Iran buying appetite grows for European grains

Spanish Market: Agriculture
17/06/22

Iranian buyers have shown renewed interest in European wheat and barley in recent days, as the nation braces for a poor domestic harvest and the end of grain shipments from Ukraine.

Iranian buyers this week were seen to enquire about European barley and 12.5pc protein grade milling wheat for shipment periods ranging from July to March 2023.

Most buying interest lacked clear price levels but a bid for October-March-shipment European 12.5pc wheat was most recently seen at a €26/t ($27.20/t) premium to the Euronext December milling wheat contract on a fob basis. Offers for the same product for shipment from German ports during the same period were heard at a €31/t premium to the Euronext December futures contract earlier this week.

Interest for barley also lacked clear pricing indications but offers for Iran-bound shipments out of Romanian ports in the second half of July were seen at $420/t.

Meanwhile, a 63,000t cargo of French barley was scheduled to be shipped today from the French port of La Pallice for shipment to Iran by trading firm Viterra. This is the first official French barley export to Iran since July 2019, when 132,000t was shipped to the destination.

Iran's 2022-23 grain harvest is expected to remain weak, with slight improvements on the year but broadly below levels seen in previous years. The nation's wheat and barley output has been most recently pegged at 13.2mn t and 3mn t, respectively, for the upcoming season, up from 12mn t and 2.7mnt in 2021-22, under US Department of Agriculture (USDA) estimates.

And the country is forecast to import some 6mn t of wheat and 2.5mn t of barley in the next season, down by 1mn t and 100,000t on the year, respectively, according to the USDA. But the wheat import forecast this month was already revised up from the 5.5mn t that the USDA expected in May.

And Iran's own industry groups expect higher wheat imports, amid a poor domestic harvest. Iranian Food Association last month predicted that the nation's 2022-23 wheat imports would reach 7.5mn t.

Despite growing interest in European crops, Russia is expected to remain as the primary grain supplier to Iran. Iranian oil minister Javad Oji in late May said Russia was poised to supply 5mn t of wheat to Iran under a recently signed agreement between the two countries.

Iran was also recently reported to express interest in transit shipments of Russian goods to India and other South Asian destinations via the Caspian Sea and bypassing the Black Sea. Buyers yesterday were seen to enquire about Russian corn and barley for delivery to north Iran, without clear price or shipment indications.

By Bilal Muftuoglu

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31/10/24

US biofuel feedstock use dips in August

New York, 31 October (Argus) — Renewable feedstock usage in the US was down slightly in August but still near all-time highs, even as biomass-based diesel production capacity slipped. There were nearly 3.5bn lbs of renewable feedstocks sent to biodiesel, renewable diesel, and sustainable aviation fuel production in August this year, up from fewer than 3bn lbs a year prior, according to the US Energy Information Administration's (EIA) latest Monthly Biofuels Capacity and Feedstocks Update report. August consumption was 0.4pc below levels in July and 0.5pc below record-high levels in June. US soybean oil consumption for biofuels rose to 39.3mn lbs/d in August, up by 2.1pc from a year earlier on a per-pound basis and up 6.9pc from a month prior. The increase was entirely attributable to increased usage for renewable diesel production, with the feedstock's use for biodiesel slipping slightly from July. Canola oil consumption for biofuels hit 14.2mn lbs/d, up by 58.1pc from a year prior on a per-bound basis but still 19.4pc below record-high levels in July. Distillers corn oil usage, typically less volatile month-to-month than other feedstocks, bucked that trend to hit a high for the year of 13.6mn lbs/d in August. That monthly consumption is up 13.6pc from a year earlier and 20.9pc from a month earlier. Among waste feedstocks, usage of yellow grease, which includes used cooking oil, rose to 22.4mn lbs/d in August, up 13.8pc from levels a year prior and 5.8pc from levels in July. Tallow consumption for biofuels was at 18.6 mn lbs/d over the month, an increase of 27.8pc from August last year but a decrease of 13.4pc from July this year. Production capacity of renewable diesel and similar biofuels — including renewable heating oil, renewable jet fuel, renewable naphtha, and renewable gasoline — was at 4.6bn USG/yr in August, according to EIA. That total is 24.1pc higher than a year earlier and flat from July levels. US biodiesel production capacity meanwhile declined to fewer than 2bn USG/yr over the month, down by 4.3pc from a year earlier and 1.3pc from a month earlier. US biomass-based diesel production capacity has expanded considerably in recent years, but refiners have recently confronted challenging economics as ample supply of fuels used to comply with government programs has helped depress the prices of environmental credits and hurt margins. The industry is also bracing for changes to federal policy given this year's election and a new clean fuel tax credit set to kick off in January. That credit, known as "45Z", will offer a greater subsidy to fuels that produce fewer greenhouse gas emissions, likely encouraging refiners to source more waste feedstocks over vegetable oils. That dynamic is already shaping feedstock usage this year, with Phillips 66 executives saying this week that the company's renewable fuels refinery in California is currently running more higher carbon-intensity feedstocks ahead of a shift to using more waste early next year. By Cole Martin Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US court set to weigh biofuel blend mandates

