Chicago Reports
24-04-2014 09:59 AM | Chicago Reports
23/04/14 -- Soycomplex: Beans closed lower on the old crop and higher on the new. The jungle drums concerning Chinese cancellations and switches into the US are deafening. Reuters apparently confirmed that Japan's Marubeni Corp had resold two cargoes of Brazilian beans to US buyers, naming the vessels, the volumes, the ports they've sailed from and their destinations (Mobile, Alabama and Wilmington, North Carolina). About the only thing they skipped was the prices paid. Is that just the tip of the iceberg? ADM denied that any of it's sales to China had been defaulted on, and Bunge and Cargill refused to comment, Reuters added. The Chinese government meanwhile is expected to restart its weekly soybean reserve auctions on May 6th, which may further curtail demand from the world's largest buyer. Venezuela are in the market for soymeal for July shipment, Argentina might be the most likely seller. The Rosario Grain Exchange estimated Argentina's 2013/14 soybean crop at a record 54.9 MMT, up from a previous forecast of 54.7 MMT. They said that better yields than expected in Cordoba are offsetting lower ones in other areas. Harvesting is 25% complete, 15 points behind last year, they added. The USDA attaché in Argentina estimated plantings for the 2014/15 soybean harvest rising to 20.6 million ha versus 19.1 million for the current harvest. The attaché sees next year's Argentine soybean crop at a new record 57.5 MMT. Early estimates also have Brazil producing a new record crop in 2014/15 of around 95-97 MMT, whilst US farmers are also expected to "go large" with soybeans plantings this year. That sounds like a lot of soya doesn't it, especially in the face of faltering demand from China. Tomorrow's weekly export sales from the USDA will be interesting in light of all the cancellation talk. Estimates for that are from zero to possibly negative 200 TMT on old crop, and 350-550 TMT positive on new crop. May 14 Soybeans closed at $14.69, down 10 3/4 cents; Jul 14 Soybeans closed at $14.65, down 5 3/4 cents; May 14 Soybean Meal closed at $478.80, down $1.00; May 14 Soybean Oil closed at 42.44, down 30 points.

Corn: The market ended around 7 to 8 cents higher on the day. Fund money ended up as an estimated net buyer of around 8-9,000 contracts on the day. Late planting of the 2014 US corn crop is getting spec money excited (already). There's talk that some are already prophecising (if that's not a real word then it should be) another summer weather disaster, and are looking to "get in early" on the long side. Others suggest that 2014 will be an El Nino year, and that would normally produce a beneficial growing environment for the US Midwest. Suffice to say that April is very early indeed to get into a US weather market. Anything like trendline yields this year could leave fund money looking spectacularly foolish come the autumn. Next week's weather forecast is not conducive to planting though, but could ultimately prove beneficial in the long run. "The GFS forecast is extremely wet in the Midwest, calling for 2-4 inches of rainfall with a slow moving storm. The rain potential is great. Some farms in Missouri, Illinois and Wisconsin could receive 4-6 inches of rain. This would be the equivalent to a month's worth of May rainfall. Ohio and Indiana would be “less wet” the new forecast calling for 1.5 – 2.5 inches of rain," said Martell Crop Projections. Elsewhere, the Rosario Grain Exchange increased their forecast for the 2013/14 Argentine corn crop from 22.7 MMT to 23 MMT, and said that harvesting is 23% complete. A Reuters survey put South Africa’s 2014 corn crop at 13.1 MMT. APK Inform reported that Ukraine's corn exports continue unhindered by political issues. They shipped out 1.1 MMT of corn in the April 1-22 period, and increase of 49% on a year ago. Marketing year to date corn exports are now 16.4 MMT, an increase of 56% versus the same period in 2012/13. Full season exports will total 19.3 MMT, APK Inform estimated. US ethanol production this past week fell to 910k barrels/day from 939k bpd the previous week. Tomorrow's weekly export sales are expected to be in the region of 500 TMT to 1 MMT. May 14 Corn closed at $5.03 3/4, up 7 1/2 cents; Jul 14 Corn closed at $5.09 1/2, up 7 1/2 cents.

Wheat: The market closed around 3 to 5 cents higher on the day. The trade continues to fret over US winter wheat crop conditions, slow spring wheat plantings and Ukraine. There is also some talk of Oklahoma confirming freeze damage to winter wheat from the recent sub-zero dip. The same major storm that is shaping up next week to further delay corn plantings in the Midwest, could however bring some drought relief to winter wheat on the southern Plains. "Both Oklahoma and central Kansas could receive up to 1 inch of rainfall from the slow moving storm," said Martell Crop Projections. China's weekly (or should that be weakly?) wheat auctions continue to be woefully under subscribed. Today's offering of 675,445 MT only received a 7.2% take-up rate. That's even worse than the 16-17% acceptance of the last two weeks. The USDA did however announce the sale 120 TMT of US sorghum to China for 2013/14 shipment. Japan bought 108,789 MT of food wheat for May-Sept shipment in their regular weekly tender. As usual the origins were split between the US, Canada and Australia. Iran bought 60,000 MT of Russian wheat. Kazakhstan said that it plans to export 1.2 MMT of wheat to Iran this year. Stats Canada are out with their planting intentions estimates tomorrow. The trade is expecting an all wheat area of 24.4 million acres versus 26.26 million in 2013. For barley the average estimate is 6.7 million versus 7.08 million last year. For oats it's 3.2 million versus 3.17 million in 2013. Morocco said that it only expects a cereal harvest of 6.7 MMT this year, down sharply from 9.7 MMT a year ago. Wheat will account for 3.7 MMT of that against 5.2 MMT in 2013 when good rains fell. Rains this year ave come a bit too late to boost yields the Ag Minister said. After a wet Easter, eastern Australia is seen mostly dry for the next few days, favouring field work, but more rain will soon be needed. The west remains dry. Fund money was estimated as buying around a net 2,000 Chicago wheat contracts on the day. Trade estimates for tomorrow's weekly export sales report are old crop 200–400 TMT, and new crop 250–500 TMT. May 14 CBOT Wheat closed at $6.76 1/2, up 3 1/2 cents; May 14 KCBT Wheat closed at $7.45 1/2, up 4 1/4 cents; May 14 MGEX Wheat closed at $7.25 1/4, up 5 cents.

