Note that soybeans have already hit 50% of their target to regularly trade higher in both sessions immediately before and after Thanksgiving.
The UK economy grew 0.5% between July and September it has been announced today. That was in line with expectations and the 11th quarterly rise in a row, even if it was down from growth of 0.7% in Q2. The market doesn't seem to impressed by the news as the pound is down against both the dollar and the euro this morning.
The Buenos Aires Grain Exchange said that the Argentine wheat harvest is about 20% complete at 1.5 MMT, leaving their forecast for this year's crop unchanged at 9.5 MMT. Early yields are coming in better than expected, they said. Soybean planting is 43.2% done and corn sowings are 39.1% complete, they added.
Trade talk suggests that Russian grain exporters have suspended entering into any fresh contracts with Turkish buyers for fear of the former introducing some form of restriction on sales/economic reprisals following the shooting down of a Russian jet over Syria earlier in the week.
According to Rusagrotrans Turkey was the second largest buyer of Russian grain in Q1 of 2015/15 - beaten only by Egypt.
26/11/15 -- EU grains closed mostly lower in uneventful trade with US markets closed for Thanksgiving. Rapeseed pressed on to new highs for the move, closing at the best levels on a front month since Aug 10th.
At the close, new front month Jan 16 London wheat was down GBP0.45/tonne at GBP114.00/tonne, Dec 15 Paris wheat was down EUR0.75/tonne at EUR177.00/tonne, Jan 16 Paris corn was EUR0.50/tonne lower at EUR166.50/tonne, whilst Feb 16 Paris rapeseed jumped EUR3.50/tonne to EUR385.50/tonne.
Rapeseed is getting support from rising palm oil prices on the back of El Nino-perceived crop losses in Indonesia/Malaysia and also reduced EU and Ukraine plantings again this year.
Nervousness over what action Russia might take with regards to the Turkish downing of one of their jets earlier in the week might also be prompting a bit of short-covering in grains in general.
Turkey was reportedly a destination for 3.5 MMT, or around 12%, of all Russian grain exports so far this year. Around 1.4 MMT of that was imported in Q1 of 2015/16, almost 14% of all Russia's foreign sales.
Brussels confirmed that they'd released 523 TMT worth of soft wheat export licences this past week, down from a season to date high of 636 TMT a week ago. That takes cumulative 2015/16 exports to 8.7 MMT, down 27.5% on this time last year. France picked up 139 TMT, or 26.5%, of the weekly total. Their season to date share is now 2.8 MMT, or 23.3%.
Barley export licences this week were only 97 TMT, down from 126 TMT a week ago. Even so season to date barley exports total 4.6 MMT. Corn import licences were slightly higher than those granted for wheat imports at 527 TMT, taking the campaign total so far to 4.4 MMT.
Euro weakness continues, which should help EU exports as we enter 2016.
Algeria were said to have bought 75,000 MT of optional origin feed barley in a tender.
Russia's 2015 corn harvest is said to be 89.1% complete at 12.5 MMT off 2.4 million ha. Average yields are reported to be up 13.7% at 5.15 MT/ha.
Russian winter grain plantings for the 2016 harvest remain stalled at 16.3 million ha, or 95.3% of the government target.
25/11/15 -- Soycomplex: Beans closed higher, in line with their "normal" trend to finish in the green heading into the Thankgsiving Day holiday. The UDSA reported 190,000 MT of US soybeans sold to unknown destinations for 2015/16 shipment under the daily reporting system. MDA CropCast were unchanged on their forecast for the 2015 US soybean crop at 3.9 billion bushels. There was no alteration either for Brazil (99.9 MMT) or Argentina (59.58 MMT). Soyoil continues to be supported on Indonesian palm oil production concerns related to El Nino, and calls for palm oil prices to continue to rise into the first half of 2016. Brazilian weather is mixed - a bit dry in some northern and central areas and too wet in parts of the south. Argentine weather is generally friendly. The trade is bracing itself for a deluge of old crop Argentine soybeans coming onto the market once new president Macri gets into office mid-December. Jan 16 Soybeans settled at $8.75 1/4, up 11 1/2 cents; Mar 16 Soybeans settled at $8.77 3/4, up 11 1/2 cents; Dec 15 Soybean Meal settled at $284.80, up $1.00; Dec 15 Soybean Oil settled at 28.89, up 58 points.
