stand at around 96 million mt, with some analysts calling for even lower figure. But the danger of planting corn late meant that key development stages for the fledgling crops would likely be pushed back into colder, cooler weather – raising fears of exposure to cold and frost, with some talking of heavy crop losses ahead.
“The market is worried about contract breaches; crop losses will be higher than 60% in the state of Paraná,” Victor Martins, hedge advisor at Hedgepoint Global Markets, told Agricensus.
“People are already referring to the ‘D Wednesday’ when more frost is expected,” a broker told Agricensus, although after developing under dry conditions, much of the damage is already done.
“This week’s frosts will impact mainly the latest planted areas, most of the safrinha crop loss will be due to dry and warm weather conditions during the months prior,” Martins said, estimating as much as 70% of the crop has been hit by dry conditions, meaning the balance is now impacted by frost.
“There is no widespread talk of higher imports as yet, but I do not rule out rising Argentinian imports,” the broker source said as Brazil strives to plug holes in its domestic corn supply.

Jun 29 - Russian wheat export prices largely unchanged ahead of new season 

Russian wheat export prices were largely unchanged last week, supported by a new floating duty in Russia and improving crop forecasts ahead of the start of the new marketing season, analysts said on Monday. Wheat exports from Russia, Ukraine and Kazakhstan are expected to rise by 5% in the new 2021/22 marketing season, which starts on July 1, a Reuters poll showed earlier this month. 

Jun 29 - EU countries approve deal to overhaul farming subsidies 

European Union countries on Monday gave the green light to reforms of the bloc's huge farming subsidy programme, after a three-year battle over rules to make it greener and support smaller farms. Negotiators representing the EU's 27 countries and European Parliament struck the deal on Friday to reform the Common Agricultural Policy (CAP), which will spend 387 billion euros ($462 billion) on payments to farmers and rural development, roughly a third of the EU's 2021-2027 budget.

Jun 29 - Frosts seen hurting Brazil corn; smaller risk for sugar cane, coffee 

A strong polar air mass moving through the South and Southeast areas in Brazil this week will probably damage fields of corn, but the risk is smaller for problems in areas of sugar cane and coffee, analysts and weather centers said on Monday. There is forecast of frosts happening from Tuesday to Thursday in most regions in the state of Parana -- Brazil's 2nd largest grain producer -- in parts of Mato Grosso do Sul and in the southern part of Sao Paulo state, the country's number 1 sugar cane grower.

Jun 28 - EU strikes deal on huge farm subsidies, ending three years of negotiations 

European Union negotiators struck a deal on reforms to the bloc's huge farming subsidy programme on Friday, introducing new measures aimed at protecting small farms and curbing agriculture's environmental impact. The deal ends a near three-year struggle over the future of the EU Common Agricultural Policy, which will suck up around a third of the EU's 2021-2027 budget, spending 387 billion euros on payments to farmers and support for rural development.

Jun 28 - Most Belarus potash exports not affected by EU sanctions - analysts 

The European Union's ban on imports and transit of potash from Belarus will not affect most exports of the crop nutrient from the world's top producer, provided the restriction stays in its current form, potash transporters and analysts said. The curbs apply to Belarus Potash Company (BPC) which exports potash -- Minsk's main foreign currency earner -- mostly via the Baltic port of Klaipeda in EU-member Lithuania.

Jun 28 - Taiwan bought 55,000 tonnes wheat of U.S.-origin in tender 

The Taiwan Flour Millers' Association purchased an estimated 55,000 tonnes of milling wheat to be sourced from the United States in a tender which closed on Thursday, European traders said on Monday. The wheat was bought in one consignment comprising various wheat types for shipment from the U.S. Pacific Northwest coast in August.

Jun 25 - Market Briefing: Dairy (IHSmarkist)

- Steady milk production growth in New Zealand
- The USDA announces new market support stimulus package worth USD1.0 billion
- Chinese imports continue to surge in April, UK exports to EU bottom out
- GDT Price Index down for the fifth time in a row

Production

- Milk production in New Zealand surged in April, as Fonterra reported a 12% y/y increase on a litres basis. The country’s collections for April were 118.2 million kgMS, up 11% y/y, driven by a 26% y/y surge in North Island collections.
- Australia’s milk production is forecast to reach 9.2 million tonnes in 2021, compared with the 2020 result of 9.1 million tonnes. Labour shortages and elevated dairy property prices are reported to have resulted in an increased number of dairy farmers choosing to retire earlier than planned.
- In Latin America, Uruguayan January-April milk collection volumes exceeded 600 million litres for the first time, with the total up 7% y/y to 601 million litres.

Demand

- The USDA has announced USD1.0 billion-worth of support measures that will replace the food box program in the US which ran until last month. The stimulus will include USD500 million to support purchase of government commodities that are distributed to food banks; USD400 million to make food bank purchases from disadvantaged farmers; and a further USD100 million will be allocated to fund supply chain grants.
- Chinese consumers have been increasing dairy in their diet and have maintained some of the habits acquired during the pandemic prevention period. Around 11% of Chinese consumers said they have increased the variety of milk products they consume, adding dairy snacks and yogurt to their daily diet, in addition to liquid milk, milk powder and cheese.

Trade

- With Chinese total dairy imports in April hitting 323,900 tonnes, up 25% y/y, the January-April total reached 1.46 million tonnes; a 32% y/y surge. Import growth continued to be spurred by whey and liquid milk, up 62% y/y and 54% y/y, respectively. In addition, imports of cheese soared 51% in January-April.
- UK dairy exports to the EU are continuing to lag pre-Brexit levels. British exports of key dairy products in April 2021 were worth GBP40.5 million – up by 7% m/m, but still 58% below y/y. For January-April, UK dairy exports to the EU totalled GBP109.2 million – just 27% of export values in Jan-April 2020.
- Uruguay’s total dairy exports increased 12% y/y in January-April, totalling USD210 million. The country’s main revenue earner WMP’s exports in the first four months of the year were up 12% y/y, to USD137 million, followed by cheeses with USD33 million, a decrease of 10% y/y.
- Brazil imported a total of 7,334 tonnes of dairy goods in April, 49% lower m/m and an increase of 19% y/y. The monthly slip was attributed to the rise of international prices and the US dollar appreciation.

Prices

- GDT prices have been declining from the strong values they had reached in H1, making New Zealand prices more aligned with international competitors. At the 1 June GDT event butter fell the most, by 5% to USD4,690/tonne. AMF’s price average fell by a mere 1.3% to USD5,654/tonne, with the commodity now trading at an almost USD1,000 premium to butter. WMP also witnessed a decline, with the price down 1.5% to USD4,062/tonne. The last GDT event (15 June) also reported an overall index decline, its fifth-consecutive. The price increases in AMF, cheddar and lactose – each up by less than 1% - were not able to offset the declines seen across milk powders and butter.
- European dairy prices have also continued to ease back. Demand is impacted by buyers holding back in the expectation of lower prices in the weeks to come. Supplies are seen as plentiful despite the fact that production in Europe has now passed its seasonal peak. Progressive steps to reopen the foodservice industry have tended to support dairy consumption, but prices are being generally capped by international factors: both Oceania and US butter prices are now below the EU average value for the first time this year.

