The Late Morning Vibe

21/10/13 -- Latest customs data out of China shows that they imported the following grains/oilseeds in September: 4.7 MMT of soybeans (down 5.4% versus September 2012), 718.5 TMT of wheat (+37%), 336.6 TMT of barley (+67.6%) and 232.8 TMT of rapeseed (+26%). Have I forgotten something? Yes, corn, the reason I nearly forgot corn is that they only imported 1,537 MT of the stuff, a 99.6% decline on the volume imported in September 2012. That was probably a blip then? Well, Jan/Sep 2013 corn imports stand at 1.6 MMT, some 61% less than they imported during the same period in 2012, so it might not be a blip at all.

For what it's worth Jan/Sep 2013 soybean imports now stand at 45.754 MMT, up 3% on a year ago; Wheat imports of 2.842 MMT are 12% down on this time last year; barley imports of 1.719 MMT are 17% lower than in 2012; rapeseed imports of 2.523 MMT represent a 24% increase.

One thing that is interesting is that of the 718.5 MMT of wheat that China imported last month, 684 TMT of it (95%) came from the US - that's more than double the volume of US wheat they imported in the corresponding month in 2012. In contrast, none of their September soybean imports came from the US, with Brazil being the largest supplier (3.646 MMT) followed by Argentina (580 TMT).

Another point of interest is that they imported far more rapeseed from only recently allowed back into the fold Australia (172 TMT) than old stalwart supplier Canada (61 TMT).

As far as year to date wheat supplies go, China have imported 58% of their Jan/Sep requirements from the US (1.643 MMT). Again this is more than double the volume imported from the US in the same period in 2012. Canada is their second largest supplier at 624 TMT. followed by Australia (543 TMT).

Of their total Jan/Sep soybean imports of 45.754 MMT, Brazil has supplied 60% (27.544 MMT), the US 27% (12.524 MMT) and Argentina 8% (3.588 MMT). Brazil's volume is up 24% versus 2012, America's is down 24% and Argentina's down by 15%.

Russia's grain harvest now stands at 86.8 MMT, off 88.9% of plan, according to the Ag Ministry. They've harvested 93.2% of the wheat area, producing a crop of 52.4 MMT to date. The barley harvest is 90% done at 15.5 MMT and the corn harvest 37.3% complete at 4.8 MMT.

Winter grains have now been planted on an area of 12.5 million hectares in Russia, 76.3% of the original target. At least according to the Ministry they have. This time last year they'd planted 15.1 million ha, and in 2011 it was 14.6 million ha.

Russia's Oct 1-16 grain exports were 1.07 MMT, including 832 TMT of wheat, 153 TMT of barley and 75 TMT of corn. They've now shipped 9.97 MMT of grains since the start of the 2013/14 marketing year, up 7% versus 12 months ago. The Ministry's aim is for full season exports of 18-20 MMT.

In Ukraine meanwhile, exports are picking up as more corn comes onto the market. Grain shipments last week totalled 990 TMT, up 71% from the previous week. They've exported 7.79 MMT of grains this season so far, up 9.8% versus last year. That includes 4.8 MMT of wheat, 1,73 MMT of barley and 1.19 MMT of corn.

I omitted to tell you over the weekend that Informa pegged US all wheat plantings at 57.7 million acres for the 2014 harvest, a rise of 1 million on their previous forecast and 1.6 million more than was planted for this year. With winter wheat also looking in much better shape this year we could therefore see a significant rise in US wheat production next year.

It's interesting to note that deciding to plant the largest corn area in 75 years when the latter was running at parity close to parity with wheat last spring now means that corn prices are on their arse, relatively speaking versus wheat and soybeans. Now it would seem that US farmers are to switch out of corn in big way next year, simultaneously jumping ship for soybeans (and wheat to a lesser degree). Growers in Brazil and Argentina have also been thinking along the same lines.

Could it be that there will be a tidal wave of soybeans on the global market next year? A lot depends on the weather and Chinese demand, but at "only" 3% up so far this calendar year, will the latter's imports really jump 16% in the 2013/14 marketing year as currently forecast by the USDA? It looks a tall order to me. Note too that they are stepping up their rapeseed imports at a much faster rate than those for soybeans.