China reopened imports of pork from the United States, increasing domestic demand for soy meal and feed grain. India has increased vegetable oil imports by 48 percent. Egypt bought 30,000 tons of U.S. vegetable oils.
Soybean exports out of South America are slow. Planting progress in Brazil is 7 percent above average. Argentine soybean planting is 7 percent ahead of average. Argentina’s soybean exports are down nearly a million tons this year due to farmer strikes. Most of the Argentine crop is now processed.
Last week’s soybean exports were in excess of markets expectations at 691,000 tons. Total soybean export sales for the year are 24 percent above USDA predictions at 64.5 percent of total predictions. Export inspections were up 10 percent.
Last week 2.74 billion pounds of soybeans were crushed, bullishly exceeding expectations. Biodiesel production is up 25 percent this month.
Soybean condition ratings are declining. There is a rumor that China may cancel shipments due to quality problems in soybeans.
World corn supply estimates bearishly increased 4 million tons. South American corn exports increased; however, corn planting intensions are bullishly lower. Argentine farmers planting intentions are below 4.5 million acres of corn.
Weekly export sales were below market anticipations near 367,200 tons. Total exports are 4 percent behind USDA estimates.
Ethanol production has increased 2 million barrels from last year for a total of 22,556,000 barrels. Ethanol prices rise with gasoline prices.
Export inspections were disappointing at 23 million bushels. Corn crop condition ratings have dropped 2 percent in one week. Traders are uncertain if yields have been reduced. Markets now expect corn quality to suffer.
World wheat production estimates were increased another million tons. Russia is buying domestic wheat to support prices. Europe and Asia are actively marketing large quantities of wheat. India reduced incentives for farmers to grow wheat after a record harvest. Argentina estimates production of 7.75 million tons, France 36.6 million.
Export inspections of 1.9 million bushels were below market anticipations. Wheat export sales did not meet market expectations at 365,700 tons.
Winter wheat planting is late and acres are down significantly. Planting progress is 79 percent complete, where 90 percent is average. The crop rating is near the 10 year average.
India has issued a tender for 30,000 tons of rice this past week. The drought there has severely damaged their rice crop. India is normally self sufficient in rice. Indian grain production is down 18 percent. Most of the reduction is for rice and corn.
Japan intends to increase rice reserve supplies significantly above the million ton storage level.
Vietnamese rice prices have increased. As Vietnam and Thailand prices get closer, international markets will look toward U. S. rice. Rice exports are increasing.
Cotton damage from excess rain in the Cotton Belt exceeds market expectations. The Chinese cotton crop is also damaged from excess rain. U.S. harvest is now 28 percent complete. Slow cotton harvest progress has broken a 25-year record. Average harvest progress is 58 percent complete.
Last week’s cotton exports of 102,000 bales were 50,000 below average. Shipments of 109,400 bales were a new market low. Open interest in cotton markets is increasing but traders are waiting for confirmation that demand is increased before buying cotton.
Stock market prices put pressure on cotton market prices. Cotton market volatility reflects the faceoff between slow demand and diminishing supplies. Harvest factors are also bear and bull supportive. Delays cause bullish yield and quality problems but increased product availability causes bearish harvest pressure.