22/07/16 -- Soycomplex: Beans closed sharply lower on the day and for the week. News that the Argentine truckers strike was over brought a bearish end to the week. The Argentine government were said to have increased their 2015/16 soybean production estimate from 58 MMT to 58.8 MMT as well (USDA: 56.5 MMT). Latest weather forecasts look a bit wetter. "The morning satellite image shows how very humid, unstable air ultimately reaches the Midwest, promoting instability and strong showers. The Southwest monsoon played a major role in fueling Midwest showers. Moist air from the Gulf of Mexico streams into the Southwest desert, then bends north into the Great Plains. The moist air air stream then turns east across the Midwest farm belt,W said Martell Crop Projections. Aug 16 Soybeans settled at $10.06 1/2, down 26 cents; Nov 16 Soybeans settled at $9.88 1/4, down 24 1/4 cents; Aug 16 Soybean Meal settled at $346.70, down $5.80; Aug 16 Soybean Oil settled at 30.21, down 85 points. For the week Aug 16 were beans were down 66 cents, with Aug 16 meal a $22.70 loser and Aug 16 oil dropping 68 points.
Corn: The market closed with small gains on the day but fair losses for the week. China was said to have sold the 453,203 MT of corn stocks they put up for auction. The Argentine Ag Ministry raised their estimate for 2015/16 corn production there from 37.9 MMT to 39.8 MMT (USDA: 28.0 MMT). They said that harvesting of that crop is 53% complete. FrancAgriMer pegged French corn crop conditions at 69% good to very good, unchanged on a week ago and 7 points better than this time last year. Rain makes grain! Or at least is makes corn in the case of France if not wheat. A wetter US weather outlook seems bearish. "More heavy rainfall is expected in the Midwest. Periods of strong showers would be fueled by the monsoon circulation. Moreover a storm track is expected to develop from west-to-east across the northern tier of the United States, carrying waves of showers into the northern Plains and Upper Midwest," said Martell Crop Projections. News of the Argentine truckers strike being over is also a bearish influence. Sep 16 Corn settled at $3.35, up 3/4 cent; Dec 16 Corn settled at $3.41 3/4, up 1 cent. Sep 16 fell 17 1/4 cents compared with last Friday.
Wheat: The wheat market followed French markets higher. FranceAgriMer cut another 7 points off French wheat good to very good today, making for a 37 point decline in the last 3 weeks alone. The French crop was rated 76% G/VG this time a year ago. Paris wheat futures put in their highest close of 2016 tonight. French analysts ODA cut 3 MMT off their previous production estimate, pegging the crop at a 9-year low of 32 MMT. Harvesting of French wheat is only 17% done compared to 53% a year ago and there are fears than things could get worse yet as the harvest progresses. Jordan are in for 100,000 MT of optional origin hard wheat. The Argentine Ag Ministry cut their forecast for 2016/17 wheat plantings there from 5.34 million ha to 5.25 million. Russian wheat production could reach 68 MMT this year say IKAR (USDA: 65 MMT). They've harvested 28.1 MMT so far, say the Ag Ministry. RusAgroTrans said that grain exports in July might be lower than expected due to reduced Turkish interest and as traders sit on their hands awaiting the anticipated removal of the export tax on wheat. Sep 16 CBOT Wheat settled at $4.25 1/4, up 7 1/2 cents; Sep 16 KCBT Wheat settled at $4.19, up 11 1/2 cents; Dec 16 MGEX Wheat settled at $5.11, up 8 3/4 cents. Chicago wheat was up 1/2 cents on the week, with Kansas wheat up 5 1/4 cents and Minneapolis falling 1 cent.
22/07/16 -- EU grains finished mostly higher on the day, with yet another wheat crop downgrade coming in from FranceAgriMer. The EU market continues to be pulled one way by the demise of the French crop, and another by likely bumper production from Ukraine and Russia again this year. The former won the day today.
The day ended with new front month Nov 16 London up GBP2.05/tonne at GBP126.05/tonne, Sep 16 Paris wheat was EUR7.00/tonne higher at EUR174.00/tonne, Aug corn was up EUR2.25/tonne at EUR171.50/tonne and Aug 16 rapeseed fell EUR6.25/tonne to EUR357.75/tonne.
For Paris wheat this was the highest front month close of 2016 so far following the news that ODA had downgraded their French wheat crop estimate this year by 3 MMT to 32 MMT. Production was almost 41 MMT a year ago, so we're looking at a near 22% decline, and the lowest output since 2007 here.