Jun 25 - Market Briefing: Meat and Livestock (IHSmarkit)

- Manpower issues impacting on poultry production in UK and US.
- Demand for chicken and eggs improving in Europe.
- Brazilian chicken meat exports to UK surge after Brexit.
- Pigmeat prices in China down 50% on year-ago levels.

Production

- The UK poultry industry has reported a 10% decrease in throughput because of a shortage of workers across farming and processing. Manpower issues are also causing problems in the US, where data points to tight supplies of poultry - with prices reflecting that supply situation. Wing cold stocks reached their lowest May freezer pounds opening since 2012, drawing down 3% from March to 36 million pounds.
- Elsewhere, cattle prices in Brazil reached a record BRL320.9 per 15kg unit (USD4.22/kg) on 18 June as data showed that slaughter numbers in the first quarter stood at the lowest level for twelve years,

Demand

- The re-opening of the restaurant and foodservice sectors in many parts of Europe pushed egg prices higher this month – at a time of year when egg prices are normally falling. The easing of Covid restrictions has boosted demand in France, where prices are currently 5% up on year-ago levels. Meanwhile, tight supplies and increased demand for grilling parts following the onset of summer weather combined to push the EU’s benchmark broiler price above EUR205 per 100kg in mid-June – an increase of 14% y/y. European cattle prices also moved to fresh three-year highs this month amid growing demand for female cattle in particular.

Trade

- Brazil exported 41,650 tonnes of chicken to the UK market in the first five months of this year – up 41% y/y. In value terms, these shipments were worth almost USD100 million – an increase of 30% y/y. The UK’s shift away from European poultrymeat suppliers could strengthen when the UK starts imposing post-Brexit border checks on EU goods later this year. Meanwhile, Argentine beef exports have resumed following a month-long ban, but the government will limit shipments to 50% of last year’s monthly volumes in a bid to contain domestic food price inflation.

Prices

- Prices of pork and live pigs have fallen further in China, raising concerns over the effectiveness of government stabilization measures. Wholesale pork prices fell to CNY21 per kg (USD3.25/kg) in the third week of June – down by 50% since mid-February, according to data from the Chinese Commerce Ministry. Figures from the Agriculture Ministry shows the national live pig price falling to CNY15.13 per kg, a decrease of 7% w/w and down 51% year-on-year. The decline in prices is making it unprofitable for many small and mid-sized producers to continue raising pigs. Alongside the collapse in spot prices, live hog futures have tumbled by more than a third since the start of May.

Jun 25 - Market Briefing: Oilseeds (IHSmarkit)

- USDA revised EU rapeseed output up 0.6 million to 17.2 million tonnes in 2021/22
- German rapeseed crush up 10% y/y to 3.3 million tonnes in the first four months of 2021
- Turkey extends its zero import duty on sunflower seeds into 2021-22

Production

- USDA raised EU rapeseed output by 0.6 million to 17.2 million tonnes in 2021/22, as the cool spring weather and timely May rainfalls lifted yield prospects in France, Germany, and Poland. Meanwhile, Australian rapeseed production was also revised up 0.2 million tonnes to 3.7 million tonnes on higher area harvested and yield.
- IGC forecasts a bumper Brazilian soy crop of 139 million tonnes in 2021/22, up 3.3% y/y. IHS Markit estimates a slightly more optimistic volume at 140 million tonnes, up 1 million tonnes y/y.
- Cargill has started building a new USD200 million palm oil refinery in Lampung, Indonesia, to “accelerate Cargill’s efforts to develop a sustainable palm supply chain and provide verified deforestation free products to customers”. The refinery will meet demand for sustainable crude palm oil in North America and Europe, and is expected to be completed in late 2022.

Demand

- German rapeseed crush stood at 3.3 million tonnes in the first four months of 2021, up 10% y/y, the Union for the Promotion of Oil and Protein Plants (UFOP) stated.
- The National Oilseed Processors Association (NOPA) reported May soybean crush at 163.5 million bushels, below a previous crush estimate of 165.1 million bushels. However, the figure still was a record for the month of May.
- Turkey has extended its zero import duty on sunflower seeds into 2021-22, and will also maintain reduced rates for sunflower oil imports at 10%, according to a presidential decree published in the Official Gazette.

Trade

- Cambodian crude palm oil exports reached almost 20,000 tonnes in the first five months of 2021, up 36% y/y, according to a local news report citing data from the Ministry of Agriculture, Forestry and Fisheries.
- Canadian rapeseed oil exports reached 295,000 tonnes in May, down 13% y/y, IHS Markit reported. It also expects overall rapeseed oil shipments to decline by 1% y/y to 3.4 million tonnes in 2020/21.
- Ukraine’s sunflower oil exports are forecast to rebound by 24% to 6.2 million tonnes in 2021/22, as production should recover by 23% to 7 million tonnes, according to IHS Markit latest data.

Price

- Brazil’s soy prices declined by 9% w/w to BRL153.43 (USD30.26)/60-kilo bags, in the week ending June 18, at the Paranaguá port. In the state of Paraná, prices also fell to BRL148.08 (USD29.21)/60-kilo bags, down 10% w/w.
- Indonesia’s crude palm oil reference price surged to USD1223.90/tonne, up USD113.22 m/m, or 9.2% m/m, due to the continued strengthening of international prices. As a result, Indonesia increased its June’s export duty to USD183/tonne from USD144/tonne.
- The Nearby July soybean contract lost 9 1/2 cents to end the session at USD13.85 per bushel with November down 2 cents at USD13.00 1/4. Soybean futures closed mostly Tuesday with soybeans lower on improved weather conditions in the US corn Belt.

Jun 25 - Market Briefing: Grains and Feed (IHSmarkit)

- EU wheat output up 9.3% y/y to 136.1 million tonnes in 2021/22
- Brazil’s corn prices declined by 5% w/w to BRL89.87 (USD17.73)/60-kilo bags
- Indian oilmeal exports declined by 25% m/m to 228,242 tonnes in May 2021

Production

- IGC predicts China to overtake the EU as the largest wheat producer in 2020/21, with output expected at 134.3 million tonnes against 124.5 million tonnes in the EU. However, the EU is projected to outpace China in 2021/22, with volumes estimated at 136.1 million tonnes, up 9.3% y/y, while China should harvest 136 million tonnes, up 1.3% y/y.
- US corn output is projected to rise by 5.3% y/y to 379.5 million tonnes in 2021/22, while China should produce 267 million tonnes, an increase of 2.5% y/y, IGC forecasts. It also predicts Brazil’s output at 117.4 million tonnes, up 12% y/y, and Argentina’s harvest at 59.3 million tonnes, up 8% y/y.
- The ABARES (Australian Bureau of Agricultural and Resource Economics) forecasts Australia’s winter crop production at 47 million tonnes in 2021/22, below last year’s level. In particular, wheat production is expected to fall by 17% to 28 million tonnes in 2021/22, while barley output should decline by 21% to 10.4 million tonnes.