Corn: The corn market closed around 2-4 cents higher. Weekly ethanol production data from the US Energy Dept was supportive. Production last week hit a record 1.008 million barrels/day, an increase of 33,000 barrels/day from the previous week. The previous all-time high was 994,000 barrels/day. The EPA are expected to release their updated Renewable Fuels Standard on Friday. Spanish-owned biofuel operator Abengoa (who operate 6 ethanol plants in the US) are said to have applied for preliminary protection from creditors following a breakdown in negotiations with a new investment firm. John Deere report equipment net sales for the US and Canada are down 23% for the quarter and 18% for the year, according to FCStone. Poor machinery sales are a classic sign of farmer dissatisfaction with grain prices. MDA CropCast were unchanged from last week on their forecast for the 2015 US corn crop at 13.782 billion bushels. There was also no adjustment for Brazil (79.6 MMT), Argentina (25.4 MMT) or Ukraine (22.1 MMT). Russia said that their 2015 corn harvest is 88.8% complete at 12.4 MMT. Dec 15 Corn settled at $3.66, up 1 3/4 cents; Mar 16 Corn settled at $3.72 3/4, up 3 1/4 cents.
Wheat: The wheat market closed mixed. Egypt bought 240,000 MT of wheat for Dec 21-31 shipment, with half of that being French origin, plus a cargo each from Romania and Russia. US wheat remains priced out of such business. Egypt's Supplies Minister said that the country now has enough wheat bought to last it until the end of April - into the beginning of their own 2016 harvest. The Russian Ag Ministry said that their 2015 wheat harvest was still not quite over at 99.8% complete producing a crop of 64.0 MMT in bunker weight. Winter grain planting in Russia seems to have stalled at 16.3 million ha, or 95.2% of the original government target. Colder air is seen moving into the Volga region next week. Ukraine said that it's winter wheat crop (only planted on 89% of the intended area) for the 2016 harvest has only emerged on 4.1 million ha, or 62% that area. Winter wheat in Ukraine is rated 68% good to satisfactory versus 83% a year ago. Weak/thinned is 32% against 17% this time last year. Unconfirmed reports suggest that Russia has banned wheat exports to Turkey following the shooting down of a Russian jet over Syria earlier in the week. Dec 15 CBOT Wheat settled at $4.79 1/4, down 5 cents; Dec 15 KCBT Wheat settled at $4.57 1/4, down 1/4 cent; Dec 15 MGEX Wheat settled at $5.14 1/2, up 5 cents.
25/11/15 -- EU grains closed mostly higher with Jan 16 London wheat up GBP0.65/tonne at GBP114.45/tonne. In Paris, Dec 15 wheat rose EUR1.75/tonne to EUR177.75/tonne, Jan 16 corn was EUR0.50/tonne easier at EUR167.00/tonne and Feb 16 rapeseed gained EUR5.00/tonne to EUR382.00/tonne.
Fresh news was lacking. Rapeseed, having been the weakest link yesterday, regained the starring role today aided by an improved showing from Chicago soybeans. This was in fact within half a euro of being the best close on a front month since mid-August for Paris rapeseed.
The outlook for another significant fall in EU (and Ukraine) rapeseed plantings for 2016 might be lending some support to that going forward.
Talking of which, the Ukraine Ag Ministry recently said that the country's winter rapeseed crop was only sown on 79% of the originally intended area, with the optimum planting window long since passed.