23-04-2014 09:09 AM | Chicago Reports
22/04/14 -- Soycomplex: Beans traded both sides, but ultimately ended lower, on continued worries on demand from China. A Reuters report suggesting that more Brazilian beans already sold for export were still at risk from cancellation got heavily long fund money nervous. They were estimated as ending the day as net sellers of around 7,000 soybean contracts. Reuters also reported that two cargoes of Argentine meal have been sold into the US east coast and that more deals are being discussed. Adding fuel to the fire was ABOIVE cutting their estimate for Brazilian soybean exports in 2013/14 from 44 MMT to 43 MMT, due to weaker Chinese demand. Dr Cordonnier forecast the Brazilian soybean crop at a record 86.5 MMT, with Argentina at 53.5 MMT, both were unchanged from his previous estimates. Safras e Mercado pegged the Brazilian crop at 86.9 MMT, with Argentina seen matching the previous record crop at 54.5 MMT on Friday. US farmers are soon expected to begin planting a record 2014 soybean crop of their own this year. The USDA attaché in Canada estimated 2014/15 canola production at 16.2 MMT versus 18.0 MMT last year. Despite a lower output, the attaché estimated Canadian 2014/15 canola exports at 8.5 MMT versus 8.0 MMT. Stats Canada's 2014 planting intentions report comes out on Thursday. Canola plantings could come in around 21 million acres versus 19.9 million last year it is thought. May 14 Soybeans closed at $14.79 3/4, down 19 cents; Jul 14 Soybeans closed at $14.70 3/4, down 16 1/2 cents; May 14 Soybean Meal closed at $479.80, down $5.90; May 14 Soybean Oil closed at 42.74, down 26 points.

Corn: The corn market closed higher, with trade talk of US planting delays adding support. The USDA said last night that 6% of the US corn crop was now in the ground, although up on last year's late planted 4%, it's below the 5-year average of 14% and less than the 9% that the market anticipated. A bit more support came from yesterday's large weekly export inspections total of 1.6 MMT, followed by today's announcement from the USDA that private exporters had sold 240,000 MT of US corn to Mexico for 2014/15 shipment under the daily reporting system. South Korea's KFA bought 60,000 MT of US or South American corn for Oct shipment. Dr Cordonnier forecast the 2013/14 Brazilian corn crop at 72.0 MMT, versus previous estimate of 70.0 MMT. In Argentina he held pat at 23.5 MMT. Ag Canada estimated the Canadian 2014/15 corn crop at 12.7 MMT versus previous estimate of 13.1 MMT and down from 14.2 MMT in 2013/14. Stats Canada are out with their 2014 planting intentions report on Thursday. Corn acres are expected to be around 3.4 million versus 3.7 million last year. Ukraine said that it had exported 29 MMT of grains so far this season, with 18.3 MMT of that total corn. APK Inform expect full season grain exports at a record 31.3 MMT, of which 19.5 MMT (also an all time high) will be corn. The spec community got the jitters yesterday, after news broke that Barclays was pulling out of most of its metals, energy and agri commodities trading due to "falling profitability in the face of tougher regulation". There was little sign of those nerves remaining today, with fund money estimated as finishing up as net buyers of around 10-12,000 corn contracts on the day. May 14 Corn closed at $4.96 1/4, up 7 3/4 cents; Jul 14 Corn closed at $5.02, up 8 1/4 cents.

Wheat: The wheat market closed a little higher, in light "Turnaround Tuesday" style, following yesterday's rout. Even so, only a relatively small proportion of Monday's losses were regained. Dollar weakness may have helped foster ideas that this will encourage some export demand. Last night's crop condition ratings, whilst unchanged in the good/excellent category from a week ago where hardly friendly either. Maybe the market just felt that last night's losses of 20-23 cents were a bit overdone? Some rain is in the forecast for US winter wheat, but amounts are generally low. Japan seeks 108,789 MT of food wheat for May/Sep shipment in their regular routine tender. Iraq cancelled a tender for 50 TMT of optional origin wheat due to high prices. Egypt’s state newspaper estimated the country's 2014 wheat crop at 9.0 MMT versus the Ag Minister's 9.5 MMT. Ag Canada estimated the Canadian all wheat crop in 2014 at 29.3 MMT, unchanged from a previous estimate and down versus the record 37.5 MMT produced last year. Despite the decline, all wheat exports were forecast at 22.1 MMT, unchanged from previously and up 0.5 MMT versus 2013/14. The Canadian barley crop was estimated at 8.3 MMT versus a previous estimate of 8.4 MMT and compared to 10.2 MMT in 2013/14. Stats Canada's 2014 planting intentions report, due out on Thursday, is expected to show a Canadian all wheat area of 24.4 million acres versus 26.26 million in 2013. Ukraine said that it's early spring grain plantings (mostly barley) were 97% complete. Russia’s Ag Ministry said that as of April 21st Russia had planted spring grains on 3.7 million ha (11.5% of the total planned area) versus 2.1 million a week ago and 2.8 million a year ago. May 14 CBOT Wheat closed at $6.73, up 4 3/4 cents; May 14 KCBT Wheat closed at $7.41 1/4, up 7 1/4 cents; May 14 MGEX Wheat closed at $7.20 1/4, up 5 3/4 cents.

22-04-2014 09:19 AM | Chicago Reports
21/04/14 -- Soycomplex: Beans closed lower, in line with losses across the rest of the complex. News that Barclays was pulling out of commodities trading was seen as broadly bearish, especially coming at a time when fund money holds a very large speculative long in soybeans and corn. "Funds are insanely long and if we break much more I see them moving to a liquidation mode," one market analyst commented. "There is a lot of room on the downside if we get normal weather the next couple of months," he warned. Will we get "normal" weather? An El Nino year, if we are in for one as many are suggesting, would typically bring good Midwest rains and relatively benign temperatures. That, coupled with expectations of record large soybean plantings in the US this spring, could indeed leave the market vulnerable to a significant downside, especially given the very hefty long that the funds currently hold. The USDA released their second weekly crop progress report of the year. That has soybeans plantings in Louisiana at 33% done versus 19% a year ago and 26% on average. Mississippi is at 14% sown versus 7% a year ago and 26% on average. Texas is 21% done versus 43% a year ago and 52% on average. Arkansas is 7% complete versus 4% a year ago and 13% on average. Alabama is 3% planted versus 1% a year ago and 2% on average. Safras e Mercado said on Friday that Brazil's soybean harvest is 90% complete versus 86% a year ago. Weekly US export inspections for soybeans came in at 270.5 TMT, taking the marketing year to date total to 41.8 MMT. That's over 97% of the USDA's projection for a season with more than 4 months still left to run. May 14 Soybeans closed at $14.99 1/4, down 14 3/4 cents; Jul 14 Soybeans closed at $14.88 1/2, down 13 3/4 cents; May 14 Soybean Meal closed at $485.90, down $2.40; May 14 Soybean Oil closed at 43.06, down 35 points.