Demand

- China has started to import rice from India for the first time in years, totalling almost 300,000 tonnes in the first quarter of 2021, and has recently granted India access for non-basmati rice.
- Total Indian wheat consumption is projected at 104 million tonnes, up 1% y/y driven by a sharp growth in feed use, up 8% y/y to 7 million tonnes, while FSI consumption should rise marginally, up 0.4% y/y to 97 million tonnes, according to USDA.

Trade

- Indian oilmeal exports declined by 25% m/m to 228,242 tonnes in May 2021, and by 8% y/y, SEA reported. The decrease was driven by a sharp fall in rapeseed meal exports, down 46% to 97,000 tonnes, and in castor seed meal, down 25% to 21,000 tonnes.
- US corn exports remained unchanged at 2.4 billion bushels in 2021/22, according to USDA’s WASDE June report.
- Cumulative Thai rice exports from January 1 - June 13, 2021, reached 1.4 million tonnes, down 25% from the same period last year, USDA stated.

Price

- SovEcon revealed Russian wheat prices continued to decline in the week ending June 18, due to a greater supply, the upcoming harvest, and record wheat stocks. Average prices for grade 3 Russian wheat fell by RUB250 to RUB13,775/ tonne, by RUB175 to RUB13,600/tonne for grade 4, and by RUB200 to RUB13,125/ tonne for grade 5 (average price EXW, European part of Russia, excluding VAT).
- Brazil’s corn prices declined by 5% w/w to BRL89.87 (USD17.73)/60-kilo bags on June 18, in the city of Campinas, due to CBOT futures falling on weak demand, and humid weather expected to be favourable for the US producing belt.
- Thai rice export prices fell in the week ending June 14, due to a shortage of inquiries induced by high freight costs and container shortages, USDA reported. Thailand’s benchmark 5% broken white rice and parboiled 100% rice prices declined by USD1.00 to USD461/tonne and USD466/tonne, respectively.

Jun 25 - The Parana River, the main export waterway for grains in Argentina is facing low water levels for the second consecutive year. As many as 60 barges have been trapped by impassable water levels, and some vessels may remain stuck until September according to AgriCensus. Water levels at the Port of Rosario in mid-June were 0.60 meters compared to the historic average of 3.5 meters. A lack of rainfall in June is expected to draw down water levels even further.

Jun 25 - Russia's ministry again increases wheat, corn export taxes (Agricensus)
Russia's agriculture ministry has announced it will increase the export duty on wheat and corn once again, but leave barley unchanged for the June 30-July 6 period, an official notice showed Friday.
The wheat tax will be increased by another $3.20/mt to reach $41.30/mt, according to the seven-day average index price published by the Moscow Exchange (MOEX) of $259.10/mt.
The corn export tax will also continue to go higher, being revised up by $0.30/mt to $50.50/mt based on the seven days index which stood at $257.20/mt.
Barley remained at $39.60/mt as the index was unchanged at $241.70/mt during the weekly period.
The duty is calculated from a formula, whereby exporters will have to pay 70% of the difference between a floor price and a floating index price calculated by a panel of industry experts and published by MOEX.
The tax is updated every Friday and comes into force on the third working day after publication.
The scheme is set to run through the 2021/22 marketing year, which begins on July 1.

Jun 25 - EU trims 2021/22 wheat harvest and stocks forecasts 

The European Commission on Thursday trimmed its forecast of usable production of common wheat in European Union's 27 member countries in 2021/22 to 125.8 million tonnes from 126.2 million estimated last month. The reduced forecast was nonetheless 7% above the 2020/21 crop of 117.2 million tonnes, the Commission's monthly supply and demand data showed.

Jun 25 - IGC raises forecast for 2021/22 global corn crop 

The International Grains Council (IGC) on Thursday raised its forecast for global corn (maize) production in the 2021/22 season mainly driven by an improved outlook for number two producer China. In its monthly update, the inter-governmental body raised its global corn production outlook by 7 million tonnes to a record 1.201 billion tonnes.

Jun 24 - EU grain industry warns of import surge from green goals 

European Union targets to reduce the environmental impact of farming could cut crop production sharply and turn the bloc into a net cereal importer, grain industry group Coceral said on Wednesday. Under its "Farm to Fork" strategy set out last year, the European Commission proposed objectives for 2030 including expanding organic production to 25% of farmland from 8% currently, and cutting pesticide use by 50%. 

Jun 24 - Argentine May soybean crush at four-year high, on par with expectations - Agricensus
Soybean crushing in Argentina rose by a further 2% on the prior month and was up 7% from the same month last year, official data from the Argentine Ministry of Agriculture showed late Tuesday.
Soybean processing came in at 4.29 million mt, in line with market expectations of 4.3 million mt.
A seasonal increase in availability supported bean processing in May as the soybean harvest approached completion, however disappointing rates of farmer selling has continued to be seen this marketing year.
A total of 17.99 million mt of soybeans were processed in the first five months of the year, up 17% on the same time last year, as grinding activity continued to recover from disappointing rates last year.
Further support came from high soyoil prices as Argentinean soyoil cash prices peaked in early May.
The May soybean crush resulted in the production of 847,624 mt of soyoil and 3.58 million mt of soymeal, up 6% and 18%, respectively, from May last year.
In 2021, Argentina is forecast to crush 40.5 million mt of soybeans in 2021, according to the exporter chamber Ciara-CEC.

Jun 24 - Russia starts harvesting this year's grain crop with bright prospects 

Russia, the world's largest wheat exporter, started harvesting its 2021 grain crop on Wednesday with bright prospects for another year of large production. Russia's southern region of Stavropol began to bring in winter barley, its regional agriculture ministry said in a statement.

Jun 24 - Argentine ranchers slam gov't limit on beef exports, say will hit production 

Argentina's new policy of limiting beef exports for the rest of this year will hurt production, ranchers said in a statement on Wednesday that signaled rising tensions between the agricultural sector and the center-left administration. The export curbs, announced on Tuesday and which include a cap on monthly beef exports at half last year's average level until August, are aimed at controlling high domestic food inflation. 

Jun 23 - China books an estimated 250k mt of Australian milling wheat - Agricensus
China returned to the market for Australian wheat for August-September shipment despite ongoing geopolitical and trade tensions between the two countries, trade sources said on Tuesday.
China was said to be in the market recently and booked around 200,000-250,000 mt of wheat for August-September shipment, according to traders and brokers.
There was no firm idea on the price paid, with sources putting the price in a wide $285/mt-$300/mt FOB East Coast range, saying that it was high protein wheat that was sold.
The trades come after Australia successfully shipped around 1.3 million mt through the December-April period, with the April amount standing at 173,656 mt, according to official data.
Relations between the two countries soured through 2020 and China effectively banned Australian barley imports by slapping a steep import duty on the origin, although wheat remained untouched.

