CBOT Closing Comments
Corn
July Chicago corn closed at $4.07 ½, up 2 ¼ cents. Threats against corn-ethanol subsidies are a concern but remain some way off for now. Of more immediate concern are planting delays in the Midwest and potential yield losses from cool & wet conditions. Trade estimates for tomorrow's weekly export sales are 800,000 to 1,200,000 MT.
Soybeans
July soybeans finished at $11.18, up 17 cents. Tight old crop stocks, the ongoing problems in Argentina and firmer outside markets supported beans throughout the session. All eyes will be on Thursday's USDA export sales report to see if China still keep returning to the trough.
Wheat
Wheat finished slightly higher with July at $5.58 ¾, up 6 ¼ cents. Spring wheat planting delays in the US and Argentina about to plant their lowest winter wheat acreage on record are seen as supportive. Plantings in Argentina are seen down around 19% in the wake of a year-long drought and continued disputes between the farmers and the government over taxes.
EU Wheat Ends Flat/Higher
EU wheat futures closed flat to mostly higher Wednesday supported by rising crude oil and stock markets.
Paris November milling wheat finished up EUR1.25 at EUR149.25/tonne, and London November feed wheat closed flat at GBP124.00/tonne.
There is currently very little to get excited about with farmers remaining reluctant sellers ahead of a mixed outlook for new crop.
Still old crop stocks are plentiful, which will likely cap any rises from progressing too far unless weather problems materialise into a serious crop scare.
Argentina is about to start planting its wheat crop in the face of a year long drought, with output now seen at 11 MMT, up on 2008 but significantly lower than original projections.
NWF Shares Jump
Shares in NWF, the Cheshire-based warehousing, feed and fuel group jumped yesterday following the news that it expects its full-year results to be “significantly ahead” of market expectations after a good all-round performance during the winter.
NWF chief executive Richard Whiting said: “NWF has continued to perform at record levels throughout the key winter months and, in particular, the team in the fuels division has delivered an exceptionally strong result.
“The strength of our three trading divisions continues to deliver a good platform to support the future development of the group.”
Shares leapt 14% yesterday to close up 11.5p, at 95p, and are currently up a further 8.5% this morning at 102p.
US Attaché Pegs EU Wheat Crop At 137.7 MMT
The US agricultural attaché projects the 2009 wheat production (including durum) in the EU-27 at 137.7MMT. This is below the 151.7MMT produced last year due to a lower harvested acreage of 25.8 (26.9) mln ha and lower yields.
Barley production is estimated at 64.2 (65.6) MMT from a harvested acreage of 14.3 (14.6) mln hectares.
Corn production is seen at 56.9MMT, down from 62.4MMT in 2008.
ADM Profits Plunge 98 Percent
Archer Daniels Midland Company yesterday announced net earnings for the quarter ended March 31, 2009 decreased 98% to $8 million, or $0.01 per share from $517 million or $0.80 per share last year.
The figure including a $132 million non-cash after-tax charge related to currency derivative losses of the Company's equity investee, Gruma S.A.B. de C.V., and a $97 million income tax charge related to the Company's investment in Wilmar International Limited.
Net sales and other operating income decreased 21% to $ 14.8 billion.
CBOT Closing Comments
Corn
May corn closed at $3.98 ½, up ½ cent. There are some concerns about the EPA’s proposed new alternative-fuel standard and that it could favour other fuels ahead of ethanol. Wet and cool weather continues to frustrate US farmers attempts to crack on with planting.
Soybeans
May soybeans finished at $11.16, up ¾ cent. Whilst planting delays might be bullish for corn, the possibility is that they will lead to more US soybean acres. The old crop stocks situation still looks tight, but next week's USDA report is likely to show plenty of new crop ending stocks in the pipeline.
Wheat
May CBOT wheat closed at $5.41 ½, up 3 cents. Spring wheat planting progress continues to lag well behind normal, although yield potential in Kansas, the major HRW producer, looks promising. Weakness in soy & corn limited wheat's gains.
