Corn: The corn market jumped around 9-10 cents, also aided by a set of strong weekly export sales from the USDA. These came in at 1,518,000 MT for old crop - up 81 percent from the previous week and 35 percent from the prior 4-week average. There were also new crop sales of 164,500 MT reported for Japan. Shipments this week came in at a respectable 1,138,147 MT, taking total exports for the season so far to 18.4 MMT, with a further 19.2 MMT of sales outstanding. If the latter were all to get shipped, and that is potentially quite a big if, then total commitments are 37.6 MMT, or nearly 92% of the USDA's target for the season which is only halfway through. That would suggest that the USDA might have to increase this forecast on Monday. They already upped it by 4 MMT in February. The FAO's AMIS raised their forecast for the world corn crop in 2013/14 by 6 MMT to 1006 MMT, although increased consumption meant that ending stocks remained unchanged at 175 MMT. That's still a fair rise on carryout of only 131 MMT last season though and is 18 MMT higher than the USDA's current forecast. "In the southern hemisphere conditions are mixed. In Argentina, approximately 70 % of the crop is rated in good condition. Welcome and timely precipitation across the major growing regions helped to support crop development and harvest has begun in northern growing regions for the early planted crop. In Brazil, conditions are mixed and have been slightly reduced since last month due to dry hot conditions in south east and south central growing areas. Planting of the second crop is underway though is delayed in Mato Grosso due to wetness, which is delaying soybean harvest. Planted area for both the first and second crops is down, due to an increased area planted to soybeans," they said. Fund money was estimated as adding around 14,000 corn contracts to their net long position on the day. Mar 14 Corn closed at $4.85 3/4, up 10 1/2 cents; May 14 Corn closed at $4.91, up 9 cents.
Wheat: The wheat market was only modestly higher, with the exception of soon to expire and extremely technical Mar 14 Minneapolis wheat, which had something of a fit closing almost 40 cents higher on the day. It feels like wheat would possibly have finished lower if it wasn't for spillover support from corn and beans. Weekly export sales for wheat came in at 556,100 MT of old crop and 44,400 MT of new crop which was in line with expectations for sales of 350-650 TMT. Mexico (213,100 MT), Brazil (93,100 MT), unknown destinations (63,600 MT) and China (60,000 MT) were the main takers. Total wheat shipments now stand at 23 MMT with a further 5.6 MMT of outstanding sales. The USDA target for the season is 31.5 MMT. The FAO's AMIS raised their estimate for the global wheat crop by 2 MMT to a record 716 MMT, and increased ending stocks by 3 MMT to 179 MMT. The USDA are currently at 712 MMT and 184 MMT respectively, but will issue revised forecasts on Monday. "In Ukraine and Russia, conditions are good and the crop is in the dormancy phase. Following the extreme cold temperatures last month, unseasonably warm weather moved into southern regions of Ukraine and southern Russia, melting much of the snow cover which could increase their vulnerability to frost damage in the event of a drop in temperatures. To date, no wide-spread winter damage has been reported and an assessment of wintering and crop damage will be made at the end of dormancy. In the US, dryness across the Southern Plains is continuing to raise some concern over the dormant crop, particularly in areas that have experienced colder than normal temperatures and lack protective snow cover. However, no damage has been reported to date," they said. Iraq bought 200 TMT of wheat from Canada and Australia. Taiwan bought 83,150 MT of US milling wheat. Japan bought 111,779 Mt of wheat for April–June shipment from the US, Canada and Australia. Mar 14 CBOT Wheat closed at $6.41 1/2, up 4 1/4 cents; Mar 14 KCBT Wheat closed at $7.06 1/4, up 3 cents; Mar 14 MGEX Wheat closed at $7.41 1/4, up 39 3/4 cents.