Sowing of winter wheat in Ukraine has fared a little better, with 89% of the intended area now sown, but only 62% of that is yet emerged. Of what has emerged only 68% is said to be in good to satisfactory condition versus 83% this time a year ago.
Ukraine's grain exports for the season so far now stand at 16.3 MMT, including 8.64 MMT of wheat, 3.65 MMT of barley and 3.95 MMT of corn.
The Ukraine Ministry said that the country would export 16.6 MMT of wheat this season along with 3.9 MMT of barley and 16 MMT of corn.
Egypt's GASC bought 240,000 MT of wheat for late December shipment today, half of which was French origin. They also picked up one cargo each of Romanian and Russian wheat.
Sharply lower freight rates helped French wheat win a good share of the business. Whilst that is good news on the one hand, on the other it also possibly means that other "traditional" North African homes for French wheat like Algeria and Morocco are able to pick up more competitive offers out of the Baltic.
Tomorrow's weekly export licence total out of Brussels will provide a useful barometer to EU exports. Last week's total was a marketing year high of 636 TMT, up 58% on 401 TMT on the previous week. That market will be hoping for that trend to continue.
The market is also keeping an eye on developments between Russia and Turkey following the shooting down of a Russian jet that had allegedly violated Turkey's airspace on Tuesday. Turkey are a huge buyer of Russian wheat and energy, and as we know President Putin is not one to take these things lying down.
24/11/15 -- Soycomplex: Beans closed with little change. The market garners support from ongoing strong Chinese demand, and one or two worries about dryness in parts of Brazil. Weakness comes from the Macri victory in the weekend's Argentine presidential run-off, suggesting that large volumes of old crop soybeans will now start to come onto the international market. Argentine soybeans currently incur a 35% export tax. Planting of their 2016 crop is about a third of the way through. The Argentine Ag Ministry see plantings at a record 20.6 million ha this year, up 4% from 19.8 million a year ago. US harvest pressure is also a bearish factor, along with dollar strength and the outlook for the Fed to start to raise US interest rates next month. The markets are closed Thursday for Thanksgiving. Across the last 40 years beans have apparently closed higher on both the day before and after Thanksgiving almost 65 percent of the time. Jan 16 Soybeans closed at $8.63 3/4, down 1/2 cent; Mar 16 Soybeans closed at $8.66 1/4, unchanged; Dec 15 Soybean Meal closed at $283.80, down $1.50; Dec 15 Soybean Oil closed at 28.31, up 40 points.
Corn: The corn market closed around 3 cents lower. Dr Cordonnier was said to have left his Brazilian and Argentine corn productions estimates unchanged at 81.2 MMT and 21.6 MMT respectively. The Macri win in the weekend election run-off in Argentina is expected to herald a return to more "normal" crop rotation in Argentina, with corn and wheat output both increasing in the coming years. Currently Argentine corn exports are taxed at 20%. Although this is less than the duty on beans, corn (and wheat too) also suffer from the introduction of sporadic quotas on volume, a matter that Argentine growers have been unhappy about for a long time - that's one of the reasons behind the relatively recent large-scale switch into beans. The HGCA say that the combined soybean, corn and wheat area in Argentina is 27.65 million ha, of which 72% is beans and only 12% corn. In Brazil the equivalent figures are 64% for soybeans and 31% for corn, they note. The Ukraine corn harvest is now 93% done on 3.82 million ha for a crop of 21.19 MMT to date. The Russian harvest is now 88.5% done at 12.4 MMT. The EPA is expected to release their updated Renewable Fuels Standard this week with the trade expecting an uptick of of 2-5% in ethanol and biodiesel. Dec 15 Corn closed at $3.64 1/4, down 3 cents; Mar 16 Corn closed at $3.69 1/2, down 3 1/2 cents.
