Chicago Reports
24-07-2014 09:59 AM | Chicago Reports
23/07/14 -- Soycomplex: Beans closed with some decent gains on talk of a drier pattern developing in the 6-10 day and 8-15 day weather outlooks. August is the most important pod-setting month for determining US soybean yields. The weather has been kind up until now, and prices have slumped to 2 1/2 year lows, so even the slightest hint of a weather scare will be enough to cause a few ripples. China only sold sold 54,945 MT out of the 354,470 MT of soybeans on offer in yesterday's government auction. With US soybean prices having tumbled lately I suspect that Chinese buyers would prefer to buy "fresh" supplies rather than government stocks that have been around for some considerable time. Doane’s crop tour continues to indicate very high yield potential in the western belt. Dr Cordonnier was said to have estimated US 2014 soybean yields at 45.0 bu/acre, unchanged from his previous estimate. Lanworth were said to have estimated US yields at 45.2 bu/acre with production at 3.671 billion bushels. Ag Canada estimated the canola crop there this year at 14.5 MMT versus a previous estimate of 14.8 MMT and down 19.4% versus 18.0 MMT in 2013. They now see 2014/15 canola ending stocks at 1.1 MMT versus a previous estimate of 1.7 MMT and compared to 3.0 MMT at the end of 2013/14. Trade estimates for tomorrow's weekly export sales report for soybeans are 150-250 TMT of old crop and 1.2-1.4 MMT of new crop, with China buying the latter quite heavily. Aug 14 Soybeans closed at $12.01, up 17 cents; Nov 14 Soybeans closed at $10.76 1/2, up 18 3/4 cents; Aug 14 Soybean Meal closed at $391.50, up $9.70; Aug 14 Soybean Oil closed at 36.20, up 27 points.

Corn: The corn market closed a couple of cents higher in sympathy with beans. The potential for a drier beginning to August isn't seen as much of a threat to corn, as July is a more important month in determining final yields. The ongoing Doane crop tour is reporting back some fantastic yield potential. Lanworth upped their forecast for US 2014 corn yields to a record 172.8 bu/acre versus a previous estimate of 172.1 bu/acre. They see the average Illinois corn yield at 204.9 bu/acre, with Iowa coming in at 193.8 bu/acre. They now forecast the US 2014 corn crop at a record 14.635 billion bushels versus a previous estimate of 14.562 billion, despite lower plantings this year. Dr Cordonnier was said to have gone for a more modest 167.0 bu/acre, unchanged from his previous estimate. IMEA estimated Mato Grosso’s 2013/14 corn crop at 17.1 MMT versus a previous estimate of 15.0 MMT. They said that the state's safrinha corn harvest is about a third done. Ag Canada forecast the 2014 Canadian corn crop at 11.3 MMT versus a previous estimate of 12.4 MMT and compared to 14.2 MMT in 2013/14. They now have 2014/15 ending stocks estimated at 1.9 MMT versus a previous estimate of 2.7 MMT and compared to 3.1 MMT at the end of 2013/14. The US Energy Dept said ethanol production in the States this past week was 959,000 barrels/day, up 16,000 bpd from the previous week and the second largest week of the year. EU corn closed at 4 year lows on ideas that a greater proportion than normal of the EU wheat crop may only be suitable for animal feed this year. Trade estimates for tomorrow's weekly export sales report are around 300-500 TMT of old crop and 400-600 TMT of new crop. Sep 14 Corn closed at $3.62 1/2, up 2 1/4 cents; Dec 14 Corn closed at $3.70 3/4, up 2 1/2 cents.

Wheat: The wheat market closed with modest gains in consolidation trade following recent heavy losses. Egypt's GASC bought 235 TMT of Black Sea wheat. They booked two cargoes of Russian origin, along with one each of Romanian and Ukraine wheat for early September shipment. The average price paid was around $4/tonne cheaper than the price they last bought at two weeks ago. US wheat wasn't offered, and neither was French origin. There's widespread talk of this year's French wheat crop suffering quality downgrades. There's rumblings that German's crop may also see some rain-related damage. Earlier this month the USDA said that this year's poor US winter wheat crop production would be more than compensated for by a rise in spring wheat output. A crop tour in southern parts of North Dakota (which produces around 46% of the US spring wheat crop) found an average yield potential of 48.3 bu/acre versus 43.3 bu/acre in 2013 and the tour’s five-year average of 42.9 bu/acre. "I think we have seen an extraordinary crop," said one tour participant. The USDA currently rates spring wheat crop conditions in the state as 82% good to excellent, whilst neighbouring South Dakota is 80% G/E. Russia's 2014 wheat harvest is said to be 30.7% done at 28 MMT, with average yields up 16% at 3.6 MT/ha. Ag Canada estimated the 2014 Canadian all wheat crop at 27.7 MMT versus a previous estimate of 29.6 MMT and compared to last year's record crop of 37.5 MMT. They have all wheat ending stocks estimated at 9.2 MMT, unchanged from their previous estimate and down from 10.9 MMT at the end of 2013/14. Trade estimates for tomorrow's weekly export sales report are a fairly modest 350-500 TMT. Sep 14 CBOT Wheat closed at $5.30 3/4, up 6 1/4 cents; Sep 14 KCBT Wheat closed at $6.23 1/2, up 2 1/4 cents; Sep 14 MGEX Wheat closed at $6.21, up 2 1/4 cents.

23-07-2014 08:49 AM | Chicago Reports
22/07/14 -- Soycomplex: Beans closed mostly lower save for front end Aug 14. Oil World estimated the global 2014/15 oilseed crop at 505 MMT versus 488.4 MMT in 2013/14. That increase is down to soybean production, which they see rising from 284.6 MMT to 305.6 MMT. World rapeseed and sunflower output is seen slightly lower in the season ahead. Global oilseed ending stocks will rise from 85.9 MMT to 102 MMT, again this is essentially all down to soybeans, where world carryout is forecast at a record 88.4 MMT, up sharply from 70.9 MMT in 2013/14. The USDA announced 180,000 MT of new crop US meal sold to Vietnam, along with 225,000 MT of new crop US meal sold to unknown. They also announced 20,000 MT of new crop US bean oil sold to unknown. Argentina’s Rosario port workers ended their strike and went back to work yesterday. It's an uneasy truce though. Another port workers union in Argentina has threatened to go on strike today and customs workers are talking about strike action later in the week. Aug 14 Soybeans closed at $11.84, up 8 1/4 cents; Nov 14 Soybeans closed at $10.57 3/4, down 13 3/4 cents; Aug 14 Soybean Meal closed at $381.80, up $1.10; Aug 14 Soybean Oil closed at 35.93, down 21 points.

