Chicago Modestly Higher In Narrow Trade

18/09/13 -- US Crop Weather: "A rainy weather pattern has developed in the Midwest. The forecast remains promising for heavy soaking rains across the several days. Waves of showers would develop in a slow-moving trough of low pressure. At least 0.50 inch of rainfall is expected in the Midwest, but 0.75 to 1.25 inch in a wide swath from eastern Kansas to Wisconsin, including most of Iowa. Rain this late in the growing season would not have much of an effect on drought-stressed crops. One inch of rain may stem the tide of deterioration, but would not significantly improve yields. Fields are dry through a very deep layer. The cooling temperatures in September and less intense sunlight would also limit the heat units required to drive crop development. Weather conditions would become more settled on Friday and Saturday when a weak high pressure system develops in the central United States. Light showers may resume Sunday-Monday in the Upper Midwest from a fast-tracking disturbance. North Dakota and northeastern South Dakota stand to get 0.10 to 0.50 inches of rainfall from this fast moving disturbance; elsewhere in the Midwest, weekend conditions would be dry," said Martell Crop Developments.

Soycomplex: Beans traded both sides, but ultimately closed higher on ideas that Midwest rains this week have come too late to be of much use for yields. Informa trimmed their forecast for US soybean production this year from 3.239 billion bushels to 3.22 billion and the USDA estimate of 3.149 billion. Lanworth estimated the 2013/14 global soybean crop at 281 MMT, up 3 MMT from versus a previous estimate of 278 MMT. The USDA announced 2013/14 soybean sales to China of 1.92 MMT, along with 180 TMT to "unknown" destinations. Normally a sale of this magnitude to China would be a big event, but it seems it was simply part confirmation of a framework agreement for the Chinese to buy 4.3 MMT of US soybeans over the next 12 months that was signed by a Chinese trade delegation earlier in the week. A "shop window" trade effectively, and 4.3 MMT is after all less than a month's worth of normal Chinese imports, so this is business that the US would have probably got anyway. Attention is already starting to turn to South America, even before the US harvest gets going. Dr Michael Cordonnier said that farmers in Mato Grosso, the largest Brazilian soybean state and usually this first to plant, had forward sold around 39% of the 2013/14 crop versus 61% this time last year. Growers here are waiting for rain. Somar said Mato Grosso has had some scattered rain this week, but generally the forecast is dry for the next 10 days. Oil World suggested that dryness in Argentina might lead some intended sunflower acres to get switched to beans. Trade estimates for tomorrow's weekly soybean export sales are 450-800,000 MT (this week's Chinese business will be in next week's report). Nov 13 Soybeans closed at USD13.47 3/4, up 5 1/4 cents; Jan 14 Soybeans closed at USD13.50 1/4, up 7 1/4 cents; Oct 13 Soybean Meal closed at USD427.00, down USD1.80; Oct 13 Soybean Oil closed at 42.47, up 47 points.

Corn: The corn market closed modestly higher, after also trading both sides, but within a very narrow range of only around 5 cents on the day. The weekly ethanol production data was bearish, dashing hopes that last week's rise was the start of a trend. Production fell 10,000 barrels/day to 838,000 bpd. Informa estimated the 2013 US corn crop at 13.80 billion bushels, versus a previous estimate of 14.013 billion and the USDA's estimate of 13.843 billion. Lanworth estimated the crop at 13.483 billion bushels, up from a previous estimate of 13.396 billion. They raised their 2013 US corn yield estimate to 152.9 bu/acre versus a previous estimate of 152.2 bu/acre on the back of improved yield expectations in Kansas, Nebraska, and South Dakota. They estimated the 2013 global corn crop at 942 MMT, unchanged from their previous forecast. Whichever way you look at it, the US and the world are in for a record corn crop this year. US corn will face stiff competition from the Black Sea - most notably Ukraine - and South America, despite the outlook for slightly lower production from the latter they will still have an historically large crop to market. Brazil will produce 72 MMT, against a domestic requirement of 54 MMT and Argentina will have a crop of 26 MMT against consumption of only 7.8 MMT, according to the USDA. There could still be a bit more harvest pressure to come yet for corn. Early yield reports out of the US continue to suggested better than expected results. Trade estimates for tomorrow's weekly export sales report are 350-600,000 MT. Last week's sales disappointed at 332 TMT. Dec 13 Corn closed at USD4.56 1/4, up 2 1/4 cents; Mar 14 Corn closed at USD4.68 3/4, up 2 1/4 cents.

Wheat: The wheat market closed modestly higher on all three exchanges. Informa estimated the 2013/14 US all wheat crop at 2.08 billion bushels versus a USDA estimate of 2.114 billion. Lanworth estimated the 2013 global wheat crop at 704 MMT, up from a previous estimate of 702 MMT. That puts them in the same ballpark as many other leading analysts - the USDA went for 709 MMT last week - in projecting a record world wheat crop in 2013/14. The trade is wondering how much longer US wheat exports will continue to be boosted by out of the ordinary demand from Brazil and China. The latter have gone quiet of late. The former will soon be harvesting their own wheat crop and now have the option of purchasing new crop Canadian wheat. There is trade going on in the international market, but much of it is going to European or Black Sea sellers. US SRW wheat prices are around USD270/tonne FOB the US Gulf versus USD250-255/tonne FOB the Black Sea, and smaller cargoes can be bought for less. Pakistan are said to have bought 500,000 MT of Black Sea origin wheat (for the first time in three years) over the past few weeks. Bangladesh are said to have bought 200,000 MT of Ukraine wheat over the past few weeks, and are tendering for more. Egypt has only bought Russia, Ukraine or Romanian origin since it came back into the market in early July. Meanwhile European exports are more than double what they were this time a year ago. Australia will also soon begin harvesting their 2013/14 wheat crop. Trade estimates for tomorrow's weekly export sales report are 400-800,000 MT. Dec 13 CBOT Wheat closed at USD6.46 1/2, up 3 1/2 cents; Dec 13 KCBT Wheat closed at USD6.92 1/2, up 2 1/4 cents; Dec 13 MGEX Wheat closed at USD7.00 1/4, up 3/4 cent.