Jun 23 - Russia may supply up to 1 mln T of wheat to Algeria in new season - expert 

Russia may boost supplies to Algeria to up to 1 million tonnes of wheat in the 2021/22 marketing season, which starts on July 1, Eduard Zernin, who heads the Russian union of grain exporters, told Reuters on Tuesday. Russia, one of the world's largest wheat exporters, sent 28,000 tonnes of wheat to Algeria - the first such shipment in more than four years - earlier this week.  

Jun 23 - Malaysia surpasses Indonesia to become India's top palm oil supplier 

Malaysia has surpassed Indonesia to become the biggest crude palm oil (CPO) exporter to top consumer India in 2020/21, after Indonesia imposed heavy taxes on exports of the edible oil last year, industry officials told Reuters. Malaysia's palm oil exports to India surged 238% to 2.42 million tonnes in the first seven months of 2020/21 marketing year started on Nov. 1, according to data compiled by The Solvent Extractors' Association of India (SEA), a trade body of Indian vegetable oil refiners and traders.

Jun 23 - Brazil's 2020/2021 corn crop forecast below 94 mln T - Reuters poll 

Brazilian farmers will harvest just under 94 million tonnes of corn this season, a Reuters poll of ten forecasters indicated on Tuesday, a fall of 8.5% from the last due to a severe drought. Crop failure will lead to higher imports and lower exports of the cereal, the forecasters suggested, as Brazil, home to some of the world's largest meat processors, needs it to make livestock feed.

Jun 22 - Russian wheat export prices down under pressure from good crop 

Russian export prices for the summer's new wheat crop fell last week under pressure from approaching good crop in the Black Sea area, analysts said on Monday. Wheat exports from Russia, Ukraine and Kazakhstan are expected to rise by 5% in new 2021/22 marketing season, which starts on July 1, a Reuters poll showed last week. 

Jun 22 - New compensation offer made over Suez Canal blockage 

The owners of a container ship that blocked the Suez Canal in March have made a new offer in a compensation dispute with the canal authority, and a court ruling on the case was postponed for two weeks on Sunday to allow more time for negotiations. The giant Ever Given container ship has been anchored in a lake between two stretches of the canal since it was dislodged on March 29. It had been grounded across the canal for six days, blocking hundreds of ships and disrupting global trade.

Jun 22 - U.S. Plains farmers bet on sorghum as Chinese demand lifts prices 

U.S. farmers are poised to expand plantings of sorghum by nearly 20% this year, a far larger percentage than soy or corn acres, as the crop purchased mainly by China for use in animal feed and to make baiju liquor trades at a premium.  Although strong demand for corn and soybeans lifted futures prices of those crops to near-decade highs, farmers said sorghum is particularly appealing this year as it is more resistant to drought. 

Jun 22 - EU farming policy failing to fight climate change, auditors say 

The European Union's huge subsidy programme for agriculture is failing to rein in greenhouse gas emissions from farming, despite 100 billion euros of such subsidies being labelled as climate spending since 2014, auditors said on Monday. The environmental impact of agriculture is under increased scrutiny, as the EU seeks to eliminate its net emissions by 2050 - including the 10% of emissions that come from farming.

Jun 21 - Indonesia will change its palm oil export levy scheme to reduce the highest rate to $175 per tonne soon, Finance Minister Sri Mulyani Indrawati said on Monday ((Reuters), compared with $255 per tonne under the current rules.
A new regulation will soon be issued for authorities to collect a $50 per tonne export levy when crude palm oil prices reach a minimum of $750 per tonne, she said.
For every $50 increase in prices, the levy will rise by $20 for crude palm oil and $16 for derivative products, but there will be a ceiling rate of $175 when CPO prices go above $1,000.
We think they mean 55 minimum but state $50/tonne minimum in the article but that’s not the key here. The key is that the top end tax to drop from 255 to 175 and this increases the competitiveness of the export market for Palmoil from there – at face value in isolation bearish.

Jun 21 - French cereal crop conditions stay favourable in hot spell 

Cereal crop ratings in France were stable in the week to June 14, with field conditions staying mostly favourable during a hot spell, data from farm office FranceAgriMer showed on Friday. An estimated 81% of soft wheat, France's main cereal crop, was in good or excellent condition, unchanged from the previous week and well above a year-earlier score of 56%, FranceAgriMer said in a weekly cereal report.

Jun 21 - German pig prices down as Chinese fall pressures world markets 

German pig prices fell sharply this week as a slump in Chinese prices undermined international markets, industry sources said on Friday. German pig prices fell to 1.48 euros ($1.76) a kg slaughter weight from 1.57 euros last week, the association of German animal farmers VEZG said.

Jun 21 - China's May soybean imports from Brazil surge 82% vs April 

China's May soybean imports from Brazil jumped 82% from the previous month, bolstered by the arrival of cargoes due to land earlier but delayed by rains, customs data showed on Sunday.  China, the world's top importer of soybeans, brought in 9.23 million tonnes of soybeans from the South American country in May, up from 5.08 million tonnes in April, data from the General Administration of Customs showed.

Jun 18 - Market Briefing: Oilseeds (IHSmarkit)

- Brazil to harvest 139 million tonnes of soy in 2021/22, up 3.3% y/y
- USDA raised EU rapeseed output by 0.6 million to 17.2 million tonnes
- Indonesian palm oil exports reached 2.1 million tonnes in May

Production

- Brazil is predicted to record a bumper soy crop of 139 million tonnes in 2021/22, up 3.3% y/y, according to IGC. IHS Markit estimates a slightly more optimistic volume at 140 million tonnes, up 1 million tonnes y/y, as yields should remain high. US soy production is expected to increase by 7.3% y/y to 121 million tonnes in 2021/22.
- USDA raised EU rapeseed output by 0.6 million to 17.2 million tonnes as the cool spring weather and timely May rainfalls lifted yield prospects in France, Germany, and Poland. Meanwhile, Australian rapeseed production was also revised up 0.2 million tonnes to 3.7 million tonnes on higher area harvested and yield.
- IHS Markit expects Indonesian palm oil output at 46.1 million tonnes in 2020/21, up 8%y/y. However, it is expected to decline by 2% to 45 million tonnes in 2021/22. The situation is reversed in Malaysia with an expected production of 19 million tonnes in 2020/21, down 2% y/y, while volumes should recover by 4% to 19.5 million tonnes in 2021/22.

Demand

The National Oilseed Processors Association (NOPA) reported May soybean crush at 163.5 million bushels, below a previous crush estimate of 165.1 million bushels. However, the figure still was a record for the month of May.

Trade

- Indonesian palm oil exports reached 2.1 million tonnes in May, against 1.8 million tonnes in the same period last year, IHS Markit reported. Meanwhile, Malaysian palm oil exports fell to 1.3 million tonnes, against 1.4 million tonnes last year.
- Canadian rapeseed oil exports registered a decline in May at 295,000 tonnes against 341,000 tonnes in the same month last year, according to IHS Markit’s latest data.