EU Wheat Nudges Higher
EU wheat futures nudged higher Tuesday, despite a sharply weaker dollar with Paris May milling wheat closing up EUR0.50 at EUR146.25/tonne, and London July feed wheat rose GBP0.25 at GBP114/tonne.
Firmer equities, crude oil and a strong Chicago market outweighed the negative impact of a weak dollar to send prices modestly higher at the close.
US spring wheat plantings remain well behind schedule, and the outlook for lower production numbers in 2009 is keeping traders cautious, with farmers only light sellers ahead of an uncertain outlook for new crop.
After a largely dry start to the year recent rains will have aided crop development in the UK, France and Germany, but more is needed if we are to get even close to last seasons bumper yields.
US Planting Progress Lags
Wet and soggy conditions continue to hamper US farmers' planting progress with just 23% of spring wheat, 33% of corn and 5% of soybeans in the ground so far.
Spring wheat is normally 59% seeded by now, with progress in the US top producing state of North Dakota only 3% complete compared with 51% on average.
The weather looks to continue rather cool and wet in the week ahead for much of the Midwest, before a brief surge of hot air out of the southern Plains creates warm-front rains a week from today, with the two forward-one back “two-step dance” continuing. A major warm-up mimicking summer shows 10 days out, according to Allen Motew of QT Weather.
Somali Pirates Hijack Soy Vessel
Somali pirates are understood to have hijacked the British-managed MV Ariana and its 24-strong Ukrainian crew.
The vessel was captured off the coast of the Seychelles in the early hours on Saturday morning.
Owned in Greece by All Oceans Shipping, the vessel is Maltese flagged and managed by London-based Seven Seas Maritime.
The vessel was understood to have been carrying 35,000MT of soybeans from Brazil to the Middle East.
Stan Rankin has already been spotted at Mogadishu airport!
CBOT Closed Sharply Higher
Corn
May corn closed at $4.06 ¼, up 10 cents. Strong buying came in during the last hour of trade to take corn to new daily highs. Another belt of rain is set to hit much of the corn belt Saturday/Sunday/Monday which will keep field progress to a minimum. The USDA will release its latest planting progress report Monday night, with traders expecting the crop to be only around 30-35% seeded, compared to a five year average of 58% done. Spillover strength from soybeans and wheat also helped corn today, as too did firmer crude oil.
Soybeans
May soybeans closed at $11.02, up 32 cents, breaking through the $11 mark as China continues to buy US beans at an aggressive pace. The government there announced that it would continue to shore up the domestic market by buying a further 1.25 MMT of soybeans from Chinese farmers. With supply worries remaining over Argentina, this should keep Chinese crushers coming back for more US beans for a little while longer yet. Meanwhile, in addition to its logistical problems, the Argentine crop keeps shrinking, now only expected to yield 32-34 MMT, sharply down from early season hopes of 50 MMT.
Wheat
May CBOT wheat finished at $5.57 ¼, up 33 cents. Spring wheat planting progress is severely behind schedule, with traders calling Monday night's USDA report to show around 20-24% complete, compared to 58% normally at this time of year. North Dakota, don't even go there sister, the largest spring wheat producing state in the US by a country mile was just 1% planted as of last Monday. For winter wheat Oklahoma & Texas crops are also looking like a disaster area, with a sharp frost at the beginning of April decimating potential yield there. Crop concerns in Russia and the Ukraine are also now surfacing.
EU Wheat Follows US Market Higher
EU wheat futures closed higher Friday, buoyed by sharply firmer US markets late in the day.
London November feed wheat closed up GBP1.75 at GBP124.00/tonne, whilst Paris May milling wheat was EUR1.50 higher at EUR142.00/tonne.
US wheat futures were sharply higher late in the session, which added support despite a weaker US dollar.
