Grains Report 03/03/2023

MORNING GRAINS COMMENTS
Jack Scoville

Friday, March 03, 2023

Price Futures Group, CBOT
Chicago, IL
(312) 264-4322
jscoville@pricegroup.com

JSL, SA de CV
San Salvador, El Salvador (503) 2260-7806 jslsadecv@comcast.net

JSL, SA
San José, Costa Rica (506) 2282-7024
jslsa@comcast.net

DJ Food Prices Fell for Eleventh Month But Hunger Persists in Many Countries, FAO Says
By Will Horner
A long-running decline in global food prices continued for an eleventh consecutive month in February, though the rate of decline appeared to be easing, as grains prices remain locked at historically elevated levels and many countries continue to experience debilitating levels of hunger and soaring local food prices, according to data from FAO.
The United Nations’ Food and Agriculture Organization’s Food Price Index inched down 0.6% last month to 129.8. The closely watched barometer of global food prices registered declines in the price of vegetable oils and dairy products while grain and meat prices remained flat and sugar prices jumped, the FAO said Friday.
The figures are the latest evidence that the most acute effects of the food supply crisis sparked by the now yearlong war in Ukraine are easing. The FAO’s index spiked at a record level following Russia’s invasion as Ukraine’s large grain supplies were halted, but prices of staple foods have now fallen almost 19% from their peak, the FAO said.
Still, the FAO warned that the declines weren’t alleviating the risk of severe hunger in many of the poorest nations. Declines in global prices weren’t translating into lower local food prices in some countries while drought and war continued to deepen food insecurity in others. 45 nations across the world need external help in sourcing adequate food, the FAO said in a separate report also released Friday.
Six countries are experiencing the most acute level of food insecurity, defined as catastrophic hunger, the FAO said. Those countries are Burkina Faso, Haiti, Mali, Nigeria, Somalia and South Sudan.
Grain prices were particularly impacted by the conflict, thanks to Ukraine’s key pre-war role as a major supplier of wheat, corn and other crops. Global grain prices have come down significantly from the highs they hit in the months after Russia’s invasion but have stabilized at historically elevated levels.
The FAO’s index of cereal prices was unchanged last month, while wheat prices rose slightly due to fresh concerns about supplies from Ukraine and dry weather conditions in the U.S. crimped crop expectations.
While global prices for grain, a staple food source, have come down significantly in recent months, local prices in many countries remain at exorbitant levels. Coarse grain prices in Ghana were 150% higher than last year, while grain prices in Malawi and Zambia are at record levels, the FAO said.
Other staple foods such as dairy products and vegetable oils fell in February. The FAO’s vegetable oil prices index declined 3.2% thanks to falls for palm, soy and sunflowerseed oil prices. Dairy prices declined 2.7%.
Sugar prices, however, surged 6.9% to a six-year high due to a weaker-than-expected crop in India.
Meat prices were unchanged the FAO said. Poultry prices weakened despite outbreaks of bird flu. Pig meat prices rose.

DJ CBOT Delivery Intentions: Totals – Mar 3
Source: CME Group
Contract Quantity Next Trade
Commodity Month Delivery Day Assigned Today Date Available
SOYBEAN OIL March Mar 06, 2023 234 Mar 01, 2023
ROUGH RICE March Mar 06, 2023 33 Mar 02, 2023
CORN March Mar 06, 2023 143 Feb 27, 2023
KC HRW WHEAT March Mar 06, 2023 80 Feb 22, 2023
OATS March Mar 06, 2023 1 Feb 28, 2023
SOYBEAN March Mar 06, 2023 37 Feb 27, 2023
WHEAT March Mar 06, 2023 704 Mar 02, 2023

WHEAT
General Comments: Wheat markets were higher yesterday. It was another relatively narrow range day, but it is possible that Wheat is trying to find a bottom at this time. Kansas City and Minneapolis prices now appear headed higher but Chicago remains in a trading range. The funds maintain a huge short position in this market. The problem remains demand as world supplies are not so large and US inventories are less as well. Ideas that big Russian offers and cheaper Russian prices would be a feature for a while in the world market was the driving force for the weaker prices, and price weakness could continue. The war in Ukraine continues, but Russia is expected to allow the grain export program to continue in one form or another. Ideas are that both Australia and Russia are harvesting record to near record Wheat crops this year. Russia has a large production and is undercutting most world prices in the international market. The demand for US Wheat in international markets has been a disappointment all year and has been hindered by low prices and aggressive offers from Russia.
Overnight News: The southern Great Plains should get isolated showers. Temperatures should be near to below normal. Northern areas should see mostly dry conditions. Temperatures will average near to below normal. The Canadian Prairies should see mostly dry condition. Temperatures should average above normal.
Chart Analysis: Trends in Chicago are mixed, Support is at 702, 692, and 680 May, with resistance at 722, 738, and 742 May. Trends in Kansas City are mixed to up with objectives of 837 and 852 May. Support is at 822, 807, and 800 May, with resistance at 837, 853, and 862 May. Trends in Minneapolis are mixed to up with objectives of 880 and 891 May. Support is at 869, 860, and 857 March, and resistance is at 880, 887, and 892 May.