Corn: The corn market ended around 1 to 2 cents lower across the board. Again, a slight easing in tensions between Ukraine/the West and Russia may have encouraged a little bit of profit-taking following the recent rally to a near 6-month high. There is still no evidence of any notable disruption to grain shipments out of the region. Continued wet weather in Brazil is seen slowing progress with planting of second crop corn, underpinning the market. Weekly US ethanol production came in at 894,000 barrels per day versus 905,000 bpd last week and the near 930,000 bpd needed to hit USDA targets for the season. There's talk that China could approve MIR 162 GMO corn at some point during the first half of this year. That approval can't come soon enough as far as US exporters are concerned. There's a suggestion that uncertainty over corn supplies out of Ukraine may twist their arm a little to push the legislation through a bit quicker than they have so far seemed inclined to do. Monday's upcoming USDA report is expected to show US 2013/14 corn ending stocks increasing by 5-10 million bushels from 1.481 billion last month. World ending stocks are however seen falling by around 1 MMT to 156.27 MMT. The Brazilian corn crop is seen down around 1 MMT to 69 MMT, with Argentina's output maybe dropping by 0.5 MMT to 53.5 MMT. Favourable Argentine weather is in the forecast for the next few days. Drier weather is in the forecast for Brazil for next few days, which should speed up the soybean harvest and aid safrinha corn plantings a little. "As of the end of February, 75% of the safrinha corn crop in Mato Grosso had been planted, which is 13% behind last year's planting progress. The ideal planting window for safrinha corn in the state generally closes by the end of February, so approximately 820,000 hectares of corn will be planted later than desired," said Dr Cordonnier. Trade estimates for tomorrow's weekly export sales report are around 700 TMT to 1 MMT. Mar 14 Corn closed at $4.75 1/4, down 1 1/2 cents May 14 Corn closed at $4.82, down 2 1/4 cents.
Wheat: The wheat market closed mostly a cent lower to 3 cents higher, although the thinly traded front month Mar 14 Minneapolis wheat continues to behave erratically. Has the sudden rush of fund money into Chicago wheat more or less run it's course? Benson Quinn Commodities point out that "another interesting development over the past week or so is the rapidly declining open interest in Chicago, which is now at its lowest level since 2010." That would suggest that recent developments in Ukraine have merely prompted funds to cover in their remaining Chicago wheat shorts, rather than indicate a flood of "new money" coming into the market. Whilst US winter wheat conditions at the end of February showed monthly declines for KS, OK and NE in the good/excellent category, it is worth noting that the figures for all three were still significantly better than a year ago (KS 35% G/E vs 23%; OK 31% vs 9% and NE 43% vs 12%). Despite recent price rises, there's still a fair bit of activity on the international tender market. Algeria bought 300-350 TMT of optional origin wheat (possibly French) for May-June shipment. They are also looking for 50 TMT of durum wheat for May shipment. In addition, Tunisia seeks 92 TMT of milling wheat of optional origin for April-May shipment, and Lebanon wants 25 TMT of the same for April shipment. Note though, that Informa yesterday raised their forecast for Indian wheat production this year to a whopping (and easily record) 108 MMT. India’s MMTC have released a tender to sell 80 TMT of wheat for March-April shipment, whilst another state-owned firm, PEC, have tendered to sell 70 TMT of wheat also for March–April shipment. Russia was said to have exported 812 TMT of wheat in February, up from 684 TMT in January, and exports may rise again in March. Monday's USDA report is expected to show US 2013/14 wheat stocks rising from the 558 million bushels forecast last month to around 570 million. World wheat ending stocks are seen little changed at 183.65 MMT. Trade estimates for tomorrow's weekly export sales report are 350-650 TMT. Mar 14 CBOT Wheat closed at $6.37 1/4, down 2 1/2 cents; Mar 14 KCBT Wheat closed at $7.03 1/4, down 1 cent; Mar 14 MGEX Wheat closed at $7.01 1/2, up 11 1/2 cents.
Corn: The corn market shot higher, with the Mar 14 contract hitting the best levels for a front month since 12 September 2013. As with soybeans we saw two-sided trade today, but a surge of buying late in the session saw prices close near the day's highs. Despite an apparent slight softening in Russia's stance on Ukraine, fund money looks like it thinks it sees an opportunity and is now pouring into grains. They were estimated as net buyers if around 18,000 corn contracts on the day, to add to the 20,000 that they were thought to have stepped in for yesterday. Dr Cordonnier estimated the Brazilian corn crop at 68.5 MMT, unchanged from his previous estimate. He increased his Argentine corn production forecast to 23.0 MMT versus a previous estimate of 22.5 MMT. Informa cut their Brazilian corn production forecast by 1.1 MMT to 65.45 MMT, which is well below the USDA's 70 MMT estimate. Rains continue to delay the Brazilian soybean harvest, and therefore the planting of second crop corn. Informa left their forecast for the Argentine corn crop unchanged at 22.6 MMT versus the USDA's 24.0 MMT. Both Bunge and ADM said that their Ukraine operations are running as normal. The Ukraine Ministry said that the country had exported 2.82 MMT of grains in February, up 1.3% compared with January. That total included 2.33 MMT of corn. They also said that Ukraine had exported a further 340 TMT of grains in the first three days of March. Ukraine's corn exports for the period Jul-Feb now stand at a little under 15 MMT, making the USDA's forecast for the entire season of 18 MMT seemingly well within reach if things carry on as they are. Reports that Russia had blocked the Kerch Strait, which provides access to the Black Sea for ships carrying grain, were denied by the Ukraine infrastructure ministry - at least with respect to the movement of non-military vessels. Mar 14 Corn closed at $4.76 3/4, up 12 3/4 cents; May 14 Corn closed at $4.84 1/4, up 13 3/4 cents.
