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Articles of Interest- Wednesday, October 23, 2019

Articles of Interest- Wednesday, October 23, 2019

Saudi Arabia’s SALIC Says Looking at Black Sea Grain Terminal

Reuters – 10/23/2019

Saudi Arabia’s SALIC is conducting due diligence on several projects in the Black Sea region and is looking to acquire a grain terminal there, its managing director told Reuters. SALIC, the Saudi Agricultural and Livestock Investment Co, was formed in 2011 to secure food supplies for the desert kingdom, the world’s top oil exporter, through mass production and foreign investments… Aboodi said SALIC would seek to bring in Russian wheat through state grain buyer Saudi Grains Organization (SAGO) should its investments in potential Russian wheat producers or farmland come to fruition. Russia, the world’s largest wheat exporter, had long been seeking access to the Saudi market and in August the Gulf Arab state relaxed its bug-damage specifications for imports of the grain, opening the door to Black Sea origin wheat. SALIC is looking to bring in Russian wheat for SAGO’s international purchasing tender if it makes a sizeable purchase of a Russian agribusiness firm engaged in wheat production.

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Analysis: Australian Wheat Likely to See Renewed Demands as Black Sea, Argentina Prices Rally

S&P Global – 10/23/2019

Australian wheat is garnering fresh attention from Southeast Asian buyers as the price spread with cheaper origins like Black Sea and Argentina narrows. The spread between S&P Global Platts assessed Australian Premium White wheat and Black Sea 12.5% protein wheat has narrowed by $20.75/mt since September 19 to $32.75/mt Tuesday. This has come on the back of the surge in Black Sea wheat outpacing the rise in Australian wheat prices. Strong farmer retention has been a common factor behind the recent price rally for all the three origins. Black Sea wheat has faced strong demand from both local millers and destination end-users in the Middle East and Southeast Asia. So far this season, Ukraine’s wheat exports have been more than 10 million mt, 47% ahead of last year’s pace, data from Ukraine’s agriculture ministry showed. This comes on the back of larger production and stronger demand due to competitive prices.

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China’s Economic Slowdown Deepens, Weighing on Global Growth

Capital Press – 10/18/2019

China’s economic growth sank to a new multi-decade low in the latest quarter as a trade war with the U.S. deepened a slump that is weighing on the global economy. Growth in the world’s second-largest economy slipped to 6% in the three months ending in September, down from the previous quarter’s 6.2%, data showed Friday. It was the weakest level since China started reporting data by quarters in 1993. The slowdown and weakening consumer demand add to headaches for Chinese leaders as they fight a 15-month-old tariff war that has sapped China’s exports. Still, the slowdown will not necessarily compel decision makers in Beijing to reach an agreement with President Donald Trump since domestic factors, rather than trade, are having a bigger impact on the economy, said Julian Evans-Pritchard of Capital Economics. “I don’t think striking a deal with the U.S. and lifting those tariffs would resolve the issues the Chinese economy is facing,” said Evans-Pritchard. “It would be only a modest boost.”

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Concern Swells as USMCA Talks Linger

Agri-Pulse – 10/23/2019

House Speaker Nancy Pelosi still isn’t ready to hold a vote on the U.S.-Mexico-Canada Agreement, but the pace of talks between Democrats and the White House is picking up speed as both sides aim for ratification before the end of the year. House Ways and Means Committee Chairman Richard Neal, the Massachusetts Democrat charged with spearheading negotiations with U.S. Trade Representative Robert Lighthizer to produce a pact that can pass the House, assured Agri-Pulse this week that talks are intensifying and progress is being made, but time is running out in 2019. Senate Finance Committee Chairman Chuck Grassley, an ardent supporter of the new USMCA, told reporters Tuesday he’s getting worried there just won’t be enough time. “I think it’s fair to say that the clock is ticking,” said Grassley, who stressed that he’s concerned USMCA will take a back seat to elections in 2020. “Time’s running out and I’m going to urge Democrats in the House to move quickly … Until now, I haven’t been inclined to do that, but I’m getting worried.

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North Dakota Wheat Commission Releases Annual Crop Quality Reports

North Dakota Wheat Commission – 10/22/2019

The North Dakota Wheat Commission recently released the results of its annual crop quality reports. The organization has been conducting harvest surveys for more than 60 years, and the data gathered is used for publishing regional reports and the U.S. Wheat Associates overall report which covers all six classes of wheat produced in the nation. The data is also used in overseas and domestic marketing seminars and outreach with customers. The annual harvest survey represents hard red spring wheat produced in North Dakota, Montana, Minnesota, South Dakota and the Pacific Northwest, and durum produced in North Dakota and Montana. During harvest, state wheat check-off groups contract with the National Ag Statistics Service to collect nearly 900 hard red spring wheat and durum samples and ships them to North Dakota State University to be analyzed for kernel quality and end-use properties. Samples are combined according to specific regions and protein levels, and the combined samples (composites) are milled into semolina or flour, and analyzed for bread and pasta qualities. 

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Source: U.S. Wheat Associates