RICE:
General Comments: Rice was higher again yesterday despite weak export sales as offers into the market appear less. Demand has been good from domestic sources. Export demand has been uneven. Demand has been an issue for the market all year. There is not much going on in the domestic market right now although mills are milling for the domestic market in Arkansas and are bidding for some Rice. Markets from Texas to Mississippi are called quiet. Demand in general has been slow to moderate for Rice for exports.
Overnight News: The Delta should get mostly dry conditions. Temperatures should be above normal.
Chart Analysis: Trends are up with no objectives. Support is at 1742, 1724, and 1714 May and resistance is at 1762, 1773, and 1779
CORN AND OATS
General Comments: Corn closed a little lower yesterday on ideas of weak demand. Oats closed a little lower. The export inspections report released Monday afternoon showed bad exports once again and the US is falling far behind the pace to meet USDA targets. The export sales report showed weaker sales as well. The lack of demand has been a reason for all the selling in the last seven days. Wire reports yesterday showed that India is now making sales to Southeast Asia instead of the US. US prices are currently very competitive with those from South America and US demand could improve because of the price differentials. Prices from South America should now remain strong as countries there concentrate on Soybeans exports, so the US has a chance now to see export demand improve. Brazil has been hanging on for its Summer crop although losses are now being reported. The situation is now more stable in southern Brazil and northern Argentina after recent rains, but the situation in central and southern Argentina remains stressed. Argentina has suffered through some extreme drought and losses could be large. The Brazil Winter crop is harvested and China has been buying the surplus. The Summer crop and the Argentine crop is developing under stressful conditions. The next Winter crop is going into the ground in good conditions, but it has been wet so the Soybeans harvest has been delayed and the Corn planting is becoming delayed as well. Reports indicate that the weather is now better in central and northern Brazil and that the Corn planting pace is much improved. However, Brazil sources say that 20% of the Winter crop could be planted outside of the ideal window so yields could be hurt in the end. China released its PMI data earlier this week and the PMI weas above expectations. It was considered positive for new demand potential from China.
Overnight News:
Chart Analysis: Trends in Corn are mixed. Support is at 630, 622, and 615 May, and resistance is at 637, 641, and 645 May. Trends in Oats are down with objectives of 327 and 312 May. Support is at 330, 325, and 322 May, and resistance is at 338, 342, and 345 May.

SOYBEANS
General Comments: Soybeans and the products were higher on speculative buying despite a weak export sales report that showed Soybeans sales at a marketing year low. Soybeans export demand is flowing to Brazil now. Argentina is the world’s largest exporter of Soybeans products while the US and Brazil battle for supremacy in Soybeans exports. The South American harvest coming to export channels in the near future and the lack of exports for the US has hurt the price action and created down trends for Soybeans and sideways to down trends for the products. It remains hot and dry in Argentina and crop conditions are getting worse. Weather is becoming less important now as the harvest is already underway in central and northern Brazil and will spread south soon. Sothern Brazil and northern Argentina are getting enough rain to stabilize conditions and production losses but central and southern Argentina remain very dry. Central and northern Brazil have seen harvest operations interrupted with too much rain but the weather is now improving and the harvest pace is increasing. Production potential for the Brazil is called very strong even with potential problems and losses in the south. Argentine production ideas continue to drop with the drought as planting is delayed and the crops already in the ground are stressed. Chinese demand is expected to improve in the world market and especially in Brazil with the country now open and many starting to move beyond Covid and create life and opportunity again.
Overnight News:
Chart Analysis: Trends in Soybeans are mixed to down with objectives of 1458 and 1408 May. Support is at 1489, 1478, and 1476 May, and resistance is at 1520, 1522, and 1530 May. Trends in Soybean Meal are mixed to down with objectives of 462.00 and 446.00 March. Support is at 465.00, 462.00, and 457.00 May, and resistance is at 478.00, 484.00, and 485.00 May. Trends in Soybean Oil are mixed to up with objectives of 6220 May. Support is at 6090, 605a0, and 5970 May, with resistance at 6250, 6380, and 6440 May.