Corn: The corn market closed with losses of around 3-4 cents. The first day of a Doane’s crop tour reported largely excellent production potential in NW Illinois where a conservative yield estimate was said to be in the 190 bu/acre plus region, with higher probable. "Scouts in a couple of key corn producing regions report very little stress, high plant population with a chance to fill kernels to end of the cob and strong possibility of high ear weights," said Benson Quinn Commodities. Today is the second day, which will cover Western Illinois, Iowa, Southern Minnesota, Eastern Nebraska and Eastern Missouri. A Commerzbank analyst was quoted on Reuters as saying “We think the favourable US crop outlook should be priced in by now. Corn prices should not go down further, at least not on a lasting basis." He added "We think even the soybeans downtrend is more or less done." EU corn prices fell sharply on the day to set 4-year lows. The ongoing rain and warmth might not be helping the EU wheat crop much, but it will be doing no harm at all to corn, providing "hothouse" conditions. It may also mean that there's more feed wheat about, directly competing with corn. New crop Ukraine corn is said to be offered in the market at $188/tonne FOB the Black Sea for Oct/Nov shipment with bids around $182/tonne. Sep 14 Corn closed at $3.60 1/4, down 3 3/4 cents; Dec 14 Corn closed at $3.68 1/4, down 3 3/4 cents.

Wheat: The wheat market ended around 4-6 cents lower across the three exchanges. Japan is looking for 94,586 MT of milling wheat for September shipment in a routine tender, with 37,689 MT of if to be US dark northern spring wheat. SovEcon said that Russia had harvested around 22 MMT of wheat so far (to Jul 18) with yields averaging 3.6 MT/ha versus 3.1 MT/ha this time a year ago. Improved weather conditions mean that Russia will harvest 56.5 MMT of wheat this year, said IKAR. The USDA currently only have the Russian wheat crop down at 53 MMT versus production of 52 MMT last year. Kazakhstan said that they'd finished 2013/14 exporting 8.7 MMT of grains out of their 18.9 MMT harvest. Production this year is expected to be around 1 MMT lower. They said that they had exported 219,400 MT of grain between July 1-20 versus 374,100 MT in the same period a year ago. Ukraine said that they'd exported 1.2 MMT of grains so far this month, including 232 TMT of wheat. The Ukraine early grain harvest is now at 19.1 MMT, according to the Ag Ministry there. Persistent and heavy rain in France is said to have caused "widespread crop damage" according to a report on Reuters. French hagbergs could only average 150-160 this year whereas last year 99% of the crop made 220 or higher, they said. There are now also said to be similar concerns emerging in parts of Germany. Sep 14 CBOT Wheat closed at $5.24 1/2, down 5 1/2 cents; Sep 14 KCBT Wheat closed at $6.21 1/4, down 6 3/4 cents; Sep 14 MGEX Wheat closed at $6.18 3/4, down 4 1/2 cents.

22-07-2014 09:39 AM | Chicago Reports
21/07/14 -- Soycomplex: Beans closed lower. Weather forecasts call for a couple of days of Midwest heat followed by a relatively cool and non-threatening start to the key pod filling month of August. "August weather will strongly influence the Midwest soybean yield as this is period when pod filling occurs. Seeds developing pods are enlarged with above-normal rainfall in August, boosting the yield," said Martell Crop Projections. The USDA announced 135,000 MT of US meal sold to unknown for 2014/15 delivery. Exporters keep finding old crop beans to sell too, they USDA also announced 120,000 MT of US beans sold to China for 2013/14 delivery. Chinese customs data shows that the country imported 6.4 MMT of soybeans in June, down 7.76% from a year ago. Jan-Jun imports are now 34.2 MMT, up 24.43% from a year ago. After the close the USDA raised their soybean good/excellent crop ratings by a point on last week to 73% versus 64% this time last year. Last week's ratings were already the best in 20 years. They said that 60% of the crop is blooming, up from 41% a week ago and versus 56% for the 5-year average. They said that 19% of the crop is setting pods compared to the 5-year average of 17% at this time. Fund money is now short on beans for the first time since 2011, according to Friday's CFTC data. They were estimated as adding a further 6-7,000 lots to that position today. Aug 14 Soybeans closed at $11.75 3/4, down 1 cent; Nov 14 Soybeans closed at $10.71 1/2, down 13 3/4 cents; Aug 14 Soybean Meal closed at $380.70, up $0.40; Aug 14 Soybean Oil closed at 36.14, down 43 points.

Corn: The corn market closed around 6-7 cents lower, setting fresh 4-year lows. The market views current weather conditions as non threatening. "The week is beginning on a warm note with mid and upper 80s F, but by Wednesday afternoon much cooler Canadian air would begin descending into Central United States. By midweek, a much cooler weather pattern would develop, mid 70s F for highs and mid 50s F for lows. Coolness in July is a mixed blessing, on the one hand holding down evaporation and conserving soil moisture. However, corn development would be set back increasing worries about potential freeze damage in the fall. July is the warmest month of the growing season, so reduced heat units would have a strong impact," said Martell Crop Projections. Chinese customs data shows them importing only 27,250 MT of corn in June, taking the calendar year to date total to less than 1.4 MMT, down 9.52% from a year ago. The EU Commission's MARS unit estimated EU-28 corn yields at an average 7.23 MT/ha, up from the 7.18 MT/ha forecast last month, 7.6% up on last year and 6.6% above the 5-year average. Talk of more feed wheat around in Europe this year also leans bearish for corn. After the close the USDA held steady with their good/excellent crop ratings for corn at 76% (also said to be the highest rating in years). They said that 56% of the crop was silking, up from 34% last week and in line with the 5-year average of 55%. Fund money was judged to have been a net seller of around 7,000 lots on the day. Sep 14 Corn closed at $3.64, down 7 1/4 cents; Dec 14 Corn closed at $3.72, down 6 1/2 cents.