31/10/24

US court set to weigh biofuel blend mandates

New York, 31 October (Argus) — A US court on Friday will weigh some novel issues that could affect enforcement of the Renewable Fuel Standard (RFS), the federal program that sets minimum biofuel blending levels for domestic motor fuel supplies. The Environmental Protection Agency (EPA) in last year's RFS regulation required refiners and importers to blend increasing volumes of renewable fuel from 2023-2025. But the rule differed from past obligations in a crucial way. While the RFS law set annual volume targets of cellulosic, advanced and conventional biofuels through 2022, it tasked EPA with setting volumes in subsequent years by balancing factors such as the environmental impacts of biofuels, energy security, expected production and consumer costs. In a consolidated case to be heard Friday by the US Court of Appeals for the District of Columbia Circuit, environmental groups and oil refiners are separately challenging aspects of how the EPA applied those factors in setting 2023-25 volumes. The court has previously affirmed the legality of many RFS rules. "Past cases always give you some perspective on how the DC court might see it," said Susan Lafferty, a partner at law firm Holland & Knight. "But the DC court could also say, ‘not relevant anymore because this is a different part of the statute that we are working with.'" Refiners say EPA misapplied the criteria, upping compliance costs more than necessary by setting targets for cellulosic and conventional biofuels too high and targets for advanced biofuels too low. They also challenge EPA's balancing of potential impacts, noting that the agency assumed that all parties can easily pass the costs of compliance on to consumers. In a separate case this year, the DC Circuit discarded EPA rejections of program waiver petitions, in part because judges disagreed that refiners can easily pass on the cost of Renewable Identification Number (RIN) credits used to show compliance with the RFS program. EPA used this pass-through theory in the 2023-2025 rule "like a magic wand, waving it around to dismiss any argument that the rule will cause harm", the American Fuel and Petrochemical Manufacturers and small refineries said in a case filing. Lafferty expects the judges at Friday's hearing to probe the extent to which EPA's volumes relied on this pass-through theory, "a policy that now this very court has gutted." Environmentalists have similarly targeted EPA's cost analysis, arguing that the agency downplayed the environmental drawbacks of growing crops for energy. The Center for Biological Diversity and the National Wildlife Federation argue that EPA has legal discretion to set post-2022 volumes for corn- and soybean-derived biofuels as low as zero. EPA counters that the court owes the agency deference in evaluating scientific data and making predictive judgments. And biofuel groups that have intervened argue that the program is designed to require more biofuel production even if there are no formal volume requirements in law anymore. While EPA's post-2022 authority to set blend mandates is a new issue, the DC Circuit has handled various cases about EPA's implementation and has generally been deferential to the agency's volume decisions. The court this year upheld 2020-2022 targets. In a 2019 decision, the court kept volumes in place , despite telling EPA to more deeply weigh endangered species impacts. While the court might take issue with some aspects of EPA's latest rule, including the agency's lateness in finalizing volumes, judges could again be reluctant to upend fuel markets if they find only small oversights. Depending on how skeptical judges appear about EPA's arguments on Friday, the case could cause concern for biorefineries. A decision is expected next year, meaning any order for EPA to better justify its decisions or go back to the drawing board would likely fall to the next president's administration. On the panel for Friday's hearing are two judges familiar with the program: Democratic appointee Cornelia Pillard, who wrote the opinion this year upholding 2020-2022 blend mandates, and Republican appointee Gregory Katsas, who dissented and said those volumes were excessive. The third judge on the panel is Democratic appointee J. Michelle Childs. RINcrease or decrease RIN market activity has thinned as participants await the results of the court case and November's presidential election. In its latest rule, EPA aimed to provide a clearer picture over a longer timeline by finalizing volumes over multiple years. But the agency underestimated the growth in renewable diesel production, partly because of unexpectedly high feedstock imports. The result has been persistent oversupply, which took D4 biomass-based diesel credit prices from around 150¢/RIN in spring last year to as low as 42¢/RIN a year later according to Argus assessments. Multiple refiners have consequently dialed back biofuel production. In the past, RIN prices have proven sensitive to legal developments as traders anticipate supply and demand shifts. Prices softened this summer after the DC Circuit vacated small refinery waivers, leaving it unclear whether many facilities would have to buy RIN credits at all. By Cole Martin and Matthew Cope Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