FranceAgriMer backed-up the downgrade by dropping it's estimate for the proportion of the crop rated good to very good by 7 percentage points to just 42% (76% a year ago). They said that harvesting of French wheat was 17% complete versus 7% last week and 53% this time last year.
The French winter barley crop was seen at 42% good to very good, down 2 points and well below 86% this time last year. Harvesting of that is 95% complete. Spring barley was put at 60% G/VG from 62% last week and 64% last year. Harvesting of that crop is 7% done versus 3% last week and 38% last year.
The French corn crop was seen unchanged at 69% G/VG (62% last year), and silking is at 13% (3% last week and 73% last year).
RusAgroTrans lowered their forecast for Russia's July grain exports from 2.5 MMT to 2.0 MMT. The revision is a result of reduced demand from Turkey and some trader/grower reluctance ahead of the anticipated removal of the export tax on wheat at the end of this month.
The Russian Ag Min say that this year's wheat harvest now stands at 28.1 MMT of 6.7 million ha. Yields are averaging 4.17 MT/ha versus 3.79 MT/ha a year ago. They've also harvested 3.6 MMT of barley.
Ukraine say that they've harvested 61% of the planned early grains area (or 5.88 million ha) for a crop of 21.34 MMT to date. Wheat accounts for 3.554 million ha (57% of plan) for a crop of 13.8 MMT so far. Barley adds another 6.83 MMT off 73% of plan.
They say that they've already exported 1.443 MMT of grains so far this new season, including 760,000 MT of barley, 297,000 MT of wheat and 386,000 MT of corn.
21/07/16 -- Soycomplex: Soybeans closed around 3-5 cents higher. Weekly export sales came in at 325,000 MT for 2015/16 and 1,001,600 MT for new crop, beating pre-report estimates of 750,000 MT to 1.25 MMT over both crop years. Exports of 393,800 MT were down 1 percent from the previous week, but up 30 percent from the prior 4-week average. The much touted Midwest heatwave is now upon us, with AccuWeather giving "real feel" temperatures of as high as 115F for Chicago Friday afternoon. Aug 16 Soybeans settled at $10.32 1/2, up 5 1/2 cents; Nov 16 Soybeans settled at $10.12 1/2, up 3 1/2 cents; Aug 16 Soybean Meal settled at $352.50, up $0.10; Aug 16 Soybean Oil settled at 31.06, up 35 points.
Corn: The corn market closed around 3-4 cents lower. Weekly export sales were 345,100 MT for 2015/16 and 506,300 MT for 2016/17. Trade estimates were for combines sales of 900,000 MT to 1.25 MMT. Exports of 1,240,900 MT were unchanged from the previous week, but down 5 percent from the prior 4-week average. Reuters reported that corn arrivals in Argentina's Rosario port are down dramatically due to the ongoing truckers strike there. The EU approved 138 TMT of corn import licences for a season so far total of 534 TMT. Sep 16 Corn settled at $3.34 1/4, down 3 1/4 cents; Dec 16 Corn settled at $3.40 3/4, down 3 1/2 cents.
Wheat: The wheat market closed higher. Weekly export sale of 478,000 MT for 2016/17 were up 50 percent from the previous week, but down 15 percent from the prior 4-week average. Exports of 360,600 MT were up 6 percent from the previous week, but down 27 percent from the prior 4-week average. China took one cargo of the latter. The global wheat market has a familiar look to it: Continued downgrades for France; average crops in most of the rest of Europe; Better yields than expected in Ukraine although quality is down; Better yields and quality in Russia; Improved optimism for Australia. Sep 16 CBOT Wheat settled at $4.17 3/4, up 4 3/4 cents; Sep 16 KCBT Wheat settled at $4.07 1/2, up 3/4 cent; Dec 16 MGEX Wheat settled at $5.02 1/4, up 1 1/4 cents.
21/07/16 -- EU grains closed mostly firmer on strong exports and continued French crop downgrades.
The day ended with benchmark Nov 16 GBP2.35/tonne firmer at GBP125.80/tonne. Sep 16 Paris wheat traded up EUR6.50/tonne at EUR167.00/tonne, Aug corn was EUR1.75/tonne firmer at EUR169.25/tonne and Aug 16 Paris rapeseed was down EUR0.50/tonne at EUR364.00/tonne.
Brussels confirmed that they'd released 826 TMT worth of soft wheat export licences this past week along with 191 TMT worth for barley.
That takes the cumulative total on wheat to 1.814 MMT just 3 weeks into the new season, some 44% more than this time a year ago.
Barley exports for the season so far are now 619 TMT, some 47% below this time last year.
France's share of total wheat exports to date is 23.5% and for barley 30.4%.
