Corn and Soybean Morning Update & Commentary: China tariffs on Canadian rapeseed roil the veg oil trade
<div class=\"default-font-wrapper\" style=\"line-height: 1;font-size: 12pt; font-family: Verdana, Geneva, sans-serif;\">Corn and Soybean Morning Update & Commentary<br><br id=\"isPasted\">Overnight, the markets were highly mixed; by the morning pause, corn was 1-3 cents higher, bean oil more than -2% lower, meal $2-3 higher, and soybeans steady/easier. The early feature arguably is not even a U.S. story; China imposed 100% tariffs on Canadian rapeseed oil, which has roiled the veg oil trade. Canadian rapeseed futures are 6% lower, but on the other side of the spectrum, palm oil futures are +3% higher. Other tariff news is lacking, which we are all grateful for? Mexico elected not to retaliate on U.S. tariffs – yet. The latter is helping corn to recover another notch; futures have already re-traced one-third of the break and appear to be gunning for at least a 50% fib? Outside markets are in a moderately bad mood to start, likely eyeing a poor economic print out of China this weekend (consumer price deflation?) and jitters over a potential U.S. gov’t shutdown at week’s end. The US Dollar and Crude are near the flat line, but equity indices are ~1-2% lower to start the day. Today is also position day in front of the March WASDE tomorrow; that is, if anyone cares, given the report’s usual lack of importance (no new production data and precedes more important stocks/acreage report at month’s end). Export news was mostly quiet over the weekend, though there was a small 8 AM flash of 126,000 metric tons U.S. corn to Japan.<br> <br>Corn futures trended further toward stability, maintaining firmer trade throughout the day to close 3-5 cents higher. Bulls made a minor statement by securing a higher (1 ¾ cents) weekly close, finishing nearly thirty cents above Tuesday’s session low. Beans featured a similar ‘stability trade’; May beans settled 2.25 cents lower Friday while the new crop November contract gained nearly 5 cents. For the week, spot beans lost 1.25 cents, which was 32 cents off the week’s low. The weekly CFTC report went a long way toward explaining recent price action, finding aggressive spec fund liquidation across the ag spectrum. Managed Money traders were net sellers of a whopping 117,702 corn contracts in a single week (w/e Tuesday 3/4), zapping roughly one-third of their net length. They also sold over 43k soy, 33k soy oil, and 22k soy meal. Commercial traders and small non-reportables bought the ensuing correction. When including limited buying the past few sessions, we think funds are heading into the weekend net long over 240,000 delta-adjusted corn, net short 25k soybeans, net long 13k oil, and short 75k meal. The next major issue for ag markets will likely be Brazil safrinha corn weather, though we are probably a couple weeks out from forecasts becoming more market-moving? Recent rains have stabilized Argentina’s crop outlook, though not all crops benefitted equally (it arrived too late for some).<br> <br> <br>QT News - Top News<br> <br>**USDA reported private sale of 126,000 mt of Corn to Japan for the 24/25 MY<br> <br> -- On Monday, Malaysian Palm Oil Board estimated end of February palm oil stockpiles at 1.512 mln mt, that's above analysts' expectations at 1.484 mln mt. January's ending palm oil stocks were revised to 1.580 mln mt. In February 2024 palm oil stocks totaled 1.920 mln mt.<br> <br>-- On Monday, Malaysian Palm Oil Board estimated February palm oil exports at 1.002 mln mt, that's below analysts' expectations at 1.050 mln mt. January's palm oil exports were revised to 1.196 mln mt. In February 2024 palm oil exports totaled 1.024 mln mt.<br> <br>-- On Monday, Malaysian Palm Oil Board estimated February palm oil output at 1.188 mln mt, that's above analysts' expectations at 1.155 mln mt. January's palm oil production was revised to 1.239 mln mt. In February 2024 palm oil output totaled 1.259 mln mt.<br> <br>-- AmSpec Agri on Monday estimated Malaysian palm oil product exports over the March 1-10 estimate at 197,070 mt, off from February's pace at 319,410 mt over the first 10 days.<br> <br>-- On Monday, Intertek estimated Malaysian palm oil product exports over the March 1-10 at 249,952 mt, that was off -25.8% from their Feb 1-10 estimate at 336,980 mt.<br> <br>-- On Saturday, China's commerce ministry announced they will be applying 100% tariff on Canadian rapeseed oil and pea imports starting March 20, and additional 25% tariff will be imposed on Canadian pork imports. The Chinese tariffs are in retaliation for Canadian import levies on Chinese EVs, steel and aluminum product imports.<br> <br>-- Soybean grower group, Aprosoja, Friday afternoon claimed they have received a temporary court order blocking Maranhao state's 1.8% grain export tax. The growers say the judge did not rule on the merit of the state's tax, but instead the judge has given the state 15 days to present a defense, in the meantime the tax has been suspended.