CANOLA AND PALM OIL
General Comments: Palm Oil closed higher today in response to Chinese PMI data that showed that the Chinese economy is recovering and implied that China could soon increase Palm Oil imports. Futures were also higher on reports of flooding in Malaysia. China was a noted buyer of Palm Oil last week. Indonesia is now revoking some export permits to keep internal prices controlled and to support the bio fuels industry. The controls are expected to last through Ramadan. China has tried to relax some Covid restrictions so that the economy can start to function again. However, new outbreaks of the virus are being reported and infection rates are rapidly increasing but will start to decrease soon as most have now had Covid. Peninsular Malaysia is getting flooding rains. Flash floods are being reported. Canola was slightly higher in narrow range trading on demand concerns as ideas that Brazil will capture demand for the world market. Brazil is expected t dominate the oilseeds market for the next few months. Reports indicate that domestic demand has been strong due to favorable crush margins. Production was much improved this year on better weather during the Summer. It is dry in the southern and southwestern prairies now and this could mean reduced yields when the production season begins in a couple of months.
Overnight News:
Chart Analysis: Trends in Canola are mixed. Support is at 816.00, 811.00, and 803.00 May, with resistance at 827.00, 835.00, and 836.00 May. Trends in Palm Oil are up with no objectives. Support is at 4270, 4220, and 4130 May, with resistance at 4420, 4440, and 4620 May,

Midwest Weather Forecast: rain and snow to the south. Temperatures should average near to above normal.

US Gulf Cash Basis

Corn HRW SRW Soybeans Soybean Meal Soybean Oil
February
85 Mar
195 Mar
125 Mar
105 Mar

March
85 Mar
195 Mar
125 Mar
105 Mar

April
89 May
1790 May
120 May
110 May

DJ ICE Canada Cash Grain Close – Mar 2
WINNIPEG — The following are the closing cash
canola prices from ICE Futures.
Source: ICE Futures
Price Basis Contract Change
CANOLA
*Par Region 816.60 0.00 May 2023 dn 0.35
Track Thunder Bay 855.30 30.00 May 2023 up 6.70
Track Vancouver 890.30 65.00 May 2023 up 6.70
All prices in Canadian dollars per metric tonne.
*Quote for previous day
Source: Commodity News Service Canada
(news@marketsfarm.com, 204-414-9084, or cell
204-782-5944)

DJ Malaysian PM Cash Market Prices for Palm Oil – March 3
The following are prices for Malaysian palm oil in the cash market at 1000 GMT Friday, supplied by commodity broker Matthes & Porton Bhd.
Prices are quoted in U.S. dollars a metric ton, except for crude palm oil and palm kernel oil, which are in ringgit a ton. Palm kernel oil prices are in ringgit a pikul, a Malaysian measurement equivalent to 60 kilograms.
Refined, bleached and deodorized palm oil, FOB, Malaysian ports
Offer Change Bid Change Traded
March 1005.00 +10.00 Unquoted – –
Apr/May/Jun 1005.00 +12.50 Unquoted – –
Jul/Aug/Sep 985.00 +10.00 Unquoted – –
RBD palm olein, FOB, Malaysian ports
Offer Change Bid Change Traded
March 1015.00 +10.00 Unquoted – –
Apr/May/Jun 1015.00 +12.50 Unquoted – –
Jul/Aug/Sep 995.00 +10.00 Unquoted – –
RBD palm stearin, FOB, Malaysian ports
Offer Change Bid Change Traded
Mar 995.00 +20.00 Unquoted – –
Palm Fatty Acid Distillate, FOB Malaysian ports
Offer Change Bid Change Traded
Mar 760.00 +10.00 Unquoted – –
Crude palm oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
Mar 4350.00 +50.00 Unquoted – –
Palm kernel oil, Delivered Basis, South Malaysia
Offer Change Bid Change Traded
4Mar 250.00 +03.00 Unquoted – –
($1=MYR4.475)

