FI Evening Grain Comments 12/27/22

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Private exporters reported sales of 177,500 metric tons of corn for delivery to Japan. Of the total, 7,500 metric tons is for delivery during the 2022/2023 marketing year and 170,000 metric tons is for delivery during the 2023/2024 marketing year.

Choppy trade on lack of direction after a higher open from an unfavorable Argentina weather outlook, harsh weather for the US over the past several days and changes in China covid policies. A rally in global vegetable oils supported soybean oil. Mela ended lower on product spreading after fund buying dried. World geopolitical problems limited losses for meal and Chicago wheat. Volume was heavy for March soybeans despite the holiday week. South American soybean selling was noted.

Weather

US mainland snow coverage needs to improve:

· 44.1% Wednesday morning

· 44.3% Thursday morning

· 53.7% Friday morning

· 55.4% Saturday morning (western Plains 43.9% covered)

· 47.8% Monday morning

· 45.2% Tuesday morning

The US will warm up this week after the blast of cold temperatures. We expect winterkill and wind damage for wheat from this event. The USDA January Winter Wheat and Canola Seedings report should not reflect any area acreage loss, if any, from this storm event. What was planted should have been counted. Survey collection was conducted during the first two weeks of December. The Great Plains was dry over the weekend, as expected. US temperatures started to warm bias far southwestern growing areas Saturday, central and upper northwest of the Great Plains along with the central and southern Midwest Sunday, and upper Midwest into the northeast Monday. This morning (Tuesday) the models project most of the US Mainland at or above around the 20 degree mark for the areas surrounding the Great Lakes while the rest of the GP and Midwest will be in the 30’s to mid-50’s (bias south and southwest). The Great Plains will see precipitation across CO and NE Thursday and eastern TX Thursday through Friday before turning dry over the weekend. Heavy rains are expected across the lower Mississippi River Wednesday and Thursday. The South American weather forecast has not changed that much, and the theme is generally the same: good rain for central and northern Brazil and lighter rain for southern Brazil and Argentina. Showers should favor Argentina’s Cordoba today and Saturday.

December 27 US snow coverage

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World Weather, INC.

MOST IMPORTANT WEATHER FOR THE COMING WEEK

Argentina remains high on the list of world weather concerns

Weekend precipitation was significant in central through southeastern Buenos Aires where 1.00 to 2.32 inches resulted with one location reporting 3.50 inches
Rain also fell in northwestern parts of the nation impacting Salta, northernmost Santiago del Estero and Chaco most significantly with 1.00 to 2.12 inches resulting
Most areas in between these two precipitation area failed to get enough rain to counter evaporation

Rainfall of 0.05 to 0.39 inch resulted with poor coverage
Temperatures were warm, but not nearly as hot as last week with the dry areas reaching the upper 70s and lower 80s during the afternoons
Hot temperatures continued in the far north prior to the development of rain with extreme highs of 100 to 102, but conditions did cool down once the rain commenced

Argentina rainfall will continue poorly this workweek with net drying likely and temperatures near to above normal

Frequent high temperatures in the upper 70s and 80s will occur in the south while in the middle 80s and 90s in the north

Rain is expected in Argentina this weekend into next Monday, but it is unclear how significant the rainfall will be

Rain totals of 0.30 to 0.90 inch and local totals of 1.00 to 2.00 inches are expected, but changes may occur in the next few days
The precipitation will be very important and will be followed by a week of drying and if that occurs the bottom line will be pressuring production potentials lower once again

Rain must fall in Argentina immediately to support late season planting, emergence and establishment. Without significant rain the majority of the nation will see crop moisture stress increasing

AAO index is falling finally which may lend some support to improved Argentina rainfall in January, although the situation will need to be closely monitored and changes are not very likely in this first ten days of the forecast with the exception of the little rain event expected this weekend
No tropical cyclones or developing storms were noted around the world today except for Tropical Cyclone Darian which remains over open water in the central Indian Ocean far from land
Southern and center west Brazil will get some timely showers during mid-week this week and again early next week

The rain will bolster topsoil moisture for improved crop development after recent drying
Rainfall by the middle part of next week will vary from 1.00 to 3.00 inches from northern parts of Rio Grande do Sul to Mato Grosso

The GFS model continues to suggest greater rainfall

Southern Rio Grande do Sul will remain driest, although the greatest rain will hold off until next week even though some needed moisture is expected during the middle to latter part of this week as well
Temperatures will be seasonable with a slight cooler bias in the northeast

Three-day rainfall ending Monday morning in Brazil was restricted from Mato Grosso do Sul and southern Goias through western and southern Sao Paulo, Paraguay and Parana to Rio Grande do Sul

Weekend precipitation was significant in Mato Grosso, Tocantins, northern Goias, portions of Minas Gerais and Bahia with rainfall of 1.00 to 2.75 inches and local totals over 4.00 inches, although the greater amounts were highly localized and mostly confined to central Goias.

Brazil weekend temperatures were seasonable to slightly cooler than usual
Central Philippines rainfall during the weekend resulted in some impressive rain totals

Through dawn Monday amounts varied from 2.50 to more than 7.00 inches with one location on Samar Island reporting 21.41 inches of rain

Flooding was serious in a part of the region especially from northern Mindanao to Samar
An active northeast monsoon will result in additional rain this week that may result in more flooding

U.S. precipitation was quite limited during the Friday through Monday afternoon period with the exception of areas downwind from the Great Lakes where amazing amounts of snow fell.

