Chicago Reports
29-07-2014 09:49 AM | Chicago Reports
28/07/14 -- Soycomplex: Beans closed with strong gains. Weekly soybean export inspections came in at 112,345 MT versus 97,160 MT last week. That takes the 2013/14 marketing year total to date to over 43 MMT versus 35.3 MMT a year ago. In addition the USDA reported 486,000 MT of new crop beans sold to China, split 66,000 MT optional origin and 420,000 MT of US origin. There's talk of an Argentine debt default for the second time in 12 years on Thursday. That would potentially put the peso under more pressure, increase inflation even further, and could lead to more "hoarding" of soybeans by Argentine farmers. After the close the USDA cut soybean crop ratings by 2 percentage points in the good/excellent category to 71%. The trade was expecting ratings to be unchanged. That's still better than 63% a year ago though. They said that 38% of the crop is setting pods, up from 19% a week ago and compared to the 5-year average of 31%. They said that 76% of the crop is blooming versus the 5-year average of 72%. Aug 14 Soybeans closed at $12.36 1/2, up 24 1/4 cents; Nov 14 Soybeans closed at $11.07 3/4, up 24 1/4 cents; Aug 14 Soybean Meal closed at $402.80, up $4.80; Aug 14 Soybean Oil closed at 36.52, up 43 points.

Corn: The corn market closed around 4-5 cents higher. Weekly export inspections came in at 805,365 MT, down from 941,977 MT the previous week, and a bit below expectations of 850 TMT to 1 MMT. The 2013/14 marketing year to date total is now 41.8 MT. Taiwan are tendering for 60,000 MT of US or South American corn for Sept-Oct shipment. Chinese analysts estimated their 2014 corn crop at 223.0 MMT, up 2.1% from a year ago. The country's hard line stance on MIR 162 appears to have effectively barred US DDGs from entering the country and will also at the very least hinder US corn export prospects to China. The USDA cut corn crop ratings by one point to 75% good/excellent versus trade expectations of unchanged. That's far from a disaster and much better than 63% this time last year. They said that 78% of the crop is silking versus 56% a week ago, 67% this time last year and 75% for the 5-year average. They said that 17% of the crop is at the dough stage versus 8% a year ago and 16% for the 5-year average. "The forecast continues very cool, with the 7-day outlook calling for temperatures 7-10 F below average in Midwest corn," said Martell Crop Projections. However the forecast is also mostly dry, which could provide some threat, particularly for corn yet to pollinate when moisture needs are high, they add. Sep 14 Corn closed at $3.67 3/4, up 4 3/4 cents; Dec 14 Corn closed at $3.76 3/4, up 5 cents.

Wheat: The wheat market closed lower across the three exchanges. Weekly export inspections came in at 395,963 MT, down from 527,633 MT the previous week, and a bit below expectations of 400-550 TMT. That takes the marketing year to date total to 3.64 MMT versus 5.12 MMT a year ago at this time. The USDA announced 101,000 MT of US wheat sold to Nigeria under the daily reporting system. Taiwan are tendering for 84,800 MT of US milling wheat for Sept-Oct shipment. IKAR estimated Russia’s 2014 wheat crop at 57.5 MMT versus a previous estimate of 56.3 MMT. That's just about the highest estimate in the ring so far. Wheat harvesting there is said to be 36% complete, producing 33.2 MMT to date. There's some talk of possible dry weather damage to wheat in northern New South Wales and Queensland. Other parts of Australia's wheat growing belt are said to be experiencing largely favourable conditions though. The USDA reported the 2014 US winter wheat harvest at 83% complete, up from 75% a week ago and a bit better than the 5-year average of 80% done at this time. Spring wheat crop prospects remain favourable. The USDA held steady with their ratings for that crop at 70% good/excellent versus 68% this time last year. They said that 93% of the crop was headed, up from 84% a week ago and exactly in line with last year and the 5-year average. Sep 14 CBOT Wheat closed at $5.34 3/4, down 3 1/4 cents; Sep 14 KCBT Wheat closed at $6.25 1/2, down 5 3/4 cents; Sep 14 MGEX Wheat closed at $6.21 1/4, down 6 1/2 cents.