Corn: The corn market ended around 6 to 7 cents lower on the day in what looked like general consolidation. Weekly export inspections came in at a strong 1.6 MMT, taking the 2013/14 total so far to 26.8 MMT, which is just under 60% of the USDA's forecast for the season. The USDA reported US corn planting at 6% complete, up from 3% done a week ago, and versus 4% this time last year. The 5-year average is 14%, so things are still behind normal. The weather outlook is improving though. "Strong warming developed on Easter Sunday with widespread 70s F in the Midwest. Fine sunny mild conditions are expected to a continue a few more days. However, a sharp cold wave is predicted Thursday-Friday, dropping Midwest temperatures 12-15 F below average. Maximum temperatures Friday would be high 40s F in the northern corn belt to 60s F south. Midwest rainfall has picked up in March and April with bouts of very heavy rain. Soaking rains last week developed in a wide swath of the corn belt from eastern Nebraska to Wisconsin, and including Iowa, western Missouri and southeast Minnesota. Partially frozen fields means there was run-off, but overall drenching rains were beneficial, improving soil moisture for corn planting. Stormy weather l is expected again this week in the Midwest favouring corn farms west of the Mississippi River for the heaviest rainfall. Lighter amounts of rain, .25 – 50 inch, are predicted in eastern Illinois, Indiana and Ohio," said Martell Crop Projections. On Friday, Safras e Mercado estimated Brazil’s 2nd corn crop at 42.25 MMT versus 45.2 MMT a year ago. May 14 Corn closed at $4.88 1/2, down 6 1/4 cents; Jul 14 Corn closed at $4.93 3/4, down 6 3/4 cents.

Wheat: The wheat market took a nosedive, possibly linked to an easing of tensions between Russia and Ukraine/the West over the weekend. Wheat's recent meteoric rise appears to have been directly linked to the evolving situation between the two big Black Sea exporting nations, despite the fact that very little spring wheat is sown in Ukraine. Deteriorating US winter wheat crop conditions have also been supportive to the market in recent weeks. The USDA today reported US winter wheat at 34% good/excellent, which is unchanged on a week ago and 1 point lower than this time last year. The top producing state of Kansas is only 24% good/excellent, and 32% poor/very poor. Oklahoma is even worse, with zero excellent, 11% good and 61% poor/very poor. There are prospects for rain however. "The subtropical jet stream is expected to deliver a strong wave of showers to Kansas, Oklahoma and Texas late in the period Sunday-Monday, April 27-28. Kansas wheat is also expecting rain Wednesday, when a strong short-wave disturbance tracks through the central Great Plains into the Upper Midwest," said Martell Crop Projections. The USDA said that 9% of winter wheat is headed versus 7% a year ago and 17% on average at this time. Spring wheat planting meanwhile if 10% complete versus 7% a year ago 19% for the 5-year average. Weekly export inspections came in at 495 TMT versus 712 TMT the previous week. May 14 CBOT Wheat closed at $6.68 1/4, down 23 cents; May 14 KCBT Wheat closed at $7.34 1/2, down 23 1/2 cents; May 14 MGEX Wheat closed at $7.14, down 18 3/4 cents.

18-04-2014 09:09 AM | Chicago Reports
17/04/14 -- Soycomplex: Beans closed a little lower on light profit-taking ahead of the long weekend. They still managed decent gains for the week though. Fresh news was lacking heading into the Easter break. Weekly export sales for beans came in at a net 19,200 MT for old crop (with the trade expecting zero due to tightness in availability) and 400,700 MT for new crop (expecting 150-350 TMT) - the latter being mostly for unknown/China. Actual shipments themselves this week were 339,200 MT, continuing to slacken off - as they need to do. The US has now already shipped 41.5 MMT of soybeans abroad this year, and has outstanding sales of just over 3 MMT. The USDA estimate for the season is only 43 MMT, so the US has already exported 96.5% of the USDA target for the season, and has total commitments of 103.5%. Whilst talk of China now defaulting on as many as 30-40 cargoes of existing soybean purchases is bearish, outstanding sales from the US are only said to be 141,400 MT - so this is a much bigger problem for South America than it is for the US. The Argentine soybean crop is 21.4% harvested versus 38% a year ago. The Ministry there estimate production this year matching the 2009/10 record at 54.5 MMT, and up 12.4% versus 48.5 MMT last year. They say that Argentine growers have around 20% of their crop sold versus 25% this time a year ago. May 14 Soybeans closed at $15.14, down 4 3/4 cents; Jul 14 Soybeans closed at $15.02 1/4, down 6 1/2 cents; May 14 Soybean Meal closed at $488.30, down $2.70; May 14 Soybean Oil closed at 43.41, down 30 points. For the holiday-shortened week that puts nearby beans up 51 cents, with meal up $15.40 and oil 131 points higher.

Corn: The market also closed with modest losses of around 2-3 cents in light consolidation ahead of the Easter break. Weekly export sales came in at a combined 794,500 MT (including 192,600 MT of new crop), in line with the expected 600-900 TMT. In addition, the USDA announced 125,000 MT of corn sold to South Korea for 2013/14 shipment. Exports this week were 1,111,000 MT. MDA CropCast cut their forecast for Ukraine corn production this year by 1.1 MMT from last week to 27.1 MMT, a 10% fall on last year's record, although still easily their second largest crop ever (their previous best was 22.8 MMT in 2009/10). MDA CropCast also trimmed their view on Argentina's output next year by 1.5 MMT to 22.7 MMT. Strategie Grains estimated the EU-28 2014/15 corn crop at 65.1 MMT versus a previous estimate of 65.2 MMT and 64.1 MMT in 2013/14. The Argentine corn harvest is said to be 19.7% complete versus 31.7% a year ago. The Argentine Ministry estimated the 2013/14 corn crop at 23.5 MMT versus 27.0 MMT last year. They said that Argentine growers have sold 25% of their 2013/14 corn crop versus 57% a year ago. The US weather is finally about to improve, to the benefit of corn and soybean plantings. "The weather pattern in North America is expected to undergo a fundamental shift , finally warming up and turning significantly wetter. The biggest change would occur in the heartland, the Great Plains and western Midwest, where very strong warming is predicted along with generous rainfall. Spring weather conditions for many weeks have been cold and dry, so this represents a significant change for the better," said Martell Crop Projections. May 14 Corn closed at $4.94 3/4, down 2 3/4 cents; Jul 14 Corn closed at $5.00 1/2, down 3 cents. For the week that puts front month corn 3 3/4 cents lower.