US ag trade deficit looms over US election

29/10/24

US ag trade deficit looms over US election

Washington, 29 October (Argus) — A deepening of the US' agriculture trade deficit is a concern for many in the industry ahead of the 5 November election, as proposals of even more aggressive tariffs against China could further cut US soybean and corn exports. Former president and Republican presidential candidate Donald Trump has made reducing the overall US trade deficit a key issue of his campaign, vowing to subject all imports from China to punitive tariffs. In September he told the American Farm Bureau Federation (AFBF) that he intends to "permanently end our reliance on China for all critical goods and strengthen domestic Buy American and Hire American policies" if elected president. Trump has proposed tariffs of up to 20pc on all foreign goods and 60pc tariffs on all imports from China, and plans the "Trump Reciprocal Trade Act," which promises a 100pc reciprocation of any tariffs placed on US products from other countries. During his first term in office, Trump sparked a trade war with China that led to retaliatory tariffs against US grains — contributing to the first US agriculture trade deficit in 60 years. The USDA projects that for the current fiscal year the US' agriculture trade deficit will reach $42.2bn, the largest deficit on record. While vice president and Democratic presidential candidate Kamala Harris has been less vocal about trade policies on the campaign trail than her opponent, she has continued to indicate a hard line toward Chinese goods. Trump trade concerns Trump's first presidency featured trade disputes with China that started in 2018 with a 25pc tariff on goods such as cars and aircraft parts. China retaliated with a 25pc tariff on US soybeans and corn. The US' decades-long agriculture trade surplus reversed the next year. As a way to settle the dispute, the US and China signed a "Phase One" deal in January 2020 that required Beijing to step up purchases of US agricultural and energy products. But China never fully implemented that agreement, citing the economic disruption from the Covid-19 pandemic. Chinese tariffs on US grains remain in place, but with an annually renewed waiver that restricts them. Currently, Chinese tariffs on US ag products are at a most favored nation rate of 3pc for soybeans and 1pc for corn within sales quotas and 65pc for out-of-quota, according to a study by the World Agricultural Economic and Environmental Services (WAEES). The study noted that the out-of-quota tariff rate has historically not been applied, even after corn imports exceed the quota of 7.2mn metric tons (t). If China were to cancel the waiver that blocks the 25pc retaliatory tariff, US soybean exports to China could decline by 51.8pc from baseline levels, dropping by 14mn-16mn t annually, according to the WAEES. Corn would also fall, by 84.3pc or 2.2mn t annually. But if China matches Trump's proposed 60pc tariff, WAEES says US soybean export loss would total 25mn t. Any further deterioration of US agricultural trade with China would likely benefit South American countries, such as Brazil, which can readily fill the gap. Brazil's soybean production and total exports have been steadily rising, with the country reaching record soybean production of 161mn t and record soybean exports of 102mn t for the 2024-25 crop year, according to estimates from the US Department of Agriculture (USDA). The share of Brazilian soybeans exported to China increased during the Trump-era trade war by three percentage points from 80pc of exports in 2017 to 83pc in 2018, according to the Associação Nacional dos Exportadores de Cereais (ANEC). A quieter approach While Harris' message on trade may appear more measured, the current administration that she serves in has kept most of the Trump era Chinese tariffs in place. The section 301 tariffs imposed under Trump have not been repealed, and in May 2024 the US Trade Representative expanded tariffs further, albeit in a more targeted fashion on specific sectors of the Chinese economy, such as semi-conductors and electric vehicles. Harris was one of 10 senators that voted against the passage of the US-Mexico-Canada (USMCA) trade agreement in 2020 on account of worker protection and environmental concerns. The USMCA will be up for review in 2026. The Harris campaign told the AFBF in September that she will "not tolerate unfair trade practices from China or any competitor that undermines American farmers and ranchers." Where Trump's rhetoric worries some in the market as being too harsh, others worry a possible Harris administration may not be tough enough on reversing the ag trade deficit. The limited focus on the issue on the campaign trail, combined with the continued tariffs and little new action makes participants nervous that the deficit may not be properly addressed. By Rachel Nelson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Seca no Brasil: Níveis dos rios voltam a subir