DJ China Dalian Grain Futures Closing Prices, Volume – Mar 03
Soybean No. 1
Turnover: 157,959 lots, or 8.71 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-23 5,515 5,515 5,445 5,503 5,515 5,506 -9 279 2,166
May-23 5,554 5,561 5,500 5,548 5,573 5,533 -40 124,415 153,466
Jul-23 5,484 5,491 5,430 5,476 5,493 5,460 -33 19,650 58,279
Sep-23 5,443 5,449 5,398 5,442 5,449 5,423 -26 3,179 6,656
Nov-23 5,408 5,422 5,372 5,408 5,420 5,396 -24 10,226 24,710
Jan-24 5,395 5,395 5,356 5,383 5,399 5,372 -27 210 444
Corn
Turnover: 324,708 lots, or 9.19 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-23 2,815 2,816 2,808 2,815 2,816 2,812 -4 1,712 6,673
May-23 2,846 2,851 2,837 2,838 2,846 2,842 -4 184,868 648,160
Jul-23 2,849 2,850 2,839 2,841 2,845 2,843 -2 87,193 570,317
Sep-23 2,812 2,814 2,803 2,805 2,809 2,808 -1 11,623 106,965
Nov-23 2,741 2,749 2,737 2,742 2,745 2,742 -3 38,701 233,601
Jan-24 2,726 2,734 2,724 2,729 2,730 2,728 -2 611 8,990
Soymeal
Turnover: 855,081 lots, or 32.14 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-23 3,941 3,984 3,937 3,952 3,952 3,954 2 816 12,029
May-23 3,745 3,776 3,735 3,763 3,734 3,756 22 589,517 1,291,238
Jul-23 3,723 3,763 3,722 3,754 3,722 3,742 20 32,137 218,395
Aug-23 3,778 3,820 3,778 3,811 3,778 3,800 22 27,757 139,479
Sep-23 3,765 3,803 3,764 3,790 3,763 3,784 21 134,565 465,531
Nov-23 3,741 3,772 3,734 3,766 3,733 3,753 20 26,675 70,084
Dec-23 3,721 3,749 3,716 3,748 3,711 3,733 22 17,288 27,488
Jan-24 3,661 3,695 3,658 3,691 3,654 3,673 19 26,326 48,009
Palm Oil
Turnover: 663,238 lots, or 55.57 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-23 8,300 8,360 8,300 8,360 8,256 8,322 66 645 2,967
Apr-23 8,404 8,478 8,378 8,438 8,360 8,436 76 15,717 66,291
May-23 8,354 8,448 8,340 8,418 8,318 8,404 86 554,199 502,635
Jun-23 8,314 8,412 8,294 8,378 8,266 8,370 104 14,087 85,500
Jul-23 8,232 8,346 8,216 8,308 8,190 8,296 106 12,646 56,792
Aug-23 8,154 8,280 8,144 8,248 8,128 8,222 94 8,235 37,052
Sep-23 8,106 8,228 8,082 8,202 8,080 8,164 84 46,835 66,694
Oct-23 8,046 8,180 8,040 8,156 8,036 8,118 82 8,368 18,389
Nov-23 7,980 8,128 7,978 8,114 8,002 8,064 62 2,403 3,338
Dec-23 7,976 8,086 7,976 8,064 7,940 8,058 118 13 86
Jan-24 7,964 8,058 7,942 8,028 7,942 8,014 72 86 358
Feb-24 7,960 7,978 7,960 7,978 7,948 7,968 20 4 12
Soybean Oil
Turnover: 565,527 lots, or 50.55 billion yuan
Open High Low Close Prev. Settle Ch. Vol Open
Settle Interest
Mar-23 – – – 9,440 9,288 9,440 152 0 472
May-23 8,888 9,042 8,852 9,040 8,868 8,954 86 493,416 507,920
Jul-23 8,820 8,984 8,796 8,978 8,806 8,898 92 10,024 81,824
Aug-23 8,784 8,960 8,776 8,960 8,784 8,868 84 7,390 56,934
Sep-23 8,740 8,906 8,718 8,906 8,718 8,818 100 39,482 100,642
Nov-23 8,684 8,840 8,662 8,828 8,670 8,752 82 7,856 36,500
Dec-23 8,676 8,828 8,664 8,810 8,668 8,748 80 6,207 17,908
Jan-24 8,662 8,810 8,646 8,794 8,652 8,742 90 1,152 2,955
Notes:
1) Unit is Chinese yuan a metric ton;
2) Ch. is day’s settlement minus previous settlement;
3) Volume and open interest are in lots;
4) One lot is equivalent to 10 metric tons.

141 W. Jackson Blvd
. Suite 1340A, Chicago, IL 60604 | (800) 769-7021 | (312) 264-4364 (Direct) | www.pricegroup.com
Past performance is not indicative of future results. Investing in futures can involve substantial risk & is not for everyone. The information and data in this report were obtained sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or futures.
The Price Futures Group, its officers, directors, employees, and brokers may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction. Reproduction and/or distribution of any portion of this report are strictly prohibited without the written permission of the author.
To SUBSCRIBE to Morning Rice Commets please click here.

To Unsubscribe from Morning Rice Comments please click here.

Questions? Ask Jack Scoville today at 312-264-4322