Chicago Grains Jump - Led By Beans
26/10/16 -- Soycomplex: Soybeans closed higher helped by the strong demand story (even though there were no flash sales announced by the USDA today). Malaysian palm oil prices firmed to the near two-and-a-half year highs seen at the start of the week, which helped. Nov 16 beans ultimately crashed through resistance at $10/bushel and kept going to close at $10.10/bushel. Market sources say that China sold 99,341 MT of government owned rapeseed oil at auction today - the entire volume offered. This adds to trade ideas that global vegoil supplies are tight. This year's EU rapeseed crop was down sharply, and next year's production already has a cloud cast over it due to poor emergence and high disease and pest issues in the UK, France and Germany. All of this increases world demand for soybeans, which is just as well given this year's record large US crop. The Brazilian real is pushing 16 month highs versus (an already strong itself) US dollar, which may have a negative impact on growers there bringing beans to market. Trade ideas for tomorrow's weekly export sales report for beans are a meaty 1.5 to 2.5 MMT. Nov 16 Soybeans closed at $10.10, up 19 1/4 cents; Jan 17 Soybeans closed at $10.21, up 18 3/4 cents; Dec 16 Soybean Meal closed at $319.10, up $10.90; Dec 16 Soybean Oil closed at 35.72, down 8 points.
Corn: The corn market closed with fair gains, helped by a weaker US dollar and spillover support from surging soybeans. The US Energy Dept put weekly US ethanol production at 991,000 barrels/day, down 7,000 barrels/day on last week. Taiwan were reported to have bought 65,000 MT of US/Brazilian corn. Given the current strength of the Brazilian real and high domestic prices there this will probably end up being US material. South Korea's NOFI are reported to be be in the market for 276,000 MT of optional origin corn for Feb/Mar shipment. South Africa say that they will plant 27% more corn this year for a total crop area of 2.46 million ha. The Russian corn harvest is reported at 8.9 MMT (55.1% complete). Under China’s new corn production policy (which includes fewer incentives for corn farming in many provinces), production is projected to drop by 4% to 216.2 MMT next year, say Water Street Solutions. Trade estimates for tomorrow's weekly export sales report on corn range from 850,000 MT to 1.2 MMT. Dec 16 Corn closed at $3.54, up 4 3/4 cents; Mar 17 Corn closed at $3.63 1/4, up 4 1/4 cents.
Wheat: The wheat market closed firmer, helped by rising corn and soybean futures. Short-covering was likely a feature again today. Pakistan estimated their wheat crop at 26 MMT versus 25.4 MMT a year ago. South Korea's NOFI are in the market for 69,000 MT of optional origin feed wheat for Feb shipment. The head of the Russian Grain Union said that this year's total clean weight grain harvest could be in excess of 116 MMT (versus 104.8 MMT last year), pegging export potential in 2016/17 at 38-40 MMT. Russian winter plantings for the 2017 harvest are said to be 95.6% complete on 16.6 million ha. The Ukraine state weather centre said that the arrival of colder than normal temperatures had slowed down, and even halted, the development of winter grains there. The last figures from the Ag Ministry showed winter wheat planting at 86% complete. Winter barley was only 59% sown as of Oct 25. The International Grains Council are due out tomorrow with their latest monthly look at global grains supply and demand. Trade ideas for tomorrow's weekly export sales report on wheat are a modest 350,000 to 550,000 MT. Dec 16 CBOT Wheat closed at $4.11 1/2, up 7 1/4 cents; Dec 16 KCBT Wheat closed at $4.17, up 3 1/2 cents; Dec 16 MGEX Wheat closed at $5.25 1/2, up 1 1/2 cents.