Wheat: The wheat market closed around 2-7 cents lower across the three exchanges. The market remains concerned that the US is missing export business to foreign competition, especially to the likes of Russia, Romania and Ukraine. The ongoing geo-political problems in the region are keeping shorts a little nervous though, as we saw last Thursday immediately following the news of the shooting down of the Malaysia Airlines jet. Private Egyptian buyers were reported to have bought 60,000 MT of Black Sea origin wheat. Pakistan were said to have bought 130,000 MT of Black Sea origin wheat for Jul-Aug shipment. Russia's Jul 1-16 grain exports were said to be in excess of 1 MMT, up 47% on a year ago. That total included more than 800 TMT of wheat. Algeria bought 200 TMT of optional origin feed barley for Nov-Dec shipment in a tender. Chinese customs data shows them importing 112,254 MT of wheat in June, down 48.83% versus June 2013. Calendar year to date wheat imports are now nearly 2.6 MMT for the half year though, up 82.86% versus the same period in 2013. Ukraine said that they'd harvested over 16 MMT of new crop early grains (excluding corn), including nearly 11 MMT of wheat. The EU Commission's MARS unit estimated EU-28 soft wheat yields at 5.80 MT/ha, marginally down on the 5.81 MT/ha forecast last month (which was also the average yield in Europe last year), but up 4.2% on the 5-year average. The USDA said that the 2014 US winter wheat harvest was 75% done, the same as the 5-year average. Spring wheat crop conditions were unchanged on last week at 70% good/excellent. Sep 14 CBOT Wheat closed at $5.30, down 2 1/4 cents; Sep 14 KCBT Wheat closed at $6.28, down 5 3/4 cents; Sep 14 MGEX Wheat closed at $6.23 1/4, down 7 cents.

22-07-2014 09:09 AM | Chicago Reports
21/07/14 -- Soycomplex: Beans closed lower. Weather forecasts call for a couple of days of Midwest heat followed by a relatively cool and non-threatening start to the key pod filling month of August. "August weather will strongly influence the Midwest soybean yield as this is period when pod filling occurs. Seeds developing pods are enlarged with above-normal rainfall in August, boosting the yield," said Martell Crop Projections. The USDA announced 135,000 MT of US meal sold to unknown for 2014/15 delivery. Exporters keep finding old crop beans to sell too, they USDA also announced 120,000 MT of US beans sold to China for 2013/14 delivery. Chinese customs data shows that the country imported 6.4 MMT of soybeans in June, down 7.76% from a year ago. Jan-Jun imports are now 34.2 MMT, up 24.43% from a year ago. After the close the USDA raised their soybean good/excellent crop ratings by a point on last week to 73% versus 64% this time last year. Last week's ratings were already the best in 20 years. They said that 60% of the crop is blooming, up from 41% a week ago and versus 56% for the 5-year average. They said that 19% of the crop is setting pods compared to the 5-year average of 17% at this time. Fund money is now short on beans for the first time since 2011, according to Friday's CFTC data. They were estimated as adding a further 6-7,000 lots to that position today. Aug 14 Soybeans closed at $11.75 3/4, down 1 cent; Nov 14 Soybeans closed at $10.71 1/2, down 13 3/4 cents; Aug 14 Soybean Meal closed at $380.70, up $0.40; Aug 14 Soybean Oil closed at 36.14, down 43 points.

Corn: The corn market closed around 6-7 cents lower, setting fresh 4-year lows. The market views current weather conditions as non threatening. "The week is beginning on a warm note with mid and upper 80s F, but by Wednesday afternoon much cooler Canadian air would begin descending into Central United States. By midweek, a much cooler weather pattern would develop, mid 70s F for highs and mid 50s F for lows. Coolness in July is a mixed blessing, on the one hand holding down evaporation and conserving soil moisture. However, corn development would be set back increasing worries about potential freeze damage in the fall. July is the warmest month of the growing season, so reduced heat units would have a strong impact," said Martell Crop Projections. Chinese customs data shows them importing only 27,250 MT of corn in June, taking the calendar year to date total to less than 1.4 MMT, down 9.52% from a year ago. The EU Commission's MARS unit estimated EU-28 corn yields at an average 7.23 MT/ha, up from the 7.18 MT/ha forecast last month, 7.6% up on last year and 6.6% above the 5-year average. Talk of more feed wheat around in Europe this year also leans bearish for corn. After the close the USDA held steady with their good/excellent crop ratings for corn at 76% (also said to be the highest rating in 20 years). They said that 56% of the crop was silking, up from 34% last week and in line with the 5-year average of 55%. Fund money was judged to have been a net seller of around 7,000 lots on the day. Sep 14 Corn closed at $3.64, down 7 1/4 cents; Dec 14 Corn closed at $3.72, down 6 1/2 cents.

Wheat: The wheat market closed around 2-7 cents lower across the three exchanges. The market remains concerned that the US is missing export business to foreign competition, especially to the likes of Russia, Romania and Ukraine. The ongoing geo-political problems in the region are keeping shorts a little nervous though, as we saw last Thursday immediately following the news of the shooting down of the Malaysia Airlines jet. Private Egyptian buyers were reported to have bought 60,000 MT of Black Sea origin wheat. Pakistan were said to have bought 130,000 MT of Black Sea origin wheat for Jul-Aug shipment. Russia's Jul 1-16 grain exports were said to be in excess of 1 MMT, up 47% on a year ago. That total included more than 800 TMT of wheat. Algeria bought 200 TMT of optional origin feed barley for Nov-Dec shipment in a tender. Chinese customs data shows them importing 112,254 MT of wheat in June, down 48.83% versus June 2013. Calendar year to date wheat imports are now nearly 2.6 MMT for the half year though, up 82.86% versus the same period in 2013. Ukraine said that they'd harvested over 16 MMT of new crop early grains (excluding corn), including nearly 11 MMT of wheat. The EU Commission's MARS unit estimated EU-28 soft wheat yields at 5.80 MT/ha, marginally down on the 5.81 MT/ha forecast last month (which was also the average yield in Europe last year), but up 4.2% on the 5-year average. The USDA said that the 2014 US winter wheat harvest was 75% done, the same as the 5-year average. Spring wheat crop conditions were unchanged on last week at 70% good/excellent. Sep 14 CBOT Wheat closed at $5.30, down 2 1/4 cents; Sep 14 KCBT Wheat closed at $6.28, down 5 3/4 cents; Sep 14 MGEX Wheat closed at $6.23 1/4, down 7 cents.