Wheat: The wheat market closed lower. Reuters reported that the wheat acreage in India for their 2016 harvest has dropped 26% due to high temperatures delaying plantings. Egypt tendered for wheat for Dec 21-31 shipment with the results expected tomorrow. Due to the slightly tricky delivery period they might not find quite as many willing sellers as in recent tenders. It appears that warmer than normal weather conditions mean that bits and bobs of late winter grain plantings are still ongoing in Russia and Ukraine. Russian plantings for the 2016 harvest are at 16.3 million ha, or 95.2% of the government's aim, versus 16.8 million ha this time a year ago. Ukraine said that winter grains there are 90% planted on 6.64 million ha versus 7.65 million ha this time a year ago. Russia's response to the shooting down of one of their jets by Turkey will be interesting, as the latter are big buyers of Russian wheat and energy. Turkey says that the jet had strayed into its airspace but Russian President Vladimir Putin says that it was flying over Syria. The BBC say that Putin has described the downing of the plane as a "stab in the back", and warned of serious consequences. Jordan cancelled a tender for 100,000 MT of hard wheat for Feb/Mar shipment due to lack of offers and immediately re-issued another tender for the same. Dec 15 CBOT Wheat closed at $4.84 1/4, down 10 3/4 cents; Dec 15 KCBT Wheat closed at $4.57 1/2, down 7 cents; Dec 15 MGEX Wheat closed at $5.09 1/2, down 7 cents.
24/11/15 -- EU grains closed mixed with Jan 16 London wheat up GBP0.05/tonne at GBP113.80/tonne, Dec 15 Paris wheat down EUR1.25/tonne to EUR176.00/tonne, Jan 16 corn unchanged at EUR167.50/tonne and Feb 16 rapeseed EUR2.50/tonne higher to EUR377.00/tonne.
The market appears to be treading water, with fresh news thin on the ground.
Ukraine said that winter grains there are 90% planted on 6.64 million ha versus 7.65 million ha this time a year ago.
Wheat is said to be 90% sown on 5.63 million ha, and barley 83% done on 864k ha.
The Ukraine winter rapeseed crop is only planted on 79% of the original government forecast at a surely over 648k ha.
The Ukraine 2015 grain harvest now stands at just over 59 MMT off 98% of the planned area. The corn harvest is now 93% done on 3.82 million ha for a crop of 21.19 MMT to date.
Russia said that it's 2015 harvest is now 99% complete at 108.1 MMT in bunker weight. The ongoing corn harvest is now 88.5% done at 12.4 MMT.
Russian plantings for the 2016 harvest remain stalled at 16.3 million ha, or 95.2% of the government's aim, versus 16.8 million ha this time a year ago.
Algeria are tendering for 75,000 MT of optional origin feed barley for December shipment.
Oil World said that the EU had imported 7.17 MMT of oilmeals in the final quarter of 2014/15, up from 6.55 MMT a year previously. That brings the total 2014/15 oilmeal imports to 27.14 MMT versus 26.61 MMT in 2013/14.
Soymeal accounted for almost 77% (20.86 MMT) of 2014/15 imports.
Oil World also said that the EU 2015 sunflower crop would fall to a 3-year low of 7.76 MMT, down 13% on a year ago.
23/11/15 -- Soycomplex: Beans closed higher, rebounding from a more than 6-year overnight low following victory for opposition candidate Mauricio Macri in the weekend's presidential election run-off in Argentina. Bloomberg suggested that Argentine growers could be sitting on as much as a huge 22 MMT hoard to soybeans that they might now want to release onto the market. That provided the initial bearish sentiment. Weekly export inspections of 1.854 MMT were 15% down on last week, but still a pretty decent total. Demand from China remains strong despite concerns over their economy. Chinese customs data shows them importing 5,531,696 MT of beans in October, up 34.85% from a year ago. Some 512,139 MT of that total came from the US, up 103.5% from a year ago. A further near 3.9 MMT came from Brazil (+47%) and another 919 TMT from Argentina (+30%). They also imported 364,680 MT of rapeseed last month, up 94.94% from a year ago. Jan/Oct Chinese soybean imports are 65.18 MMT, up 14.66% from a year ago. The USDA announced 251,000 MT of US beans sold to China for 2015/16 shipment under the daily reporting system. Jan 16 Soybeans settled at $8.64 1/4, up 6 3/4 cents; Mar 16 Soybeans settled at $8.66 1/4, up 5 3/4 cents; Dec 15 Soybean Meal settled at $285.30, up $2.30; Dec 15 Soybean Oil settled at 27.91, up 1 point.
