Global Grain Highlights – November 22nd

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Oilseeds Highlights

  • US Thanksgiving week is upon us, the most travelled holiday in the United States.
    • Aside from lower volumes throughout the week due to holidays, Agriculture futures markets are closed this Thursday with modified hours on Friday such as no Thursday night trade and a early stop on Friday.
  • Canola the biggest loss for the past trading week, correcting down $40 per tonne or just around 5%.
    • Malaysian Palm Oil had a better week, down 3.2% for the past five trading sessions
    • Soybean Oil futures down 4% for the week or 3 cents
  • Oilseed trade action into Tuesday morning appears to have stabilized for the near term, regaining some buying action in the past few hours.
  • Weakness has been seen since late last week in the veg oil markets.
    • Malaysian Palm Oil started out Mondays trade on a very positive note, up almost 1%. Despite this, palm still down for the week due to earlier weakness.
    • Palm Oil exports rose nearly 10% month over month from Malaysia.  A weaker currency earlier in the week boosted values for the Southeast Asian product.
    • As of Tuesday morning, Palm oil is trading higher after technically being oversold
  • US soybean exports up nearly 20% week over week.
  • China so far has been the export destination for 75% of US soybeans
    • Markets watching Chinese demand very closely and news from the nation can have a major influence on the commodity market.
    • Perceived weakening demand has held a weight on veg oil markets globally for the past few months.
    • United States soybean shipments to date sit at 17.1 mmt, down by a significant 2.0 mmt from last years pace.
  • North of the border, Canadian Canola remains priced quite high and markets are concerned that Canola is outpriced on the global market.
    • Australian Canola is trading for around a $100 to $150 discount at the ports and has cheaper freight into Asia such as Japan.
  • This is also a issue with US Soy oil vs other global ports. US soy priced higher than global counterparts.
  • Markets turning focus onto Brazil and Argentinian soy crops and the weather ahead.
    • Argentina is quite dry and will need some help into the new year to get a decent crop
    • Brazilin weather is quite favorable in some major production regions so far.  Markets showing little to no concern for any production issues in Brazil so far although that can change in a hurry. If realized, Brazil could put out a record sized crop.
    • Brazil 2022/23 soy crop private analyst preliminary estimates mostly over 150 mmt. If realized, this would be a 21% increase in production. USDA placed the crop at 152 mmt in Octobers report. Soil Moisture conditions are posted below.
  • Russia, Ukraine and The United Nations agree to extend the Grain Corridor for another 120 days.
    • This means the export corridor is expected to remain open until mid March 2022.
    • Russia and Ukraine generally have most of their grains exported by this time of the year.
    • It is in Russia and Ukraine’s best interest to keep the corridor open, especially Russia as they have a record wheat crop to move out of the nation.
  • Markets remain concerned over the ongoing COVID issues that China faces.
    • China remaining steadfast on its COVID policies and cases are soaring in the nation.  Beijing is closing massive amounts of facilities to try and stop the spread.
    • Markets very concerned about the Chinese economy and their ability to continue purchasing higher value crops for their massive population that represents around 18% of all humans on earth.
  • USDA WASDE REPORT (November Report):
    • Report considered to be relatively quiet
    • Global wheat stock estimates came in a bit higher than estimates, taking some wind out of the sails regarding the wheat outlook.
    • Much of the increase in wheat was due to larger Australian wheat crop, but a large chunk of this crop will not make milling quality due to flooding issues. So take numbers with a grain of salt.
    • US export demand was left untouched from last report.
    • See updated figures in section below