20-07-2014 13:09 PM | Chicago Reports
18/07/14 -- Soycomplex: Beans closed mixed but mostly lower, save for the front end. Strong Chinese buying has been rumoured this week, following the dip in prices to 2 1/2 year lows. The USDA appeared to confirm this by announcing 116,000 MT of optional origin soybeans sold to China for 2014/15 delivery, along with 464,000 MT to unknown under the daily reporting system. Thailand bought 150,000 MT of South American soymeal for Dec-Feb shipment. Argentina's Ag Ministry that farmers there have sold 45.53% of their 2013/14 soybean crop versus 52.43% a year ago. Negotiations in the labour dispute in Argentina's Rosario between dock workers and the government have been pushed back until Monday, although their strike rumbles on. Argentine truckers may also strike on Monday. SocGen forecast 2014/15 US soybean ending stocks at a weighty 464 million bushels versus the USDA's current forecast of 413 million and well over triple carryout at the end of 2013/14 of 140 million bushels. They estimated the average Q3 soybean average price at $10.85/bu and forecast the Q4 soybean average price rising to $11.17/bu. Oil World forecast the global rapeseed crop at 68.3 MMT, a 2% reduction on last year, led by a sharp decline for Canada - down from 17.96 MMT in 2013 to 14.8 MMT in 2014. They estimated global sunseed output at 40.5 MMT versus 42.1 MMT last year. Aug 14 Soybeans closed at $11.76, up 1 1/4 cents; Nov 14 Soybeans closed at $10.84 1/2, down 9 1/2 cents; Aug 14 Soybean Meal closed at $380.00, down $0.50; Aug 14 Soybean Oil closed at 36.47, up 10 points.

Corn: The corn market slumped to fresh 4-year lows on a continued non threatening US weather outlook. "Reduced rainfall and strong sunshine this week has favoured Midwest corn and soybeans, though crop development has been set back by sharply cooler temperatures. Drier weather in the Midwest this week is beneficial for corn following several weeks of relentless rainfall previously," said Martell Crop Projections. The outlook for bumper 2014 US corn production continues to weigh. SocGen forecast average 2014 US corn yields of 167 bu/acre versus 165.3 bu/acre currently from the USDA. The vast majority of the trade are now factoring in a number of 167-170 bu/acre it would seem. Some estimates, like yesterday's from the Commodity Weather Group (CWG), a US weather forecasting firm, are even higher. The USDA seem likely to revise their estimate upwards next month once we have passed the critical pollination period of middle to late July. Despite potentially higher production in 2014, SocGen however estimated 2014/15 US corn ending stocks at "only" 1.56 billion bushels versus the USDA's current 1.8 billion forecast and 1.246 billion in 2013/14. They aren't too bearish on prices either, forecasting an average Q3 US corn price of $4.44/bu and a Q4 average price of $4.38/bu. Argentina's Ag Ministry said that growers there have sold 49.15% of their 2013/14 corn crop versus 69.49% a year ago. Japan's corn usage in feed was 46.8% in May versus 42% in May 2013 as the discount to wheat returns to more "normal" levels, according to the Ag Ministry there. Sep 14 Corn closed at $3.70, down 9 1/2 cents; Dec 14 Corn closed at $3.77 1/2, down 9 3/4 cents.

Wheat: The wheat market closed anywhere from 6 to 18 cents lower on the day, reversing yesterday's "knee jerk" price reaction to the news of the Malaysian passenger jet being shot down over Ukraine. Despite US wheat prices falling to 4 year lows, they still aren't picking up a great deal of export business, aside from what you might call from "traditional" buyers. Yesterday's weekly export sales of 320,700 MT were far from spectacular. Iraq bought 100,000 MT of hard wheat from Russia and Canada for Oct-Nov shipment. Russia remains a very active and aggressive seller, with their 2014 wheat harvest now 22.7% done and average wheat yields said to be up 14% at 3.61 MT/ha. Average Russian grain yields, including barley, are up by even more. The Argentine Ag Ministry said that farmers there have only forward sold 61.76% of their 2013/14 wheat crop versus 96.10% a year ago. They said that Argentine farmers will plant 4.5 million hectares of wheat for the 2014/15 harvest, an increase of 23% versus last year. Plantings are so far 73% complete, a similar figure to 12 months ago, they added. The final planted area will be dependent upon some waterlogged and flooded areas returning to more normal levels, they said. The Buenos Aires Grains Exchange yesterday cur their Argentine planted area estimate to 4.2 million ha, saying that 80% of the crop was already in the ground. This large jump in plantings in Argentina this year will potentially impact upon demand for US wheat in the first half of 2015, as Brazil (who are also hoping for/expecting a large jump in production of their own this year) have been big "bonus" buyers of US wheat this year. Sep 14 CBOT Wheat closed at $5.32 1/2, down 18 1/4 cents; Sep 14 KCBT Wheat closed at $6.33, down 16 cents; Sep 14 MGEX Wheat closed at $6.30 1/4, down 6 3/4 cents.