Corn: The corn market settled around 3-4 cents higher. Weekly export inspections of 494,689 MT were in line with the expected 350-550,000 MT. China imported just 42,883 MT of corn in October, down 62.44% from a year ago. Even so, Jan/Oct corn imports are 4,516,893 MT, up 164% from a year ago. They shipped in 660,193 MT of DDGs in October, up 460% from a year ago. Russian seaports shipped out 113,000 MT of corn last week, around 21.5% of the total grain volume exported during the week. Russia's total corn exports so far this season (Jul 1 to Nov 18) are said to be 1.05 MMT. The Russian Ag Ministry said that the 2015 corn harvest there is 88.1% complete on 2.4 million ha for a crop of 12.4 MMT to date. Yields are said to be averaging 5.16 MT/ha versus 4.56 MT/ha a year ago. Ukraine seaports are said to have exported 217 TMT of corn last week, around 43% of all grain shipped out of the country. US grain markets are closed Thursday for Thanksgiving, and will trade a holiday-shortened session on Friday. We could therefore see a bit of book-squaring and/or profit-taking Tuesday/Wednesday, which might also explain today's modest price rises if they were due to a bit of short-covering. US growers are reluctant sellers at these levels, but we have to consider the effect of the falling Argentine peso and Brazilian real means that South American prices are viewed as pretty good. Forward sales there are thus surprisingly advanced. Dec 15 Corn settled at $3.67 1/4, up 4 cents; Mar 16 Corn settled at $3.73, up 3 1/4 cents.
Wheat: The market closed around 6-7 cents firmer across the three exchanges. That rise came despite weekly export inspections this morning coming in at a fairly modest 271,335 MT, although that was in line with the expected 200-400,000 MT. China imported 315,739 MT of wheat in October up 682% from a year ago. Barley imports of 998,367 MT were up 356% from a year ago. Ag Canada estimated Canada’s 2015/16 wheat crop at 26.061 MMT, unchanged from their previous estimate. Russian seaports were said to have shipped out 405 TMT of wheat last week, around 77% of all grain exports. Ukraine seaports shipped out 501 TMT of grains, of which over 40% (203 TMT) was wheat and 16% (82 TMT) was barley. Russia's 2015/16 season to date (to Nov 18) grain exports are 15.48 MMT, down 9.2% on a year ago. Over 75% of those (11.69 MMT) were wheat and a further 2.51 MMT was barley. Jordan are back in the market tendering for 100,000 MT each of optional origin hard wheat and feed barley. Last week's tenders for the similar quantities of both were pulled. France are said to be currently loading an unusual 50,000 MT cargo of wheat in Rouen destined for Indonesia - said to be the first such shipment since 2009. Euro weakness and dollar strength continues to hamper US export hopes. Dec 15 CBOT Wheat settled at $4.95, up 6 1/2 cents; Dec 15 KCBT Wheat settled at $4.64 1/2, up 7 1/2 cents; Dec 15 MGEX Wheat settled at $5.16 1/2, up 7 cents.
23/11/15 -- EU grains began the week mixed. Rapeseed was the weakest of the bunch today following a poor beginning from Chicago soybeans.
At the close, new front month Jan 16 London wheat was down GBP0.45/tonne at GBP113.75/tonne, Dec 15 Paris wheat was up EUR1.00/tonne at EUR177.25/tonne, Jan 16 Paris corn was EUR0.50/tonne higher at EUR167.50/tonne, whilst Feb 16 Paris rapeseed fell EUR2.50/tonne to EUR374.25/tonne.
