Chicago Mixed On Positioning Ahead Of Crucial USDA Report

07/11/13 -- Soycomplex: Soybeans closed mixed, firmer on the nears and weaker on the forwards, ahead of tomorrow's important USDA report. That is expected to give us a US 2013 soybean yield of 42.407 bu/acre, from within a range of estimates of 41.5-43.3 bu/acre. The USDA's September estimate was 41.2 bu/acre and 2012 final yields were 39.6 bu/acre. For production the average trade guess is 3.221 billion bushels, from within a range of estimates of 3.137-3.298 billion. The USDA September estimate was 3.149 billion and the 2012 crop was 3.015 billion. Bean harvested acres are estimated at 75.928 million, from within a range of estimates of 74.7–76.98 million and the USDA's September estimate of 76.378 million. US 2013/14 soybean ending stocks are forecast at 172 million bushels, from within a range of estimates of 145-240 million and the USDA's September estimate of 150 million. In other news, weekly soybean export sales came in at 1,018,400 MT for 2013/14 along with a further 18,700 MT for 2014/15. Sales of only 113,500 MT were needed to hit the USDA target for the season. Weekly shipments were very strong at 2,159,800 MT, and were primarily to China (1,690,900 MT). Total net shipments plus outstanding sales now stand at 89% of the current USDA forecast for the season versus around 60% normally at this relatively early stage. Separately, private exporters reported the sale of 250 TMT of US soybeans to China under the daily reporting system. Nov 13 Soybeans closed at $12.78 3/4, up 15 3/4 cents; Jan 14 Soybeans closed at $12.66 1/2, up 11 1/2 cents; Dec 13 Soybean Meal closed at $403.80, up $7.00; Dec 13 Soybean Oil closed at 40.74, down 40 points.

Corn: Corn was narrowly mixed, but still managed to post a new lowest close in more than 3 years on front month Dec 13. The daily trading range was less than 5 cents. The market is expecting a bearish report from the USDA tomorrow. With funds heavily over-sold the reaction could be violent to the upside IF it doesn't get it. US 2013 corn yields are seen averaging 158.933 bu/acre, from within a range of estimates of 155.6-163.3 bu/acre. The USDA's September estimate was 155.3 bu/acre and 2012 final yields were only 123.4 bu/acre. Corn production is estimated at an average of 14.003 billion bushels, from within a wide range of estimates of 13.421–14.367 billion. The USDA's September estimate was 13.843 billion bushels and 2012 final production was 10.78 billion. For corn harvested acres the average trade estimate is 88.0947 million, from within a range of estimates of 86.9-89.135 million and the USDA September estimate of 89.135 million. US 2013/14 corn ending stocks are seen rising to an average estimate of 2.029 billion bushels, from a range of estimates of 1.799-2.292 billion and the USDA September estimate of 1.855 billion. Weekly export sales for corn were better than expected at 1,718,600 MT. This week's exports were 710,200 MT. China are said to have approved Brazilian corn for import, giving US corn a bit more competition there. There's also some talk that the EPA could release revised (lower) ethanol production mandates tomorrow, which could add to the volatility. Dec 13 Corn closed at $4.20 1/2, down 3/4 cent; Mar 14 Corn closed at $4.31 1/2, unchanged.

Wheat: Wheat closed with fairly modest losses, with the Kansas market displaying the most weakness. The expectation for a bearish USDA report on corn is keeping a lid on any attempts at a wheat rally. For wheat, tomorrow's report is expecting a fairly large drop in US 2013/14 carryout, from 561 million bushels in September to 519 million this time round. This is largely due to the "new" demand being displayed on an almost weekly basis from Brazil. Weekly export sales for wheat were ho-hum at 416,800 MT for 2013/14 plus 11,000 MT for 2014/15, and included only 27,700 MT to South America's largest wheat buyer. Actual shipments of 312,000 MT included 85,200 MT to Brazil. The FAO cut their forecast for the Argentine wheat crop from 9.5 MMT to just 8.8 MMT, the same level given by the Argentine Ministry a couple of weeks ago that was subsequently "pulled" as being erroneous. To add to the southern hemisphere confusion the USDA's FAS in Canberra put Australia's wheat crop at only 23.5 MMT, citing weather problems in eastern states, despite other trade estimates being in the 25.0-28.0 MMT range. The USDA themselves went for 25.5 MMT in September. Canada's wheat crop could be increased from the 31.5 MMT that the USDA forecast in September to around 33 MMT. Meanwhile a CNGOIC senior economist says that China will import "only" 5 MMT of wheat in 2013. The USDA has pegged imports at 9.5 MMT for the 2013/14 season. They have certainly gone a bit quiet lately. Then we also have the question of India to be answered. What will they export in 2013/14 now that they've lowered their price aspirations? Dec 13 CBOT Wheat closed at $6.53, down 1/4 cent; Dec 13 KCBT Wheat closed at $7.12 1/2, down 4 cents; Dec 13 MGEX Wheat closed at $7.09 1/2, down 2 3/4 cents.