Global Vegetable Oil Pricing

USDA WASDE DATA – November 2022

Special Crops

    • European Union Durum exports higher than normal.  Import pace lowest in a decade.
    • Heavy rainfall in eastern Australia has downgraded the Barley crop.  Upwards of 60% of the Australian barley crop is grown in the region.
    • 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.
    • Moisture conditions in India coming in well for pea and chickpea production regions. Plantings of these crops are expected to be slightly lower for the year but the positive moisture conditions could help make up the difference.
    • Argentinian export pace of Canary seed has been quite aggressive recently, the heaviest movement in 10 years.
    • Container shipping rates falling significantly, although logistics still a problem.
      • Baltic Index tracked US to China container rates around half of July levels. Below $3,000 for the first time in nearly two years.
    • Brazilian Sugarcane crop expected to be the smallest since 2011, resulting in a lower supply available for the nations ethanol market.
    • Ukrainian Barley export availability expected to fall significantly,
    • Australia expected to harvest another large Barley crop, although it is mostly making its way into Saudi Arabia and Middle Eastern markets as the Chinese Market is still off limits. Australian barley does have quality issues due to rain during harvest.
    • European Durum crop is expected to fall to 6.9 mmt, 800,000 tonnes lower than last years production.
    • Canadian Durum crop expected to be of high quality, over half as a #1.
    • Canadian flax exports are slower, larger than expected ending stocks come in. Most since 2017/18
    • India has announced Lentils will remain exempt from levy of 10% until March 31st

South American SOil Moisture



  • Russia / Ukrainian grain corridor extended for another 120 days.
  • US rail workers expected to strike in the coming weeks if a deal is not reached amongst unions and railways.
    • The largest US railway union voted against a wage proposal by the US White House.
    • The rejected deal included a 24% wage increase over 5 years, retroactive to 2020.
    • A rail strike could stop upwards of 30% of daily US cargo shipments and the implications would be most greatly felt by commodity producers such as mining, energies and agriculture products.
  • Argentinian production of wheat coming in at around 10mmt per local sources (USDA 15mmt). Typically they produce a 19 to 20mmt crop.  The nation will be quite short on exportable crop given that they keep just over 6mmt domestically.
    • Brazil is typically a major importer of 5 to 6 mmt of Argentinian wheat.
    • Brazilian production has been increasing in years. Expected at 9.4 mmt vs 7.7 mmt last year and 6.2 mmt year prior.
  • US winter wheat issues persist. Good to Excellent ratings heading into winter dormancy sit at 32%. Lowest on this type of record since record keeping began in 1986
    • US winter wheat acreage is critical to the overall US wheat crop. Over 70% of US wheat production falls into the winter wheat category, 30% falls into spring wheat and durum (mostly spring wheat)
  • US Wheat expensive to other global ports of origin. US wheat over $100 per tonne more expensive than worlds cheapest wheat.
  • Australian wheat suffering from heavy rains during harvest, leading to grade issues. Expected that around half of Australian wheat could face grade issues.
  • Brazil’s new government is expected to remove biodiesel mandates of 10%, angering the biodiesel industry in the nation.  It is expected to take place after the new government forms on January 1st.
  • Ukranian barley exports have been very slow, helping support Canadian and other exporters prices.
  • Ukranian grain exports down 32% year over year, despite shipping corridor.
  • Ukraine is expected to face a 30% to 40% drop in its winter wheat acres planted.
    • Input Financing, logistical issues and the fact the nation is at war sum up most of the cause for the drop in acres.
  • US transportation hurting inland basis levels.
    • US barge system facing restrictive water levels in the Mississippi River.  Barge traffic has become massively restricted in recent weeks.
    • Add rail issues on top of this if strike proceeds.
  •  Russian crop size is quite large, pushing over the mega 100mmt mark. This is easily be 10mmt to 15mmt over a previous record crop size.
    • Winter wheat plantings in the Black Sea lower.
  • This also raises the markets question as to if the Ukraine grain corridor will be extended past its November 19 deadline.
  • Fertilizer prices globally have eased slightly due to European Nitrogen production coming online once again for a few weeks as natural gas reached cheap enough levels.
  • Europe’s 2022 corn crop is expected to be the smallest in 15 years.
  • Ukrainian wheat production seen falling to 17.4 mmt by private analysts. This is down from roughly 33mmt in the year prior.



Chinese Soybean and Corn Highlight