Chicago soybeans fell to a 6-year low in overnight trade following the news that opposition candidate Mauricio Macri won the weekend's presidential election run-off in Argentina. Whilst not unexpected, reports that a potential devaluation of the Argentine peso by as much as 35% sparked ideas that heavy farmer selling from the South American country could be imminent.
A Bloomberg report suggested that Argentine growers have amassed as much as a huge 22 MMT hoard to soybeans as a hedge against inflation and the falling value of the peso - around one-third of last season’s record crop.
Much of those stockpiles could now come onto the market in the months ahead, along with smaller but still significant volumes of corn and wheat, it is thought. In addition, wheat production could soon return to the halcyon days of production in the 15-17 MMT range, a regular feature of the "noughties" when Argentina was one of the leading wheat exporters in the world.
The Argentine situation just adds to the whole bearish vibe reverberating around the market at the moment.
In other news, MARS said in their monthly report that "temperatures from the end of October until mid-November were well above average across most of Europe, and the highest in our records (since 1975) for the United Kingdom, France, Germany, Scandinavia and the Baltic countries. Such temperatures are beneficial to the development of the emerged winter crops."
"Conditions improved in Poland, Ukraine and Russia, where beneficial rains and higher temperatures provided relief from the difficulties reported in the previous Bulletin. The preceding unfavourable germination conditions may yet have a knock-on effect on next year’s yields, depending on the winter and spring conditions to come," they added.
As far as winter wheat goes, that crop has gone in under generally favourable conditions in the leading EU producing nations.
In France "conditions have been predominantly good, allowing for slightly advanced sowing in all main producing areas; the sowing campaign has practically finished now." In Germany "sowing activities experienced many rain-induced interruptions in mid-October, but were completed with no problems at the beginning of November," they said.
At home in the UK meanwhile "sowing activities progressed well, and were practically completed in October, thanks to the drier than-usual autumn weather conditions," they added.
For rapeseed "the main EU-28 producers of rapeseed (Germany, France, and the UK, but excluding Poland) experienced favourable weather conditions around sowing and emergence," they said. For Poland though "sowing and emergence occurred under very complicated conditions. The persistent of dry conditions in August delayed sowing activities by several weeks. Farmers were eventually able to sow thanks to some rainfall in northern regions, but it was insufficient to replenish soil water reserves. Consequently, seeds germinated under unfavourable conditions. This made rapeseed plants more vulnerable to the low temperatures experienced in large parts of northern Europe in October, leading to poor crop establishment," they noted.
Less than ideal conditions were observed in Ukraine, although recent improved rains and above average temperatures may have improved conditions "some losses are likely for winter wheat, winter barley and rapeseed," they said. A very similar situation also occurred in the southern half of Russia too, they added.
Reuters reported of a 50,000 MT vessel loading wheat at the leading French export hub of Rouen bound for Indonesia - the first such shipment since 2009. That adds a bit of confidence to the market following news late last week of wheat loading at the southern port of Fos-sur-Mer bound for another "unusual" French home - Lebanon.
20/11/15 -- General: The Argentine presidential run-ff is Sunday. The trade expects opposition leader Macri to win and take office on December 10th. Both candidates have promised to lower grain and soybean export taxes, so either way this weekend's result could be viewed as bearish - provided that they stick to their pre-election mandate of course. The impact in the long run could be more bearish for gains than soybeans, as the current ad-hoc system of on/off quotas and tariffs has seen a dramatic shift into sowing of the latter in recent years. Argentina is currently in the middle of harvesting an estimated 3.5 million ha of wheat, down a third on the area sown as recently as 2011/12 (5.2 million ha). Some are saying that wheat acres could rise to 7-8 million in the next few years. Corn plantings for 2015/16 are seen at 3.2 million ha bu the USDA versus 4.0 million in 2012/13. This year's soybean area is estimated by Washington at 20.0 million ha compared to 17.6 million in 2011/12.