18-07-2014 09:39 AM | Chicago Reports
17/07/14 -- General: News broke in late afternoon trade (London time) that a Malaysian passenger plane en route from Amsterdam to Kuala Lumpur had apparently been shot down over eastern Ukraine, possibly by pro-Russian separatists. That provided some volatility and prompted some short-covering with wheat the main beneficiary, just as it was when Russia seized Crimea. Chicago wheat quickly put on 30% back then, only to subsequently give up all those gains and more besides as the situation calmed. I find it difficult to believe that these latest developments will prove to be the catalyst that finally turned the wheat market around, but we shall see.

Soycomplex: Beans closed lower despite the news out of Ukraine, setting a new 2 1/2 year low. Weekly export sales came in at 37,700 MT of old crop and 561,000 MT of new crop - the latter being primarily for China (365,000 MT) and unknown destinations (149,500 MT). Separately the USDA announced 708,000 MT of new crop US beans sold to China under the daily reporting system. South Korea's MFG bought 110,000 -120,000 MT of US or South American soymeal for Dec-Jan shipment. South Korea's NOFI bought 55,000 MT of South American meal for Nov shipment. Lanworth forecast the US soybean crop at 99.8 MMT versus the USDA's 103.4 MMT, although still sharply higher (+11.5%) than 89.5 MMT a year ago. A strike at the leading Argentine grain export hub of Rosario has entered its second day. Reuters are reporting that truck drivers there have voted for a national strike starting Jul 21. The Buenos Aires Grain Exchange said that the Argentine 2013/14 soybean harvest is 99.2% complete at 55.3 MMT, forecasting final production at a record 55.5 MMT. The Argentine Ag Min estimated the 2013/14 bean crop somewhat lower at 53.0 MMT versus a previous estimate of 54.0 MMT. Persistent wetness has been Argentina's problem this year, delaying the harvest, but also casting a cloud over the quality and oil content of their 2013/14 soybean crop. Aug 14 Soybeans closed at $11.74 3/4, down 12 1/2 cents; Nov 14 Soybeans closed at $10.94, down 8 cents; Aug 14 Soybean Meal closed at $380.50, down $3.20; Aug 14 Soybean Oil closed at 36.37, down 46 points.

Corn: The corn market closed with token gains. Weekly export sales were good at 573,700 MT of old crop and 495,000 MT of new crop. The Commodity Weather Group (CWG), a US weather forecasting firm, estimated the 2014 US corn yield at 171 bu/acre versus 165.3 bu/acre from the USDA. CWG forecast record average corn yields in Illinois (190.1 bu/acre versus the previous record of 180.0 bu/acre set in 2004) and Iowa (184.1 bu/acre versus the previous record high of 182.0 bu/acre set in 2009). Allendale estimated US 2014 corn yields at a more conservative 167.8 bu/acre. Lanworth estimated the US corn crop at a record 370 MMT this year, well above the USDA's current 352.1 MMT forecast and 4.6% up on last year's 353.7 MMT output. MDA CropCast raised their forecast for US corn production this year by 3.2 MMT from last week to 357.4 MMT "due to favourable conditions." Strategie Grains estimated the EU-28 2014/15 corn crop at 66.4 MMT versus a previous estimate of 65.9 MMT. They also said that a lower proportion of this year's EU wheat crop would make milling grade than last year. Reports of the very early wheat harvest in France appear to confirm that this is likely. With a higher overall wheat crop expected in Europe, this potentially means a lot more feed wheat kicking around this year, which will be in direct competition to corn in feed rations. Argentina's Ag Ministry estimated their 2013/14 corn crop at 33.0 MMT versus 32.1 MMT previously. The Buenos Aires Grain Exchange say that the Argentine corn crop is 65.4% harvested and forecast production at only 25 MMT. Sep 14 Corn closed at $3.79 1/2, up 1 1/4 cents; Dec 14 Corn closed at $3.87 1/4, up 1/2 cent.

Wheat: The wheat market opened lower but jumped higher immediately following the news out of Ukraine, and managed to hold onto most of those gains by the close. Weekly US export sales came in at an unimpressive 320,700 MT, although interestingly there was a 60,000 MT sale in there to China. Japan bought 112,709 tons of milling wheat for Aug–Sep shipment, most of which was US origin. Turkey bought 235,000 MT of optional origin milling wheat and 200,000 MT of feed barley for Aug-Oct shipment, with the Black Sea the most likely provider. Israel bought 50,000 MT of Black Sea feed wheat. There's talk of better than expected HRW yields in Nebraska, South Dakota and parts of Colorado. Nevertheless, MDA CropCast cut their US all wheat production forecast by 0.9 MMT from last week to 55.6 MMT due to acreage reductions and earlier dryness. They raised their estimates for Russia (+0.6 MMT), Europe (+0.4 MMT), Ukraine and Australia (both +0.2 MMT) however. Strategie Grains estimated EU-28 soft wheat crop at 140.5 MMT versus previous estimate of 139.50 MMT. They see EU-28 durum wheat output down 0.7 MMT from last month to 7.2 MMT. The Buenos Aires Grain Exchange say that Argentine farmers will plant 4.2 million hectares of wheat for the 2014/15 harvest, that's down 100,000 ha from their original estimate due to persistent rains. That figure still represents a 16% increase on 3.62 million ha a year ago however. Sep 14 CBOT Wheat closed at $5.50 3/4, up 12 3/4 cents; Sep 14 KCBT Wheat closed at $6.49, up 11 3/4 cents; Sep 14 MGEX Wheat closed at $6.37, up 9 cents.

17-07-2014 08:49 AM | Chicago Reports
16/07/14 -- Soycomplex: Beans closed higher, consolidating recent losses - last night's close had been the lowest for a front month since Jan 2012. The USDA announced a 120 TMT sale of old crop US beans to China under the daily reporting system, along with 240,000 MT of US new crop beans sold to unknown. Additional support came from news that in Argentina Rosario port workers will begin striking tonight. In the US Midwest "unseasonable coolness is expected to persist a few more days, before gradual warming on the weekend," according to Martell Crop Projections. Yet the market seems very relaxed about these cool and wet conditions, at least for the time being, viewing them as non-threatening and better than too hot and dry. "Very favourable crop reports from Midwest producers are surprising given the extremely wet field conditions. June rainfall ranked among the highest on record leading to lowland flooding in corn and soybeans," Martell Crop Projections added. South Korea's MFG are tendering for 55,000 MT of soymeal from the US, South America and/or China for Dec-Jan shipment. APK Inform said that Ukraine would produce a record 3.4 MMT of soybeans this year, up from 3.2 MMT estimated previously and 26% higher than 2.7 MMT a year ago. Aug 14 Soybeans closed at $11.87 1/4, up 6 3/4 cents; Nov 14 Soybeans closed at $11.02, up 15 3/4 cents; Aug 14 Soybean Meal closed at $383.70, up $4.60; Aug 14 Soybean Oil closed at 36.83, down 7 points.

