24/07/15 -- EU grains closed lower across the board, both on the day and for the week.
At the close of play on Friday, Nov 15 London wheat was down GBP0.70/tonne to GBP123.30/tonne, Sep 15 Paris wheat fell a EUR0.75/tonne to EUR185.75/tonne, Aug 15 Paris corn was down EUR0.75/tonne to EUR178.50/tonne, whilst Aug 15 Paris rapeseed was EUR3.00/tonne lower at EUR384.25/tonne.
For the week that puts London wheat down GBP2.15/tonne, with Paris wheat EUR7.00/tonne easier. Paris corn lost EUR2.75/tonne during the course of the week, whilst nearby rapeseed was down EUR4.50/tonne from last Friday.
Corn came off the least worst on ideas that this is now the crop being most adversely affected by heat and dryness, in France in particular. France is of course Europe's largest corn producer.
FranceAgriMer today cut their good to very good ratings for the French corn crop by 5 points from a week ago to 62% - making for a 19 point decline in the last 3 weeks. It's also now far less than the 84% of the crop that was rated in the top two categories this time last year.
French wheat conditions were nominally left unchanged at 76% good to very good (versus 72% a year ago). Spring barley conditions were down one point in the good/very good category to 64%.
In the case of wheat I say "nominally" because 60% of the crop had already been harvested as of Monday night, up from 38% a week ago and almost double the 33% done from this time last year as the warm and dry conditions allow the combines to make rapid progress.
The French winter barley harvest was 98% done as of Monday, 6 points ahead of this time last year, and the spring barley harvest was 47% complete, up 30 points in a week and compared to only 13% this time last year.
They said that 81% of the French corn crop was at the silking stage versus 54% a week ago and 52% this time last year.
Agritel reported that reports about French wheat yields are "comforting, erasing fears linked to hot weather conditions since the end of June."
In Russia, "yields in the south of the country are generally OK, numbers for the Central district areas and the Volga are showing a big drop compared to last year. Producers in these areas are expecting yields down about 20%," they said.
The local weather centre in Siberia estimated average wheat yields in the region of around 1.2-1.4 MT/ha, which they said was somewhat lower than previously expected, although a bit better than the 5-year average for the region of only 1.24 MT/ha. Dryness and heat (with temperature of up to 37C) in June and July was the reason given for the drop compared with previously.
The Russian Ag Ministry said that the national harvest was now 15.9% complete at 27.5 MMT, with yields so far averaging 3.71 MT/ha versus 3.47 MT/ha a year ago.
Yields in the most productive Southern region (52.4% harvested) are at 4.06 MT/ha versus 3.76 MT/ha a year ago, and the North Caucasus area (68.8% harvested) is seeing average yields of 3.8 MT/ha compared to 3.69 MT/ha in 2014.
It's a different story further north though, as Agritel note. Average yields in the Central region (4.9% harvested) are only running at 3.29 MT/ha versus 3.9 MT/ha in 2014. In the Volga region, where it has been very dry, the harvest is only just getting going at 3.7% complete. Yields here are currently averaging 1.46 MT/ha compared to 2.03 MT/ha a year ago.
Things are better in Ukraine, where the national Hydrometeorlogical Centre raised their forecast for corn yields there this year from 6.0 MT/ha to 6.2 MT/ha, increasing their production forecast from 25.3 MMT to 26.5 MMT. They now expect a total Ukraine grain crop of 60.5 MMT this year.
Algeria said that they'd bought 300,000 MT of durum wheat at tender for October shipment, with 200,000 MT coming from Mexico and the rest from France.
The Hungarian Grain Association estimated their wheat crop this year at 4.5-4.7 MMT versus 5.0 MMT a year ago.
Brussels said that it had issued 325 TMT worth of soft wheat export licences this week, down from 470 TMT a week ago. Still, the total volume granted so far of 1.26 MMT is said to be the largest since 2004. It is also more than double the total released in both 2014 and 2013 at this stage.
The same is also true of barley export licences, currently at a cumulative 1.18 MMT versus 569 TMT a year ago and 447 TMT in 2013.
It's early days yet, but all that augurs well for final exports this season. Continued euro weakness will add some help.
23/07/15 -- Soycomplex: Beans closed lower. The USDA reported weekly export sales for beans of 80,800 MT for 2014/15 and 241,800 MT for 2015/16. The latter was below trade expectations, and appeared to confirm trade concerns that new crop sales are lagging. Trade estimates had been for sales of around 300,000-550,000 MT for new crop soybeans. There was however an additional sale of 180,000 MT of new crop beans sold to China under the daily reporting system. The USDA also announced 40,000 MT of US soybean oil sold to Venezuela for 2014/15 shipment. Actual soybean exports this week of 315,900 MT were pretty decent, being up 87 percent from the previous week and 56 percent above the prior 4-week average. Meal sales of 65,800 MT on old crop, and net reductions of 32,100 MT on new crop were poor. Trade gossip says that Ecuador and the Philippines have both purchased soymeal from Argentina for November and December delivery in preference to US material. MDA CropCast lowered their US soybean production estimate by 31 million bushels from last week to 3.663 billion bushels. "Rains were not quite as heavy across the south central and eastern Midwest this past week, which allowed wetness to ease a bit. The continued downturn in rains there this week will allow conditions to improve further," they said. A Bloomberg survey into trader sentiment on beans found 5 bulls, 12 bears and 7 neutral. Aug 15 Soybeans closed at $10.10, down 10 3/4 cents; Nov 15 Soybeans ended at $9.80 1/2, down 15 cents; Aug 15 Soybean Meal finished at $359.00, down $4.50; Aug 15 Soybean Oil ended at 31.19, down 16 points.