Wheat: The market closed with modest gains across the three exchanges. Weekly export sales came in at 438,000 MT of old crop and 359,900 MT of new crop. That was towards the top end of trade expectations which had been as low as only 250 TMT to as high as 850 TMT on a combined marketing year basis. The old crop sales included increases for Brazil (85,000 MT, including 50,000 MT switched from unknown destinations). MDA CropCast said that Brazil's 2014/15 wheat crop would rise 29% to 7.1 MMT, on increased plantings. They also raised their forecast for Argentina's 2014/15 wheat output, up from 10.9 MMT last week to 11.9 MMT this week, and 17% higher than a year ago. The potential for both Brazil and Argentina to produce more wheat in 2014/15 is a significant one as US exports have received a major shot in the arm from demand from Brazil this season. Strategie Grains estimated the EU-28 soft wheat crop at 137.2 MMT, down 0.5 MMT from last month but still 2% higher year-on-year. They see exports in 2013/14 at a record 26.8 MMT, with those in 2014/15 falling to 22.4 MMT, both estimates are higher than a month ago. Seeing as wheat has been possibly the main beneficiary of the sudden upsurge in speculative interest that we've seen in the markets in the past couple of months, it will be interesting to see how it takes the news that broke late in the day of a "deal" of sorts between Russia, Ukraine and EU/US negotiators reached in multi-party talks in Geneva (if indeed it holds until Monday or even proves effective at all). May 14 CBOT Wheat closed at $6.91 1/4, up 3 1/4 cents; May 14 KCBT Wheat closed at $7.58, up 3 1/2 cents; May 14 MGEX Wheat closed at $7.32 3/4, up 6 1/4 cents. For the week that puts Chicago wheat up 31 cents, with Kansas gaining 38 1/2 cents and Minneapolis adding 31 cents.

17-04-2014 09:49 AM | Chicago Reports
16/04/14 -- Soycomplex: Beans closed sharply higher for the third session in a row. Fund buying continues to support the market, they were in for an estimated net 5,000 bean contracts on the day today. Old crop remains extremely tight, with any shorts in May or July getting squeezed out as making delivery against those shorts isn't an easy option. The Buenos Aires Grain Exchange said that the rain-delayed soybean harvest in Argentina is 21.4% complete, up from 14% a week previously, producing a crop of around 13.5 MMT so far. The harvest this time last year was 38.6% complete. The Brazilian soybean harvest was 86% complete as of last Friday. US weekly export sales are out tomorrow, with the trade expecting zero on old crop beans due to lack of availability, and with sales of maybe 150-350 TMT on new crop. We will also see how many soybeans have been shipped out of the US in the past week, with shipments so far already at 96% of the USDA's forecast for the entire season. Unfulfilled sales to China are said to be only 262,800 MT, with a further 984,000 MT outstanding for unknown. This makes the Chinese credit/default problems much more of an issue for South American sellers than it is for the US. Two vessels are currently said to be in Brazil's shipping line-up to load beans for the US. It looks like more will be needed. May 14 Soybeans closed at $15.18 3/4, up 17 1/2 cents; Jul 14 Soybeans closed at $15.08 3/4, up 21 1/4 cents; May 14 Soybean Meal closed at $491.00, up $3.60; May 14 Soybean Oil closed at 43.71, up 88 points.

Corn: The corn market closed around 4 to 6 cents lower. Funds were estimated to be net sellers of around 6,000 lots on the day. The Chinese Stats Bureau said that corn plantings there this year will rise 1.75%. Dr Cordonnier said that 7% of Mato Grosso's safrinha corn crop has already finished pollinating, with 10% of the crop at the same stage in Parana (Brazil). Crop conditions so far are "very favourable" he noted. Parana corn is rated 93% good, 6% average and only 1% poor, he said. CONAB estimate second crop corn producing 43.9 MMT this year, or around 58% of the national crop. UkrAgroConsult said Ukraine exported 954,000 MT of grain between April 1-April 14. The vast majority of that will have been corn. The Ukraine Ministry said that the country had exported 28.6 MMT of grains to date this season, and over 18 MMT of that has been corn. The Buenos Aires Grain Exchange said that progress with Argentina's corn harvest has been very slow, with only 19.7% of the crop cut so far. That's only 3.2% up in a week, and 12 points down on a year ago at this time. They noted that there had been an early frost in some parts of the grain belt, and that this could have an adverse affect on yields. Nevertheless, they held their production estimate unchanged for now at 24 MMT. Weekly US ethanol production came in at 939k barrels/day, up sharply on 896k barrels/day a week previously, and hitting the level required to match USDA targets for the season for the first time in weeks. This was the highest weekly grind since early December. May 14 Corn closed at $4.97 1/2, down 6 1/4 cents; Jul 14 Corn closed at $5.03 1/2, down 6 1/4 cents.

Wheat: The wheat market closed lower on profit-taking. Fickle funds were given credit for ending the day net sellers of around 4,000 Chicago wheat contracts on the day - having been said to have been net buyers of 6,000 yesterday. The latest US weather forecast on the Plains is warmer, and a bit wetter. Recent Chinese government wheat auctions haven't been going well. They only sold less than 17% of the 626 TMT of wheat on offer in today's sale and last week's auction of 858 TMT of wheat only received a take-up rate of 16%. Jordan purchased 150,000 MT of optional origin wheat yesterday and 100,000 MT of optional origin barley today. The Black Sea is the most likely origin for both. EU soft wheat exports look like they are finally slowing, with Brussels granting 421 TMT worth of export licences this week versus 585 TMT the previous week. The 2014 EU wheat and barley harvests look like being early, with crops running 2-4 weeks ahead of normal maturity following a generally mild winter. Japan is tendering for 136,200 MT of food grade wheat. There's a long weekend looming, with US and Europe closed on Friday. US markets re-open on Monday afternoon, whilst Europe remains shut until Tuesday. Who knows what the Ukraine situation will be like by then? Trade estimates for tomorrow's weekly export sales report from the USDA are all over the place, from as low as only 250 TMT to as high as 850 TMT. May 14 CBOT Wheat closed at $6.88, down 13 3/4 cents; May 14 KCBT Wheat closed at $7.54 1/2, down 11 cents; May 14 MGEX Wheat closed at $7.26 1/2, down 12 cents.