Corn: The corn market closed around 4-5 cents higher, recovering most of yesterday's losses that took prices down to 4 year lows. There are question marks over exactly how benign/non threatening Midwest cool and wet conditions are for corn. "A large cool air mass dominates the Midwest. Temperatures this morning bottomed out in the low 40s F in the northern Midwest, threatening to break records. Typical night minimums in mid July would be low 60s F. Corn development would be set back by coolness, most concerning in the northern Midwest where the growing season is short," said Martell Crop Projections. The USDA announced 210,448 MT of US new crop corn sold to unknown. South Korea's Kocopia bought 55,000 MT of optional origin corn for Dec shipment. US ethanol production hit 943,000 barrels per day last week, up 16,000 bpd on the week prior. The EU announced that it was increasing the EU corn import tariff from zero (where it has been since 2010) to EUR5.32/tonne (around $7.20/tonne). Ukraine currently have a duty-free quota to export 400 TMT of corn to Europe that lasts until the end of October. There's some talk that the EU duty increase will trigger some buying of Ukraine corn, although the cheapest new crop offers are for the Nov/Dec shipment period (now down to around $190/tonne FOB). It may be that the EU will grant Ukraine a further duty free quota beyond the existing Oct 31 deadline, or that EU buyers will simply wait for Ukraine prices to fall another $7.20/tonne to absorb the difference. They've already dropped $20/tonne in the past week, according to Agritel. Sep 14 Corn closed at $3.78 1/4, up 4 1/4 cents; Dec 14 Corn closed at $3.86 3/4, up 5 cents.

Wheat: The wheat market closed narrowly mixed. Jordan passed on a tender for 100 TMT of hard wheat and immediately re-issued another one. Algeria were said to have bought 810 TMT of EU wheat, most if not all of it probably of French origin, for Oct-Nov shipment. They are also now tendering for optional origin barley for Nov shipment. There should be plenty of sellers, Reuters are reporting that Strategie Grains will "significantly raise" its estimate for the 2014 EU barley crop in it's regular monthly production update due out tomorrow. Turkey’s TMO bought 235,000 MT of wheat for Aug-Oct shipment, along with 200,000 MT of barley for Aug-Sep. Japan seeks 112,709 MT of wheat for Aug–Sep shipment of US and Australian origin. The Russian Ag Minister said that their 2014 grain harvest could exceed the 100 MMT mark, versus 92.4 MMT last year and up from a previous forecast of 97 MMT. Other analysts are not quite so optimistic, although SovEcon and IKAR did both also raise their estimates today as well. SovEcon now go for a figure of 92-93 MMT and IKAR 98 MMT. ProZerno said that 84% of the 2014 wheat harvest in Russia's Krasnodar region is of milling quality, up from 73% a year ago. New crop Russian 11.5% milling wheat FOB the Black Sea is said to be offered around $239/tonne FOB, with 12.5% milling wheat at around $10/tonne more. Ukraine offers are typically a few dollars below those levels, but buyers seem to have more faith in Russian quality for the time being. Sep 14 CBOT Wheat closed at $5.38, up 1/4 cent; Sep 14 KCBT Wheat closed at $6.37 1/4, down 1 3/4 cents; Sep 14 MGEX Wheat closed at $6.28, down 2 1/2 cents.

16-07-2014 10:19 AM | Chicago Reports
15/07/14 -- Soycomplex: Beans closed mixed, lower nearby to flat further forward. The USDA announced the sale of 120,000 MT of US beans sold to China for 2014/15 shipment, although this is just routine business. The USDA says that China will import 73 MMT of soybeans in 2014/15. To do that they need to buy 280,000 MT each and every day of a 5-day week for the entire year (no holidays allowed!). The Chinese government only sold 59,692 MT of the 352,740 MT of soybeans on offer at auction. Dr Cordonnier estimated the 2014 US soybean yield at 45.0 bu/acre, unchanged from his previous estimate. He said that he expects Brazil’s 2014/15 soybean planted area to increase by 2-4%. Aug 14 Soybeans closed at $11.80 1/2, down 16 1/2 cents; Nov 14 Soybeans closed at $10.86 1/4, unchanged: Aug 14 Soybean Meal closed at $379.10, down $9.50; Aug 14 Soybean Oil closed at 36.90, up 2 points.

Corn: The corn market closed around 5-7 cents lower, setting fresh 4-year lows. Dr Cordonnier estimated 2014 US corn yields at a record 167.0 bu/acre versus his previous estimate of 165.0 bu/acre and the USDA's 165.3 bu/acre. Morgan Stanley went for a figure of 165.6 bu/acre. Dr Cordonnier said that he expects Brazil’s 2014/15 total corn planted area to decrease by 2-4%. He said that corn prices in Mato Grosso are way below the cost of production at the equivalent of around $2.33/bu, and that local growers are asking the government for help. The supposed minimum price guaranteed by the government is around $2.80/bu, although the cost of production is said to be somewhere in the $3-3.50 range. IMEA estimated Mato Grosso's 2013/14 corn output at 17.09 MMT versus a previous estimate of 15.41 MMT. There's talk that rather than support farmers in the state, that the Brazilian government may start auctioning off up to 5 MMT of it's own stocks as early as next month. Sep 14 Corn closed at $3.74, down 7 1/2 cents; Dec 14 Corn closed at $3.81 3/4, down 6 1/2 cents.

