Midwest freeze restricting movement of grains
Midwest freeze restricting movement of grains
SoycomplexBeans fell hard on a combination of risk aversion, the impending huge South American crop and yet more Chinese cancellation talk. Argentine weather suddenly looks more co-operative, and if anything they could now do with a bit less rain in Brazil where the soybean harvest pace in Mato Grosso has slowed, hindered by persistent showers. "According to the Mato Grosso Institute of Agricultural Economics (Imea), the soybean crop in the state is approximately 6% harvested, which is 2% slower than last year at this time," said Dr Cordonnier. The USDA's attaché in Brazil estimated the 2013/14 soybean crop at a record 89.5 MMT versus the official USDA estimate of 89.0 MMT and the 2012/13 crop of 81.6 MMT. The attaché estimated Brazil's 2013/14 bean exports at a record 46.0 MMT, which is 2 MMT more than the USDA's own forecast. Argentina producers are still not selling old crop or new crop soybeans until the dust settles around the rapidly weakening peso. There's talk of a possible hike in the soybean export tax too. "If the government begins to enact measures to entice or even force sales, this could be a very bearish development on the market," said one commentator. Some are saying that tomorrow's weekly export sales report could be in negative territory for old crop beans due to Chinese cancellations. The US has been busy selling new cop beans lately. Trade estimates for export sales for both marketing years tomorrow are around 500-600 TMT. Chinese markets are closed Friday and Monday due to Lunar New Year celebrations. Mar 14 Soybeans closed at $12.69 1/4, down 16 1/4 cents; May 14 Soybeans closed at $12.56 3/4, down 14 1/4 cents; Mar 14 Soybean Meal closed at $423.30, down $5.30; Mar 14 Soybean Oil closed at 37.10, down 30 points.CornThe corn market closed around 4 cents lower amidst a general malaise in the grain markets. The current deep freeze hitting the Midwest is keeping producer selling light and restricting the movement of grains however. Temperatures are forecast to moderate a little by the end of the week, but storms could bring up to 6 inches of snow for some. Reuters reported that Canada's record 14.2 MMT corn crop is making it as far afield as Ireland. In fact, of the volume shipped abroad in the first five months of 2013/14 nearly three-quarters of it headed for Ireland, according to the Canadian Grain Commission. Ukraine seem to be having a few problems with weather-related logistics, maybe that is why the US picked up a 110 TMT sale to Spain yesterday? The US Energy Dept reported weekly ethanol production at 900,000 barrels/day, down 5,000 bpd on the previous week. Around 924,000 bpd is what is required to hit the USDA projection for the season. Stocks also declined to 16.9 million barrels from 17.0 million last week. Trade estimates for tomorrow's weekly export sales report are in the 600-900 TMT region for corn. An improved weather outlook for Argentina may help corn a bit, but is likely to be more beneficial for soybeans it is thought. The trade is watching and waiting for any action from the Argentine government to "encourage" a pick up in farmer selling. There's talk that bird flu in China is spreading. Mar 14 Corn closed at $4.27 1/2, down 4 1/2 cents; May 14 Corn closed at $4.34, down 4 cents.WheatThe wheat market crashed between 7 and 14 cents lower on the day across the three exchanges. Front month Mar 14 CBOT wheat displayed the most weakness closing at the lowest level since July 2010 on the continuous chart. An improved US weather outlook, a moderation in temperatures and chances of snow removed some of the winterkill talk. Japan bought 150 TMT of feed barley via a tender for Feb – March shipment. Bangladesh bought 150,000 TMT of Indian wheat. US wheat was easily the cheapest offer put up on an FOB basis in yesterday's Egyptian tender, but they still only bought one cargo of US SRW. The US offer was matched by Russian wheat when freight was added on. There were no Ukraine offers. It's difficult to know if that was because they are sold out, or due to the civil unrest going on there at the moment. There were no Romanian offers either. The move to lower the maximum moisture requirement to 13% could provide a boost for US wheat to make further inroads in future GASC tenders. Egypt’s Supply Minister said that their wheat reserves are now sufficient to last until May. Regardless, they may well be back in the market again next week, or even over the weekend after today's price slump. Trade estimates for tomorrow's weekly export sales report are 350-550 TMT. Minneapolis wheat set another new contract low for the third session in a row today, closing below $6/bushel. Mar 14 CBOT Wheat closed at $5.51 1/2, down 14 1/2 cents; Mar 14 KCBT Wheat closed at $6.08 3/4, down 13 1/4 cents; Mar 14 MGEX Wheat closed at $5.98, down 7 cents.
No comments posted yet. Be the first to post a comment
Farms and Land for sale
Farming UK Holiday Rentals
Top stories you may have missed