Wheat: The wheat market closed higher, with the exception of the technical nearby Minneapolis contract. As with the other grains, wheat was in the red in early "Turnaround Tuesday" style, but clawed its way higher as the open outcry session wore on. Fund buying in Chicago wheat (the only one of the three wheat pits where they are still short) was a feature again. Afternoon reports that Russia had test-fired a intercontinental ballistic missile may have been responsible for further late buying in wheat. Ukraine's wheat shipments so far this season (Jul-Feb) are at 7.43 MMT versus a USDA forecast for full season shipments of 10 MMT, leaving around 2.5 MMT left to go to hit that target. Despite the ongoing problems with Russia, grain exports are said to be continuing relatively unhindered. That doesn't seem to matter though, if the funds suddenly fancy wheat again. The latest monthly crop condition reports show month-on-month declines in US wheat rated good/excellent for Kansas (down 1% to 34%), Nebraska (down 3% to 43%), Oklahoma (down 5% to 31%) and Texas (down 4% to 15%). Japan seeks 111,779 MT of wheat for April–June shipment, in it's routine combination of US, Canadian and Australian origins. Algeria is tendering for 50,000 MT of optional origin milling wheat for May shipment. Australia's ABARES forecast the 2014/15 wheat crop there at 24.8 MMT, down 8% versus output of 27.0 MMT last year. Despite lower production though, they see Australia's 2014/15 wheat exports rising to 19.1 MMT versus 18.5 MMT this season. They forecast wheat plantings rising 130k ha to 13.6 million ha, but currently anticipate lower yields. It's currently very dry Down Under, although this is Australia in the middle of their summer that we are talking about, not the Somerset levels in the midst of a British winter. Wheat planting doesn't begin until May, so there's time for some improvement yet. Mar 14 CBOT Wheat closed at $6.39 3/4, up 13 cents; Mar 14 KCBT Wheat closed at $7.04 1/4, up 3 cents; Mar 14 MGEX Wheat closed at $6.90, down 5 3/4 cents.
Corn: The corn market jumped around 6-7 cents, although that close was well off the intra-day highs on short-covering and spec buying following weekend events in Ukraine - set to be the third largest corn exporter in the world after the US and Brazil this year. The USDA announced 140,000 MT of corn sold to South Korea for 2013/14 delivery. They also said that 211,500 MT of US corn had been sold to Japan, comprising 47,000 MT for 2013/14 shipment and 164,500 MT for 2014/15 shipment. Agritel said that Ukraine had shipped 500 TMT of corn last week. That may change this week, we will have to wait and see. They estimated that Ukraine still has a further 5 MMT of corn left to ship in 2013/14. Regardless of what is going on in the region, spring plantings are said to be underway in both Russia and Ukraine. Talk of Western sanctions against Russian aggression may take the form of an embargo on imports of Russian corn and wheat possibly? China are reported to have rejected 887,000 MT of US corn since November due to the unapproved GMO strain MIR 162. Fund buying was estimated by some to be as high as a net 20,000 contracts on the day today. Brazilian rains that are slowing the soybean harvest will also be having a negative impact on safrinha corn plantings. Weekly export inspections of just over 1 MMT were above trade expectations and above what is required to hit the USDA's target for the season. Corn planting for the new 2014 season is underway in Texas, with 8% of the crop now in the ground versus 3% last week and 14% this time a year ago. Rumours persist from Friday that the EPA may soon revise upwards the ethanol mandate to come in near 13.5 billion gallons. Mar 14 Corn closed at $4.64, up 6 1/2 cents; May 14 Corn closed at $4.70 1/2, up 7 cents.
Wheat: The wheat market shot higher on the news that the Ukraine crisis had stepped up a gear over the weekend. Wheat in Chicago is the only agri-commodity left that fund money is short of, even if they have reduced that short quite dramatically since the turn of the year. That may help explain why wheat led the rest of the market higher today. Ukraine is just about sold up on wheat for 2013/14 it would seem, although they may have up to 3 MMT of wheat sold and as yet unshipped, according to Agritel. Russia however remain an active seller, as was witnessed in last week's Egyptian tender. Some form of Western sanctions against Russia may include an embargo on wheat imports. That could mean more business for the US and Europe, although I'm sure that China would probably be first in the queue to "help" Russia by increasing its purchases of wheat and corn from them. That's wheat and corn that they would otherwise have bought from the West, so an embargo could be something of a two-edge sword. There's some talk that Canadian growers are struggling to get their bumper 2013 wheat crop onto the cash market. This means that some are struggling for the funds needed to purchase inputs for 2014 spring plantings, it is being mooted. Logistical problems, added to by extremely cold weather are forcing the Canadian railways to operate shorter trains running at slower speeds, continue to restrict the movement of grains. This could ultimately have a negative impact on spring plantings some suggest. Weekly export inspections for US wheat were 609,867 MT versus 482,430 MT a week ago. Mar 14 CBOT Wheat closed at $6.26 3/4, up 27 3/4 cents; Mar 14 KCBT Wheat closed at $7.01 1/4, up 24 1/4 cents; Mar 14 MGEX Wheat closed at $6.95 3/4, up 25 cents.