Tunisia were confirmed to have bought 117,000 MT of soft wheat, 75,000 MT of barley and 109,000 MT of durum wheat in their tender, all of optional origin.
Reports out of France, where Agritel yesterday described the crop as "very, very bad" continue to suggest poor yields and bushel weights. It is also probably likely that protein levels will have been compromised.
FranceAgriMer will update us Friday morning on crop progress, although the figures given will only be as of Monday. Last week's good to very good ratings fell 10 percentage points in wheat.
Agritel also tell us that they estimate that only 40% of this year's Ukraine wheat crop will make milling standards as opposed to 50% on average for the last 3 seasons.
In Russia the 2016 wheat harvest is said to be 26.7 MMT already, with yields averaging 4.22 MT/ha vs. 3.78 MT/ha a year ago.
20/07/16 -- Soycomplex: Soybeans closed lower under pressure from a firmer US dollar. There were no new weather market developments today, so the old adage "the bulls need feeding everyday" maybe came into play and we drifted lower. Trade ideas for tomorrow's weekly export sales report for beans are 750,000 MT to 1.25 MMT over both crop years. Talk of lower demand from China than the 87 MMT that the USDA has pencilled in for 2016/17 leans bearish. They are due to auction off another 579,300 MT of state owned reserved on Friday. Word is that the Argentine government is baulking at introducing the promised next 5% reduction in the soybean levy, which would upset growers there and maybe lead to some selling reluctance. Aug 16 Soybeans settled at $10.27, down 17 cents; Nov 16 Soybeans settled at $10.09, down 18 3/4 cents; Aug 16 Soybean Meal settled at $352.40, down $7.30; Aug 16 Soybean Oil settled at 30.71, up 5 points.
Corn: The corn market closed lower despite weekly US ethanol production coming in at a new record 1.029 million barrels per day, according to the US Energy Dept. Weekly export sales for corn tomorrow are expected to be in the region of 900,000 MT to 1.25 MMT. The trade seems relaxed about the ongoing Argentine truckers strike possibly disrupting shipping programmes there, at least for now. The trade is fixed on US weather. "Maximum temperatures are expected to climb into the 90s F over the next several days in Midwest corn and soybeans. Kansas and Oklahoma are expecting highs over 100 F. This would not necessarily be newsworthy, except that extreme heat has been absent this summer to date. Showers are predicted in corn and soybeans though coverage may be scattered. Nebraska and Kansas are expecting the heaviest rainfall, more than one inch, while conditions look drier for Iowa, Missouri and southern Minnesota the balance of this week. Corn farms east of the Mississippi Valley are targeted for heavier rainfall, Illinois, Indiana, Ohio and Michigan," said Martell Crop Projections. Sep 16 Corn settled at $3.37 1/2, down 4 1/4 cents; Dec 16 Corn settled at $3.44 1/4, down 4 1/4 cents.
Wheat: The wheat market closed lower. Export sales of US wheat during the week ending July 14 are estimated to be from 300,000 to 600,000 MT in tomorrow's weekly export sales report. The USDA’s attaché in Australia has pegged the wheat crop there to 26 MT (+6.12% from last season). There's some talk of final production being much higher than this once the combines start rolling. The current WASDE estimate is at 25.5 MT. Japan is tendering for 165,048 MT of wheat in it's regular weekly tender. The French wheat crop is looking poor, but elsewhere in Europe things look better. The FSU looks great. The Ukraine Ag Min predicted a grain harvest in excess of 60 MMT for the 4th year in a row. The wheat harvest there is presently 47% done at 11.3 MMT. The Russian harvest is also going well with more than 25 MMT of wheat already in the barn. UkrAgroConsult predicted Russia's share of the global wheat export market to rise to 16% this season from 14.1% last year. Dec 16 CBOT Wheat settled at $4.36, down 6 1/2 cents; Dec 16 KCBT Wheat settled at $4.32 3/4, down 3 3/4 cents; Dec 16 MGEX Wheat settled at $5.01, down 3 cents.
20/07/16 -- EU wheat closed mixed in relatively light trading activity. French analysts Agritel described the wheat harvest there as "very, very bad" but it seems like the rest of Europe has escaped that and got of with "very, very ordinary" in terms of both quality and quantity.
At the close Jul 16 London wheat was unchanged at GBP111.75/tonne, Sep 16 Paris wheat was up EUR0.25/tonne to EUR160.50/tonne, Aug Paris corn was down EUR1.75/tonne at EUR167.50/tonne and Aug 16 Paris rapeseed was EUR4.50/tonne higher at EUR364.50/tonne.