Soycomplex: Beans closed a touch lower on the day, but a tad higher for the week. The IGC raised their outlook for the global 2015/16 soybean crop by 2 MMT from a month ago to 321 MMT (unchanged versus 2014/15), and cut ending stocks by 2 MMT to 47 MMT, although these are still up 2 MMT versus last season. "China’s needs accounting for the modest y/y rise. Brazil is seen as the largest exporter in 2015/16, its shipments significantly exceeding those by the US," they said. China's imports were raised 1 MMT to a new record 81 MMT. The USDA announced 120,000 MT of US beans sold to unknown for 2015/16 shipment. In Argentina, the Buenos Aires Grains Exchange said that 6 million ha of soybeans out of a final area of 19.8 million ha had been planted so far, mostly concentrated on the centre of the agricultural region. The Argentine Ag Ministry see final plantings at a new record 20.6 million ha, up 4% from 19.8 million a year ago. They say plantings are 23% complete so far. A Bloomberg survey into trader sentiment in beans found 4 bulls, 9 bears and 10 neutral. Jan 16 Soybeans settled at $8.57 1/2, down 2 1/2 cents; Mar 16 Soybeans settled at $8.60 1/2, down 2 1/2 cents; Dec 15 Soybean Meal settled at $283.00, down $3.60; Dec 15 Soybean Oil settled at 27.90, up 35 points. For the week Jan 16 beans were up 2 1/4 cents, meal was down $5.80 and oil was up 86 points.
Corn: As with beans, the corn market closed slightly lower on the day, but a bit higher for the week. The IGC lowered their global 2015/16 corn production estimate by 3 MMT to 967 MMT, down 4.5% from last season. They were unchanged on ending stocks however at 200 MMT (down from 207 MMT in 2014/15). Chinese production took a sizeable 7 MMT hit, down to 220 MMT. The Buenos Aires Grains Exchange said that Argentine corn planting is only making slow progress. EU corn import licences were issued for 314 TMT this week, and the season to date total now stands at 3.9 MMT versus 2.8 MMT this time a year ago. Ukraine said that it had exported 3.5 MMT of corn so far this season. A Bloomberg survey into trader sentiment in corn found 6 bulls, 8 bears and 9 neutral. Brazil are said to be actively offering corn 18 to 20 cents/bu cheaper than the US in the world market. Crude oil prices continue to struggle on oversupply, with NYMEX just about managing to hold above $40/barrel for now. OPEC are due to meet in Vienna in a couple of week's time to discuss matters. Brazilian markets were closed today for a holiday, trading there resumes on Monday. Dec 15 Corn settled at $3.63 1/4, down 1 cent; Mar 16 Corn settled at $3.69 3/4, down 1/2 cent. For the week Dec 15 was up 5 cents and Mar 16 added 4 1/4 cents.
Wheat: The wheat market closed a bit lower on the day, and mostly easier for the week. The IGC were unchanged on their outlook for the global 2015/16 wheat crop at 726 MMT, and lowered carryout by 1 MMT to 208 MMT (versus 201 MMT last season). The Argentina Ag Ministry estimated the 2015/16 wheat crop there at 10-12 MMT versus 13.9 MMT a year ago. They see plantings at 4.0 million ha, down 24%. Reduced production in Argentina again this year, and also quality issues due to heavy rain in southern Brazil harming their crop, could once more provide US wheat with an export opportunity. There's talk of Brazil buying at least one cargo of US HRW wheat this week, with the potential of more to follow in 2016. Kazakhstan said that they had now finished bringing in a 2015 grain harvest of 20 MMT, up 5.8% on a year ago. Wheat accounts for 14.7 MMT of that versus 14.4 MMT a year ago. Ukraine said that they'd exported 8.4 MMT of wheat so far this season. A Bloomberg survey into trader sentiment in wheat found 5 bulls, 9 bears and 9 neutral. Dec 15 CBOT Wheat settled at $4.88 1/2, down 2 1/4 cents; Dec 15 KCBT Wheat settled at $4.57, down 5 1/2 cents; Dec 15 MGEX Wheat settled at $5.08 3/4, down 1/4 cent. For the week Chicago wheat was down 7 1/4 cents, with Kansas losing 8 1/2 cents and Minneapolis adding 4 1/2 cents.