Corn: The corn market ended the day around 4 cents lower. Net weekly export sales of 223,400 MT for delivery in 2014/15 were a marketing-year low, being down 33 percent from the previous week and 54 percent below the prior 4-week average. New crop sales of sales of 311,400 MT were also at the low end of trade hopes. The trade was expecting sales of 250,000-450,000 MT for old crop and 300,000-500,000 MT for new crop. Still, weekly shipments hit a new marketing year high of 1.15 MMT. "However, the improving (US weather) conditions, harvest starting in the southern plans and delta as well as competitive demand might warrant a wider trade, at least for the moment," said Benson Quinn. The Buenos Aires Grain Exchange said that their Argentine production forecast remains at 25 MMT. Harvesting of that crop is 73.4% complete so far, they added. Taiwan's MFIG bought 130,000 MT of Brazilian corn for Oct/Dec shipment. South Korea's FL bought 69,000 MT of optional origin corn for Jan shipment. South Korea's MFG cancelled a tender for 70,000 MT of optional origin corn due, they said, to high prices. Ukraine said that they had exported 18.88 MMT of corn in 2014/15. The USDA's FAS estimated the EU-28 corn crop at 66 MMT this year, down 12.6% on the record 77.5 MMT produced a year ago. MDA CropCast cut their forecast for the US corn crop by almost 82 million bushels this year to 13.443 billion bushels. That helped to knock 4 MMT off the global crop in 2015/16. A Bloomberg survey into trader sentiment on US corn prices found 4 bulls, 15 bears and that were 7 neutral. Sep 15 Corn closed at $4.03 1/4, up 1/2 cent; Dec 15 Corn ended at $4.13 3/4, up 1/4 cent.
Wheat: The wheat market closed mostly higher. Weekly export sales of 502,800 MT beat albeit modest trade expectations of 200-400,000 MT. Exports of 582,300 MT were also up noticeably from the previous week, with the primary destinations being China (121,700 MT). Japan bought 141,483 MT of food wheat for Aug-Sept shipment, most of which was US material too. MDA CropCast trimmed their Canadian wheat production estimate by 0.64 MMT from a week ago to 27.2 MMT. "Rains last week further improved moisture in central Alberta and northern Saskatchewan, and additional improvements are expected this week. However, some dryness will likely linger in southern Alberta," they said. The Buenos Aires Grain Exchange said that wheat planting there is almost 94% complete. The pending area is concentrated almost entirely on the Buenos Aires region, they added. They see plantings at 3.75 million ha this year. The Rosario Exchange see them even lower at 3.6 million acres, down a whopping 20% from last season. The Argentina wheat acreage may be the smallest in 100 years, based on a new report from AgroSouth, the online news agency, say Martell Crop Projections. "Planting rains were deficient in Cordoba and Santa Fe, the second and third top wheat provinces. Producers were still looking to plant wheat in the winter season June and July. However, unusually warm, dry weather has prevailed, severely depleting soil moisture, the Rosario Grains Exchange claims. A Bloomberg survey into trader sentiment on US wheat prices found only 3 bulls, 18 bears and 5 that were neutral. Sep 15 CBOT Wheat closed at $5.21 1/2, up 4 3/4 cent; Sep 15 KCBT Wheat ended at $5.17, up 4 3/4 cent; Sep 15 MGEX Wheat finished at $5.52 3/4, up 4 3/4 cents.
23/07/15 -- EU grains closed mixed, with a bit of light consolidation in evidence following recent losses.
At the close Nov 15 London wheat was up GBP1.00/tonne at GBP124.00/tonne, Sep 15 Paris wheat was unchanged at EUR186.50/tonne, Aug 15 Paris corn was EUR0.50/tonne higher at EUR179.25/tonne, whilst Aug 15 Paris rapeseed was EUR1.25/tonne lower at EUR387.25/tonne.
The USDA's FAS estimated the EU-28 grain harvest at 305 MMT, down 6.5% from last season, although still the third highest on record.
They see wheat production here this year at 148.5 MMT, down 8.3 MMT compared with a year ago. Barley output will fall 3.0 MMT to 57.5 MMT and the corn crop will be 9.5 MMT lower at 66.0 MMT, they forecast.
They estimated EU-28 wheat exports in 2015/16 down 4 MMT to 30.5 MMT, with those of barley dropping 2.0 MMT to 7.0 MMT and corn shipments 0.5 MMT lower at 2.5 MMT.