25/10/24

Seca no Brasil: Níveis dos rios voltam a subir

Sao Paulo, 25 October (Argus) — Os embarques brasileiros de grãos e fertilizantes seguem em risco devido ao baixo nível dos rios ao longo das principais hidrovias, uma vez que a pior seca na história do Brasil continua dificultando a navegação. Porém, os rios registraram recuperação esta semana, devido ao aumento das chuvas no país, com seus níveis subindo novamente após quase um mês de quedas consecutivas. Hidrovia do Madeira A hidrovia Madeira liga Porto Velho, capital do estado de Rondônia, ao porto de Itacoatiara, no estado do Amazonas, e é a segunda maior da região Norte. Em outubro, o porto de Itacoatiara deve receber cerca de 70.634 toneladas (t) de fertilizantes, de acordo com dados de lineup da agência marítima Unimar. O nível do rio Madeira em Porto Velho aumentou para 91cm em 23 de outubro, ante 46cm em 18 de outubro, de acordo com dados do monitoramento do Serviço Geológico Brasileiro (SGB). Porém, a navegação permanece suspensa no porto, depois da Sociedade de Portos e Hidrovias do estado (SOPH) interromper as operações em 23 de setembro porque o Rio Madeira registrou seu menor nível desde que o monitoramento começou em 1967. Hidrovia do Solimões-Amazonas A hidrovia Solimões-Amazonas é a principal do Norte do Brasil, movimentando cerca de 65pc dos volumes da região, segundo o Departamento Nacional de Infraestrutura de Transportes (DNIT). Ela liga a capital do Amazonas, Manaus, à capital do Pará, Belém. Em 23 de outubro, o nível do Rio Negro estava em 12,56m no ponto de monitoramento do SGB em Manaus, acima dos 12,46m de 18 de outubro. Isso ainda supera o menor nível histórico de 12,7m registrado em 121 anos de monitoramento. Hidrovia do Tapajós-Teles Pires É uma hidrovia importante para transportar os volumes produzidos na porção norte do estado de Mato Grosso até o porto de Santarém, no Pará. O porto de Santarém deve receber 130.234t de fertilizantes em outubro, de acordo com dados de lineup da agência marítima Unimar. A hidrovia Tapajós-Teles Pires também enfrenta uma situação crítica. A Agência Nacional de Águas e Saneamento Básico (ANA) declarou escassez hídrica no Rio Tapajós em 23 de setembro. O clima mais seco do que o normal reduziu os níveis dos rios — especialmente no trecho entre as cidades de Itaituba e Santarém, no Pará — para abaixo dos níveis mínimos históricos. O nível do Rio Tapajós no ponto de monitoramento de Itaituba, onde está localizado o ponto de transbordo para a hidrovia em Miritituba, estava em 1,03m em 23 de outubro, acima dos 92cm em 18 de outubro, mas ainda abaixo da mínima recorde de 1,32m, de acordo com dados do SBG. No ponto de monitoramento de Santarém, o Rio Tapajós estava em 27cm, um nível considerado de seca. O nível era de 28cm em 18 de outubro. O mínimo histórico no local é de -55cm abaixo do ponto de referência do porto. Um nível abaixo de zero não significa que o rio está seco, mas indica condições extremamente baixas. Hidrovia Tocantins-Araguaia A hidrovia Tocantins-Araguaia abrange os Rios Araguaia e Tocantins. Ela vai da cidade de Barra do Garças, em Mato Grosso, pelo Rio Araguaia, ou da cidade de Peixes, no estado do Tocantins, pelo Rio Tocantins, até o porto de Vila do Conde, no Pará. Soja, milho, fertilizantes, combustíveis, óleos minerais e produtos derivados são transportados pelas hidrovias do Norte. O porto de Vila do Conde deve receber 245.500t de fertilizantes em outubro, de acordo com a Unimar. O SGB possui dois pontos de monitoramento no Rio Araguaia. Na cidade de Nova Crixás, em Goiás, o rio estava em 3,11m em 23 de outubro, acima dos 2,85m de 18 de outubro e superando o mínimo histórico anterior de 3,10m. Na cidade de São Félix do Araguaia, em Mato Grosso, o rio estava a 2,71m, acima dos 2,56m de 18 de outubro, se recuperando dos níveis extremos de seca e se afastando da mínima histórica de 2,51m. Por João Petrini Envie comentários e solicite mais informações em feedback@argusmedia.com Copyright © 2024. Argus Media group . Todos os direitos reservados.