Price

- Brazil’s soy prices fell by 2% w/w in the week ending June 11, both in Paranaguá port and Paraná state, to BRL169.41 (USD33.09)/60-kilo bags and BRL165.35 (USD32.29)/60-kilo bags, respectively.
- The July nearby soybean future lost 6½ cents to end the session (June 16) at USD14.65¾ per bushel, while November fell 21¾ cents at USD13.73½. Soybean futures declined across the board Tuesday extending the correction for the fifth day in a row pressured by an improved weather outlook for the US Corn Belt.

Jun 18 - Market Briefing: Grains and Feed (IHSmarkit)

- EU wheat output up 9.3% y/y to 136.1 million tonnes in 2021/22
- Russia’s wheat harvest raised by 1.5 million tonnes to 82.4 million tonnes in 2021
- Brazil’s corn prices decreased by 4% w/w to BRL94.88 (USD18.53)/60-kilo bags

Production

- IGC predicts China’s wheat output at 134.3 million tonnes over the EU at 124.5 million tonnes in 2020/21. The scenario is expected to be reversed in 2021/22, as the EU is projected to outpace China with volumes estimated at 136.1 million tonnes, up 9.3% y/y, while China should harvest 136 million tonnes, up 1.3% y/y.
- US corn output is projected to rise by 5.3% y/y to 379.5 million tonnes in 2021/22, while China should produce 267 million tonnes, an increase of 2.5% y/y, IGC expects. It also predicts Brazil’s output at 117.4 million tonnes, up 12% y/y, and Argentina’s harvest at 59.3 million tonnes, up 8% y/y.
- SovEcon raised its forecast for 2021 Russia’s wheat harvest up by 1.5 million tonnes to 82.4 million tonnes, due to good crop conditions, on improved weather, and an increase in spring wheat area. Meanwhile, USDA revised its forecast to 86 million tonnes (excluding Crimea).

Demand

China has started to import rice from India for the first time in years, totalling almost 300,000 tonnes in the first quarter of 2021, and has recently granted India access for non-basmati rice.

Trade

- USDA predicts India’s rice exports at 17 million tonnes in 2020/21, up 17% y/y benefiting from competitive prices, and increased export capacity by using deep water ports to ship in bulk. Bangladesh is currently the top export destination for Indian rice with nearly 900,000 tonnes shipped in the first quarter of 2021.
- Ukrainian wheat exports are expected to reach 16.4 million tonnes (including wheat flour converted to wheat grain equivalent) in 2020/21, according to USDA.
- Cumulative Thai rice exports from January 1-June 6, 2021, reached 1.3 million tonnes, down 27% from the same period last year.

Price

- Brazil’s corn prices declined by 4% w/w to BRL94.88 (USD18.53)/60-kilo bags in the week ending June 11, in the city of Campinas. Local producers chose to withdraw from trading talks, due to concerns over crop yields and tight stocks.
- Thailand’s benchmark 5% broken white rice price declined marginally by 0.2% to USD462/tonne, while parboiled 100% rice fell by 1% to USD467/tonne.

Jun 18 - Market Briefing: Dairy (IHSmarkit)

- US cheese production continued growing in April, up 1% y/y
- UK dairy exports to the EU dip 58% y/y, driven by almost complete collapse in liquid milk supplies
- European wholesale prices signal to end of rally of high butter, milk powder and whey prices

Production

Total US cheese production in April was stronger than expected, at 1.1 million pounds, a 1% y/y increase. Production of American-style cheeses, like Colby and Monterrey, has consistently been running about 8%, or 15 million pounds, higher than 2019 since the beginning of the year. IHS Markit expects that strong cheddar cheese production (up 1% y/y), coupled with an additional 27 million pounds of American-style cheese in stocks. might not be absorbed by current demand in the short-term.

Demand

- Chilean dairy demand continued growing, as imports in January-April were up 42% y/y to 49,500 tonnes. Cheese was the main import category, accounting for 53% of the total import volume, rising 67% y/y, to 26,300 tonnes. Import revenue surged by 62% y/y to USD103 million.
- In the US, the USDA has announced USD1.0 billion-worth of support measures that will replace the food box program which ran until last month. The stimulus will include USD500 million to support purchase of government commodities that are distributed to food banks; USD400 million to make food bank purchases from disadvantaged farmers; and a further USD100 million will be allocated to fund supply chain grants.

Trade

UK dairy exports to the EU are continuing to lag pre-Brexit levels. British exports of key dairy products in April 2021 were worth GBP40.5 million – up by 7% m/m, but still 58% below y/y. For January-April, UK dairy exports to the EU totalled GBP109.2 million – just 27% of export values in Jan-April 2020. One of the most striking features has been the almost complete collapse of UK liquid milk exports, which have so far this year totalled just 3,611 tonnes – compared with close to 300,000 tonnes in the same period in 2019 and 2020.

Prices

- Europe’s internal market demand is reported to be generally firm, so no major collapse in prices is likely. However, the end is now in sight of a rally seen in the EU average price of butter, which rose by 23% since the start of 2021, of SMP and WMP – by 19% each, and of whey power – by 29%. This is also reflected in EEX butter futures, where butter for February 2022 delivery is trading at below EUR4,000/tonne, compared with the current June delivery value of EUR4,125/tonne.
- In addition, this week’s (15 June) GDT price average has declined for the fifth time in a row. The price increases in AMF, cheddar and lactose – each up by less than 1% - were not able to offset the declines seen across milk powders and butter.

Jun 18 - Argentine port unions say to go on 24-hour strike over vaccine access 

A coalition of nine Argentine port worker unions will go on a nationwide 24-hour strike starting at midnight to press for vaccinations against the coronavirus, the labor groups said in a statement on Thursday. Workers including tugboat captains and customs officers have held similar work stoppages recently, as the South American grains powerhouse gets hit by a second wave of COVID-19 cases.

Jun 18 - Japan buys 207,472 tonnes of food wheat via tender  

Japan's Ministry of Agriculture on Thursday bought 207,472 tonnes of food-quality wheat from the United States, Canada and Australia in a regular tender. Japan, the world's sixth-biggest wheat importer, keeps a tight grip on imports of the country's second-most important staple behind rice and buys the majority of the grain for milling via tenders typically issued three times a month.

Jun 18 - India puts on hold proposal to cut import duty on edible oils - sources 

India has put on hold a proposal to reduce import duties on edible oils as cooking oil prices started to fall in the world market after hitting record highs, two government and one industry officials told Reuters. The world's biggest vegetable oil importer was considering reducing duties after domestic soyoil and palm oil prices more than doubled in the past year, hitting consumers already stung by record fuel prices and reduced incomes amid the COVID-19 pandemic. 

Jun 18 - U.S. Supreme Court rules for Nestle, Cargill over slavery lawsuit 

The U.S. Supreme Court on Thursday threw out a lawsuit accusing Cargill Inc and a Nestle SA subsidiary of knowingly helping perpetuate slavery at Ivory Coast cocoa farms, but sidestepped a broader ruling on the permissibility of suits accusing American companies of human rights violations abroad. The 8-1 ruling authored by Justice Clarence Thomas reversed a lower court decision that had allowed the lawsuit, brought on behalf of former child slaves from Mali who worked at the farms, filed against the companies in 2005 to proceed.