16-04-2014 09:39 AM | Chicago Reports
15/04/14 -- Soycomplex: Beans closed above $15/bu on a front month for the first time since last July after the March NOPA crush came in well above expectations. The trade was anticipating a crush number of around 146 million bushels. What it got was a figure of 153.84 billion, which under current "excited" market conditions was enough to spark another feeding frenzy amongst the fund community, who ended up as net buyers of an estimated 10-12,000 soybean contracts on the day. The crush number again implies that US 2013/14 soybean ending stocks are likely to be far tighter than the USDA currently project. Certainly though this will stimulate imports, and encourage US farmers to not waiver from their intention to plant a record large crop this year. The market views potential demand reductions out of China as more of a problem for South American beans than it is for US beans. There are some suggestions that Chinese buyers could ultimately default on 30 or more cargoes of existing soybean purchases due to negative crush margins and difficulties in obtaining Letters of Credit. The Philippines bought 120,000 MT of US or South American soymeal for Aug/Sep shipment today. Dr Cordonnier estimated the 2013/14 Brazilian soybean crop at 86.5 MMT, unchanged from his previous estimate. He estimated the 2013/14 Argentine bean crop at 53.5 MMT, down from a previous estimate of 54.0 MMT. May 14 Soybeans closed at $15.01 1/2, up 25 1/4 cents; Jul 14 Soybeans closed at $14.87 1/4, up 23 3/4 cents; May 14 Soybean Meal closed at $487.40, up $8.30; May 14 Soybean Oil closed at 42.76, up 50 points.

Corn: The corn market ended narrowly mixed on a general lack of news. The Ukraine situation continues to add a bit of support to the market, with corn planting there only just getting going. There's the probability that lack of credit will mean Ukraine growers are forced to cut back on their planting intentions and also on inputs. Agritel yesterday estimated Ukraine’s 2014 corn crop at 23.3 MMT versus a previous estimate of 26.8 MMT, and down 18% from a year ago. Remember though that this will still be their second largest corn crop in history. Dr Cordonnier estimated the 2013/14 Brazilian corn crop at 70.0 MMT, unchanged from previous estimate, although he did note that there was potential for this the be raised at some time in the future. Growing conditions for Brazil's second corn crop are said to be favourable. He estimated the 2013/14 Argentine corn crop at 23.5 MMT, also unchanged from his previous estimate. The Ukraine state stats service said that the country's April 1st grain stocks were 12.3 MMT, up 14% from a year ago. The US Energy Dept will release their usual weekly ethanol production and stocks report tomorrow. Last week's production of 896k barrels/day was well below the circa 938k barrels/day required to hit the USDA's target for the season. Planting of US corn in the Midwest remains delayed by cold weather, although it's too early to suggest that this will mean a drop in yields later this year. May 14 Corn closed at $5.03 3/4, up 3/4 cent; Jul 14 Corn closed at $5.09 1/2, up 1/4 cent.

Wheat: The wheat market jumped back above the $7/bu mark in Chicago on heavy spec buying as the problems in Ukraine intensified. Funds were estimated as finishing up as net buyers of around 6,000 Chicago wheat contracts on the day. This would almost certainly take their long holding back above the levels of a fortnight ago, which was their largest net long in CBOT wheat since Nov 2012. Talk of crop damage to US winter wheat after a hard freeze overnight also got the market excited, although some analysts said that less than 1% of the crop was likely to be at risk. "For wheat that was very advanced with jointing there would be serious damage. However, due to persistently cold weather this spring, freeze damage is not likely to be severe in Kansas, where crop development is significantly delayed," said Martell Crop Projections. "Oklahoma wheat jointing was further advanced with 4% of wheat flowering-heading. A hard freeze would have killed pollen leading to a blank grain head with no kernels. Just a small percentage of the crop would have been affected. Texas wheat was 28% heading suggesting serious freeze damage in wheat. However, we don’t know exactly where wheat was heading. The panhandle is the main wheat region in Texas and also the coldest with mid-upper 20s F overnight. North Central Texas wheat growing areas were less cold with 32 F (freezing) at the minimum. There leaf burn may have developed but no lasting freeze damage. Temperatures tonight are expected to remain above freezing, though mid 30s F are still possible in western Kansas on the High Plains. Moderating temperatures are predicted the balance of the week," they added. May 14 CBOT Wheat closed at $7.01 1/2, up 22 3/4 cents; May 14 KCBT Wheat closed at $7.65 3/4, up 23 3/4 cents; May 14 MGEX Wheat closed at $7.38 1/2, up 21 1/4 cents.

15-04-2014 08:59 AM | Chicago Reports
14/04/14 -- Soycomplex: Beans ended up recovering most of Friday's losses as fund money returned to the fray after weekend events in Ukraine took a turn for the worst. They were estimated as ending up as net buyers in beans of around 4-5,000 contracts on the day. Weekly US export inspections were reported at 267,939 MT, which is not much better than half of last week's 509,627 MT. Nevertheless, nor do they need to be, cumulative shipments for the marketing year to date now stand at almost 41 MMT, just 2 MMT shy of the USDA's target for the season. US exports are (finally) dropping off as the Brazilian harvest winds down. Safras e Mercado said as of Friday that was 86% complete versus 80% a week ago, 82% a year ago and 78% for the 5-year average. There's unconfirmed talk of more unwanted Chinese purchases of Brazilian beans being resold into the US. The NOPA March crush report comes out tomorrow, with the trade expecting a domestic demand number of around 146 million bushels. There are reports of bird flu outbreak in Japan. Goldman Sachs forecast US soybean prices at $10.50/bushel 12 months from now. May 14 Soybeans closed at $14.76 1/4, up 13 1/4 cents; Jul 14 Soybeans closed at $14.63 1/2, up 16 1/4 cents; May 14 Soybean Meal closed at $479.10, up $6.20; May 14 Soybean Oil closed at 42.26, up 16 points.

Corn: The market closed around 4-5 cents higher, with renewed tensions between Russia and the West/Ukraine supporting. Fund money was estimated as finishing the day as a net buyer of around 5-7,000 corn contracts. The rapid demise of the Ukraine currency, which is down by more than 50% in the past 3 months since their political problems escalated to new heights, is seen harming corn planting and inputs this year. Agritel estimated Ukraine’s 2014 corn crop at 23.3 MMT versus a previous estimate of 26.8 MMT, and down 18% from a year ago. Although for now, Ukraine's corn exports continue relatively uninterrupted, there's also the suggestion that farmers there may hold off selling whatever old crop they have left (and likely do the same on new crop) as a hedge against the weakening hrynia - at least until the situation stabilises. Agritel estimated Russia’s 2014 corn crop at 9.8 MMT versus a previous estimate of 10.2 MMT, and down 6% from 2013. Weekly US export inspections were strong at 1.45 MMT, and now total almost 25.2 MMT for the marketing year to date. Safras e Mercado said that as of Friday 74% of the Brazilian summer corn crop has been harvested versus 63% a year ago. They estimated Brazil’s 2nd "safrinha" corn crop at 40 MMT or more. Current conditions for that are favourable. The USDA released the first crop progress report of the year today, placing the US crop at 3% planted versus 2% this time a year ago and 6% on average. May 14 Corn closed at $5.03, up 4 1/2 cents; Jul 14 Corn closed at $5.09 1/4, up 4 3/4 cents.