"Weather stress in the final stages of the growing season is responsible for reduced yields. Heat wave conditions have developed in recent weeks promoting strong drying, along with sub-par rainfall. France the leading wheat country in Europe has experienced the worst decline in crop prospects from late-season weather stress," said Martell Crop Projections.
Rusagrotans cut their forecast for Russia's 2015/16 total grain exports from a previous estimate of 30-32 MMT, and last season's 31.95 MMT, to a new figure of 28 MMT.
They said that they expect final Russian wheat yields to be 8-10% lower than a year ago as the harvest progresses into some of the drier areas. The Russian Ministry said yesterday that average yields were up 6.6% so far, although this year's harvest was only 15.4% complete at the time.
Rusagrotrans trimmed their forecast for the country's 2014/15 grain ending stocks from 14.8 MMT previously to 12.3 MMT.
They see this year's harvest at 98-98.5 MMT versus 105.3 MMT in 2014.
Ukraine said that their 2015 early grain harvest was 55% complete on 5.64 million ha, producing a crop of 18.5 MMT to date. Yields are marginally ahead of a year ago at 3.27 MT/ha (3.24 MT/ha in 2014).
Growers there have cut 53% of their wheat, producing a crop of 12.78 MMT to date, with yields averaging 3.52 MT/ha. That implies a final wheat crop of just over 24 MMT, which is on a par with the current USDA prediction.
Barley output looks like being significantly higher than the USDA's 6.0 MMT though. With 66% of this year's crop harvested, the country says it has already produced 5.32 MMT, suggesting final production around the 8 MMT mark.
This isn't the case with rapeseed though. That harvest is already 71% done, producing 1.18 MMT so far, which implies total output of only 1.66 MMT versus the USDA at 1.8 MMT.
The Ukraine Ag Ministry also refined their figures for the old 2014/15 season, pegging grain exports at 35.12 MMT, which is 1.77 MMT below their previous forecast. Production last year was 63.86 MMT, they say.
Wheat exports in 2014/15 totalled 11.23 MMT, with barley at 4.49 MMT and corn at 18.88 MMT, they added.
Ukraine's 2014/15 grain ending stocks were pegged at 10.96 MMT, down 2.48 MMT from previously suggested, although up by almost a third compared to 12 months ago.
22/07/15 -- Soycomplex: Beans closed mostly lower save for nearby Aug 15. The USDA reported 120,000 MT of soybeans sold to China for 2015/16 delivery under the daily system. Trade estimates for tomorrow's Weekly Export Sales report around 300,000-550,000 MT for new crop soybeans and something like zero to 150,000 MT for old crop.
Aug 15 Soybeans closed at $10.20 3/4, up 2 cents; Nov 15 Soybeans closed at $9.95 1/2, down 9 1/4 cents; Aug 15 Soybean Meal closed at $363.50, up $3.60; Aug 15 Soybean Oil closed at 31.35, down 58 points.
Corn: The corn market closed 3 to 5 cents lower, setting new lows for the month. South Korea KOCOPIA bought 55,000 MT of corn of either US or South American origin for November shipment. The US Energy Dept reported weekly ethanol production at 973,000 barrels/day, down 11,000 bpd from the previous week. Trade estimates for tomorrow's weekly export sales report are around 250,000-450,000 MT for old crop and 300,000-500,000 MT for new crop. Sep 15 Corn closed at $4.02 3/4, down 3 3/4 cents; Dec 15 Corn closed at $4.13 1/2, down 4 cents.
Wheat: The wheat market closed lower on all three exchanges, extending the recent losing streak. Yesterday's Egyptian tender merely confirmed what the market knew already, that US wheat is far too expensive on the international stage. US exporters are going to have a very difficult job increasing foreign sales by the 15% that the the USDA has them targeted to do in 2015/16. Estimates for tomorrow's weekly export sales report are only around 200-400,000 MT. Sep 15 CBOT Wheat closed at $5.16 3/4, down 8 cents; Sep 15 KCBT Wheat closed at $5.12 1/4, down 5 3/4 cents; Sep 15 MGEX Wheat closed at $5.48, down 8 1/2 cents.
22/07/15 -- EU grains closed lower across the board on harvest pressure, stiff foreign competition.
Nov 15 London wheat finished down GBP0.50/tonne at GBP123.00/tonne, Sep 15 Paris wheat was EUR2.25/tonne easier at EUR186.50/tonne, Aug 15 Paris corn was down EUR1.75/tonne to EUR178.75/tonne, whilst Aug 15 Paris rapeseed was down EUR1.00/tonne to EUR388.50/tonne.
Russia's clean sweep in yesterday's GASC tender set the tone. French wheat was comfortably out-priced in that.
Reports of better than expected yields in both Russia and Ukraine, added more pressure, along with the knowledge that carryover stocks in both Europe and Russia are much larger than normal this year.
Russia said that it's 2015 harvest was now 15.4% complete at 26.6 MMT, and that yields are up 6.6% at an average of 3.7 MT/ha.
Wheat accounts for 20.5 MMT of that total, for which the harvest is now past 20% done. Wheat yields this year are said to be 5.3% higher than in 2014 at 3.79 MT/ha.
