Global feed market: USDA report is unexpectedly bullish, feed price rises

Foreign media news on July 4th: In the week ending July 2, 2021, most of the global food market has risen.
Because of the bullish sown area data report and quarterly inventory data released by the US Department of Agriculture , the weather outlook for the Midwest region of the United States still exists.
With great uncertainty, Brazil’s dry weather continues to damage the local yield potential of the second crop of maize
.
The decline in the US dollar and the firm rise in international crude oil futures are also positive for prices
.

 

　　On Friday, the Chicago Board of Trade (CBOT) December 2021 corn futures rose by approximately 60.
5 cents or 11.
65% from a week ago, to close at 579.
75 cents/po
.
Meiwan No.
2 yellow corn was quoted at 750.
25 cents per cat, up 52.
25 cents or 7.
49% from a week ago
.
The corn futures for delivery in November 2021 on the EURONEXT exchange reported about 204.
5 euros/ton, an increase of 9 euros or 4.
60% from a week ago
.
The FOB spot price of Argentine corn in Shanghe was US$244/ton, up US$12 or 5.
17% from a week ago
.
The September corn futures on the Dalian Commodity Exchange closed at 2,631 yuan/ton, up 43 yuan or 1.
66% from a week ago
.

 

　　This week, the international crude oil futures market closed for the sixth consecutive week.
As the world economy recovered from the epidemic, vaccination was further promoted, some major economies in the United States, Europe and Asia opened up their economies, summer driving in the northern hemisphere and the arrival of peak tourism seasons, crude oil demand outlook Optimistic
.
At the same time, the OPEC alliance's pace of increasing production may be lower than demand growth, which means that crude oil supply and demand will be further tightened
.
On Friday, the New York Mercantile Exchange (NYMEX) West Texas Intermediate Crude Oil (WTI) August contract closed at 75.
16 yuan per barrel, up 1.
5% from a week ago
.
The global benchmark Brent September crude oil futures closed at $76.
17 per barrel, up 1.
03% from a week ago
.
The rise in crude oil means that the outlook for biofuel demand is improving, which constitutes a positive support for corn, because corn is the main raw material for ethanol in the United States
.

 

　　On Friday, the US dollar index closed at 92.
24 points, up 0.
5% from a week ago
.

 

　　The unexpected corn planting area announced by the US Department of Agriculture this week triggered a sharp increase in corn futures prices
.
The U.
S.
Department of Agriculture estimates that 92.
7 million acres of corn planted in the United States this year (equivalent to 37.
514 million hectares), which is lower than the 93.
79 million acres predicted by analysts on average
.
The report shows that Minnesota and North and South Dakota have the largest increase in the planted area compared to the planned area in March, and these three states, especially North and South Dakota, have experienced the worst drought since 2013
.
This means that although the corn planted area is 1.
2 million acres higher than the planting intention in March, the increased corn area is facing serious yield losses
.
As the planting area is lower than expected, it means that the summer weather will play a more critical role in ensuring sufficient supply in the 2021/22 season
.

 

　　On the same day, the quarterly inventories released by the US Department of Agriculture were lower than expected, which caused the market to worry about the new season's corn production and supply prospects
.
As of June 1, U.
S.
corn stocks were 4.
122 billion pu (equivalent to 1044.
5 million tons), a year-on-year decrease of 18%, the lowest level since 2014, and the low end of the industry's expected range
.
Among them, farm inventory decreased by 39% year-on-year, reflecting the strong pace of corn sales by American farmers this year
.
It is worth mentioning that the stock of sorghum on June 1 was 40.
8 million cats, a sharp drop of 44% year-on-year, of which farm stocks were only a quarter of the same period last year
.

 

　　The US Department of Agriculture's weekly crop progress report shows that as of June 27, the proportion of US corn entering the spinning period was 4%, the same as the same period last year, but lower than the five-year average of 6% over the same period
.
The percentage of American corn with excellent ratings is 64%, down from 65% a week ago, and the excellent rate in the same period last year was 73%
.

 

　　The US Department of Agriculture’s weekly export sales report shows that for the week ending June 24, US 2020/21 net corn sales were 15,000 tons, which was 93% lower than last week and 94% lower than the four-week average
.
The net sales volume in 2021/22 was 67,600 tons
.
The total US corn export sales in 2020/21 so far reached 69.
55 million tons, an increase of 64.
4% year-on-year
.

 

　　This week, some analysis agencies continued to lower their forecasts for the second crop of maize in Brazil due to severe drought
.
The Brazilian consulting agency AgroConsult estimates that the 2020/21 second season corn output in Brazil will be 65.
3 million tons, which is lower than the 66.
2 million tons predicted in May
.
Brazil’s total corn production is expected to be 90.
2 million tons, a decrease of 900,000 tons from May
.
The company said that due to strong domestic demand, Brazil's corn imports may double
.
Due to the drought and frost damage, StoneX this week lowered the forecast for the second season corn output in Brazil to 60.
45 million tons, and lowered the total output of Brazilian corn for 2020/21 by 1.
75 million tons to 87.
93 million tons
.

 

　　Frost occurred in some corn-producing areas in Brazil this week, which may exacerbate the loss of corn production in Brazil
.
Prior to this, Brazil's second-season corn crop has been severely affected by drought
.
It is still difficult to quantify the impact of cold weather in detail, because it takes several days for the damage to crops to manifest
.
Safras & Mercado currently expects Brazil’s second-season corn output to be 61.
6 million tons, 22.
4 million tons lower than Safras’s initial forecast
.
Safras predicts that Brazil’s total corn output this year will reach 95.
5 million tons (including first season corn)
.

 

　　This week, the Brazilian Vegetable Oil Industry Association (ABIOVE) and Brazilian credit rating agency Serasa announced a partnership this week to allow corn buyers to know whether farmers have fulfilled their pre-sale contracts
.
A statement from the association stated that Brazil’s main grain trading companies will unite to reduce information asymmetry and prevent sellers from negotiating with other buyers for the grains they have already sold
.