Brazil's drought: River levels rise after declines

23/10/24

Brazil's drought: River levels rise after declines

Sao Paulo, 23 October (Argus) — Brazilian grain and fertilizer shipments remain at risk from low river levels along key waterways, as the worst drought in Brazil's history continues to hamper inland navigation. But rivers have recovered this week, because of increased rainfall in the country, with their levels rising again after almost a month of extended declines. Madeira waterway The Madeira waterway links Rondonia state's capital Porto Velho to Itacoatiara port in Amazonas state, and is the second largest in the northern region. Itacoatiara is expected to receive around 70,634 metric tonnes (t) of fertilizers in October, according to line-up data from shipping agency Unimar. The Madeira river's depth at Porto Velho increased to 91cm on 23 October, from 46cm on 18 October, according to monitoring data from Brazil's geological survey SGB. But navigation remains suspended at the port after the state's ports and waterways authority SOPH halted operations on 23 September in response to the Madeira registering its lowest level since monitoring began in 1967. Amazon waterway The Amazon River is the main waterway in northern Brazil, handling around 65pc of the region's cargo, according to national transportation and infrastructure department DNIT. It links Amazonas state capital Manaus to Para state capital Belem. The Negro river's depth was at 12.56m at the SGB monitoring point in Manaus on 23 October, up from 12.46m on 18 October. This still exceeds the previous historic low of 12.7m over the past 121 years of monitoring. Tapajos waterway Tapajos is an important waterway for moving product from the northern part of Mato Grosso state to Santarem port in Para state. Santarem is expected to receive 130,234t of fertilizers in October, according to line-up data from Unimar. The Tapajos-Teles Pires waterway is also facing a dire situation. National water and sanitation agency ANA declared a water shortage on the Tapajos river on 23 September. Drier than usual weather has reduced river levels — especially between Itaituba and Santarem cities, in Para state — to below the historic minimum. The depth of the Tapajos at the Itaituba monitoring point, where the transfer point for the Miritituba waterway is located, was 1.03m on 23 October, up from 92cm on 18 October but still below the previous record low of 1.32m, according to SGB data. At the Santarem monitoring point, the Tapajos was at 27cm, a level considered to be dry. The level was 28cm on 18 October. The historic minimum at the location is -55cm below the port's reference point. A level below zero does not mean the river is dry, but indicates extremely low levels. Tocantins-Araguaia waterway The Tocantins-Araguaia waterway encompasses the Araguaia and Tocantins rivers. It runs from Barra do Garcas city, in Mato Grosso, into the Araguaia river, or from Peixes city, in Tocantins state, into the Tocantins river to the port of Vila do Conde, in Para state. Soybeans, corn, fertilizers, fuels, mineral oils and derivative products are transported along the northern waterways. Vila do Conde is expected to receive 245,500t of fertilizers in October, according to Unimar. The SGB has two monitoring points on the Araguaia river. In Nova Crixas city, in Goias state, the river was at 3.11m on 23 October, up from 2.85m on 18 October, surpassing the previous historic minimum of 3.10m. In Sao Felix do Araguaia city, in Mato Grosso state, the Araguaia was at 2.71m, up from 2.56m on 18 October, recovering from extreme drought-like levels and moving away from the historic low of 2.51m. By João Petrini Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

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