<br> <br>-- Buenos Aires Grain Exchange weekly report Friday placed Soybean conditions as of March 6th at 29% good to excellent, 44% fair, and 27% poor to very poor. Last weeks soy conditions were 24% good to excellent, 43% fair, and 33% poor to very poor.<br> <br>-- Buenos Aires Grain Exchange weekly report Friday placed harvest at 6.7% complete with 439,078 hectares harvested so far out of the 6.59 mln ha expected to be harvested. Corn harvest so far is around 3.52 mln mt, with yields running around 80.1 qq/ha.<br> <br>-- For the week ending March 18, Russia's Ag Ministry set the Corn export tax at 1,925.90 roubles/mt that compares with the previous week's 1,715.80 roubles/mt<br> <br>-- For the week ending March 18, Russia's Ag Ministry set the Barley export tax at 874.80 roubles/mt that compares with the previous week's 680.90 roubles/mt<br> <br><strong>Analysts Estimates for March 2025 USDA-WASDE US Production and US-World Ending Stocks</strong><br>(<em>To be released March 11, 2025 at 11:00 am CT</em>)<br><table border=\"0\" cellpadding=\"0\" cellspacing=\"0\"><tbody><tr><td valign=\"top\"><br></td><td valign=\"top\"><strong><u>Average Estimate</u></strong></td><td valign=\"top\"><strong><u>USDA February 2025 Report</u></strong></td></tr><tr><td valign=\"top\"><strong><u>US Ending Stocks</u></strong><br><strong>(bln bu)</strong></td><td valign=\"top\"><br></td><td valign=\"top\"><br></td></tr><tr><td valign=\"top\"><ul type=\"disc\"><li>US 24/25 Marketing Year</li></ul></td><td valign=\"top\">1.52</td><td valign=\"top\">1.540</td></tr><tr><td valign=\"top\"><strong><u>World Ending Stocks</u></strong><br><strong>(mln mt)</strong></td><td valign=\"top\"><br></td><td valign=\"top\"><br></td></tr><tr><td valign=\"top\"><ul type=\"disc\"><li>24/25 Marketing Year</li></ul></td><td valign=\"top\">289.9</td><td valign=\"top\">290.3</td></tr><tr><td valign=\"top\"><strong><u>23/24 South American Corn Production</u></strong><br><u>(mln mt)</u></td><td valign=\"top\"><br></td><td valign=\"top\"><br></td></tr><tr><td valign=\"top\"><ul type=\"disc\"><li>Argentina</li></ul></td><td valign=\"top\">49.0</td><td valign=\"top\">50.0</td></tr><tr><td valign=\"top\"><ul type=\"disc\"><li>Brazil</li></ul></td><td valign=\"top\">126.1</td><td valign=\"top\">126.0</td></tr></tbody></table> <strong><u>Soybeans</u></strong><br> <br><table border=\"0\" cellpadding=\"0\" cellspacing=\"0\"><tbody><tr><td valign=\"top\"><br></td><td valign=\"top\"><strong><u>Average Estimate</u></strong></td><td valign=\"top\"><strong><u>USDA February 2025 Report</u></strong></td></tr><tr><td valign=\"top\"><strong><u>US 2025 Crop</u></strong><br><u>(bln bu)</u></td><td valign=\"top\"><br></td><td valign=\"top\"><br></td></tr><tr><td valign=\"top\"><ul type=\"disc\"><li>Soybean Production</li></ul></td><td valign=\"top\">NA</td><td valign=\"top\">NA</td></tr><tr><td valign=\"top\"><ul type=\"disc\"><li>Soybean Yield</li></ul></td><td valign=\"top\">NA</td><td valign=\"top\">NA</td></tr><tr><td valign=\"top\"><strong><u>US Ending Stocks</u></strong><br>(bln bu)</td><td valign=\"top\"><br></td><td valign=\"top\"><br></td></tr><tr><td valign=\"top\"><ul type=\"disc\"><li>US 24/25 Marketing Year</li></ul></td><td valign=\"top\">0.37</td><td valign=\"top\">0.380</td></tr><tr><td valign=\"top\"><strong><u>World Ending Stocks</u></strong><br>(mln mt)</td><td valign=\"top\"><br></td><td valign=\"top\"><br></td></tr><tr><td valign=\"top\"><ul type=\"disc\"><li>24/25 Marketing Year</li></ul></td><td valign=\"top\">124.6</td><td valign=\"top\">124.34</td></tr><tr><td valign=\"top\"><strong><u>23/24 South American Soybean Production</u></strong><br><u>(mln mt)</u></td><td valign=\"top\"><br></td><td valign=\"top\"><br></td></tr><tr><td valign=\"top\"><ul type=\"disc\"><li>Argentina</li></ul></td><td valign=\"top\">48.9</td><td valign=\"top\">49.0</td></tr><tr><td valign=\"top\"><ul type=\"disc\"><li>Brazil</li></ul></td><td valign=\"top\">169.2</td><td valign=\"top\">169.0</td></tr></tbody></table> <br>-- Euronext Paris May rapeseed futures on Monday are trading -7.75 euros lower at 488.00 euros/mt<br> <br>-- Dalian May soybean futures on Monday traded +5 yuan higher ending at 4,157 yuan/mt; May soymeal gained +26 yuan ending at 2,928 yuan/mt<br> <br>-- On Monday, Dalian May vegoil futures traded higher, palm oil jumped +158 yuan ending at 9,156 yuan/mt, soyoil gained +62 yuan ending at 8,008 yuan/;mt<br> <br>-- Malaysian May crude palm oil futures on Monday traded -123 ringgit lower ending at 4,502 ringgit/mt<br> <br>-- On Monday, Malaysian Apr/May/Jun cash offers for RBD palm oil and olein traded -$15/mt lower ending at $1,080.00/mt and $1,085.00/mt, respectively<br> <br>-- CBOT Deliveries: March Soybean 142<br> <br>-- CBOT Deliveries: March Soybean Meal 34<br> <br>-- CBOT Deliveries: March Soybean Oil 165<br><br>KJ</div>