Wheat: The market closed with good gains, although it also finished well off the intra-day highs as a bit of profit-taking kicked in later in the day. Fund money was estimated as being a net buyer of around 6-7,000 Chicago wheat contracts on the day, smelling blood (unfortunately, literally) on weekend developments in Ukraine. Agritel suggested that financial problems will cut Ukraine many farmers' ability to fund inputs for corn and wheat this year. There's also the issue of inadequate winter rains in not just Ukraine, but also Russia. Agritel estimated Ukraine’s 2014 wheat crop at 18.4 MMT versus a previous estimate of 20.0 MMT, and down 16.5% from a year ago. They now see Russia's crop at 48.1 MMT versus a previous estimate of 49.9 MMT, and down 8% from 2013. Taiwan bought 92,550 MT of US milling wheat for May June shipment, according to Reuters. South Korea's NOFI bought 65,000 MT of optional origin feed wheat for Sep/Oct shipment. Weekly US export inspections of 683,544 MT were better than trade expectations of 450-550,000 MT. The USDA reported US winter wheat at 34% good to excellent, down a point from a week ago and versus 36% a year ago. They rated 32% of the crop as poor to very poor, versus 29% a week ago and 31% a year ago. Headed was 5% versus 4% a year ago. Spring wheat plantings were 6% complete versus 5% a year ago. All in all then, the US wheat crop is in similar shape to 12 months ago. May 14 CBOT Wheat closed at $6.78 3/4, up 18 1/2 cents,; May 14 KCBT Wheat closed at $7.42, up 22 1/2 cents; May 14 MGEX Wheat closed at $7.17 1/4, up 15 1/2 cents.

13-04-2014 14:49 PM | Chicago Reports
11/04/14 -- Soycomplex: Beans closed sharply lower on profit-taking and fund selling (estimated at a net 4,000 in soybeans on the day) spurred by widespread reports of Chinese defaults and cancellations/deferrals of Brazilian soybean purchases. Chinese demand is after all almost single handedly responsible for keeping the global soybean market going. It is also the reason why US growers are expected to "go large" and plant a record soybean crop this year. MDA CropCast yesterday estimated US 2014 production at 97.2 MMT, a 12% hike on last year. Brazilian growers are of course also keen to continue to get a slice of the action. Their crop will rise 9% to 95.7 MMT in 2014/15, as world output increases by 7.5% to a record 292.1 MMT, MDA CropCast said. Note too, that they are often quite restrained in their production estimates. The USDA will give us their first 2014/15 crop production forecasts next month. As well as Chinese defaults/cancellations there are also now reports circulating that the Chinese government may start selling beans from its reserves in May. A cynic would say "they're just trying to get the market down" but it doesn't feel like that to me on this occasion. The Argentine Ag Ministry said that farmers there have currently sold 18% of their new crop soybeans versus 24% a year ago. The Buenos Aires Grains Exchange said that the Argentine harvest is 14% complete versus 9.5% a week ago and 24% a year ago. They estimated the crop at 54.5 MMT, unchanged from their previous estimate. MDA CropCast raised their forecast for the Brazilian 2013/14 soybean crop by 1.2 MMT to 87.6 MMT. That's now very similar to Lanworth and the USDA who both line up at 87.5 MMT, and above CONAB who gave us 86.08 MMT yesterday. The USDA announced 330,000 MT of US beans sold to unknown for 2014/15 shipment. The March NOPA crush report comes out on Tuesday, with the trade expecting a figure of around 146 million bushels, which would be the largest March crush in 4 years. May 14 Soybeans closed at $14.63, down 19 1/4 cents; Jul 14 Soybeans closed at $14.47 1/4, down 18 1/4 cents; May 14 Soybean Meal closed at $472.90, down $6.60; May 14 Soybean Oil closed at 42.10, down 40 points. For the week that still puts front month beans higher, up 26 1/2 cents, with meal $4.50 firmer and oil up 162 points.

Corn: The corn market closed around 2-5 cents lower, but like beans it still managed net gains for the week. Chinese demand, or lack of it is also an issue for corn, and US corn in particular as the dispute over the MIR 162 variety trundles on. Some suggest that this issue may not now be resolved until the second half of the year. China are said to have now rejected 1.45 MMT of US corn and US corn products since this spat began last November. The National Grain and Feed Association said that exports of US corn and corn products to China between January and April are down 85% versus the same period last year. The Argentine Ag Min said farmers there have sold 22% of their new crop corn versus 55% a year ago. The Buenos Aires Grains Exchange said that the Argentine corn harvest is 16.5% complete versus 13% a week ago and 28.2% a year ago. They estimated production at 24.0 MMT, unchanged from their previous estimate. Lanworth estimated the Brazilian 2013/14 corn crop at 71.0 MMT versus a USDA estimate of 72.0 MMT. MDA CropCast raised their forecast for Brazilian production to 71 MMT citing favourable conditions for 2nd crop corn. They forecast the US 2014/15 corn crop at 357 MMT, which is up 9.3 MMT on last year despite a lower planted area due to an anticipated rise in yields. A brief warm up this weekend will give way to much colder Midwest weather next week with heavy rain on the way, said Martell Crop Projections. The rain should be welcome, although the return to cold will not. "Moderating temperatures in April generated more optimism for corn planting in the Midwest. April temperatures to date have been near normal, promoting gradual thawing of frozen fields. Frost is still present in farm fields, however, especially the Upper Midwest. Southern Minnesota's topsoil temperatures are still 37-40 F, a far cry from the 50 F needed to germinate seeds. January-March temperatures were among the coldest on record causing deep penetrating frost in Midwest corn farms. Yet, deep frost that delays planting is not necessarily a prescription for a reduced corn yield. Similar cold occurred in 1978 and 1979 abut in both years the corn yield finished better than average," they observed. The USDA are expected to release their first national corn planting progress report on Monday night. On a national level around 3-5% of the corn crop is expected to have been sown in southern states. May 14 Corn closed at $4.98 1/2, down 2 3/4 cents; Jul 14 Corn closed at $5.04 1/2, down 2 3/4 cents. May 14 corn posted a 6 1/2 cent gain for the week.