Corn: The corn market also reversed yesterday's action, with fund money seen buying a net 12,000 contracts on the day - a similar volume to that they were said to have sold yesterday. The ongoing wet weather in Brazil is seen hampering the timely planting of second crop corn. The turmoil in Ukraine is seen potentially hindering corn exports there, and possibly even impinging on spring corn plantings and/or reducing inputs later in the season due to the weak hyrvnia/US dollar exchange rate. At least for now, buying corn from Ukraine doesn't look a very safe option if you want guaranteed delivery, even though some say that the ports are operating more or less normally. The Buenos Aires Grains Exchange said that Argentine corn harvesting is 1.6% complete, barely moved on 1.2% a week ago and well behind the 6% of a year ago. They have the Argentine corn crop estimated at 23.5 MMT, unchanged from their previous forecast. Safras et Mercado cut their Brazilian corn production forecast to 71.2 MMT from the 75.6 MMT estimated previously. CEC estimated South Africa’s 2014 corn crop at 12.40 MMT versus a previous figure of 11.69 MMT. There's talk of a potential increase to the US corn ethanol mandate from the EPA, or at least a reduction not as great as the originally proposed cut to 13 billion gallons from 14.4 billion. The new number being bandied about is 13.5 million gallons. The USDA announced 101,600 MT of corn sold to unknown for 2013/14 delivery. Israel bought 60 TMT of optional origin corn (possibly from the Black Sea) for May/June shipment. The weekly Commitment of Traders report shows fund money continuing to build on their newly established corn long for the week through to Tuesday night. They are now said to be sitting on their largest net long since early last summer. Mar 14 Corn closed at $4.57 1/2, up 9 1/2 cents; May 14 Corn closed at $4.63 1/2, up 9 cents. For the week front month Mar 14 corn was 4 1/2 cents higher.
Wheat: The wheat market also effectively reversed yesterday's sharp losses, posting gains of around 15-17 cents on the day. US weather remains cold and dry. Midwest winter precipitation averages 81% of normal, whilst temperatures have been exceptionally cold - averaging 4.9 F below normal, according to Martell Crop Projections. "A fresh blast of polar air would sink into the US heartland in the wake of an upcoming Midwest storm due Sunday. North Dakota temperatures may plummet to -35 F (-17 C) on Tuesday morning. Subzero F temperatures are predicted as far south as Kansas. Presently wheat fields are bare, but snow is predicted ahead of the cold wave in the weekend storm. Severe drought is plaguing the Southern Plains jeopardizing the wheat crop in Oklahoma and Texas. While Kansas is expecting generous precipitation this weekend, the 2 southern wheat states are not," they add. ABARES are due to released their 2014/15 Australian crop production estimates on Tuesday. A Reuters survey estimates the new season wheat crop at around 25 MMT, although traders note that it's still very early days as plantings there don't get underway until May. The Egyptian state-run Middle East News Agency (MENA) said that the country has enough wheat bought to last it until early June. Tensions in Ukraine are keeping wheat shorts nervous, even though they are effectively more or less out of the export market until new crop. "It's looking increasingly like Russia has taken Crimea; to contextualise it for my UK pals, it's like France taking control of the Isle of Wight," said my Ukraine agronomist chum Mike Lee. "The Commitments of Traders (report) shows that managed money continued to cover shorts at an almost frantic pace in Chicago Wheat," said Benson Quinn Commodities. They cut their net short by around 14k lots on the week through to Tuesday night and now sit on a net short of just over 20k contracts versus over 100k at the end of 2013. Mar 14 CBOT Wheat closed at $5.99, up 16 3/4 cents; Mar 14 KCBT Wheat closed at $6.77, up 14 3/4 cents; Mar 14 MGEX Wheat closed at $6.70 3/4, up 15 1/4 cents. For the week CBOT wheat was still 10 3/4 cents lower, with Kansas down 5 3/4 cents and Minneapolis rising 6 1/2 cents.