Ukraine said that it had exported 1.57 MMT of grains already so far this season. That includes 764 TMT of corn, 426 TMT of wheat and 382 TMT of barley. A further 331 TMT of grains are said to be loaded and awaiting customs clearance.
That would take total exports in July so far to over 1.9 MMT.
The wheat harvest is progressing well in France aided by fine weather, said Agritel. This, combined with a higher euro vs US dollar exchange rate, put the market under further price pressure today, they added.
21/07/15 -- Soycomplex: Beans closed higher in "Turnaround Tuesday" style. With US exporters having already shipped 98% of the USDA's target for the season on old crop beans, premiums continue to be made on the nears. The USDA announced 110,000 MT of US beans sold to unknown for 2015/16 shipment, adding support to new crop, sales of which haven't been too stellar of late. A weaker US dollar today was also a bit friendly. Concerns and much debate surround this year's US yield potential. Most think that the USDA are too high at 46 bu/acre, with something around 44.0-44.5 nu/acre being well-touted as a more realistic range. Coming up with an average in what looks like being a highly varied year isn't easy. Chinese customs data showed that they imported more than 8 MMT of soybeans in June, up more than 26% on a year previously. Imports from Brazil were 6.66 MMT, with 1.17 MMT coming from Argentina. Chinese imports from the US though were only a nominal 2,771 MT. Their soybean imports now need to average 7.57 MMT in July and August to reach the USDA's total 2014/15 import estimate of 74 MMT, say Benson Quinn. It is thought likely that their July imports will be in the 8-9 MMT region. Aug 15 Soybeans closed at $10.18 3/4, up 11 cents; Nov 15 Soybeans closed at $10.04 3/4, up 5 1/4 cents; Aug 15 Soybean Meal closed at $359.90, up $3.90; Aug 15 Soybean Oil closed at 31.93, up 25 points.
Corn: The corn market closed with small gains, but only managed to claw back a small proportion of yesterday's losses. Customs data showed China imported almost 873 TMT of corn in July. Taiwan's MFIG are tendering in the market for 130,000 MT of corn of US, South American or South African origin for Oct-Dec shipment. There's talk of heat and dryness potentially leading to a corn production downgrade in Ukraine. Temperatures are expected to hit 35C in the west of the country this week. As with soybeans, this year looks like throwing up some especially varied yields across the US. "Overall, the best corn is still clearly in the western Midwest, which is why I project record yields for Minnesota, North Dakota, South Dakota, Iowa and Nebraska. The poorest corn is across the southern Midwest," said Arlan Suderman of Water Street Solutions. He now sees the national yield at an average of 168 bushels/acre, up from 166.8 bushels/acre the previous week (the latter number being where the USDA currently reside). "Over the next 10 days, temperatures will fluctuate depending on areas: the Plains will be warmer than normal while near normal temps take place in the eastern corn belt. The hottest weather takes place at the end of this week before it returns to near normal for the end of July and early August. Rains will take place occasionally with near normal rainfall through next Thursday, after that normal to below rainfall is expected," say the Fintec Group. Sep 15 Corn closed at $4.06 1/2, up 1 1/2 cents; Dec 15 Corn closed at $4.17 1/2, up 1 1/2 cents.
Wheat: There was no "Turnaround Tuesday" for the wheat market, which closed lower again across the three exchanges. Egypt bought 175,000 MT of Russian wheat for Sep 1-10 shipment. The prices paid were around $20/tonne below US FOB levels, and that was on a delivered basis! A reminder once again that US wheat is simply too expensive to feature into anything but safe, traditional homes. Talking of which, Japan are staging their regular weekly tender for 141,483 MT of food wheat for Aug-Sept shipment. The mix is the usual combo of US western white wheat, US HRW wheat, US dark northern spring wheat, Canadian red spring wheat and Australian white wheat. The results are expected tomorrow, but routine business like this isn't going to provide much in the way of support for the US wheat market. Romanian and French wheat was also outpriced in the GASC tender, meaning that they also need to sharpen their pencils next time. It is interesting to see Russia get a clean sweep this time around, especially as analysts there are reducing their export forecasts, for July and August at least. There's talk that the government and exporters have reached some sort of accord over the new export duty on wheat that came into force on Jul 1. It has certainly hit Russian exports this month. Rusagrotrans today cut their forecast for July grain exports from 2.8 MMT to 2.1 MMT, of which 1.4 MMT will be wheat, they estimate. SovEcon put wheat exports even lower this month at 1 MMT. Rusagrotrans note that wheat exports in July will make up two thirds of total grain shipments versus 80% in July 2014. Sep 15 CBOT Wheat closed at $5.24 3/4, down 8 cents; Sep 15 KCBT Wheat closed at $5.18, down 7 1/2 cents; Sep 15 MGEX Wheat closed at $5.56 1/2, down 2 1/2 cents.
21/07/15 -- EU grains closed mixed, but mostly a little lower, on harvest pressure and, in wheat at least, a general abundant global supply situation.
At the close Nov 15 London wheat was down GBP0.75/tonne to GBP123.50/tonne, Sep 15 Paris wheat fell a euro to EUR188.75/tonne, Aug 15 Paris corn was up EUR0.75/tonne to EUR180.50/tonne, whilst Aug 15 Paris rapeseed rose EUR2.50/tonne to EUR389.50/tonne.