Jun 17 - Egypt's GASC amends wheat tender book to allow suppliers to present shipment bids 

Egypt's state grains buyer, the General Authority for Supply Commodities (GASC) on Wednesday amended its tender book for international wheat purchases to allow suppliers to directly present shipment bids for their cargoes, a document seen by Reuters showed.  The change comes after GASC cancelled its latest wheat tender on Tuesday, a move many traders attributed to high shipping prices presented at the tender. 

Jun 17 - South Korea’s KFA bought about 60,000 tonnes corn in private deal  

The Korea Feed Association (KFA) purchased an estimated 60,000 tonnes of corn expected to be sourced from South America in a private deal on Tuesday without an international tender being issued, European traders said on Wednesday. The corn was purchased by the KFA’s Busan section at an estimated $315.00 a tonne c&f plus a $1.50 a tonne surcharge for additional port unloading.

Jun 17 - Argentine meat packers reach preliminary export deal with government, says source 

Argentine meat packers have reached a preliminary deal with the government that will allow them to partially reopen beef exports after a month-long suspension aimed at cutting domestic food price inflation, an industry source said on Wednesday. Argentina, China's second-biggest beef supplier after Brazil, halted exports for a month in mid-May as it grapples with fast rising domestic food prices. Meat packers have been negotiating a way to lift the curbs amid fears they could be extended. 

Jun 17 - Black Sea wheat exports seen up 5% in 2021/22 - POLL 

Wheat exports from Russia, Ukraine and Kazakhstan will rise in 2021/22, a Reuters poll showed, driven by high crops and stockpiles as well as increased global demand. The group, which exports its wheat mainly via the Black Sea to customers in Africa and the Middle East, faces tougher competition. In its main peer the European Union prospects for this year's crop are also good.

Jun 16 - Russian wheat export prices down as crop outlook improves  

Russian export prices for the summer's new wheat crop fell slightly last week following an improved outlook for the upcoming harvest, analysts said on Tuesday. Prices for new-crop Russian wheat with 12.5% protein loading from Black Sea ports and for supply in July were $255 a tonne free on board (FOB) at the end of last week, down $1 from the previous week, the IKAR agriculture consultancy said in a note. 

Jun 16 - South Korea's MFG buys about 65,000 tonnes feed wheat in tender - trade 

South Korea's Major Feedmill Group (MFG) has purchased about 65,000 tonnes of animal feed wheat which can be sourced from optional origins in a tender which closed on Tuesday, European traders said. The tender had sought up to 140,000 tonnes in two consignments of up to 70,000 tonnes. But traders said that only one consignment was purchased.

Jun 16 - NOPA May soybean crush below most estimates at 163.521 million bushels 

The U.S. soybean crush in May fell short of market expectations for a fourth straight month, rebounding only slightly from a sluggish April pace blamed largely on processing plant downtime, according to National Oilseed Processors Association (NOPA) data released on Tuesday. NOPA members, which handle about 95 percent of all soybeans processed in the United States, crushed just 163.521 million bushels of soybeans last month, up from 160.310 million bushels in April and 169.584 million bushels in May 2020.

Jun 16 - Germany's 2021 wheat and rapeseed crops helped by good weather 

Germany's 2021 wheat crop of all types is expected to increase by 3.8% on the year to 22.98 million tonnes as recent good weather helped crops, the country's association of farm cooperatives said on Tuesday. The association in its latest harvest forecast said Germany's 2021 winter rapeseed crop will rise 4.6% from last summer's crop to 3.67 million tonnes.

Jun 15 - EU 2020/21 soft wheat exports 24.88 million tonnes by June 13 

Soft wheat exports from the European Union in the 2020/21 season that started last July had reached 24.88 million tonnes by June 13, data published by the European Commission showed on Monday. That was down from 33.94 million tonnes cleared by the same week last season, the data showed. 

Jun 15 - Unusual dive for Iowa corn health ahead of another dry week - Braun 

Hot and dry weather across the U.S. Corn Belt last week sent crop conditions tumbling on Monday in top-producing states, particularly Iowa. Health could deteriorate further on dryness in the week ahead, though forecasts suggest some critical relief could be in store for the following week. The U.S. Department of Agriculture’s statistics agency placed 68% of the country’s corn in good or excellent condition as of Sunday, below trade expectations of 69%. That is not a bad rating by itself, but the trend is slightly problematic.

Jun 15 - Argentine’s agri. exports decline 13% y-o-y in Jan-May: BCR
Argentina exported a total of 43 million mt of grain and derivatives in the first five months of the year, a fall of 13% year-on-year amid smaller harvest volumes, a report by the Rosario Grain Exchange (BCR) said.
The overall fall came despite exports in the soybean complex reaching 16.6 million mt in the January-May period, an increase of 5.5 million mt.
But exports in the wheat complex fell 27% to 6.2 million mt, while corn shipments totaled 13 million mt, down 15% compared to the same period in 2020.
Emilce Terre, chief economist at the Rosario Board of Trade (BCR), told Agricensus that the lower export volume in the first five months of the year compared to the same stage of 2020 was chiefly due to lower exports in the corn and wheat segment as a consequence of drought conditions last year.
“In the case of wheat, drought conditions had negatively impacted production volumes and this is also having an impact in export volumes. In the corn segment, drought conditions in September and October of 2020... had also affected the first corn plantings,” Terre said.
“Due to this, many lots that were initially expected to be planted with first corn, were finally planted with second corn plantings in December. This is why the country now has more second corn crops compared to other cycles and this is also why the corn that was collected in March and April was lower compared to what was initially expected,” she added.
BCR also reported that Cargill was the biggest exporter of grains and oilseed derivatives in the 2019/20 marketing campaign, with 12.7 million mt.
That's up from 11.9 million mt in the previous marketing campaign.
Cargill was followed by Chinese-state owned company Cofco, with shipments of 11.7 million mt, a fall versus the 14.5 million mt handled in the previous campaign.
Other key exporters included Moreno Hermanos and ADM, with 10.4 million mt and 8.7 million mt respectively.
Argentine exports of grains, derivatives and oils totalled 89.78 million mt in the 2019/20 marketing season, down compared to the 98.74 million mt exported in the previous campaign, BCR said.
In the wheat segment, Cargill also led in the exports with 2.24 million mt, followed by Cofco, with 2.07 million mt and ADM with 1.84 million mt.
For corn, Cargill completed the hat-trick by topping the export list with a total of 5.61 million mt in the 2019/20 season, followed by ADM, with 5.51 million mt and Cofco, with 5.27 million mt.
Meanwhile, Cofco led exports in the soybean segment, with almost 1.21 million mt, followed by ADM with nearly 1.20 million mt and ACA with 630,000 mt, according to BCR.