Corn: The corn market also crashed lower, with funds selling an estimated 12-15,000 contracts on the day. Weekly export sales of 840,800 MT for 2013/14 and a modest 1,500 MT for 2014/15 were towards the top end of trade expectations. Private exporters also reported sales of 284,480 MT of US corn for delivery to Mexico during the 2013/14 marketing year under the daily reporting system. However, for corn too, it was just one of those days when any bullish news was largely ignored in the face of heavy fund selling. MDA CropCast cut their forecast for the Brazilian corn crop by 180 TMT to 69.74 MMT, and down from 76 MMT a year ago. The IGC left their world 2013/14 corn production estimate unchanged at 959 MMT, but raised consumption by 4 MMT to 932 MMT. World corn production in 2014/15 was forecast to decline modestly. Another bout of very harsh weather conditions in the US is expected to keep feed demand high. Mar 14 Corn closed at $4.48, down 7 1/2 cents; May 14 Corn closed at $4.54 1/2, down 6 1/2 cents.
Wheat: The wheat market, by way of not wanting to be the odd one out, fell into line tumbling 14 to 17 cents lower on the day across the three exchanges. The USDA reported weekly export sales of 365,100 MT of old crop and 199,800 MT of new crop. Weekly shipments of 547,400 MT were respectable enough. The market was disappointed however to see US wheat priced out in Egypt's latest wheat tender, having won a share of GASC's business last time. Russian wheat dominated, wining the lion's share of the 295 TMT order, with one cargo going to Romania. This apparently confirmed the market's fear that US wheat prices have gone up too far, too fast, this month. China sold 406,105 MT of wheat at auction today out of an offered volume of 607,157 MT. MDA CropCast cut their forecast for the Indian wheat crop this year by 0.5 MMT to 96.9 MMT, although that's still a record. They also trimmed 0.8 MMT off their US all wheat production estimate. Mar 14 CBOT Wheat closed at $5.82 1/4, down 17 3/4 cents; Mar 14 KCBT Wheat closed at $6.62 1/4, down 16 3/4 cents; Mar 14 MGEX Wheat closed at $6.55 1/2, down 14 3/4 cents.
Corn: The corn market closed barely changed. Choppy and two-sided trading continues for the corn market, but the edge still goes to the bulls, with front month Mar 14 up more than 10% from the mid-January lows. The USDA announced 101,600 MT of US corn sold to unknown for 2013/14 shipment. Taiwan bought 60,000 MT of US corn for April/May shipment. The extremely wet weather in northern and central areas of Brazil's Mato Grosso, where the main concentration of the state's "safrinha" corn production is focussed, is causing planting delays. Mato Grosso is estimated to be 60% done on corn planting, with Mato Grosso do Sul around 52% complete. Deral estimated Parana’s first corn crop at 5.5 MMT versus a previous estimate of 5.62 MMT. They said that Parana’s second corn crop planting has been delayed due to rains. Despite official figures appearing to show that Ukraine's corn exports have been largely unaffected by the ongoing political turmoil and civil unrest in the country, the trade continues to see things differently. The situation could provide a short-term boost for other sellers, although the recent devaluation of the Ukraine hryvnia (down 15% in a month against the US dollar) should ultimately mean that they return as aggressive sellers again once the situation calms down. The Ukraine Stats Office said that the country had exported a record volume of corn in December - 3.9 MMT. Of that total 28% went to buyers in East Asia, with Korea (630 TMT) and Japan (445 TMT) the largest buyers in the region. Both would be considered "traditional" homes for US corn. The US Energy Dept reported weekly ethanol production up marginally on a week ago at 905,000 barrels/day, but that's still below the circa 930k bpd needed to hit the USDA's target for the season. Estimates for tomorrow's weekly export sales are around 400-800 TMT. Mar 14 Corn closed at $4.55 1/2, down 1/4 cent; May 14 Corn closed at $4.61, down 1/4 cent.
