Drought in Kansas grows more severe wheat market closes lower
Drought in Kansas grows more severe; wheat market closes lower
SoycomplexBeans closed little changed. A report on Reuters, quoting China's Xinhua News, said that the US has already booked 500 TMT of South American soybeans and is working on additional deals with Chinese resellers. I read that Dr Cordonnier estimated the 2014 US soybean area at 80-81 million acres, with yields at 44-45 bu/acre. Linn Group estimated US soybean plantings this spring at 81.5 million acres. Informa went 81.2 million versus 81.3 million last month. A Reuters survey came up with an average trade estimate of 81.1 million, from within a range of estimates of 78.5 to 83.6 million. The USDA's February Outlook Forum estimate was 79.5 million. They're out with revised forecasts on Monday. Also due Monday are March 1st US stocks estimates. A Bloomberg survey pegged these at 987 million bushels, a 10 year low, and down on 998 million a year ago. A Reuters survey came up with a similar number - 989 million - from within a range of estimates of 955 million - 1.087 billion. Oil World estimated the South American soybean crop at 151.45 MMT versus a previous estimate of 150.6 MMT and up 5.5% from a year ago. They have the Brazilian crop at 84.5 MMT and Argentina's production at 54.5 MMT, both would be records. Jan/Mar South American soybean exports were estimated at 10.2 MMT versus 6.1 MMT a year ago. Brazil's March bean exports were estimated at 5.0 MMT - a record for the month. Dr Cordonnier estimated the Brazilian soybean crop at 86.0 MMT, unchanged from his previous estimate, with Argentina at 54 MMT, also unchanged. Funds were seen as modest net buyers of around 2,000 soybean contracts on the day, and the market closed with modest gains. Coincidence? I think not. May 14 Soybeans closed at $14.28, up 2 1/2 cents; Jul 14 Soybeans closed at $14.01 1/4, up 2 1/2 cents; May 14 Soybean Meal closed at $463.70, up $1.70; May 14 Soybean Oil closed at 40.74, down 10 points.CornThe corn market fell on light find selling - judged to be around a net 4,000 contracts on the day. As with soybeans, trade estimates for plantings and stocks next week are flooding in. Hearing that Dr Cordonnier estimated the 2014 US corn area at 92.0-93.0 million acres, with yields averaging 163-164 bu/acre. Linn Group estimated US corn plantings at 94 million acres, whilst Informa went for a figure of 93 million versus 93.3 million last month. A Reuters survey came up with an average trade guess of 92.75 million from within a range of estimates of 90.5-94.0 million. A Bloomberg survey came up with an average guess of 93 million acres. The USDA said 92 million last month. As far as March 1st inventories are concerned, a Reuters survey came up with an average trader guess of 7.1 billion bushels from within a range of estimates of 6.86-7.54 million. Taiwan's MFIG cancelled a tender to buy 60,000 MT of South American or US origin corn for May/June shipment citing high prices. Dr Cordonnier estimated the Brazilian corn crop at 68.5 MMT, unchanged from previous estimate, although he said he could raise this forecast sometime down the line. He was also said to have estimated the Argentine corn crop at 23.0 MMT, also unchanged from previously. APK Inform estimated the Ukraine 2014 corn crop at 29 MMT. Whilst that's down a little on last year's production of 30.9 MMT, its still a very sizable crop indeed, and one that would doubtless weigh on corn and wheat prices in Europe should it be achieved. The Energy Dept are out tomorrow with their usual weekly ethanol production report. Last week's output was 891,000 barrels/day. Whilst that was up on the previous week's modest effort of 869,000 bpd, it was still well below the 933,000 bpd needed to hit the USDA's target for the season. US weather is finally set to warm up this weekend, which may see some progress made with early corn planting in the Deep South and Southern Plains. May 14 Corn closed at $4.86 1/2, down 3 1/2 cents; Jul 14 Corn closed at $4.91 1/4, down 3 1/4 cents.WheatThe wheat market closed mostly a little lower, trimming recent sharp gains a little on a lack of fresh bullish news. APK Inform Agency estimated the 2014 Ukraine grain crop at 57.3 MMT, down 9% on last year's record output, but still a decent crop. They forecast wheat production at 19.2 MMT versus 22.3 MMT last year. These estimates do not include Crimea, they said. Linn Group estimated the US all wheat planted area at 57.5 million ares. Informa went for 56.3 million. They joined others in the trade by raising their view on US spring wheat plantings to around 12.3 million acres (although some estimates are as high as 13.5 million), presumably on the back of the recent rally in wheat values. A Reuters survey came up with an average trade estimate for US all wheat plantings of 56.3 million acres, from within a range of estimates of 54.8-56.3 million. US March 1st wheat stocks were estimated at 1.042 million bushels on average, from within a range of 985 million to 1.115 billion. A Bloomberg survey estimated US all wheat plantings at 56.09 million acres. Jordan are tendering for 150,000 MT of optional origin wheat for April–May shipment. Russia's Ag Ministry said that as of March 24 spring grain plantings are 0.8% complete on 396,400 hectares versus 443,400 hectares a year ago. Drought on the US Plains continues to be a problem for wheat emerging from dormancy. "Drought in Kansas has grown more severe with extremely dry weather the past 30 days. This is the time of year when rainfall ordinarily increases with seasonal warming in spring. The average weekly rainfall in Kansas last week was 0.38 inch in Kansas, but what occurred was only 0.08 inch," said Martell Crop Projections. Funds were estimated to have sold around a net 2,000 Chicago wheat contracts on the day. May 14 CBOT Wheat closed at $7.08 1/4, down 6 1/4 cents; May 14 KCBT Wheat closed at $7.91 3/4, down 2 3/4 cents; May 14 MGEX Wheat closed at $7.64 1/2, up 1 1/2 cents.
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