Wheat: The wheat market closed flat to 8 cents lower across the three exchanges. Russian wheat was the best priced in an Iraqi tender for hard wheat. US wheat was comfortably out-priced. Russia's grain harvest is progressing quite well, with average yields significantly ahead of year ago levels. Ukraine yields are also up on a year ago. Ukraine's statistics office said that the country's July 1st grain stocks were at 7.0 MMT, down 20% from a year ago. The total including 2.4 MMT of wheat, 2.1 MMT of barley and 2.2 MMT of corn. The Canadian Wheat Board estimated that 3.5- 4.0 million acres of all crops in Canada may have been lost due to flooding. The market seems to largely be ignoring this issue for the time being. Jordan is closing a tender for 100,000 MT of optional origin milling wheat tomorrow. An Israeli wheat tender also closes tomorrow. US origin wheat is unlikely to feature in either. Sep 14 CBOT Wheat closed at $5.37 3/4, unchanged; Sep 14 KCBT Wheat closed at $6.39, down 7 1/4 cents; Sep 14 MGEX Wheat closed at $6.30 1/2, down 8 3/4 cents.

15-07-2014 09:49 AM | Chicago Reports
14/07/14 -- Soycomplex: Beans closed higher, with the best grains on the deferred positions. This could probably be attributed to a correction from Friday night's steep looses. Weekly export inspections of 115,280 MT beat expectations of 30,000 – 75,000 MT. Year to date inspections are now 42.8 MMT. Safras e Mercado said that as of Friday Brazil has sold 82% of their 2013/14 bean crop versus 84% a year ago and in line with the five year average. A Porto Alegre marketing analyst was said to have estimated Brazil’s 2014/15 soybean planted area at 76.5 million acres, up 2.9% versus 2013/14. CitiGroup forecast the Q4 average price of US soybeans at $10.50/bushel. The USDA held pat on their soybean crop condition ratings, pegging 72% of the crop as good/excellent (although there was a subtle one point increase in the excellent category). This is said to be the highest rating in 20 years. A year ago 65% of the crop was rated good/excellent. They said that 41% of the crop is blooming versus 24% a week ago and the 5-year average of 37% and compared to 24% this time last year. "With beans blooming earlier, we could be adding more pods yet this will put a little more pressure on end of July weather to see normal rainfall to support early pod fill," said Benson Quinn Commodities. Jul 14 Soybeans closed at $12.95, down 3/4 cent; Nov 14 Soybeans closed at $10.86 1/4, up 11 1/4 cents; Jul 14 Soybean Meal closed at $421.50, down $0.30; Jul 14 Soybean Oil closed at 36.75, up 4 points.

Corn: The corn market closed mixed, lower at the front end but a little higher on new crop. Weekly export inspections of 926,329 MT were in line with trade expectations. Year to date exports are now 40 MMT. A Porto Alegre marketing analyst was said to estimated Brazil’s 2014/15 total corn planted area at 38.8 million acres, down 0.1% versus 2013/14. Israel are tendering for 108,000 MT of optional origin corn for Sept-Oct shipment. CitiGroup forecast the Q4 average price of US corn at $3.70/bushel. The USDA increased their estimate for the proportion of the 2014 US corn crop rated good/excellent from 75% to 76%, up 10 points versus 12 months ago. As with soybeans, this is the highest rating for corn at this point in the season since 1994, and one that Benson Quinn said was "almost unimaginable for this time of the year." The USDA said that 34% of the crop was at the silking stage, up from 15% last week (and also compared to 15% this time last year). This is one point ahead of the 5-year average. China continues it's "hard line" stance on GMO corn. The China Times apparently reported over the weekend that China may reject new types of GMO corn this year due to safety concerns. The USDA forecast a record Chinese corn crop of 222 MMT on Friday. The Chinese government continue to attempt to "clear the decks" of substantial volumes of state-owned corn reserves. Their stance on GMO will likely remain tough whilst they try to offload these. Jul 14 Corn closed at $3.90 1/4, down 9 1/2 cents; Sep 14 Corn closed at $3.81 1/2, up 3 1/4 cents.

Wheat: The wheat market closed higher, with the thinly traded and expiring Jul 14 contracts putting in some "off the wall" closes. Weekly export inspections were a bit disappointing at 377,520 MT versus 470,372 MT a week ago. The marketing year to date total is now 2.7 MMT versus 3.75 MMT this time a year ago. Israel are tendering for 50,000 MT of optional origin wheat for Aug-Oct shipment. Lebanon bought 7,000 MT of Black Sea origin milling wheat. Indonesian buyers were also said to have bought Black Sea milling wheat. Russia, Ukraine and Romania all remain active in the new crop export market. CitiGroup forecast the Q4 average price of US wheat at $5.10/bushel. China’s National Bureau of Statistics estimated China’s 2014 summer grain crop at 136.6 MMT, up 3.6% versus 131.85 MMT in 2013. Russia's grain harvest now stands at 17.9 MMT, including 13.3 MMT of wheat. Russian wheat yields are said to be averaging a 12% increase on this time last year. The USDA estimated the 2014 US winter wheat harvest at 69% done versus 57% a week ago, 66% a year ago and 68% for the 5-year average. They said that the top producing state of Kansas is now 90% done. Spring wheat rated good/excellent was left at 70%, the same as last week and also matching that of a year ago. They estimated that 69% of the crop was headed, up from 47% a week ago, one point ahead of the 5-year average and two up on a year ago. Sep 14 CBOT Wheat closed at $5.37 3/4, up 11 3/4 cents; Sep 14 KCBT Wheat closed at $6.46 1/4, up 10 cents; Sep 14 MGEX Wheat closed at $6.39 1/4, up 11 1/4 cents.