27-07-2014 15:39 PM | Chicago Reports
25/07/14 -- Soycomplex: Beans closed mixed, a little stronger nearby and a touch weaker further forward. The USDA announced 360,000 MT of US beans sold to China along with 134,700 MT of US meal sold to Mexico, both for 2014/15 delivery. Persistent cool Midwest weather is seen being probably of more benefit to corn than it is to soybeans. August weather still holds the key to determining final soybean yields. A Reuters poll put the average trade guess for US soybean yields this year at a record 45.5 bu/acre versus the USDA's current forecast of 45.2 bu/acre. The previous record was 44.0 bu/acre in 2009. The range of estimates was 44.2-46.85 bu/acre. The Doane crop tour estimated Iowa average soybean yields at 50-53 bu/acre versus 44.5 bu/acre a year ago. The Buenos Aires Grains Exchange said that the Argentine soybean harvest is virtually all done at 99.5% complete, and left their 2013/14 production estimate unchanged at a record 55.5 MMT. Safras e Mercado estimated Brazil’s 2014/15 soybean planted area at 31.2 million ha, up 4% from last year. Planting will begin in Mato Grosso in the second half of September. They forecast Brazil’s 2014/15 soybean crop at a record 94.45 MMT versus their 2013/14 crop estimate of 86.6 MMT. Market expectations for Monday's USDA crop progress report are for soybean conditions to be unchanged from a week ago at 73% good to excellent. Aug 14 Soybeans closed at $12.12 1/4, up 4 3/4 cents; Nov 14 Soybeans closed at $10.83 1/2, down 1 1/4 cents; Aug 14 Soybean Meal closed at $398.00, up $2.70; Aug 14 Soybean Oil closed at 36.09, down 15 points. For the week that puts front month beans up 36 1/4 cents, with meal gaining $18.00 and oil falling 38 points.

Corn: The corn market closed with small gains to end the week, but still lower for the week as a whole. The USDA announced 269,084 MT of US corn sold to Mexico split 23,368 MT old crop and 245,716 MT new crop. A Reuters survey estimated 2014 US corn yields at a record 170.476 bu/acre versus a previous estimate of 166.104 bu/acre. The current USDA estimate is "only" 165.3 bu/acre, although that in itself would still be a record. The previous record was made in 2009 at 164.7 bu/acre. The Doane crop tour was said to have pegged western Iowa corn yields at 200 bu/acre. The Buenos Aires Grains Exchange said that the Argentine corn harvest is 72.4% complete versus 65.4% a week ago and 92.4% a year ago. They have production in 2013/14 estimated at 25.0 MMT, unchanged from their previous estimate. Safras e Mercado said that they expect Brazil’s 2014/15 corn planted area to decline 6% this year. They still see production at 77.99 MMT versus their 2013/14 crop estimate of 75.95 MMT however. It was reported yesterday that China will only import US DDGs if they can be certified completely free of the disputed MIR 162 corn variety. And by "completely free" that's exactly what they mean, there's no 0.5% tolerance or whatever, it's zero or nothing (no pun intended). The CEO of the US Grains Council said “China is asking for something that cannot be done. This certificate that they are asking for does not exist” according to Reuters. That would appear to draw a line under that then for the time being, and must also surely cast a large black cloud over the prospects for US corn exports to China too. US corn crop condition ratings are expected to be unchanged at 76% good/excellent on Monday. Sep 14 Corn closed at $3.63, up 1 1/2 cents; Dec 14 Corn closed at $3.71 3/4, up 2 1/4 cents. For the week Sep 14 lost 7 cents and Dec 14 fell 5 3/4 cents.

Wheat: The wheat market ended around 8-10 cents higher on the day, although still mixed for the week. Repeated reports of damage to crop quality in Europe are providing support for US wheat, along with ongoing unrest in Ukraine and the corresponding rise in tensions between Russia and the West. European and US leaders are calling for further sanctions against Russia, although it's unclear exactly what form these might take (apart from removing them from hosting the 2018 World Cup). They appear to be in the middle of harvesting a pretty good 2014 wheat crop, in terms of both quality and quantity. If some of the world's leading buyers were to shun Russian wheat, for whatever reason, then it could certainly provide a shot in the arm for demand for US grain, especially if the concerns about quality in Europe ultimately prove to be founded. FranceAgriMer said that the French wheat harvest had made good progress in the past week (through to July 21st) at 44% complete versus only 5% done a week previously. They also actually raised their forecast for the proportion of the crop rated good/very good by one percentage point from a week ago to 71%. Meanwhile, the US Spring Wheat Crop Tour projected average yields at 48.6 bu/acre this year, said to be the highest since at least 1992. The Saskatchewan government said that as of July 21st 78% of spring wheat in the province is in good to excellent condition versus 87% a year ago at this time. Taiwan cancelled a tender for 80,900 MT of US milling wheat for Sep-Oct shipment due to high prices. The Buenos Aires Grains Exchange said that the 2014/15 Argentine wheat crop is 87.8% planted versus 80% a week ago and 92.7% a year ago. In Monday's upcoming crop progress report from the USDA spring wheat crop conditions are expected to be unchanged from a week ago at 70% good to excellent. Sep 14 CBOT Wheat closed at $5.38, up 9 1/4 cents; Sep 14 KCBT Wheat closed at $6.31 1/4, up 10 3/4 cents; Sep 14 MGEX Wheat closed at $6.27 3/4, up 8 cents. For the week that puts Chicago wheat up 5 1/2 cents, with Kansas wheat down 1 3/4 cents and Minneapolis down 2 1/2 cents.

