From: Terry Reilly
Sent: Wednesday, June 27, 2018 9:14:32 AM (UTC-06:00) Central Time (US & Canada)
Subject: FI Morning Grain Comments 06/27/18

PDF attached


Weather and crop conditions

  • The longer-term forecasts are calling for drier and warmer temperatures for the US Midwest.
  • World Weather evening update: “The most important part of the model run was the consistent forecast for the upper level ridge of high pressure that builds into the central Plains and western Corn Belt July 4-5 and then shifts to the Great Basin and Rocky Mountain region July 6-10. The ridge begins to shift back toward the high Plains region by July 12.”
  • The US trends warmer this week.
  • The forecast calls for limited precipitation during the second week of July, but the northern and eastern Midwest may pick up on rain.
  • U.S. northern Plains will receive daily rainfall through the next ten days.
  • The Texas Blacklands, West Texas and parts of the Delta where dryness will continue to see crop stress due to net drying through early July.
  • Eastern Australia will receive needed rain today and Wednesday.
  • Shandong, China, saw beneficial rain Monday into Tuesday. Southern Shanxi, extreme northern Henan and central Shaanxi saw rain as well.
  • Northeast China rainfall will be frequent through July 4.
  • Western Europe will continue to see a high-pressure ridge in place through Friday, limiting rainfall and keeps temperatures warm.
  • Eastern Ukraine through Kazakhstan will see drought conditions for a while. Eastern portions of Russia’s Southern Region into Kazakhstan will see some relief from warm temperatures this weekend.

Source: World Weather Inc. and FI


Source: World Weather Inc. and FI


Source: World Weather Inc. and FI




  • EIA U.S. weekly ethanol inventories, output, 10:30am


  • USDA weekly crop net-export sales for corn, wheat, soy, cotton, 8:30am
  • USDA hogs & pigs inventory data for 2Q, 3pm
  • U.S. agriculture prices received for May, 3pm
  • Buenos Aires Grain Exchange weekly crop report
  • EU weekly grain, oilseed import and export data
  • Port of Rouen data on French grain exports
  • Bloomberg weekly survey of analysts’ expectations on grain, sugar prices


  • Statistics Canada to release June seeded area for wheat, soy, barley, canola, durum 8:30am
  • USDA annual plantings data for corn, soy, wheat, cotton, noon
  • USDA grain stockpiles data for 2Q, noon
  • Traders’ estimates for July raw sugar delivery on ICE Futures
  • ICE Futures Europe commitments of traders weekly report on coffee, cocoa, sugar positions, ~1:30pm ET (~6:30pm London)
  • CFTC commitments of traders weekly report on positions for various U.S. futures and options, 3:30pm
  • Honduran Coffee Institute releases monthly exports, 4pm
  • FranceAgriMer weekly updates on French crop conditions


  • AmSpec data on Malaysia’s June 1-30 palm oil exports, 11pm ET Friday (11am Kuala Lumpur Saturday)

Source: Bloomberg and FI




·         KC wheat down 40





·         USD is higher, WTI crude higher, and gold lower, at the time this was written.

·         US Durable Goods Orders May Prelim: -0.6% (est -1.0% prev R -1.0%)

US Durable Ex Trans May Prelim: -0.3% (est 0.5% prev R 1.9%)

US Cap Goods Orders Nondef Ex Air May Prelim: -0.2% (est 0.5% prev R 2.3%%)

US Cap Goods Ship Nondef Ex Air May Prelim: -0.1% (est 0.3% prev R 1.0%)

·         US Wholesale Inventories May Prelim: 0.5% (est 0.2% prev 0.1%)

US Retail Inventories May M/M: 0.4% (prev R 0.5%)

·         US Advance Goods Trade Balance May: -$64.8bln (est -$69bln prev R $67.3bln)

·         US Pending Home Sales (M/M) May: -0.5% (est 0.5%; prev -1.3%)



  • Euronext will add a corn delivery point in Ghent, Belgium.


Export Developments

  • China sold an estimated 46.9 million tons of corn out of reserves since April 12.



Soybean complex.

·         US soybean complex is higher in part to widespread technical buying, two hot spells forecast across the US (we see no threat) and higher outside product values. End user buying should be noted.

·         China continues to prepare to for a US/China trade war. Several studies, meetings, and comments have flowed out of China over the past 24-hours. Our takeaway if the July 6 tariff date is real, and its reflecting currency and equity trading within China. The president of China hinted a slowdown in US Treasury buying, and/or eventual reduction of what they are holding. China carries a lot of US debt.