Wheat: The wheat market closed mostly lower on the day, and lower for the week, across the three exchanges. Egypt bought Romanian, Ukraine and Russian wheat in their tender. US and French wheat proved too expensive. Algeria bought what was considered to most likely be French wheat. Grain exports continue out of the Black Sea unabated. However, tensions between Ukraine (and the West) and Russia continue, with reports of pro-Russian groups seizing control of police buildings n some cities in eastern Ukraine, and reports of ensuing gun battles breaking out as Ukraine forces try to regain control, emerged over the weekend. The Russian taking of Crimea was of course one of the primary catalysts responsible for fund/spec money coming flooding back into the grains markets, sending Chicago wheat prices surging by almost 30% in 6 weeks from the beginning of February through to mid-March. We shall have to see how these latest developments pan out, and whether this encourages more spec money to re-enter the market. The latest Commitment of Traders report shows managed money reducing their net long holding in wheat, corn and soybeans for the week through to Tuesday night, although not by that much. In the case of wheat, they cut their net long by less than 2k contracts to 43k. Last week's position was said to be their largest spec long holding in CBOT wheat since November 2012. Their net corn long was reduced by under 6k lots this week to 270k and their long in beans reduced by just over 12k to 181k contracts. Talk of 2014 developing into an El Nino year would probably come too late to be of much benefit to US winter wheat on the Plains. El Nino, if it occurs, would usually be positive for Midwest crops as it typically brings wetter and cooler summer growing conditions, said Martell Crop Projections. That would probably be beneficial for spring wheat and also of course US corn and soybean production. The USDA attaché in Turkey forecast the 2014 wheat crop there to fall from 18.0 MMT last year to 15.8 MMT this time round on drought. The Turkish 2014 barley crop was estimated falling from 7.3 MMT to 5.8 MMT and the corn crop dropping from 5.1 MMT to 4.9 MMT. CONAB yesterday pegged Brazil's 2014/15 wheat production at 6.7 MMT, which is a 1.2 MMT increase from last year. Beneficial rains are expected there over the weekend. May 14 CBOT Wheat closed at $6.60 1/4, down 2 cents; May 14 KCBT Wheat closed at $7.19 1/2, down 3 cents; May 14 MGEX Wheat closed at $7.01 3/4, up 3/4 cent. For the week Chicago wheat lost 35 1/4 cents, with Kansas down 44 cents and Minneapolis losing 38 cents.

11-04-2014 09:49 AM | Chicago Reports
10/04/14 -- Soycomplex: Beans closed lower on concerns over Chinese demand. Few think that the world's largest buyer will import the 69 MMT of soybeans this season that the USDA forecast yesterday, and with good reason. The jungle drums have been beating loudly concerning credit problems in China recently, and Reuters reported today that there are 5-6 panamax vessels carrying $300 million worth of soybeans sat waiting for the buyers to pay for them before they can unload. The buyers are defaulting due to their inability to obtain Letters of Credit, it would seem. There are said to be more vessels on the way that face similar problems. Reduced demand due to bird flu and negative crush margins are also a factor, along with a huge stockpile of previously imported soybeans. Chinese trade data overnight revealed that the country had imported 4.62 MMT of beans in March versus the expected 5.69 MMT. Some analysts are now saying that they may import less than 15 MMT in Q3 of 2014 versus 18.25 MMT in the same period last year. China will account for 65% of the world's soybean exports in 2013/14, according to the USDA, so if they catch a cold, everybody is going to get it. CONAB today forecast the 2013/14 Brazilian soybean crop at 86.08 MMT versus a previous estimate of 85.44 MMT. They see 2013/14 soybean exports at 45.3 MMT, unchanged from their previous estimate. Weekly export sales came in low at 79,100 MT for 2013/14 and 210,400 MT for 2014/15. The trade had been expecting old crop sales of 0-100,000 MT and new crop sales of 300,000–500,000 MT. Funds sold an estimated net 7,000 soybean contracts on the day. May 14 Soybeans closed at $14.82 1/4, down 13 cents; Jul 14 Soybeans finished at $14.65 1/2, down 12 1/2 cents; May 14 Soybean Meal closed at $479.50, down $2.60; May 14 Soybean Oil closed at $42.50, down 41 points.

Corn: The corn market ended narrowly mixed. Weekly export sales of 658,700 MT for 2013/14 and 58,000 MT for 2014/15 were at the low end of expectations for old crop sales of 700,000–900,000 MT and new crop sales of 0-200,000 MT. There has to be a chance that Chinese credit and bird flu problems will also spill over into demand for corn. Not that they're taking delivery of US corn anyway at the moment due to the MIR 162 situation. CONAB estimated the 2013/14 Brazilian corn crop at 75.46 MMT versus a previous estimate of 75.18 MMT and compared to the USDA's estimate of "only" 72.0 MMT. They appear to be bullish on "safrinha" or second crop corn production potential, for which current conditions are said to be favourable. CONAB have domestic corn use estimated at 53.82 MMT, with exports at 19.5 MMT and ending stocks at 11 MMT. MDA CropCast estimated the 2014/15 US corn crop at 357 MMT, up 9.3 MMT on last year despite a lower planted area. Corn planting hasn't reached the Midwest yet. "Welcome warmth dominated the Midwest this week, but colder temperatures are expected to resume next week when the jet stream carves out a cold trough in the heartland. While soil temperatures have steadily warmed with stronger solar rays March into April, fields are still too cold to plant with soil temperatures below the 50 F threshold. The typical start to corn planting is late April-early May, but is expected to be delayed this season due to deep penetrating frost," said Martell Crop Projections. However "delayed planting from springtime cold is not necessarily detrimental to the yield," they noted. May 14 Corn closed at $5.01 1/4, down 1 cent; Jul 14 Corn ended at $5.07 1/4, down 3/4 cent.

Wheat: The wheat market closed around 6 to 11 cents lower on the day across the three exchanges. Fund selling was estimated at a net 3-4,000 contracts in Chicago. Weekly export sales offered no assistance whatsoever. They came in at just 41,800 MT – a marketing-year low – and were down 88 percent from the previous week and 90 percent from the prior 4-week average. New crop sales were 349,100 MT. Trade estimates had been for old crop sales of 250,000-375,000 MT and new crop sales of 150,000-300,000 MT. Japan bought 119,178 MT of US/Canadian wheat for May-Sept shipment in their routine weekly tender. South Korea FLC seeks 70 TMT of optional origin wheat for October shipment. CONAB estimated the Brazilian 2014 wheat crop at 6.7 MMT versus a previous estimate of 5.5 MMT. Domestic wheat usage was estimated at 11.93 MMT and wheat carryover stocks were estimated at 1.92 MMT. US winter wheat is set to get a break in the coming week. "Good rainfall is finally predicted in Kansas, the top US wheat state is expecting at least 0.25 inch state-wide, and up to 1.25 inches locally. Wheat farms in Oklahoma and West Texas would mostly miss out though," said Martell Crop Projections. World Weather said that next Wednesday through to Friday could bring 1 to 2 inches of rain from western Oklahoma into east-central Kansas. Early spring grains planting in Ukraine is just about done already, some rain has fallen there this week, and more is in the forecast for the next five days. May 14 CBOT Wheat closed at $6.62 1/4, down 6 3/4 cents; May 14 KCBT Wheat ended at $7.22 1/2, down 10 3/4 cents; May 14 MGEX Wheat closed at $7.01, down 11 3/4 cents.

