Chicago Jumps, Led By Limit Up Corn

25/06/12 -- Soybeans: Jul 12 Soybeans closed at USD14.82 1/2, up 40 cents; Nov 12 Soybeans closed at USD14.25 1/2, up 50 cents; Jul 12 Soybean Meal closed at USD432.80, up USD10.80; Jul 12 Soybean Oil closed at 51.27, up 153 points. Funds were heavy buyers on the day, booking an estimated 12,000 soybean contracts along with 4,000 of meal and 5,000 of oil following a hot and dry weekend in the US with the promise of more to follow this week. Note that new crop is now gaining on old crop. The USDA reported the sale of 120,000 MT of soybeans to China for 2012/13 delivery. After the close they cut good/excellent US crop ratings by three percentage points to 53%. A choppy week lies ahead it would seem, dictated by daily weather forecasts, Friday's USDA stocks and planting numbers and developments in Europe.

Corn: Jul 12 Corn closed at USD6.31, up 40 cents; Dec 12 Corn closed at USD5.94, up 40 cents. The first five positions on corn all closed the daily 40 cent limit higher in the grip of a full blown weather market, helped by funds coming in to buy an estimated 21,000 contracts on the day. Lack of rainfall and high temperatures across much of the corn belt as corn enters the key pollination stage early are behind the move. After the close the USDA cut good/excellent corn ratings by six percentage points to 57% - a larger drop than the trade was anticipating. This time last year the crop was rated 63% good/excellent and yet we still only finished up with a 147 bu/acre yield. The current USDA estimate of a record 166 bu/acre yield clearly has to be reduced considerably next month.

Wheat: Jul 12 CBOT Wheat closed at USD7.24 1/4, up 51 cents; Jul 12 KCBT Wheat closed at USD7.33, up 47 cents; Jul 12 MGEX Wheat closed at USD8.80, up 21 cents. Funds were said to have been net buyers of around 8,000 Chicago wheat contracts on the day. Spillover strength from corn and short-covering were a feature. Backing up the bullish theme was the Russian Ministry cutting their grain production estimate from 94 MMT to 85 MMT, with the wheat harvest now predicted at 46-49 MMT versus 56.2 MMT last year. Exports are also seen sliding from 20 MMT this season to 16-18 MMT in 2012/13. The Ukraine state weather centre also lowered it forecast for grain production there too. After the close the USDA said that the US winter wheat harvest is 59% complete, more than twice the normal pace. Spring wheat crop conditions were raised to 77% good/excellent, with 57% of the crop headed compared to just 18% normally.