Keep in mind that the USDA currently have global 2015/16 wheat ending stocks estimated at nearly 220 MMT, up 8.6% versus the season just ended. It also means that more than 30% of this year's production will still be with us unused when we enter 2016/17.
The plentiful supply line in wheat was highlighted by the latest tender from Egypt's GASC. That enquiry attracted 1.3 MMT worth of offers, which Agrimoney noted was "an unusually large amount even for the start of the season."
They finished up booking 175,000 MT of all Russian wheat for September 1-10 shipment at a little over $205/tonne including freight.
That was well below the cheapest French offer which was priced at $211 on an FOB basis (almost $229/tonne when freight is added on), and also confirms that Russian sellers are very much in the market.
Romanian wheat was also offered to GASC, but was also priced out by the Russian material.
Russian exports have been slow to get going this so far season, with Rusagrotrans today cutting their forecast for the country's July grain shipments from 2.8 MMT to 2.1 MMT, down significantly on the 3.12 MMT shipped out a year previously.
They see wheat accounting for around 1.4 MMT of that total versus 2.67 MMT a year ago, with barley exports at 450,000 MT (from 387,000 MT a year ago) and corn shipments at 130,000 MT (from 46,000 MT in July 2014).
The Russian analysts also trimmed back their forecast for August grain exports from 3.8 MMT to 3.2 MMT, down from 4.64 MMT last year.
Separately, SovEcon estimated Russia's wheat exports in July at only 1 MMT on a delay to this year's harvest and trader concerns over the new floating duty on exports.
The Russian Ag Ministry said that this year's grain harvest was 13.5% complete on 6.3 million ha (versus 9.1 million ha a year ago), producing a crop of 23.4 MMT to date (31.7 MMT a year ago), with yields at 3.7 MT/ha, up 6.3% compared to 3.48 MT/ha in 2014.
Wheat accounts for 18.3 MMT of that total, and barley a further 2.7 MMT, they said.
Similarly, Ukraine's harvest is also behind last year's pace, but yields are also said to be up versus 2014, if only slightly.
The Ukraine Ag Ministry say that the early grain harvest (excluding corn) is 41% complete on 4.22 million ha (1.4 million less than a year ago), producing a crop of 13.54 MMT so far (17.92 MMT a year ago), with yields averaging 3.21 MT/ha versus 3.19 MT/ha this time last year.
The wheat harvest in Ukraine is 37% complete at 8.8 MMT, implying a final crop of 23.78 MMT this year.
In other news, Oil World trimmed their forecast for the EU-28 oilseed rape crop by 0.5 MMT to 21.5 MMT, down nearly 12% on a year ago.
20/07/15 -- Soycomplex: Beans closed lower in part of what looked like a general "risk off" move in commodities. That was despite weekly export inspections of 306,379 MT setting a 9-week high, and being more than double the previous week. That means that US exporters have already shipped 98% of the USDA's target for the season versus 94% typically at this time. After the close the USDA left good to excellent crop ratings unchanged at 62%. They said that 56% of the crop is blooming and that 17% is setting pods. Both are exactly in line with the 5-year averages. Indiana, Ohio, Illinois and Missouri have the worst crop ratings, with at least 20% of the crop in poor to very poor condition in those states. Wisconsin, North Dakota, Tennessee and Minnesota have the best crop ratings. Safras e Mercado raised their 2016 Brazilian soybean production estimate to a record 99.8 MMT (the USDA are at 97 MMT). They said that they expected producers to plant a 3.8% higher area, taking plantings up to a record 32.9 million ha. Linn Group estimated 2015 US soybean yields at 44.1 bu/acre versus the USDA estimate of 46.0 bu/acre. Oil World forecast the Canadian canola crop down 11.3% to a 5-year low of 13.8 MMT, and said that 2015/16 exports would drop 12.7% to 7.55 MMT. They now have the global crop at 64 MMT, down 5 MMT from last year and 1.8 MMT below their previous estimate. Aug 15 Soybeans closed at $10.07 3/4, down 7 cents; Nov 15 Soybeans closed at $9.99 1/2, down 7 1/4 cents; Aug 15 Soybean Meal closed at $356.00, down $5.10; Aug 15 Soybean Oil closed at 31.68, down 10 points.