Wheat: The wheat market crashed lower on ideas that the recent rally to 2-month highs will cut off export business. Egypt's surprise cancellation yesterday of 110 TMT of US SRW wheat added a bit of fuel to the fire. It was private buyers, not the government agency GASC who cancelled the purchase. Traders said that the actions were due to price, and not because of politics or the recent news that officials were being prosecuted for corrupt trade practices in the rice market. Late in the session, reports that Argentina had cleared a further 500 TMT of wheat for export also knocked hopes for US exports to Brazil. That appeared to be enough to foster the belief that US wheat is too expensive into all but "traditional" US homes. Fears of US winter wheat damage by another hard blast of Arctic air this week were brushed aside. So too were worries about continuing drought on the southern Plains. European and FSU weather conditions are nowhere near as harsh as those being experienced in the US. Spring planting is underway in near ideal seeding conditions in the south of Russia, according to Agritel. Planting has also begun in Ukraine, despite the ongoing upheaval. High prices will encourage Brazilian farmers to increase their wheat plantings this year, and they could harvest a record 7.33 MMT crop towards the end of 2014, according to Safras e Mercado. The last thing that US wheat needs now is a set of disappointing weekly export sales from the USDA tomorrow to apparently "confirm" that US prices have indeed risen far enough to choke off demand. Trade estimates for that are anywhere from 250-750 TMT. After the close Egypt issued a tender for wheat for March 15-31 shipment with the results expected around 13.30 GMT Thursday. This is GASC's first tender since late January when the bought 240,000 MT of Russian and US wheat for shipment March 1-10. Mar 14 CBOT Wheat closed at $6.00, down 15 cents; Mar 14 KCBT Wheat closed at $6.79, down 11 1/2 cents; Mar 14 MGEX Wheat closed at $6.70 1/4, down 3 3/4 cents.
Corn: The corn market closed around 3-4 cents higher on the day. The heavy rains in Brazil that are delaying the soybean harvest there will also be having a negative impact on timely second crop corn plantings. Israel seeks 56,000 MT of optional origin corn for May-June shipment, with the Black Sea the most likely supplier. The turmoil in Ukraine seems to have calmed down for now, but there are still reports of buyers preferring to buy corn from other sellers, such as Russia, in the region for the time being. South Korea's FLC bought 63,000 MT of US or South American corn for June shipment. Taiwan is seeking 60,000 MT of optional origin corn for April/May shipment. Another very cold spell is underway for the Midwest and US heartland, potentially boosting domestic feed demand for corn. A jump in US ethanol prices is also said to have sparked better margins. The same Arctic blast hitting the US is also in evidence in Canada, making logistics there even worse. US oat futures surged limit up and above $5/bushel to fresh contract highs today, underpinning corn values. Front month Mar 14 oats are now up more than 40% since the turn of the year. Slow rail transportation in Canada was said to be one of the primary factors behind the jump. The Energy Dept will report on weekly ethanol production tomorrow. Last week's grind came in at 903k barrels/day, up 1,000 bpd on the previous week but still below the circa 930k bpd needed to hit the USDA's target for the season. Mar 14 Corn closed at $4.55 3/4, up 4 1/4 cents; May 14 Corn closed at $4.61 1/4, up 3 1/2 cents.
Wheat: The wheat market closed mixed. News that Egypt had cancelled 110,000 MT of US SRW wheat for 2013/14 shipment was bearish. Egypt’s Finance Ministry were however said to have approved financial guarantees of $75.3 million for the import of 240,000 MT of wheat. A report on Reuters suggests that they may be in the market to buy some 500,000-700,000 MT of wheat before their own harvest begins in April. They've been absent from the open market since late January. Taiwan are said to be seeking 83,150 MT of US milling wheat for April–May shipment. The USDA's attache in Saudi Arabia said that the country will import 3.03 MMT of wheat in 2013/14 versus the USDA's own estimate of 2.7 MMT. Canada remains mired in logistical issues in attempting to move its record 2013 wheat crop. Bad weather, a newly nationalised railway system and now a 48 hour strike by Vancouver truck drivers are all taking their toll. Analysts at a grain conference in Winnipeg estimated Canada’s 2014 wheat planted area at 23.3 million acres, down 10% from a year ago and well below Ag Canada’s estimate of 24.7 million. India's state owned firm STC was said to have picked up a best bid of $271.10 in a tender to export 110 TMT of wheat out of the west coast for Feb 28-Mar 28 shipment. Another government backed firm, PEC, was said to have picked up a best bid of $274.90 in a tendrr to export 70 TMT of wheat out of the east coast for the same shipment period. Both bids are well above the government's agreed minimum of $260/tonne. Rabobank cut their forecast for CBOT wheat prices in Q4 of 2014 by 80 cents to a 4-year low of $5.60/bushel. Mar 14 CBOT Wheat closed at $6.15, down 2 3/4 cents; Mar 14 KCBT Wheat closed at $6.90 1/2, up 1 1/2 cents; Mar 14 MGEX Wheat closed at $6.74, up 11 1/4 cents.
