08 July 2015 | Online since 2003

No evidence of grain disruptions out of Ukraine region

7 March 2014 04:30:36|Arable,Cereal,Crops,Finance,News

No evidence of grain disruptions out of Ukraine region


Beans closed with generally modest losses, consolidating from the recent rally, as the USDA announced China had cancelled 245,000 MT of US soybeans for 2013/14 delivery. There was again a slightly more relaxed tone to the turmoil in Russia and Ukraine for a second day, adding a little bit of bearish sentiment. The harvest is moving forward in Brazil, in between the showers, and so are shipments. "The state of Goias in central Brazil has been one of the hardest hit states this growing season," says Dr Cordonnier. Dry conditions earlier in the growing season and no wet weather at harvest-time have taken the shine off yields. "The Agriculture Federation of Goias (Faeg) estimates that 1.8 MMT of soybeans were lost statewide due to the dry weather," he says.

Yields in Goias are estimated at around 45 sacks per hectare versus 50-55 sacks/ha normally, he adds. For Monday's USDA Supply/demand report, traders see 2013/14 US soybean ending stocks falling to near 140 million bushels from 150 million last month. It will be interesting to see if the USDA will budge any lower than last month's 150 million, as they steadfastly refused to do so in 2012/13, regardless of the frenetic pace of US exports this season. Somehow, I doubt it. World soybean ending stocks are seen at 71.46 MMT, versus a February USDA estimate of 73.01 MMT. Trade estimates for the Argentine soybean crop are 53.5 MMT, with a further 88.14 MMT from Brazil. Last month's USDA estimates were 54 MMT and 90 MMT respectively. CONAB's Brazilian crop estimates come out on 12 March.

Before that we get the regular weekly export sales report tomorrow. For that the trade is anticipating combined sales for both marketing years of 750 TMT to 1.2 MMT. Having been stuck in a terminal decline for the whole of 2013, soybean oil has suddenly found some traction, aided by palm oil hitting 17-month highs this week on persistent dryness in the major producing countries of Indonesia and Malaysia. Mar 14 Soybeans closed at $14.20, up 2 cents; May 14 Soybeans closed at $14.20 1/2, down 2 1/2 cents; Mar 14 Soybean Meal closed at $457.70, down $1.10; Mar 14 Soybean Oil closed at 43.18, down 28 points.


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.


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.


0 Comment


Please enter your name



Please enter your comment

Post Comment

Your comment submitted successfully.Please wait for admin approval.


No comments posted yet. Be the first to post a comment


Start Date: 7 July 2015
J532: UK Business Manager - business services

UK Business Manager - business services.De Lacy Executive has been appointed to seek a UK Business Manager to direct and deve...

Start Date: 23 June 2015
Seasonal Tractor Driver and General Farm Work Job

Vegetable farm require a competent and experienced tractor driver to help with harvest. Varied duties will include tractor dr...

Start Date: 24 June 2015
Job for  Assistant herds person>>> Shepton Mallet

Modern 36/36 delaval 2 man parlour, ACR and ADF. All year round calving, cubicle housed, TMR and out of parlour fee...

Start Date: 7 July 2015
C174: Monogastric Nutritionist

De Lacy Executive is currently recruiting for a Nutritionist to enhance my clients team of expertise within their monogastric...

Start Date: 7 July 2015
M484 : Farm Liaison Managers - England & Wales

Our well established client specialises in the recycling of nutrient rich organic materials to agricultural land throughout E...

Top stories you may have missed
5 June 2015 | Cattle

A strong pound and increased red meat imports coupled with a plentiful dome...

5 June 2015 | Arable

Depression is affecting Wales' farming industry and there is a need to use ...

5 June 2015 | Arable

With just one week to go before the final judging and announcement of the w...

5 June 2015 | Finance

A rural law expert has highlighted the importance of good succession planni...

5 June 2015 | Farmshops

A south Yorkshire dairy farming family is pulling out all the stops to prom...

4 June 2015 | Finance

Predicting what is going to happen to wheat prices is a challenge, but in s...

4 June 2015 | Agri Safety

A Lancashire based livestock theft prevention scheme is aiming to go nation...

4 June 2015 | News

A female farmer has been recognised by the farming and conservation industr...

4 June 2015 | Finance

The new Conservative government appears to be preparing to implement cuts f...

4 June 2015 | Arable

The Rural Payments Agency (RPA) will have mobile support units at the follo...