Chicago Rallies Desite Outlook For Bumper World Production In 2013/14

22/05/13 -- Soycomplex: Beans posted decent gains, supported by a firmer corn market. Although Argentine dockers in the port of Rosario have returned to work a backlog of 40-50 vessels has apparently already built up. The threat of further strikes in both Argentina and Brazil in the weeks and months ahead will keep the pressure on very tight old crop US supplies. Oil World are projecting that the US will import 32 million bushels of soybeans themselves this year, around 870 TMT, as demand for meal stays high. US soybean sales are already 99% of the USDA's target for the season, and 98% in the case of meal (the target for which was increased in this month's WASDE report). Trade estimates for tomorrow's weekly export sales report for beans are a combined crop year total of 400-800 TMT and in the case of meal 100-225 TMT. Lanworth projected the world 2013/14 soybean crop at a record 286 MMT, fractionally higher than the USDA's recent 285.5 MMT estimate. They have the US soybean crop estimated at 3.430 billion bushels versus a previous estimate of 3.425 billion, an increase of almost 14% on last year. China's CNGOIC said that the rapeseed harvest there is 5-10 days ahead of normal, forecasting a crop of 14.1 MMT, up 0.7% on 2012. Harvesting in the top rapeseed province of Hubei is at the halfway stage, and 80% done in the second highest producing province of Hunan. They said that China had imported 2.912 MMT of rapeseed between Jun12-May13 so far, up 40.9% from a year ago, estimating full season 2012/13 imports at a record 3.1 MMT. Jul 13 Soybeans closed at USD14.94 1/4, up 16 cents; Nov 13 Soybeans closed at USD12.38 3/4, up 18 cents; Jul 13 Soybean Meal closed at USD440.60, up USD1.90; Jul 13 Soybean Oil closed at 49.64, up 16 points.

Corn: The corn market got a boost from the USDA confirming the sale of 360 TMT of new crop corn to China, along with a further 180 TMT to "unknown" destinations. In addition to that the weekly ethanol grind came in at 875,000 barrels/day, up 18,000 bpd from last week and the highest level in 11-months. Ag Canada estimated corn production there this year at 13.8 MMT versus a previous estimate of 12.5 MMT and up 5.7% on last year. Lanworth estimated the global corn crop in 2013/14 at a record 965 MMT, similar to the USDA's 965.9 MMT forecast earlier this month. The Australia and New Zeland Bank said that Brazilian corn production in 2012/13 could rise "close to 80 MMT for the first time" versus the USDA's current estimate of 76 MMT due to favourable conditions for "safrinha" or second crop corn. Lanworth pegged Brazilian corn production at 78.1 MMT this year, up 7% on last season. Taiwan cancelled a tender for 60 TMT of Brazilian or South African corn for July/Aug shipment due to high prices. Some are suggesting that US corn plantings could reach 90% complete by Sunday night, from 71% a week previously. The potential problem with having a very large percentage of the US corn crop planted all at the same time is that it will also likely pollinate all at the same time. That leaves a large percentage of the crop vulnerable to a heat wave should they get one later in the summer. The latest 3-month (Jun/Aug) weather outlook from the NOAA predicts above normal temperatures for the western plains, southeast, delta, and east of Indiana. Normal temps are expected from central Illinois north into Iowa, Minnesota, and Wisconsin. Normal precipitation is expected for nearly the entire Corn Belt with the exception of the western half of Nebraska, Kansas, and Oklahoma. Trade forecasts for tomorrow's weekly export sales report are 200-500 TMT. Jul 13 Corn closed at USD6.58 1/2, up 18 1/2 cents; Dec 13 Corn closed at USD5.30 1/2, up 10 1/4 cents.

Wheat: Wheat was dragged along for the ride by corn and beans. For once Chicago gained on Minneapolis wheat, suggesting that there may have been some unwinding of long MGEX and short CBOT positions. Lanworth forecast the 2013/14 global wheat crop at 694 MMT, a little lower than the USDA estimate of 701 MMT, but still up nearly 6% on last year. The US wheat crop was estimated at 2.02 billion bushels, unchanged from previous estimate and 11% down on last year. Production everywhere else around the globe though is generally seen higher this year. The 2013/14 Australian wheat crop was estimated at 24.1 MMT versus a previous estimates of 24.3 MMT but up 9.5% on last year. The Argentine Ag Secretary forecast 2013 wheat plantings there to rise 40%. Ag Canada estimated wheat production there this year at a record 29.4 MMT versus a previous estimate of 28.4 MMT and up 8% on 2012/13. Lanworth trimmed their their forecast for wheat production in Ukraine to 20.3 MMT from 21.9 MMT previously, but that's still 29% more than output in 2012. Germany’s Farm Co-op estimated their 2013 wheat crop at 23.7 MMT, up 6.3% from 22.3 MMT in 2012. Analysts estimated the French wheat crop at 36.0 MMT versus 35.6 MMT in 2012. The Australian Bureau of Meteorology said eastern Australia should see above-normal rainfall in Jun/Aug, which would be extremely welcome. Tunisia is tendering for 67 TMT of milling wheat and 25 TMT of feed barley, both of optional origin for June shipment. Trade forecasts for tomorrow's weekly export sales report are 400-700 TMT. Jul 13 CBOT Wheat closed at USD6.88 1/2, up 8 cents; Jul 13 KCBT Wheat closed at USD7.43 1/4, up 4 3/4 cents; Jul 13 MGEX Wheat closed at USD8.07 3/4, down 5 3/4 cents.