Jun 14 - Europe's barley in good shape as harvest timing assessed 

Warm weather and showers since last month have put Europe on course for good barley yields this summer, with the timing of the harvest a key issue as crops recover from a cold start to spring, analysts and traders said. "Across Europe, the situation looks better than last year," Brent Atthill, head of consultancy RMI Analytics, said of barley crops.

Jun 14 - Sovecon raises forecast for Russia's 2021 wheat crop 

Russian agriculture consultancy Sovecon said on Friday that it had raised its forecast for the country's 2021 wheat crop by 1.5 million tonnes to 82.4 million tonnes. Russia is the world's largest wheat exporter, supplying it mainly to the Middle East and Africa. It is expected to start harvesting this year's crop in late June.

Jun 11 - Market Briefing: Grains and Feed (IHSmarkit)

- Australia’s winter crop production down at 47 million tonnes in 2021/22
- Vietnamese rice shipments up 55% y/y to 787,121 tonnes in April 2021
- Brazil’s corn prices fell by 0.6% w/w to BRL98.63 (USD19.59)/60-kilo bags

Production

- USDA’s June WASDE reported total US wheat production at 1.89 billion bushels in 2021/22, up 26 million from last month’s estimate, due to a higher production of hard red winter and soft red winter production more than offsetting lower white winter production.
- EU compound feed production (EU27+UK) for farmed animals increased by 0.1% y/y to 165 million tonnes in 2020, according to data from the European Feed Manufacturers’ Federation (FEFAC). Pig feed production rose by 1.3 % y/y in 2020, while cattle feed production fell by 0.2% y/y, and poultry feed output was down 0.8% y/y due to the spread of Avian Influenza (HPAI) along with Covid-19 lockdowns.
- The ABARES (Australian Bureau of Agricultural and Resource Economics) forecasts Australia’s winter crop production at 47 million tonnes in 2021/22, below last year’s level. In particular, wheat production is expected to fall by 17% to 28 million tonnes in 2021/22, while barley output should decline by 21% to 10.4 million tonnes.

Demand

Burma’s wheat consumption to fall in 2021 due to an overall decrease in the bakery, fast food, breakfast snack categories stemming from temporary closures of bakeries, restaurants, and coffee shops. The shutdown was the result of Covid-19 containment measures and the February 1, 2021 military coup.

Trade

- Vietnamese rice shipments rose by 55% y/y to 787,121 tonnes in April, on higher shipments across all destinations, according to latest data from USDA. Exports to Asia increased by 28% y/y to 556,000 tonnes.
- Thai cumulative rice exports from January 1- May 30, 2021, totalled 1.3 million tonnes, a decline of 27% from the same period last year.
- US corn exports are maintained at 2.45 billion bushels in 2021/22, according to USDA’s WASDE June report.

Price

Brazil’s corn prices fell by 0.6% w/w to BRL98.63 (USD19.59)/60-kilo bags in the week ending June 4, in the city of Campinas.

Thailand’s benchmark 5% broken white rice price and parboiled 100% rice both declined by 3% to USD463/tonne and USD471/tonne respectively in the week ending May 31, on reduced trade activity and the strengthening of the Thai baht against the US dollar.

Jun 11 - Market Briefing: Oilseeds (IHSmarkit)

- Australia’s rapeseed output up 4% to 4.2 million tonnes in 2021/22
- Malaysia’s palm oil exports fell by 6% to 1.3 million tonnes in May 2021
- Brazil’s domestic soy prices down 0.1% w/w to BRL173.21 (USD34.40)/60-kilo bags

Production

- Cargill has started building a new USD200 million palm oil refinery in Lampung, Indonesia, to meet demand for sustainable crude palm oil in North America and Europe. The plant is expected to be completed in late 2022.
- Ceres Global is forecast to build a CAD350 million rapeseed crushing facility in Northgate, Saskatchewan, due to the growing global demand for rapeseed products. The plant, set to be operational by summer 2024, will have a crushing capacity of 1.1 million tonnes and produce over 500,000 tonnes of oil, for both food and fuel, annually.
- Australia’s rapeseed output is projected to rise by 4% to 4.2 million tonnes in 2021/22.

Demand

Malaysia’s palm oil exports fell by 6% to 1.3 million tonnes in May 2021. Demand from Asian markets has been hindered by reports that Indonesia plans to slash the export levy by USD100 per tonne, although no official government announcement has been released yet.

Trade

- Ukraine exported 4.4 million tonnes of sunflower oil in September-May 2020/21, down 700,000 tonnes y/y according to APK-Inform citing official data. India, the largest importer of Ukrainian sunflower oil reduced its imports from 1.42 million tonnes to 1.39 million tonnes in the reporting period. Similarly, shipments to the EU declined by 500,000 tonnes to 1.1 million tonnes.
- Canadian rapeseed shipments rose by 7% y/y to 3.4 million tonnes in 2020, according to data from the Canola Council of Canada. While the US and China remained the largest export destinations, the growth was driven mainly by a surge in Chinese demand. Exports to the US fell by 3% to 1.7 million tonnes, while shipments to China grew by 26% to 1.1 million tonnes compared to 2019.
- According to USDA’s latest WASDE report, US soybean oil exports are reduced 400 million pounds to 1.9 billion in 2020/21 as “high US prices reduce competitiveness in the world market”.

Price

Brazil’s domestic soy prices declined by 0.1% w/w to BRL173.21 (USD34.40)/60-kilo bags at the Paranaguá port, in the week ending June 4. Nonetheless, prices grew by 0.02% w/w in the state of Paraná to BRL168.26 (USD33.42)/60-kilo bags.

Jun 11 - Market Briefing: Meat and Livestock (IHSmarkit)

- Australia sheep flock recovering ahead of expectations.
- Philippines ramps up pork imports after losing millions of pigs to ASF.
- Canada exporting more pork despite setbacks in key Chinese market.
- Prices paid for Brazilian chicken strengthen on domestic and export markets.

Production

Favourable seasonal conditions coupled with a positive outlook for key sheep producing regions mean the pace of Australia’s national flock rebuild is faster than expected. In its latest half year update, Meat and Livestock Australia (MLA) says it expects Australia’s sheep flock to grow by 6.3% to 68.1 million head, this follows the flock falling to its lowest level on record in 2020 after years of drought. The speed of the rebuild is also attributed to lower than previously expected sheep and lamb slaughter in 2021. Saleyard prices in 2021 are expected to remain high, though slightly lower than the records set in 2020 and 2019.

Demand

Having lost millions of hogs to African Swine Fever (ASF), the Philippines is buying unprecedented amounts of pork from countries in Europe and the Americas. Imports of pigmeat and pig offal amounted to 142,574 tonnes in the first four months of 2021 – an increase of 242% y/y. Spain and Canada have been standout performers – increasing shipments roughly threefold on year-ago levels. The Philippines last month declared a ‘state of calamity’ over its ASF situation, noting that more than three million pigs have been lost the disease since it first reached the country in August 2019.