25-07-2014 10:09 AM | Chicago Reports
24/07/14 -- Soycomplex: Beans closed firmer following impressive weekly export sales. These came in at 226,700 MT for old crop and 2,451,100 MT for new crop. Pre-report estimates had been for sales of 150-250 TMT of old crop and 1.2-1.4 MMT of new crop. China (who else) bought 158,800 MT for 2013/14 and 1,283,500 MT for 2014/15. There were also net sales of 949,600 MT to unknown for 2014/15 shipment. Benson Quinn also note that "New crop meal sales remain extremely strong at 348,900 MT this week which takes accumulative sales to record pace and 3 times higher than last year’s accumulated sales for same period." The market is clearly thinking "why do we need to go lower, given this sort of demand at these levels, even with a record large US crop looming?" As far as the latter is concerned, Allendale estimated US 2014 soybean yields at 46.2 bu/acre, even if they did throw in the caveat of "we reserve the right to alter that" with the crucial yield-determining month of August still to come. Doane’s Midwest crop tour estimated Iowa soybean yields at 50+ bu/acre. Today was the last day of the western leg of the tour. The eastern leg starts on Sunday and ends Tuesday. Aug 14 Soybeans closed at $12.07 1/2, up 6 1/2 cents; Nov 14 Soybeans closed at $10.84 3/4, up 8 1/4 cents; Aug 14 Soybean Meal closed at $395.30, up $3.80; Aug 14 Soybean Oil closed at 36.24, up 4 points.

Corn: The corn market closed slightly lower. Weekly export sales came in at 291,500 MT of old crop and 1,143,400 MT of new crop. That was a bit better than trade expectations on the new crop which were in the 400-600 TMT region. Bearish news came from Allendale forecasting US 2014 corn yields at a bin-busting 174.1 bu/acre, the largest estimate I've seen yet. It's also miles above the USDA's 165.3 bu/acre. "Allendale said that its forecast implied a record US harvest of some 14.6bn bushels, well above the 13.86bn bushels that the USDA is factoring in," said Agrimoney.com. That's a record crop by some considerable distance, and would also be the second in a row for the US. "The broker believes that futures will hit $3.30 a bushel in the autumn, when the weight of supplies from harvest typically depresses markets to seasonal lows," Agrimoney added. On the weather front "the GFS model is predicting temperatures 5-10 F below normal to close out the month. The 6-10 day forecast continues exceptionally cool," said Martell Crop Projections. The market continues to view this cool scenario as not being a problem - at least for now. However, it will "further retard Midwest crop development, increasing the risk of freeze damage in the fall," Martell noted. "China has officially asked the USDA to certify a 0% tolerance for the MIR 162 trait on shipments of DDGs for export to that country," reported Benson Quinn. That would seem to effectively close the door to US DDGs exports to China. It also hints that the country's stance on MIR 162 is unlikely to change any time soon, casting a cloud over US corn acceptance in China too. Sep 14 Corn closed at $3.61 1/2, down 1 cent; Dec 14 Corn closed at $3.69 1/2, down 1 1/4 cents.

Wheat: The wheat market closed around 1-4 cents lower. Weekly export sales of 443,200 MT were in line with expectations, if unspectacular. Separately, South Korean buyers bought 27,400 MT of US wheat for Dec shipment and 30,700 MT of US wheat for Dec-Jan shipment. Japan bought 94,586 MT of food wheat for September shipment comprising of their regular mix of US, Canadian and Australian origin. The Wheat Quality Council’s 3-day wheat tour estimated US 2014 spring wheat yields at 48.6 bu/acre (said to be the highest since 1992). That's up from 44.9 bu/acre a year ago and compares favourably with the five year average of 44.7 bu/acre. Reuters reported that the Indian government is to release 10 MMT of state-owned wheat stocks onto the open market. French wheat prices rose for a third day as traders remain jittery over possible large-scale quality downgrades there. Russia continues to report very impressive wheat yields, and suggests that the quality of this year's crop is good, with 83% of the Stavropol wheat harvest said to be of milling grade for example. They've harvested 29.2 MMT of wheat so far off 32% of the intended area, with yields averaging 3.6 MT/ha versus 3.06 MT/ha a year ago. Russian 12.5% milling wheat is said to be offered around $238-242 FOB the Black Sea. Although Egypt bought wheat off Russia, Romania and Ukraine yesterday, many buyers are shying away from the latter for the time being due to the political uncertainty and unrest in the country. Dryness is said to be potentially damaging wheat yields in Australia. Sep 14 CBOT Wheat closed at $5.28 3/4, down 2 cents; Sep 14 KCBT Wheat closed at $6.20 1/2, down 3 cents; Sep 14 MGEX Wheat closed at $6.19 3/4, down 1 1/4 cents.

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.

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