Severe planting disruptions to US spring wheat in North Dakota, which accounts for almost half of all US spring wheat production, are seen as supportive.
Talk of dryness issues in Russia and Ukraine potentially affecting winter wheat yields there was also bullish for wheat.
In the EU France, Germany and the UK have all had a much drier than normal last three months. Although rains have been fairly widespread this past few days, much more is needed to get back to normal precipitation levels for this time of year.
EU farmers remain reluctant sellers at current levels, preferring to adopt a wait and see attitude. With the existing premiums to be had for new crop over old crop who can blame them?
eCBOT Close, Early Call
The overnights closed mixed with wheat 3-5 cents higher, corn up 1-2 cents and beans around unchanged levels. Nothing much to get too excited about there, it's been a roller coaster ride this week with panic selling on Monday seen by many as a buying opportunity.
For soybeans China is still the major market influence, taking more than half of the USDA's weekly export sales yesterday. The Chinese government have said that they will continue to support domestic prices by increasing it's purchases from farmers from 6 MMT to 7.25 MMT, which may stimulate even further import activity from crushers, despite high stock levels.
There are some who think that Chinese demand is a massive pack of cards waiting to collapse, and they could be right.
The WHO has officially now stopped calling swine flu swine flu, it's just flu now. Mexican fatality and hospital admission rates are falling.
My stepdaughter (aged 12) came home from school yesterday saying that there were 20 confirmed cases in nearby York and that schools there were closing left right & centre and that we were surely next, what would we do if we all caught it, everyone at school is really worried etc.
Of course it's all a load of baloney, but I guess that school kids believe all this stuff.
The Egyptians appear to be using the scare to con the masses into a nationwide pig-cull, much to the angst of the pig-keeping Christian minority.
Spring wheat planting in North Dakota just can't seem to get going. They've had an inch of rain this week, and with temperatures forecast to do no better than nudge into the 60's over the weekend soggy fields aren't going to be doing much drying out just yet.
Early calls for this afternoon's CBOT session: Corn called steady to 2 higher; soybeans called flat to 1 higher; wheat called 3 to 6 higher.
Egyptian Bacon Butties On Special Offer This Week
Egypt has announced plans to cull the entire national pig herd of around 250-350,000 head in the wake of the swine flu outbreak. At first casual glance that sounds bearish for soy doesn't it?
Well, there's a bit more to it than meets the eye.
The country's pig population largely belongs to the Christian minority living in slum areas around Cairo. Suffice to say that they don't get a lot of high protein soymeal in their diet.
The swine flu outbreak in Mexico has been seized upon by the government as a convenient excuse to rid the country of what the Muslim majority regard as unclean pests.
Christian farmers blocked streets and stoned vehicles of Health Ministry workers who came to carry out the government's order.
The state-owned Al-Ahram daily said that a farmer at an undisclosed location had been caught with 300 pigs as he tried to smuggle them to freedom on Wednesday. Armed police have been stationed huffing and puffing outside some of Cairo's pig sties to prevent such incidents.
Australian Wheat Planting Begins
Farmers in Eastern Australia have begun planting winter wheat after most of South Australia, Victoria and southern New South Wales received decent rainfall totals in the last week of April.
After a week of near record cold temperatures southeastern Australia can expect milder weather to develop during the weekend, forecasters say.
On Friday morning temperatures plummeted as much as seven degrees below the May average in Victoria and NSW.
While the east of the country is rugged up in near freezing temperatures, the west coast is enjoying sunny and warm weather more typical of mid summer.
Perth is set to record at least six days in a row of plus 25 degree temperatures only weeks out from winter.
The spell could easily last until late next week which will be the longest stretch of plus 25 degree May days for Perth in at least 46 years.
This warm and dry pattern in Western Australia, which produces around 40-45% of the country's wheat, will keep farmers in the state sitting on their hands for a week or two yet. Many areas of the WA wheat belt had just 10mm or less rainfall during April.