Trade

Canadian pork exports increased by 6% in the first four months of this year despite a drop in sales to the key Chinese market. Total shipments of pigmeat (excluding offal) reached 432,000 tonnes – up from 408,000 tonnes in Jan-April 2020. In contrast to previous years, sales to mainland China fell by a third to 121,000 tonnes in the first four months of this year. But this was offset by higher sales to the US, Philippines, South Korea and Vietnam. Progress in the EU has still not materialized however as technical barriers are still making it difficult for Canadian exporters to benefit from the provisions of the CETA free trade agreement.

Prices

Brazilian poultrymeat prices rose once again in the first week of June following another strong month for exports. Wholesale prices in the state of Paraná (PR) closed the week ending June 4, at BRL6.90 per kg (USD1.37/kg), a rise of 5% w/w, while live birds remained at BRL4.90 per kg (USD0.97/kg) all week. On the domestic market, Brazil’s economic difficulties are supporting demand for chicken meat as an affordable alternative to beef and pork. On the external market, Brazil’s fresh poultry meat exports reached 383,191 tonnes in May, up 3% y/y, while average export prices rose even more sharply – jumping 16% y/y to USD1,555/tonne. This lifted export earnings for the month to USD596 million.

Jun 11 - Market Briefing: Dairy (IHSmarkit)

- US April production of cheese was up 8% y/y, butter dipped 19%
- Chinese dairy demand maintains momentum, imports up 25% y/y January-April
- European butter prices at highest since 2019

Production

Total US cheese in April output reached 1.14 billion pounds, 8% higher y/y, though 3% lower m/m. Butter production totalled 185 million pounds, down 19% from April 2020 but up 1% versus March 2021.

Australia’s milk production is forecast to reach 9.2 million tonnes in 2021, compared with the 2020 result of 9.1 million tonnes, which is lower than the official USDA forecast of 9.4 million tonnes. Labour shortages and elevated dairy property prices are reported to have resulted in an increased number of dairy farmers choosing to retire earlier than planned.

Demand

Chinese consumers have been increasing dairy in their diet and have maintained some of the habits acquired during the pandemic prevention period. A study found that 31% of the 4,200 surveyed people said they have increased their dairy intake since the pandemic, with 11% of respondents saying they have increased the variety of milk products they consume, adding dairy snacks and yogurt, in addition to liquid milk, milk powder and cheese.

Trade

A 142% y/y improvement in Brazilian exports led the country’s daily trade balance deficit to drop by 70% m/m in April, which takes into account USD25 million from external sales and USD14 million from imports.

With Chinese total dairy imports in April alone hitting 323,900 tonnes, up 25% y/y, the January-April total reached 1.46 million tonnes; a 32% y/y surge. Import growth continued to be spurred by whey and liquid milk, up 62% y/y and 54% y/y, respectively. In addition, imports of cheese soared 51% in January-April, as imports in April alone saw a surge of 68% y/y. With fresh cheese accounting for 43% of the total cheese imports, it is evident that foodservice demand is back on track in China.

Prices

Although European dairy commodity prices have hit something of a plateau over the past week, the EU average butter price is still tracking at its highest level since early 2019. Moreover, European milk production may stage something of a recovery after an unusually cold and wet spring kept output at comparatively modest levels. On the French AgriMer exchange, the French butter price has gained 2% over the past week, rising to EUR4,524/tonne. By contrast, the Dutch PZ price has fallen by 1%, to EUR4,100/tonne, while on the German Kempten exchange, the industrial (bulk) butter price has dipped by just under 1%, to EUR4,040/tonne.

Jun 11 - Argentina ships soymeal to France in rare Atlantic arbitrage (Agricensus)
- Argentina is expected to export a cargo of soybean meal to France in a rare trans-Atlantic move, trade sources have told Agricensus, that appears to reflect a drop-off in supply from its regular importing origin, Brazil. The vessel, the N Discovery, is listed in Argentine line-up data as shipping 30,000 mt of corn to France – in what would be an even rarer movement as the export of Argentine corn into the European Union is complicated by the bloc’s anti-GMO stance. However, local trade sources expect the ship to actually load with soymeal when it reaches the berth at Quebracho, in the Up River hub of San Lorenzo.
- While not unprecedented, Agricensus export data shows some 74,000 mt of Argentine soymeal arrived in France in January 2021, it is a rare move with the last cargoes heading into France sailing in 2018.
- Volume then totalled 126,103 mt for the full year, according to customs data.
- France typically secures between 1.5 million and 2 million mt of soymeal imports from Brazil per year, the data shows, but the volume this year to date stands at just under 544,000 mt, with just under half the year already elapsed.
- That suggests export volumes from Brazil have slowed down as the country wrestles with a huge export pull from China that has drained its soybean reserves and led to the imposition of rationing measures on soybean products – such as a temporary reduction of its biodiesel blend mandate.
- Argentina, the world’s biggest meal exporter, appears to be picking up some of that market share – although the country’s main Up River export hub faces challenges of its own. Currently, Argentina’s main soymeal export destinations include countries in southeast Asia such as Vietnam, Indonesia, and Malaysia, taking about 30% of shipments, while exports to Europe total about 12%, according to customs data.
- The N Discovery, chartered to Cargill according to Nabsa line up data, was expected to berth at the Quebracho terminal on June 4 but the facility is reporting waiting times of around four days amid rumbling strike action among port workers and low water levels in the river.
According to USDA data, Argentina’s soymeal production is pegged at 31.95 million mt in 2020/21, of which 88.4% is expected to be exported.
For 2021/22 Argentina is forecast to produce 32.73 million mt of soymeal, at an increase of 2.4% on the year, with export forecast to increase by 3.4% on the year, according to USDA data.

Jun 11 - Surging food import costs threaten world's poorest, FAO warns 

Food imports costs across the world are expected to surge to record levels this year, piling pressure on many of the poorest countries whose economies have already been ravaged by the COVID-19 pandemic, the U.N. Food Agency said on Thursday. These high costs may persist for a sustained period as nearly all agricultural commodities have become more expensive, while a rally in energy markets could raise farmers' production costs, the Food and Agriculture Organization (FAO) said.

Jun 11 - U.S. lowers corn supply outlook, raises soybean view 

U.S. corn supplies will fall to an eight-year low due to rising demand from the ethanol and export sectors, the government said on Thursday. But the soybean stockpile will be bigger than expected as high prices have cut into demand for soyoil and soymeal, reducing the amount processors will need to crush, the U.S. Agriculture Department said in its monthly World Agricultural Supply and Demand Estimates report. 

Jun 11 - Surprisingly good yields push Argentine corn crop estimate higher - exchange 

Late-planted Argentine corn is enjoying better-than-expected yields, prompting the Buenos Aires Grains Exchange to increase its 2020/21 harvest estimate to 48 million tonnes from a previously estimated 46 million tonnes. About 37.8% of the crop has been brought in so far, the exchange said in its weekly report. Argentina, with its vast Pampas grains belt, is the world's No. 3 corn exporter.