This Content Is Only For Exceed Grain Marketing Clients

Please Log In or Register to unlock this content.

Oilseed Highlights

Grain markets mixed for Tuesday morning trade
- Grains higher while veg oil complex mostly lower
- EU Rapeseed trading at a large discount to Canadian canola. EU rapeseed trading at about a $100 CAD discount to Canadian canola prices.
- Rapeseed oil trading at 3 year lows in Europe export positions.
- Good swath of Saskatchewan will catch some rains this weekend, in some of the driest areas. Northwestern Alberta will catch some precipitation as well. Montana and North Dakota will see some moisture as well.
- Black Sea grain regions expected to catch some rains as well this week. Especially in the spring wheat production regions of Russia.
- Eastern US corn and bean region, Illinois, Iowa, Indiana, Ohio, Missouri all expected to mostly miss rains this week. These regions are the ones that need rains the most.
News that India has been swapping palm oil imports to sunflower and soybean oil as it prices in cheaper has sent palm oil down today.
One thing to watch in coming days in terms of broader market sentiment is the impending US debt ceiling that will need to be raised prior to June 1st to avoid domestic default.
Indian palm oil domestic prices hit a 22 month low.
Black sea grain deal was renewed last week for another 60 days.
Russia accused of shutting down inspections of ships at a Ukrainian port, causing some stir in wheat markets.
Argentina is 52% harvested its dismal soybean crop, Buenos Aires grain exchange is down to 22.5 mmt. Almost exactly half of last years 44 mmt crop.
- Brazil’s crop raised by CONAB to nearly 155 mmt. Up from 131 mmt last year.
Argentinian crop rated at 4% good to excellent.
North American planting on pace to finish up early in most regions if the weather holds.
- We are in a weather market in North America as limited other news has been occupying headlines in recent weeks.
- There are some problem regions that will catch some rains this week but will not be enough to conquer all fears of dryness.
Turkish election will wrap up this weekend
USDA WASDE May Recap:
- USDA bumped global soybean imports into China back to 100mmt which was around the 2021 record number. Imports fell to 92 million and 96 million respectively.
- USDA also suggested that new crop 2023/24 soybeans in Brazil will be a mega 163 mmt, up from this years very large 155 mmt.
- Suggesting a 48 mmt Argentinian crop. This years crop is estimated at a dismal 25 to 27 mmt.
- Aside from weather issues, supplies could be higher, keep in mind that Argentina was expected to put out a 40+ mmt crop at the beginning of the year before extreme drought. So it is a moving target stick.
- Wheat, Corn and Soybeans global ending stocks all came in above last months report and traders estimates heading into the report. So heavier stocks are keeping a cap on markets.
  - Heading into the “New Crop” 2023/2024, stocks for soybeans are expected to grow a massive 21 mmt or 20% roughly.
  - Corn stocks expected to grow 16 mmt to 313 mmt
  - Wheat stocks expected to drop 2mmt to 264 mmt.
The European Rapeseed crop looks good. The crop is currently flowering in many areas of Germany and France and looks good. EU rapeseed markets will focus heavier on its domestic production for the near future.
US Planting Progress:
- 81% of the corn crop in vs 75% avg
- 66% vs 52% soybeans planted vs avg
- 64% of spring wheat planted vs 73% average (spring wheat planting has been slightly delayed due to heavy moisture in North Dakota this spring and a late melt.)
European soil moisture looks good in Northern Europe and into most FSU regions.
- The EU rapeseed crop came sitting in relatively good condition and could be another year of good production if crop conditions remain strong into July harvest. Crop is well into flowering in many of the winter rapeseed regions.
- See JRC comments immediately below.
European Rapeseed crop estimated at 21.1 mmt vs 19.5 mmt last year.
Malaysia kept its export tax for crude at 8% for the month of May
Over 20% of Argentina’s soy crop has been harvested.
- Latest report shows that leading into harvest, only 3% of the crop had been listed in good or excellent condition.
March ABARES Quarterly update: (Next Quarterly Update June 6th)
- ABARES increased some production estimates for the crop that came off in December and into January.
- Canola production was given a boost to a record shattering 8.3 mmt. 6.82 mmt was the prior record set last year and prior to that, 2-4mmt were common crop sizes out of Australia.
- Australia has been filling gaps in Europe with cheap canola where Canadian crops have fit in recent years. Canola port price Australia around the $685 per tonne level vs $880 at Vancouver.
UPDATED AMIS GLOBAL CROP MONITOR: (SEE MAP BELOW)
- Relatively few areas of concern for oilseed production outside of South America. More to watch as we get into Northern Hemisphere growing season in April/May

BRAZIL FARMLAND VALUES – USD (University of Illinois)

USDA FAS OILSEEDS

Chinese Soy Import’s – USDA FAS Oilseeds

OILSEED TECHNICAL INDICATORS

July SOYBEAN OIL – BOLLINGER BANDS (18 Day Moving Average Red, 50 Day Black, 100 Day Yellow)