Corn: The corn market closed a cent or so lower. Weekly export inspections came in at 791,947 MT (31.17 million bushels), pretty much exactly what the market expected. "Cumulative inspections for the marketing year are now approximately 667 million bushels. To keep pace with the USDA's 2013/14 corn export estimate of 1.6 billion bushels, weekly inspections will need to average 34.56 million bushels (or 878,000 MT) over the final 27 weeks of the marketing year," noted Benson Quinn Commodities. The trade is also looking at last week's USDA numbers and thinking, record 165.3 bu/acre yields, oh really? It would take a near perfect growing season to hit that target. The USDA's estimated average price for corn in 2014/15 of $3.90/bushel is around 75 cents below the current price of the Dec 14 future. The market currently clearly thinks that production has more potential to be lower in the US this year than it does to be higher. As Bruce Forsyth would say "it's a king, what do you want to do? Higher or lower than a king?" Planting of the US 2014 corn crop is actually already underway in Texas, at 3% done as of 23 Feb, which is in line with the 5-year average. Turmoil in Ukraine is supportive, at least in the short-term. They have been majoring on corn exports for some time. Even though APK Inform said that Ukraine sea ports shipped 704.5 MMT of grain last week (with 86% of that corn), the trade is thinking that some buyers will shy away from booking Ukraine corn for the time being until the political situation calms down. That potentially provides a small window of opportunity for US corn in the near term to some homes. Reuters reported that Russian corn prices are up "at least" $5/tonne in the past week as buyers look to sellers there as an alternative to Ukraine. The Russian Ministry say that Russia has exported 2.3 MMT of corn so far this season, and traders estimate that they have the potential to ship around 1 MMT more. Mar 14 Corn closed at $4.51 1/2, down 1 1/2 cents; May 14 Corn closed at $4.57 3/4, down 1 1/4 cents.
Wheat: The wheat market closed mostly higher with the exception of front month Mar 14 Minneapolis wheat. Fund money was seen further covering in it's short position in Chicago wheat, buying an estimated net 4,000 contracts on the day. Weekly export inspections of 427,239 MT were in line with expectations. That was up versus 306,707 MT last week, but down on 576,562 MT a year ago. Weather concerns remain for US winter wheat. "The Midwest winter may go down as one of the coldest on record, as abnormal cold weather dominated also in January and most of December," said Martell Crop Projections. "Brutally cold temperatures have redeveloped in the US heartland, after a brief warm spell last week. The jet stream this week will carve out a deep cold trough over North America, delivering a fresh batch of d Arctic air to the Midwest and Great Plains. Midwest temperatures are predicted to plummet to -15 F to -20 F Wednesday and Friday mornings, some 25-30 F below normal," they said. "With cold dry polar air dominating the heartland, the precipitation forecast indicates mostly below-average precipitation this week. Hard red wheat continues to struggle from winter drought not expecting significant moisture this week," they added. In contrast, conditions in Europe are positively benign, aside from some excessive wetness in one or two places. Generally though, the worst affected areas of the UK and France aren't high producing wheat regions. Demand for EU wheat remains solid. The German Stats Office said that the country had exported 7.6 MMT of grain between July–Dec, up 17% versus 6.5 MMT a year ago. Reuters report one Canadian analyst forecasting all wheat plantings there to fall by 10% this year to 23.3 million. That's below Ag Canada's estimate of 24.7 million acres released last week. The Canadian railway system is said to be "overwhelmed" by the logistics of attempting to transport last year's record wheat and canola crops to the ports for export. Mar 14 CBOT Wheat closed at $6.17 3/4, up 8 cents; Mar 14 KCBT Wheat closed at $6.89, up 6 1/4 cents; Mar 14 MGEX Wheat closed at $6.62 3/4, down 1 1/2 cents.