10-04-2014 08:49 AM | Chicago Reports
09/04/14 -- Soycomplex: Beans ended with decent gains, but also finished well off the highs. Once again it was the front end that saw the biggest rises, although July added more than May due to fund money position rolling. The USDA cut 2013/14 US soybean ending stocks by 10 million bushels from last month to 135 million, which was a larger downward revision than the trade expected. They did increase US soybean imports as expected, by 30 million to 65 million bushels, but they also raised overall demand by 40 million. China's import needs were left unchanged from last month at 69 MMT, contrary to trade expectations for a cut. Brazilian production was reduced by 1 MMT, as expected, to 87.5 MMT. Argentine production was left unchanged at 54 MMT, where some had expected an increase. The stand out point from all of this is that the USDA now has US soybean exports this season at a record 43 MMT. However the US has already shipped 40.5 MMT of soybeans and has sales of a further 4 MMT on the books waiting to go. So to make these numbers work 1.5 MMT of those outstanding sales need to get cancelled (or switched into 2014/15) AND the US makes no further sales this marketing year. That doesn't seem like a very likely scenario to me. The alternative is that the US needs to import more beans themselves. Note too, that the US crush is estimated at 45.9 MMT, marginally below last year's levels, yet the current cumulative NOPA crush is running ahead of a year ago. World 2013/14 ending stocks were cut to 69.4 MMT from 70.6 MMT last month, which is again a larger reduction than the trade expected (the average trade guess was 70.14 MMT). Oil World estimated Brazil’s April bean exports at 5.5 MMT versus 6.23 MMT in March, saying that this would be the first time in 10 years that April's exports would be below those of March. CONAB release their April Brazilian crop estimates tomorrow morning. Also out tomorrow are the weekly export sales numbers from the USDA. The trade is expecting old crop sales of 0-100,000 MT and new crop sales of 300,000–500,000 MT. May 14 Soybeans closed at $14.95 1/4, up 12 3/4 cents; Jul 14 Soybeans closed at $14.78, up 16 1/2 cents; May 14 Soybean Meal closed at $482.10, up $4.00; May 14 Soybean Oil closed at 42.91, up 80 points.

Corn: The market ultimately closed lower, having initially made new highs just after the USDA report came out. The USDA pegged US 2013/14 corn ending stocks at 1.331 billion bushels, which was down on the 1.456 billion forecast in March and below the average trade guess of 1.403 billion. World ending stocks were placed at 158 MMT versus 158.5 MMT in March and the average trade guess of 157.7 MMT. Global corn production was however raised 6.4 MMT from last month, with a 2 MMT increase for Brazil and a 1 MMT rise for both South Africa and Russia. The trade didn't see that one coming. The Brazilian hike was due to "favourable precipitation in March and early April has supported the developing safrinha corn crop with yields now expected just below last year’s levels in the areas where this second-season corn crop is grown," they said. The global 2013/14 corn crop is now seen at a new record near 974 MMT. China's imports were left at 5 MMT, although the USDA's own FAS in Beijing yesterday cut their forecast to 4 MMT, adding that 2014/15 Chinese corn imports would decline to 3 MMT. Currently, it won't be US corn that they are importing as there's been little progress in getting MIR 162 corn approved yet, and that is keeping US exports to China on hold. The USDA forecast US 2013/14 corn exports at 44.5 MMT, up 41.3 MMT a month ago. The US has shipped 22.8 MMT of corn so far this season, so still has a fair way to go to hit that target, even if they have got 18.5 MMT worth of outstanding sales. Trade estimates for tomorrow's weekly export sales report are for old crop sales of 700,000–900,000 MT and new crop sales of 0-200,000 MT. Weekly ethanol production data lent no support, falling from 922k barrels/day last week to 896k barrels a day this time round. The level needed to hit the USDA's target for the season of 5 billion bushels of corn going to make ethanol in the US this year is 938k barrels/day. It's been a long time since they've achieved that. Corn planting in the Midwest is delayed, but Dr Cordonnier said that he doesn't currently see this as being a problem to "achieve near trend line yields if the summer weather cooperates." May 14 Corn closed at $5.02 1/4, down 4 3/4 cents; Jul 14 Corn closed at $5.08, down 5 cents.

Wheat: The market closed lower as the USDA report lent bearish for wheat. The USDA raised projected US wheat ending stocks to 583 million bushels, which was exactly in line with the average trade guess. "Lower imports (are) more than offset by a reduction in feed and residual use," they said. US wheat exports were left unchanged at 32 MMT this season. They've shipped 25 MMT so far in a season that finishes at the end of May. The bearish surprise came from a near 3 MMT hike in world ending stocks to 186.7 MMT. The trade had been anticipating a slight cut to 183.7 MMT. China's wheat import needs this season were revised down from 8.5 MMT to 7 MMT, with domestic feed demand there cut by 2 MMT to 23 MMT. This was the main reason behind the rise in world ending stocks. News that a Chinese government auction of 858 TMT of wheat had only received a take-up rate of 16% was hardly encouraging for wheat demand there. FranceAgriMer estimated French 2013/14 soft wheat ending stocks at 3.3 MMT versus a previous estimate of 3.2 MMT, and up 12.5% from a year ago. That was the fourth month in a row that they've increased their wheat stocks estimate, and reflects lower shipments to fellow EU countries. French corn and barley stocks were also raised, with barley coming in at 1.5 MMT versus a previous estimate of 1.4 MMT, and up 19% from a year ago. French corn stocks were increased to 3.0 MMT versus a previous estimate of 2.9 MMT, and up 23% from a year ago. Whilst the USDA reported that only 35% of the US winter wheat crop is in good/excellent condition in it's first weekly update of the season last night, that was in line with expectations and only one point down on a year ago. Early spring plantings in Russia and Ukraine are well advanced on year ago levels. Rain would be useful, and above average precipitation is in the forecast for almost the entire region. Light rain was reported across western Ukraine yesterday, moving eastwards. For tomorrow's weekly export sales report the trade is looking for old crop sales of 250,000-375,000 MT and new crop sales of 150,000-300,000 MT. May 14 CBOT Wheat closed at $6.69, down 12 cents; May 14 KCBT Wheat closed at $7.33 1/4, down 8 1/4 cents; May 14 MGEX Wheat closed at $7.12 3/4, down 10 1/2 cents.

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