July CANOLA – BOLLINGER BANDS (18 Day Moving Average Red, 50 Day Black, 100 Day Yellow)

July PALM OIL – BOLLINGER BANDS (18 Day Moving Average Red, 50 Day Black, 100 Day Yellow)

USDA WASDE DATA – May 2023

Special Crops

- Flooding taking place in Northern Italy.
  - Crop in general looks alright for Durum in Italy, although some localized flooding in the east central region will hamper quality.
- Australia has been doing an excellent job of supplying China with peas in recent months. Most of Aussies peas have been destined for the Asian nation.
- Yellow pea prices at Chinese warehouses have been sliding, greens and maples have been holding up stronger.
- US Grain Stocks March 1st:
  - Durum: 35.8 million bushels up 18% from 1 year ago
  - Barley: 88.7 million bushels, up 22% year over year
  - Oats: 42.9 million bushels, slightly below last years stocks. Of these stocks, on farm stocks were up 26% from 1 year ago while off farm stocks were down 12% year over year.
- US lentil acres expected to be down over 20% year over year.
- February exports of lentils from Australia set a monthly record.
- Portugal, Spain, France and Italy durum production regions very dry. Spain is in worst shape. North African crop looking dry as well.
- US Pea Acreage expected to climb 9%
- Some analysts, in contrast, looking at a pea acreage drop in Canada for the year ahead.
- Poor Conditions in Northern African Durum production regions.
- Australian pea crop raised to 314,000 tonnes. Up 20% year over year
- ABARES Lentil crop size updated to 1.4 mmt from 1.05 mmt in their December update and 1 million tonnes last year.
- Early indications point towards more peas from the Black Sea region due to lower capital costs to plant.
- Canadian Flax offers into China still holding a price premium to Kazakh or Russian flax.
- 2023 EU Durum crop is forecasted to be upwards of 7.8 million tonnes. Which could be largest in over 5 years.
- Flax exports from Russia hit a record 975,000 tonnes in 2021/22
  - Russia has been flooding several markets with Flax this year so far as well and it is hurting North American export prospects.
- European Durum crop expected at to 6.9 mmt, 800,000 tonnes lower than last years production.
- Canadian Durum crop is high quality, over half as a #1.
- Canadian flax exports are slower, larger than expected ending stocks come in. Most since 2017/18

North American Soil Moisture – Year over Year

RUSSIA WEATHER RAIN TOTAL – PAST 30 Days

Grains

Black Sea grain deal renewed for another 60 days:
- The next renewal will be ahead of harvest and Russia and Ukraine will be dealing with new crop wheat to move out. Russia and Ukraine will need export guarantees.
US east coast miller buys 210,000 tonnes German and Polish wheat for June to August delivery, skipping out on domestic crop.
- This also highlights better arbitrage environment as freight costs in recent years eliminated the freedom of sourcing product outside of the domestic market.
US Kansas Hard Red Winter Wheat tour wrapped up last week.
- Worst yield projection since at least the year 2000.
- 178 million bushel crop estimate vs the USDA’s 191 million bushels
- Some analysts on the tour stated that it felt the yield estimates were generous given that some heads counted were to short to be picked up by a machine or that the heads had small, shriveled seeds in them that might be sent trough the back of the harvester.
Some dry areas appearing in Corn and Soybean belt. Take note in the maps above. Not a lot of rain forecasted this week in the eastern corn and soy region. Western and northern spots appear to fare better.
US winter wheat region set to receive a bit more rain of actual quantity.
- Winter wheat is 61% headed. Once headed the kernels are set, one can only maintain fill and quality from this point forwards.
- Wheat rated at 28% good to excellent
Spring wheat facing some drought concerns on the outliers of production regions in United States.
Private analysts have Russia’s 2023 wheat crop at around 88 mmt, this past years crop was estimated to be at well over 100 mmt. 88 mmt would be back to a “normal” production number. It is important to note that this is a 3mmt increase in crop size estimates from just a few months ago. As they say, big crops get bigger.
- Russia’s domestic reporting agency has the crop at 78 mmt, while the USDA is at 81mmt, so there is actually quite a large discrepancy in forecasts.
- Russia’s southern region have received 2 to 4 inches of rain in the past month, so this has helped boost anticipated production levels.
North American grain prices have been softening in general since planting has begun, Wheat and Barley domestic bids have both fell in recent weeks and have been challenged to pick up any new ground on both old and new crop.
Ukrainian wheat production expected at 17 mmt down from last years 21 mmt and down from 25 mmt in 2020.
Indian wheat estimated at 108mmt by the USDA while the Indian government sits at 112-114 mmt.
(AUSTRALIA – New report out in a few weeks) March ABARES report stated a record smashing 39.2 mmt crop being reported. 14.1 mmt barley crop as well, 3rd largest on record.
- Wheat crop is 2.6 mmt larger than the December report.
- 36.7 mmt crop size last year.
- 24.2 mmt five year average