Corn: The corn market finished lower on the day, but higher for the week. Weekly export sales of 691,400 MT of old crop and zero for new crop were below trade expectations for sales of 800 TMT to 1.2 MMT. As the dispute with China over MIR 162 corn rumbles on there were no sales to that particular buyer. There were cancellations from unknown destinations (127,500 MT) and China (18,800 MT). Exports of 745,000 MT were down 22 percent from the previous week and 15 percent from the prior 4-week average. The US has now shipped 16.5 MMT of corn so far this season, or 40.6% of the USDA's forecast for 2013/14. There's a further 18.8 MMT of outstanding sales, taking total commitments so far to 87% of the USDA target. The latest Commitments of Traders report shows managed money adding to their newly established long in the week through to Tuesday. They now sit on a net long of a little over 45k contracts having been short on corn since early last summer. The USDA now say that US farmers will plant 92 million acres of corn this year, versus 95.4 million in 2013. They also project 2014 US corn yields at record levels of 165.3 bu/acre (see above), up 4% on 158.8 bu/acre last year. That takes production in 2014 to a new record 13.985 billion bushels versus 13.925 billion in 2013. Demand for corn from the US ethanol sector is seen holding steady at 5 billion bushels, with 2014/15 ending stocks rising to 2.111 billion bushels, up from 1.481 billion at the end of this season, and over 2.5 times more than at the end of 2012/13. Note that the USDA estimates US corn, soybean, wheat and cotton acres at a combined 238.5 million acres, exactly the same area as last year. Yet early season wetness in 2013 produced a total very significant "prevent plant" area being claimed for on insurance. Last year's Outlook Forum pegged 2013 corn plantings at 96.5 million acres, and by the 31 March planting intentions report that area had risen to 97.3 million versus the 95.4 million that the USDA now say finally did get planted. US soybean plantings were estimated at 77.5 million acres at last year's Outlook Forum and 77.1 million at the end of March, before finally falling to 76.5 million. So a combined area of 2.1 million acres in February, rising to 2.4 million in March seemingly never go planted. Where did it go? Not into wheat, which was estimated at 56 million in February and 56.4 million in March, before ultimately ending up at 56.2 million they now tell us. Where are those lost acres now? Chinese customs data shows that they imported 650,904 MT of corn in January, up 64% from a year ago. They also imported 575,462 MT of DDG's, up 600% from a year ago. The Buenos Aires Grains Exchange said that the Argentine corn harvest is underway at 1.2% complete versus 5% a year ago. They estimate production at 23.5 MMT, unchanged from previously, but down 13% from 27.0 MMT in 2012/13. Mar 14 Corn closed at $4.53, down 2 3/4 cents; May 14 Corn closed at $4.59, down 3 1/4 cents. For the week front month Mar 14 was up 7 3/4 cents.
Wheat: The wheat market took a bit of a thrashing to end, what had been up until now, a decent week. Options expiry, a bearish slant to the USDA's Outlook Forum data and pre-weekend profit-taking may all have been behind today's action. Weekly export sales were a bit disappointing at 424,500 MT of old crop and 67,000 MT of new crop versus trade expectations of 500-700 TMT. More disappointing though were actual shipments of only 277,300 MT – a marketing-year low – which were down 31 percent from the previous week and 29 percent from the prior 4-week average. The primary destinations were Brazil (60,000 MT), Japan (55,800 MT), South Korea (33,000 MT), Mexico (32,500 MT), and Nigeria (30,500 MT). The US has now shipped 21.8 MMT of wheat so far this season, or 68% of the USDA's forecast for the marketing year. There's an outstanding sales total of 5.9 MMT taking total net commitments to 86.5% of the USDA's target. The latest Commitments of Traders report shows managed money continuing to decrease their net short on CBOT wheat by almost 9,000 contracts in the week through to Tuesday. They now sit on a net short position of nearly 34.5k lots. That was over 100k lots at the end of 2013. In Kansas they are net long around 18.5k lots and long in the region of 7k lots in Minneapolis. The USDA's Outlook Forum pegged all wheat plantings for the 2014 US harvest at 55.5 million acres versus 56.2 million a year ago. Harvested acres however are seen at 47.2 million, which is 2 million more than a year ago due to lower abandonment rates. The 2014/15 wheat yield is seen averaging 45.8 bushels/acre, down from 47.2 bu/acre last year, possibly due to more marginal land making it through to harvest this year. All in, that gives us a 2014/15 US all wheat harvest of 2.16 billion bushels, up slightly on 2.13 billion in 2013/14. US wheat ending stocks are seen rising from 558 million bushels at the close of this season to 587 million next year. Chinese customs data shows that they imported 725,942 MT of wheat in January, up 304.75% from a year ago, with 256,935 MT of it coming from the US. Frigid weather is due to return to the Midwest next week, which may cause renewed winterkill concerns. Indeed the longer range forecast shows much colder than normal conditions largely remaining through to the second half of March. Meanwhile hard red winter wheat on the Southern Great Plains is in the throes of severe drought, say Martell Crop Projections. "The last important rain in West Texas was mid December. Oklahoma has received 1.25 inches of rain December-February, against 4.1 inches on average and 30% of normal. This is the United States second largest wheat state," they note. Russia says that 96% of it's winter grains are in good to satisfactory condition. Nevertheless, SovEcon say that a 2014/15 grain harvest of 86 MMT versus the government estimate of 95 MMT is likely to be nearer the mark, given the sharp reduction in higher yielding winter plantings. Mar 14 CBOT Wheat closed at $6.09 3/4, down 6 1/2 cents; Mar 14 KCBT Wheat closed at $6.82 3/4, down 9 cents; Mar 14 MGEX Wheat closed at $6.64 1/4, down 17 1/2 cents. For the week CBOT wheat still added 10 1/4 cents, with KCBT wheat up 8 1/4 cents and MGEX falling 2 1/4 cents after today's slump.