20/11/15 -- EU grains closed narrowly mixed on the day and for the week.
At the close, Nov 15 London wheat was up GBP0.50/tonne at GBP112.35/tonne. In Paris, Dec 15 wheat fell EUR0.25/tonne lower to EUR176.25/tonne, Jan 16 corn was EUR1.25/tonne easier at EUR167.00/tonne and Feb 16 rapeseed gained EUR0.50/tonne to EUR377.00/tonne.
For the week, London wheat fell GBP0.20/tonne, Paris wheat was EUR0.75/tonne lower, corn was a euro higher and rapeseed gained EUR4.50/tonne.
Brussels confirmed that they'd released 636 TMT worth of EU soft wheat export licences this past week, up 58% on 401 TMT a week ago, and the largest weekly volume of the campaign so far.
Even so cumulative season to date licences still lag the pace of a year ago by 30%. Barley export licences were issued for 126 TMT, taking the season to date total to 4.48 MMT, some 24% up compared with 12 month ago.
Corn import licences this week totalled 314 TMT taking the season to date total to 3.9 MMT, up 39% versus 2.8 MMT this time last year.
Reuters report on a rare cargo of French wheat loading at the southern French port of Fos-sur-Mer bound for Lebanon, suggesting that cheap French prices are finally allowing their wheat to make inroads to some more exotic destinations.
Certainly euro weakness looks like continuing to help that cause.
The global balance sheet though continues to paint a picture of plentiful wheat supplies in 2015/16, and a more than ample carryout. Plantings for next year already look like being little changed, despite current low prices.
The IGC yesterday said that incorporating assumptions for spring wheat plantings and the next southern hemisphere crops, the world harvested area in 2016 is projected at 221.8 million ha, down less than 1% year on year.
Earlier in the week, Strategie Grains forecast the EU wheat area to decline just 1% saying that "soft wheat maintains a good acreage...because of the good conditions for wheat sowings, and poor conditions for rapeseed."
In the UK, the HGCA are pencilling in a "static" wheat area, a 4% decline in winter barley and a 10% increase in spring barley sowings.
If we guess that yields in 2016 possibly won't be able to achieve the bumper levels experienced this year, then EU wheat and barley production in 2016 should fall. Any decline however will likely be at least tempered, if not entirely eradicated, by potentially exceptionally large carryover stocks at the end of the current season.
The USDA currently has EU 2015/16 wheat ending stocks at 16.34 MMT, a 22.7% increase versus the end of last season - and that assumes that we can reach their ambitious export target this campaign of a reduction over 2014/15 of less than 7%.
We also need to consider that EU corn production is likely to recover significantly in 2016.
On the international tender front, Tunisia bought 125,000 MT of soft wheat for Dec/Feb shipment, along with 92,000 MT of durum for Feb/Apr and 50,000 MT of feed barley for January. All of optional origin. France should get a look in on supplying the majority of that.
FranceAgriMer said that the French winter wheat crop is now 98% sown, along with 100% of the anticipated winter barley area also now in. The 2015 French corn harvest is said to be 97% complete.
French winter wheat is rated 97% good to very good, up a point on a week ago and 3 points ahead of this time last year. The proportion of the crop rated in the top "very good" category is 36% versus 34% a week ago and 27% this time last year.
The unusually mild November that we've seen so far across much of Europe is finally set to come to an abrupt end this weekend. Generally however crops appear well established and in good shape heading into winter dormancy.