·         Apparently, ICE livesquawk reported President Trump decided against the harshest measures on China investments.

·         Brazil is scheduled to ship 6.56 million tons of soybeans as of June 26.

·         China increased its number of Ukraine sunflower companies to supply sunflower meal to China to 18 from 7.

·         China soybean meal futures hit a 7-week high.

·         China September soybean futures increased 14 yuan per ton or 0.4%, September meal was up 59 or 1.9%, China soybean oil up 1.9% and China September palm up 36 at 4768 yuan/ton.

·         September China cash crush margins were last running at 61 cents, up 10 cents from the previous day, and compares to 52 cents last week and 27 a year ago.

·         Rotterdam vegetable oils were higher and SA soybean meal when delivered into Rotterdam were mixed as of early morning CT time. 

·         Malaysian palm oil is trading near a two-year low. Farmer sales increased after the Ramadan holiday, sending cash prices lower.

·         September Malaysian palm was 38 lower at MYR2315 and cash up $5.00 at $596.25. 

·         Indonesia will keep its CPO tax unchanged in July at zero percent and lower cocoa beans to 5 percent from 10 percent.

·         Offshore values were leading the soybean oil about 20 points higher and soybean meal $2.90/short ton higher.


Export Developments

·         Egypt seeks 30,000 tons of soybean oil and 10,000 tons of sunflower on June 28 for arrival around Aug 15-31. GASC will also accept offers for at least 10,000 tons of soyoil and 5,000 tons of sunflower oil in Egyptian pounds. (Reuters)

·         China sold 106,859 tons of soybeans (21% of the 500,000 tons offered) and 1,991 tons of soybean oil (4% of the 50,000 tons offered) from state reserves. The soybeans were sold at an average price of 3,008 yuan per ton or $455.42/ton and soybean oil at 5,000 yuan per ton or $760.35/ton. China sold 376,965 tons of soybeans out of reserves so far, this season.

  • Iran seeks 30,000 tons of sunflower oil on July 10.
  • Iran seeks 30,000 tons of palm olein oils on July 10. 
  • Iran seeks 30,000 tons of soybean oil on August 1.




Export Developments.

  • Tunisia bought 125,000 tons of optional origin soft milling wheat at $210.89/ton c&f. They also bought 75,000 tons of feed barley. Reuters provided the following:
    • Three wheat consignments, each of 25,000 tons were bought at $210.89 a ton c&f and one of 25,000 tons at $211.64 a ton c&f.
    • One 25,000-ton wheat consignment was also bought at $210.98 a ton c&f.
    • Wheat shipment was said to be in stages between Aug. 15 and Sept. 25.
    • Of the barley, one consignment of 25,000 tons was bought at $209.19 a ton c&f, another of 25,000 tons at $209.41 a ton c&f and another of 25,000 tons at $212.68 a ton c&f.
    • The barley is for shipment in stages between Aug. 1 and Sept. 15.
  • Jordan passed on 120,000 tons of wheat.
  • Japan in a SBS import tender bought only 50 tons of feed wheat and passed on barley. 
  • Japan in a SBS import tender seeks 120,000 tons of feed wheat and 200,000 tons of barley on July 4 for arrival by December 28. 
  • Syria seeks 200,000 tons of wheat on July 2 for Aug 1-Sep 30 shipment. Origins include Russian, Romania and/or Bulgaria.
  • Iraq seeks 50,000 tons of wheat from the US, Australia and/or Canada on July 2, valid until July 8.
  • Bangladesh seeks 50,000 tons of wheat on July 3 for shipment within 40 days of contract signing.



  • South Korea seeks 102,800 tons of rice for September-February arrival on June 27.


    20,000         Brown Short     Sept. 15, 2018/Incheon

    20,000         Brown Short     Sept. 15, 2018/Ulsan

    20,000         Brown Short     Sept. 15, 2018/Masan

    10,000         Brown long      Sept. 30, 2018/Mokpo

    10,000         Brown long      Sept. 30, 2018/Donghae

     2,800         Milled Medium   Dec. 1-31, 2018/Busan

    10,000         Milled Medium   Feb. 28, 2019/Busan

    10,000         Milled Medium   Feb. 28, 2019/Busan

  • Iran seeks 50,000 tons of rice from Thailand on July 3.



Terry Reilly

Senior Commodity Analyst – Grain and Oilseeds

Futures International │190 S LaSalle St., Suite 410│Chicago, IL  60603

W: 312.604.1366

AIM: fi_treilly

ICE IM:  treilly1

Skype: fi.treilly


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