Corn: The corn market finished the day with heavy losses. An improving weather pattern for the Midwest, and the prospect for potentially better crop ratings from the USDA after the close got fund money longs lightening the load. The USDA in fact left good to excellent ratings unchanged, in a manner of speaking, at 69%. There was however a 2 point shift from very good into excellent. They said that 55% of the crop is silking, up from 27% a week ago and 1 point behind the 5-year average for this time. Indiana has 26% of the crop rated poor to very poor. In North Carolina it's 22% and in Ohio it's 20%. "Weather forecasts look to be beneficial to the corn crop with higher than normal temps and near normal moisture expected over the next week," said Benson Quinn. Weekly export inspections came in at 1.16 MMT. Safras e Mercado sees the 2015/16 Brazilian summer corn area at 4.1 million ha, down 9.7% from a year ago. They see winter, or safrinha, corn plantings at 10.2 million ha, up 7.8% from a year ago. They have the total 2015/16 Brazilian corn crop estimated at 89.2 MMT versus the 2014/15 crop of 85.6 MMT. Ukraine said that they'd exported more than 1 MMT of grains already this season, including 620 TMT of corn. Linn Group estimated 2015 US corn yields at 162.0 bu/acre versus the USDA's estimate of 166.8 bu/acre. The US is forecast to have above normal temperatures on the plains, and near to below ones in the eastern corn belt through until the end of the month. Heat stress, if there is any, should be limited to Kansas/Nebraska. Reuters reported that Ukraine may lower its corn production forecast due to heat/dryness. Sep 15 Corn closed at $4.05, down 15 1/4 cents; Dec 15 Corn closed at $4.16, down 15 1/4 cents.
Wheat: The wheat market closed sharply lower across the three exchanges. The move lower came despite weekly export inspections of 489,089 MT topping trade estimates, although these were still hardly thrilling. Egypt's GASC announced a tender for US soft white wheat, US soft red winter wheat and/or Canadian soft wheat. They are also in the marker for soft wheat of EU/Black Sea origin, with the results expected tomorrow. The USDA said that the US 2015 winter wheat harvest was 75% done, one point ahead of normal and 10 points up on the week. Spring wheat crop conditions were lowered one point to 70% good to excellent, the same as this time last year. Taiwan are in the market for 104,350 MT of US wheat for Sep/Oct shipment. SovEcon estimated Russia’s 2015 grain crop at 96.5 MMT, down from a previous estimate of 98.0 MMT due to dryness. They cut wheat production by 1 MMT to 56 MMT. A Bloomberg survey estimated Russia’s 2015 wheat crop a little higher at 57.4 MMT versus the 2014 crop of 59.1 MMT. APK Inform said that Russian seaports exported 353 TMT of grains last week, up from 143 TMT the previous week, of which 296 TMT was wheat. SovEcon said that they expect the pace of Russian export to pick up very soon. The slow harvest and uncertainties over the new wheat export tax have been the reason for the relatively slow start to the season, they said. "There is talk that Russian officials have ironed out the methods used to determine what the exporters owe on export sales," noted Benson Quinn. That could be the catalyst to speed things up. There's been plenty of talk of dryness issues affecting the Canadian wheat crop this year. A Canadian Wheat Board crop tour, which starts tomorrow and ends on Friday, may shed some useful light on this. Sep 15 CBOT Wheat closed at $5.32 3/4, down 21 1/4 cents; Sep 15 KCBT Wheat closed at $5.25 1/2, down 21 cents; Sep 15 MGEX Wheat closed at $5.59, down 15 3/4 cents.
20/07/15 -- EU grains traded lower to start the week, in line with just about everything else.
At the close Nov 15 London wheat was down GBP1.20/tonne at GBP124.25/tonne, the contract's lowest finish in four weeks. Sep 15 Paris wheat was EUR3.00/tonne easier at EUR189.75/tonne, Aug 15 Paris corn was down EUR1.50tonne to EUR179.75/tonne, whilst Aug 15 Paris rapeseed was EUR1.75/tonne lower at EUR387.00/tonne.
The euro is off Friday's historic lows, although not by much. Some are suggesting that it's recent slump may have been a little overdone. The Greek banks have re-opened after being closed for 3 weeks, but things are far from sorted just yet.
The release of the minutes from the Bank of England's July MPC meeting are due to be issued on Wednesday, and could provide sterling with a bit more upside impetus if there's a hint of one or two members of the committee swaying towards raising interest rates.
Much of France is set to stay warmer than normal for the next couple of days, but a return to more seasonal temperatures is forecast from Wednesday onwards.
After than things could turn cooler, to much cooler than normal through to the beginning of August, not just across France but in the UK, Germany and Poland as well.
The 15 day forecast sees northern parts of France and Germany drier than normal, but with most other parts of Europe, save for the far east, getting above average precipitation for the time of year.
Ukraine's brisk start to the 2015/16 season continues, with almost 600 TMT of grains being shipped out of the country's seaports last week, according to APK Inform. That total included 138 TMT of wheat, 231 TMT of corn and 227 TMT of barley.
The country has now already exported more than 1 MMT of grains so far this month, most of which (620 TMT) has been corn.
In contrast Russia's exports have been a bit slow to get going.
The country has exported 434 TMT in the first half of the month, down 57% on a year ago and the smallest volume since 2008, say SovEcon. That includes 200 TMT of wheat, the lowest total since 2004, they say.
The slow harvest and new export tax on wheat are to blame, but exports are expected to pick up very soon, they add.
Russian grain exports via seaports last week were in fact 353 TMT, up from 143 TMT the previous week, so there's some evidence that things did indeed pick up in the second half of last week.
Most of what was shipped out last week was wheat (296 TMT).
Switching commodities, Oil World estimate the Canadian canola crop at 13.8 MMT this year, down 11.3% from 15.56 MMT a year ago and a 5-year low. Frost in May and subsequent drought are to blame, they say. The USDA estimated the Canadian crop at 14.6 MMT earlier this month.