13-07-2014 12:09 PM | Chicago Reports
11/07/14 -- Soycomplex: Beans crashed below USD13/bushel for the first time on a front month since the early days of February. The USDA report was expected to be bearish, and they didn't disappoint. Yet, despite front month Jul 14 closing 34 cents lower, it actually ended up in the middle of the day's trading range. The contract was over 80 cents down at one point, and Aug 14 meal, despite ending with losses of $11.50, was actually more than $10 off the lows of the day. The main bearish surprise for beans was a rise in old crop ending stocks to 140 million bushels versus the 128-130 range expected. New crop ending stocks were pushed sharply higher, to 415 million. The trade had been looking for a number in excess of 400 million, so whilst not a surprise as such, actually seeing it on paper maybe added a bit more of a bearish tone as these would be the highest since 2006/07. US 2014 soybean yield potential was left unaltered at 45.2 bu/acre. They implied that production last year may have been understated. They raised their projections for the US crush "reflecting increased domestic soybean meal disappearance in line with adjustments for 2013/14 and higher US soybean meal exports" and also their estimate for US soybean exports. World 2014/15 soybean ending stocks were estimated at a record 85.3 MMT. The US 2014 soybean crop was raised from 98.93 MMT to 103.42 MMT, reflecting the increased plantings forecast in the Jun 30 Acreage Report. Chinese demand in 2014/15 was raised from the 72 MMT forecast in June to a new record 73 MMT, which is 4 MMT higher than in 2013/14. Price expectations for beans and the by-products were all reduced, with 2014/15 soybeans forecast trading in the range $9.50 to $11.50, with meal prices at $350 to $390 and oil in the region of 36-40 cents/pound. "Global oilseed production for 2014/15 is projected at a record 521.9 MMT, up 5.8 MMT from last month with soybeans and rapeseed accounting for most of the change," they said. The bulk of the increase for soybeans came from the US. Canada's and Australia's rapeseed production potential was also raised. Jul 14 Soybeans closed at $12.95 3/4, down 34 cents; Nov 14 Soybeans closed at $10.75, down 18 cents; Jul 14 Soybean Meal closed at $421.80, down $12.50; Jul 14 Soybean Oil closed at 36.71, down 68 points. For the week, that puts front end beans 92 cents lower, with meal down $25.20 and oil losing 185 points lower.

Corn: The corn market ended around 7-8 cents lower, save for front month Jul 14 which finished with only nominal losses. Even so that was still enough to take it below $4/bu. A front month hasn't finished that low since August 2010. In fact the first four months on the board are now all sub-$4/bu. The USDA report wasn't as bearish for corn as it was for soybeans and wheat, with most of the numbers coming in at around (or even below) trade estimates. For a start they didn't raise their forecast for US corn yields this year. Whilst the unchanged figure of 165.3 bu/acre is a record, the average trade guess was for a tweak upwards to around the 166 bu/acre level. "Favourable early July crop conditions and weather support an outlook for record yields across most of the Corn Belt, however, for much of the crop, the critical pollination period will be during middle and late July," they noted. Maybe that was a hint that yield potential could eventually be increased in future reports if the weather continues to co-operate for the rest of the month? They dropped their forecast for the US 2014 crop by 75 million bushels, reflecting the lower planted area already reported at the end of June. That sees production at 13,860 million bushels, which is 65 million bushels below last year’s record. Old crop US ending stocks were expected to rise to 1.233 billion bushels, with new crop stocks at something like 1.8 billion. The actual numbers given today were 1.246 billion and 1.801 billion. World corn ending stocks were raised to 188 MMT versus 182.65 MMT a month ago. China's corn crop was raised 2 MMT to a record 222 MMT, their import needs were seen unchanged at 3 MMT, with their ending stocks rising more than 2 MMT to 80.36 MMT. "The projected range for the season-average US corn price is lowered 20 cents on each end to $3.65 to $4.35 per bushel," they forecast. Jul 14 Corn closed at $3.99 3/4, down 3/4 cent; Sep 14 Corn closed at $3.78 1/4, down 8 cents. For the week that puts Jul 14 corn down 17 1/4 cents, with Sep 14 falling 31 1/4 cents.

Wheat: The wheat market closed lower, save for the extremely thin and about to expire front end Jul 14 Minneapolis future. Essentially the USDA said that the short-comings in winter wheat production in the US this year would be more than made up for by a bigger spring wheat crop. "Projected US wheat supplies for 2014/15 are raised this month with a sharp increase in forecast Hard Red Spring (HRS) wheat more than offsetting a decrease for Hard Red Winter (HRW). The HRW crop was damaged by drought and April freezes in the Southern and Central plains; however, the HRS crop in the Northern Plains has benefitted from abundant soil moisture and cooler than normal early summer temperatures. Yields for Durum and other spring wheat are forecast to be above average," they said. The average trade guess for US all wheat production was 1.964 billion bushels, with ending stocks seen around the 590 million level. The actual numbers given were 1.992 billion and 660 million, both therefore well above trade expectations. The USDA painted a picture of lower domestic wheat usage, reduced exports and therefore higher ending stocks. "Feed and residual use for all wheat in 2014/15 is lowered 15 million bushels to 145 million as tight supplies of HRW wheat and relatively more attractive prices for feed grains reduce expected feed and residual use. All wheat exports for 2014/15 are lowered 25 million bushels reflecting expectations of large world supplies and strong competition in export markets. Ending stocks are projected 86 million bushels higher," they said. World wheat production was raised 3.6 MMT from last month to 705.2 MMT. The Australian wheat crop was raised 0.5 MMT to 26 MMT, although Canada's was lowered a similar amount to 28 MMT. Ukraine's crop was increased 1 MMT from last month to 21 MMT, although again this was matched by a 1 MMT reduction for Kazakhstan to 13.5 MMT. Europe's crop was increased from 146.3 MMT to 147.9 MMT, with a rise of 1 MMT in EU feed usage to 54.5 MMT. The projected season-average farm price range was lowered 40 cents at the midpoint to $6.00 to $7.20 per bushel. Jul 14 CBOT Wheat closed at $5.14 3/4, down 22 cents; Jul 14 KCBT Wheat closed at $6.34 1/4, down 21 1/4 cents; Sep 14 MGEX Wheat closed at $6.28 3/4, down 13 cents. For the week Jul 14 Chicago wheat was down 53 1/4 cents, with Kansas falling 62 3/4 cents.

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