Rain and mountain snow also occurred in the Pacific Northwest with the mountains of Washington and Oregon getting some of the greatest moisture along with the mountains of Idaho and Montana.
Snow did fall Sunday into Monday from North Dakota into Iowa with 1 to 3 inches and local totals to 5 inches resulting
More than 43 inches of snow fell at Buffalo, New York with more than 6.75 inches of moisture resulting
Upwards to 23 inches of snow also fell in western Michigan from Lake Effect snowfall

Bitter cold has begun to abate from North America, but the extreme conditions of late last week and during the holiday weekend were impressive with tropical storm and hurricane force wind occurring in parts of eastern Canada and the northeastern United States while blizzard conditions occurred briefly early in the weekend

Hard freezes continued during the weekend in Louisiana and throughout the southeastern United States excepting central and southern Florida.

Temperatures extremes in central Florida were mostly in the middle and upper 30s, but a few northern central areas in central Florida did slip below freezing with Lakeland dipping to 29.

The impact on citrus was minimal

Damage to sugarcane in Louisiana likely occurred, but much of the current year crop had already been harvested

There will be negative impact on first and second year stubble crops with lower yields for 2023

Most winter crops in the U.S. Midwest, Delta and southeastern states should not have been seriously damaged by the cold, but some freeze burning of leaves has likely occurred because of the freezes
Concern remains over the health of some wheat in the central and southwestern U.S. Plains where bitter cold occurred with little to no snow on the ground late last week

U.S. weather early to mid-week this week will include additional waves of rain and mountain snow from the Pacific Northwest into California with some significant snow likely in the Sierra Nevada to improve the runoff potential for spring 2023

Frequent waves of precipitation are advertised to continue through the end of next week and if all of the moisture occurs as advertised soil moisture and mountain snowpack will be greater than usual favoring a better outlook for spring water supply

The wetter bias must continue through the entire winter to greatly improve the water supply situation in California for spring and summer and the situation will be closely monitored

Some of the storms slated for California this week will march across the contiguous United States raising soil moisture and snow depths in some areas.

The active weather will be accompanied by warmer than usual temperatures in the southeastern states and a cooler bias in the west and north-central states

Europe temperatures will be warmer biased over the next ten days to two weeks and the same is expected across most of Asia
Europe weather will be wet biased in the west and north again this week with plenty of moisture expected

Most of the precipitation will occur as rain, but some mountain snow is likely as well

Western Russia, northern Ukraine, Belarus and the Baltic States will continue in a wet weather mode during the next ten days maintaining some concern over wet biased soil conditions in the spring in western Russia where some flooding may evolve
China weather this week will continue relatively quiet biased with a little rain and mountain snow in the southwest including areas from Sichuan to Yunnan

Most other areas will receive limited amount of moisture and temperatures will be near to above normal

India weather will be rather quiet as well with limited amounts of moisture expected and seasonably to slightly warmer than usual temperatures

India’s winter crops will have need for precipitation soon to support improved pre-reproductive precipitation

An active weather pattern is expected in parts of the Middle East during the next ten days, although the resulting precipitation should be mostly light to locally moderate
Australia winter and summer crop areas are unlikely to get much precipitation during the coming week.

The environment will be good for fieldwork, including late season harvest progress in southern winter crop areas
Rain is needed in interior east-central portions of the nation, although the situation is not a crisis

Unirrigated sorghum, cotton and other crops will need rain soon

Australia’s second week outlook may trend a little wetter in a few summer crop areas, but there is not much agreement in the computer forecast guidance

Temperatures may trend a little warmer than usual at times in the interior east and southeastern parts of the nation

South Africa weather will continue to be favorably mixed over the next two weeks supporting normal summer crop development

There may be some increasing need for precipitation in the western summer crop areas eventually

North Africa rainfall was limited during the weekend and it will continue restricted over the next ten days

Many areas from Morocco into Tunisia will require significant precipitation soon

West-central Africa dryness will continue through the next two weeks

Dry conditions are normal at this time of year
No excessive heat is expected, although some warming will evolve in January

Ethiopia rainfall will increase late this week and next week

Until then, rain in east-central Africa will be concentrated on Tanzania, Uganda and parts of southwestern Kenya which is normal for this time of year.

Coffee, cocoa, sugarcane, and a host of other crops should develop well in this environment

Southeast Asia will continue to experience periodic rainfall and some periods of sunshine supporting most crops throughout the region

Mainland areas of Southeast Asia will experience the driest conditions and that is normal for this time of year

Today’s Southern Oscillation Index was +18.00 today and it will likely level off early this week and then begin to fall during the remainder of this week and into the weekend

Source: World Weather INC

Bloomberg Ag Calendar

Tuesday, Dec. 27:

Malaysia Dec. 1-25 palm oil exports
HOLIDAY: UK, Australia, Hong Kong

Wednesday, Dec. 28:

Weekly USDA Broiler Report

Thursday, Dec. 29:

EIA weekly US ethanol inventories, production, 10:30am
Vietnam’s general statistics department releases monthly coffee, rice and rubber export data

Friday, Dec. 30:

USDA weekly net-export sales for corn, soybeans, wheat, cotton, pork and beef, 8:30am

CFTC commitments of traders weekly report on positions for various US futures and options, 3:30pm
ICE Futures Europe weekly commitment of traders report, 1:30pm (6:30pm London)