Some private estimates place production much lower than both of these numbers.
Oil World's forecast for Canada's canola exports in 2015/16 is 7.55 MMT, down more than 1 MMT, or 12.7%, versus 2014/15. The USDA currently have these at 8.1 MMT.
With lower production and reduced exports also expected from Australia and Ukraine also this year, not to mention Europe too, things could get interesting in the second half of the season. The USDA currently estimate EU consumption at 3.3 MMT higher than production in 2015/16.
17/07/15 -- Soycomplex: Beans closed lower on the day and for the week. Weather forecasts for the week ahead are developing a more normal look to them. There's a feeling that crop ratings should be unchanged in Monday's crop progress report, and a few suggesting that a small increase in good to excellent could be on the cards. The latest Commitment of Traders report shows fund money adding to their net long position for the week through to Tuesday night. They've probably lightened the load a little since then. Lack of new crop export demand is grabbing a few headlines. Chinese new crop US soybean export purchases are said to be only 2.4 MMT versus 7.0 MMT this time last year. They're said to have been active buyers of South American product in the past couple of weeks. Reports of South American meal sales into the US lend a bearish slant. I'd look for further choppy trade to continue through the rest of the month, and into the key yield-determining month for beans of August. Currently it still seems that crop conditions are extremely varied across the US. A huge area from Kansas, through Missouri, into Illinois, Indiana and onto Ohio and Michigan sees good to excellent soybean ratings between 12 percentage points (in Michigan) and 45 points (Missouri) down on where they were a year ago. Further north/east things look better. Nebraska, Iowa, Wisconsin, Minnesota and the Dakota's all have good to excellent ratings in the 70-80's, and most of those states are seeing better ratings compared to this time last year. Aug 15 Soybeans closed at $10.14 3/4, down 4 1/4 cents; Nov 15 Soybeans closed at $10.06 3/4, down 4 1/4 cents; Aug 15 Soybean Meal closed at $361.10, down $2.50; Aug 15 Soybean Oil closed at 31.78, up 32 points. For the week, Aug 15 beans were down 17 cents, and Nov 15 was down 15 1/2 cents. Aug 15 meal was up $5.50 compared to last Friday and Aug 15 oil was down 64 points.
Corn: The corn market closed with near 10 cent losses. US weather conditions are improving. The market will be wondering what the USDA will do with crop ratings on Monday night. The general consensus is for corn to be unchanged at 69% good to excellent, but the USDA have surprised the market the last couple of weeks by holding them unchanged when small reductions were anticipated. Could they now start to nudge them a bit higher? That notion may have encouraged some book-squaring today. The latest Commitment of Traders report has fund money increasing their long to over 200k contracts for the week through to Tuesday night. Temperatures are forecast in the 90’s today, tomorrow and into the second half of next week across the northern plains and corn belt. That could be just what the doctor ordered for crops that have got plenty of moisture at their disposal. Elsewhere, FranceAgriMer cut the proportion of the French corn crop rated good to very good by 4 percentage points to 67% today, down from 84% this time last year, as heat and dryness there takes it's toll on corn. The proportion of the crop at the silking stage was up from 18% a week ago to 54%, far higher than 22% this time last year. Ukraine continue to export corn at a brisk pace. Their total grain exports so far this year are 939 TMT, with over half of that volume (502 TMT) being corn. There's a further 164 TMT of grains already loaded waiting to go, taking total exports so far this season to 1.1 MMT. Quality issues with this year's rain-affected US wheat crop could see more of that heading into the feed sector, in direct competition with corn. The EU said that they'd issued 64 TMT worth of corn export licences so far this season, but authorised 348 TMT worth of corn imports. China only sold 65 TMT of the more than 5 MMT of corn stocks offered up at auction this week. There are some reports of Brazilian corn being exported to the US. Sep 15 Corn closed at $4.20 1/4, down 9 3/4 cents; Dec 15 Corn closed at $4.31 1/4, down 9 3/4 cents. Sep 15 corn was 14 1/2 cents lower on the week, Dec 15 lost 13 3/4 cents.
