Grain Highlights 07.12.2020

Indonesia increases the export duty on palm oil from 55 USD / ton to 180 USD / ton on 10.12.2020. From 30.11.2020, the export duty of the crude palm oil has been increased from 3 USD / ton but to 33 USD / ton.

- In the week of November 20-26, export sales of soybeans from the United States were 407,000 tons, which is 47% less than the previous week. Corn export sales were 1.37 million tons, down 18% from the previous week. Since the beginning of the season, total export sales amount to 38.3 million tons (+162% compared to last year and + 73% compared to the average for the last five years). The largest buyers  and importers of US production are:

  • China- 11.18 million tons
  • Mexico- 8.5 million tons
  • Japan- 4.9 million tons
  • Colombia-1.88 million tons

- According to Statistics Canada, the canola production in Canada for 2020 will be at its lowest point for the last 5 years and wheat production would reach its highest level since 2013. The canola production i is expected to reach 18.7 million tons (-4.5% compared to last year and -700,000 tons compared to the estimate in September). The wheat production is estimated at 35.2 million tons, which is the highest level for the last 7 years. The durum production will reach 6.5 million tons - the highest figure for the last 4 years. The barley production is predicted at 10.7 million tons (+ 3.4%) and soybean production at 6.3 million tons (+ 3.5%).

- On 04.12.2020, Turkey purchased 400,000 tons of milling wheat of any origin as follows:

  • 340,000 tons of wheat with protein 12.5%, price 264.80 - 268.10 USD / ton C&F
  • 60,000 tonnes of protein 13.5%, price 269.10 - 270.60 USD / tonne C&F 

- According to Buenos Aires Grain Exchange, as of December 2, 2020, 48.2% of the planned 17.2 million hectares for soybeans have been sown in Argentina. During the past week, rainfall has fallen in the growing areas, which will have a positive impact on the development of crops. More rainfalls are expected soon. 99% of the crops are in good and excellent condition (+1% for the week). 2.2 million hectares or 35% of the plan (+ 3% for the week) were sown with corn. 92% of the corn crops are in good and excellent condition (89% a week earlier and 98% a year earlier). Wheat was harvested on 40% of the planned areas (+ 9% for the week) and 4 million tons of wheat were harvested.

- According to BCCBA, in the period of January-October, 34.5 million tons of corn were exported from Argentina, which is 10% more than the previous year. The largest buyers were Vietnam with a share of 22%, Egypt with a share of 10% and Algeria with 9%.

- Indonesia increases the export duty on palm oil from 55 USD / ton to 180 USD / ton on 10.12.2020. From 30.11.2020, the export duty of crude palm oil has been increased from 3 USD / ton but to 33 USD / ton. Thus, the total export duties on unrefined palm oil are now 213 USD / ton. The market expected an increase in the duty to 120 USD / ton. Given the sharp and unexpected rise in tariffs, many traders did not announce prices for exports in December at all. However, new tarrifs change the outlook for biodiesel financing and raises expectations of biodisel production. Indonesia's biodiesel production is expected to be profitable in 2021, and the usage of big quantities of palm oil for production purposes is expected to compensate for export losses due to high export duty. This resulted in a significant increase in commodity prices in Malaysia on Friday.

- According to CGS-CIMB Research's estimate, palm oil stocks in Malaysia at the end of November decreased by 2% to a total of 1.54 million tons compared to October, which is the lowest level since 2004 and is 32% less than the previous year. In November, exports decreased to 1.38 million tons (-17% compared to October), which is the lowest figure for the last 10 years. Production reached 1.55 million tons (-10.4%). The decline is due to bad weather conditions and labor shortages.