18/3/24 Prices

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Rainfall across the corn and sorghum regions of Argentina has generally been good over the last 30 days. Heavy general rain has been reported over the last week which will go a long way to helping crops recover from some late heat stress in the north. The crop rating for corn in Argentina declined week on week, back from just 28% Good / Excellent to 23% G/E. Harvest of corn is roughly 3% complete.
Argentine sorghum is mostly grown in southern Cordoba, Santa Fe and Entre Rios to the east. Production in the north is mostly across northern Santa Fe and Santiago del Estro to the NW of Santa Fe state. Harvest should get under way over the next 2-3 weeks. Looking at rainfall maps for the sorghum belt over the last 90 days tends to indicate that heat stress was the only stress on the Argentine sorghum crop, rainfall has generally been good, apart from some slightly drier conditions across Northern Santa Fe.
With Argentina increasing sorghum sown area by approximately 100kha in 2023-24, and a better season than last year, total production is expected to increase to 2.5mt, approximately 900kt more than last year and slightly above the 5 year average.
Currently we see sorghum values in Argentina at US$277.25 FOB, up river. On the back of an envelope, using China as a consumer this would roughly convert to an FIS price China of US$340. This compares to US sorghum valued at roughly US$310 CiF China. So Argentine sorghum may have some work to do if it is to be competitive into the Chinese market. As a comparison local bids would be equivalent to roughly US$30 under US values.
After seeing recent wheat cancellations one could argue that if the difference between grower bids here, and US CiF offers China, is US$30. It may well be representative of what it costs to do business into China.

News of Chinese wheat cancellations is still having an impact on both futures and physical markets. Chicago wheat slipping, as well as cash values PNW.

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