Wheat: The wheat market closed lower on the day and for the week. Lack of export interest continues to be the thorn in the side of US wheat. Reports of neighbouring Mexico buying French wheat in preference to US material hardly inspires confidence that the US will achieve a 15% increase in foreign sales this year, as the USDA currently predict. The EU has issued 937 TMT worth of soft wheat export licences in the past two weeks, some 47% more than export sales reported by the USDA. Algeria were said to have bought at least 250,000 MT, and possibly as much as 600,000 MT, of optional origin (possibly French) wheat for October shipment this week. Reports out of Russia and Ukraine continue to indicate higher yields than a year ago. The Ukraine early grain harvest is said to be 31% complete, with yields averaging 3.15 MT/ha versus 3.06 MT/ha a year ago. That includes 6 MMT of wheat, for which the harvest is said to be 26% complete. They've exported 248 TMT of wheat since Jul 1. Russia said that it's harvest was 10.8% complete on 5 million ha, producing a crop of 18.7 MMT so far, with yields at 3.73 MT/ha, up 5.7% on a year ago. That includes 14.8 MMT of wheat on 3.9 million ha (14.5% of the planned area), with average yields of 3.83 MT/ha, up 5.8% on a year ago. The Russian barley harvest is said to be 7.6% complete on 676k ha, producing a crop of 2.5 MMT so far with yields averaging 3.70 MT/ha, up 8.8% on 3.40 MT/ha a year ago. The head of the Regional Ag Ministry in the Saratov area of the country however said that grain production there could be down by around a third this year, to 2.5 MMT, due to drought. If rains don't arrive soon, this could also have a negative impact on plantings in the autumn for the 2016 harvest, she added. As ever with Russia though, you can never be 100% sure exactly how accurate these reports are. Are these statements simply an attempt to prise a bit of extra financial aid from Moscow? Sep 15 CBOT Wheat closed at $5.54, down 8 1/4 cents; Sep 15 KCBT Wheat closed at $5.46 1/2, down 6 3/4 cents; Sep 15 MGEX Wheat closed at $5.74 3/4, down 7 1/4 cents. This was around 22 cents, 26 cents and 33 cents lower respectively for the week.
17/07/15 -- EU grains closed mostly lower, with only rapeseed managing to finish the day in the green. Everything ended up a net loser for the week.
Nov 15 London wheat finished down GBP1.55/tonne at GBP125.45/tonne, Sep 15 Paris wheat was EUR1.75/tonne easier at EUR192.75/tonne, Aug 15 Paris corn was down EUR1.25/tonne to EUR181.25/tonne, whilst Aug 15 Paris rapeseed was up EUR1.00/tonne to EUR388.75/tonne.
For the week that puts London wheat GBP5.85/tonne lower, for a net loss of 4.5%. In Paris, wheat lost EUR4.75/tonne, or 2.4%, corn was down EUR3.50/tonne, or 1.9%, and rapeseed fell EUR3.75/tonne, or 1%.
Continued euro weakness is fairly and squarely behind the fact that London wheat came off the worst of the bunch. The pound closed at a new highest since Nov 2007 tonight, and gained 3.4% versus the single currency in the course of the week.
The pound was helped this week by comments from BoE governor Carney that a UK base rate rise could be on the cards "around the turn of the year".
Euro weakness will certainly be helping exports on the continent, with reports emerging this week that French wheat had been sold to Mexico, despite an abundance of wheat for sale in neighbouring USA. Algeria are said to have bought 250 TMT of soft milling wheat in a tender for 50 TMT for October shipment. It is thought that France will be the most likely supplier of that too.
Brussels announced last night that they'd issued 470 TMT worth of EU soft wheat export licences this past week, up a little on 467 TMT the previous week, taking the total for the only 2-weeks old new 2015/16 season to 937 MMT, which is almost 50% more than the US has reported in the same period.
The recent dryness and heat in France has accelerated the pace of the 2015 harvest, minimising the weather risk to winter planted grains at least.
FranceAgriMer said that the French winter wheat harvest had moved on to 38% complete as of Monday, up from 15% done a week previously and versus only 4% this time last year.
Agritel say that early French wheat cuts are displaying "rather satisfying results".
The French winter barley harvest is probably now complete, it was already 96% done as of Monday, up from 85% the previous week and compared to only 75% harvested a year ago. Spring barley is 17% harvested, up from 3% a week ago and versus only 1% done this time last year.
Winter wheat crop conditions were rated unchanged on a week ago at 75% good to very good (versus 72% a year ago), spring barley conditions fell one point to 65% (now also a point behind this time last year). Corn ratings fell from 71% good to very good to 67%, well behind 84% a year ago, as that crop now bears the brunt of the current prevailing weather conditions. The crop is said to be 54% silking versus only 22% a year ago.
The HGCA said that the less advanced German wheat crop is now under more threat from the weather than the French crop. Strategie Grains this week revised potential German wheat yields down from 7.98 MT/ha to 7.70 MT/ha. Coceral have them even lower at 7.55 MT/ha, down 12.5% on a bin-busting 8.63 MT/ha a year ago.
Ukraine say that their 2015 early grain harvest (which excludes corn) is 31% complete versus 47% done this time a year ago. That's produced a crop of almost 10 MMT so far versus 14 MMT a year ago. Average yields are said to be 3.15 MT/ha compared to 3.06 MT/ha at this time in 2014.
The wheat harvest is 26% done producing 6 MMT to date, which implies a final crop of around 23 MMT versus the USDA's 24 MMT estimate and compared to 24.75 MMT a year ago. The Ukraine barley harvest is 50% complete, producing 3.7 MMT to date, implying final production of around 7.4 MMT, which is far higher than the USDA's current 6.0 MMT prediction.
The Ukraine rapeseed harvest is said to be 17% complete, producing 232 TMT of the oilseed to date. That only suggests a final crop of 1.36 MMT this year, versus a USDA forecast of 1.8 MMT and 2.2 MMT a year ago. It's unclear however if the figures from the Ag Ministry include, or exclude, spring rapeseed plantings.