Agritel forecast the Germany wheat crop at 26 MMT, which is 1 MMT more than DRV's estimate from Friday, and 1.9% down on last year's bumper result.
The UK combines are still waiting to get going, but an average harvest of around 15.3-15.5 MMT is expected rather than a bin-buster.
Switch to Ukraine where things could be described as "very good" the wheat harvest is already 47% complete at 11.3 MMT. They've brought in a further 6 MMT of barley, off 65% of the planned area and 62% of the winter OSR crop producing 720 TMT of the oilseed so far.
The UKraine Ag Ministry predict a grain harvest in excess of 60 MMT for the 4th year in a row, and growers there are said to have already started planting OSR for the 2017 harvest.
In Russia things are more like "very, very good" - they've produced 25.1 MMT of wheat off 5.9 million ha and yields are up 12.4% at 4.25 MT/ha.
In addition they've cut 916k ha of barley producing a crop of 3.4 MMT so far. Yields are up 5% at 3.69 MT/ha.
UkArgroConsult said that Russia's share of the global wheat export market would grow to 16% in 2016/17 versus 14.1% last season. France's share by contrast will fall to 11% from 12.1%.
Jordan cancelled a tender to buy wheat. Syria were said to have bought 200,000 MT of Russian wheat. Tunisia tendered fro 120,000 MT of soft wheat, 67,000 MT of durum and 100,000 MT of feed barley.
19/07/16 -- Soycomplex: Beans closed sharply lower. Latest weather forecasts showed a wetter 5 day pattern, little change to the hot/dry 6-10 day prediction but then a cooler trend for the 11-15 day model. That was seemingly all it took to get the market down 30 cents. Oil World see China importing a lot less beans in 2016/17 (80-82 MMT) than the USDA currently think (87 MMT). Dr Cordonnier reports that the Argentine government are waivering over their promise to phase in the reduction in the soybean export tax in 5 percentage point increments when they look at how much needed revenue the tax brings in. Aug 16 Soybeans settled at $10.44, down 34 1/4 cents; Nov 16 Soybeans settled at $10.27 3/4, down 38 1/2 cents; Aug 16 Soybean Meal settled at $359.70, down $13.30; Aug 16 Soybean Oil settled at 30.66, down 28 points.
Corn: The market closed substantially lower on a subtle change in the US weather outlook. The market is fixated on the US weather and crop conditions. "Conditions Mid July are better in many big production states than they were a year ago and point towards a national yield of 175.3 bu/acre and a 3 bln bushel carryout. A 3 bln bushel carryout is a 22% carryout to ratio and the last time the US experienced a carryout to use ratio like that corn was $2.00 in October 17 years ago," observed FCStone. The South American harvest is about halfway done. There are trucker strikes in Argentina but no serious delays in exporting grains are being reported yet. ProZerno forecast Russia's 2016/17 corn exports at 4.7 MMT - more than those for barley (4.3 MMT). Corn production in FSU nations is becoming the new "big thing" as they turn on to higher much yielding hybrid varieties. DRV forecast the Germany corn crop at 4.5 MMT, unchanged from 2015. Sep 16 Corn settled at $3.41 3/4, down 15 1/4 cents; Dec 16 Corn settled at $3.48 1/2, down 14 3/4 cents.
Wheat: The wheat market ended with significant losses across the three exchanges. The US winter wheat harvest is now past three quarters done, and in Ukraine it's approaching halfway. Russia's harvest is also fairly well advanced. Yields in all three countries are reported to be impressive. Harvesting in France and Germany is only just getting going. France is expecting disappointing yields and quality, but overall in Germany things might be more like "just average". The UK will get going imminently if the weather holds. ProZerno forecast Russian grain exports in 2016/17 at a record 36.1 MMT (34.6 MMT in 2015/16), including 26 MMT of wheat, 4.7 MMT of corn and 4.3 MMT of barley. Rosstat said that Russian grain stocks as of Jul 1 were down 6.8% year-over-year at 13.3 MMT. Ukraine said that they'd harvested 9.9 MMT of wheat and 5.7 MMT of barley so far. Sep 16 CBOT Wheat settled at $4.18, down 11 1/2 cents; Sep 16 KCBT Wheat settled at $4.10 1/2, down 9 1/2 cents; Dec 16 MGEX Wheat settled at $5.04, down 9 3/4 cents.
19/07/16 -- EU grains finished mostly lower on harvest pressure. Once again concerns over EU production were outweighed by impressive early harvest results in Russia and Ukraine.
The day ended with Jul 16 London unchanged at GBP111.75/tonne, Sep 16 Paris wheat was down EUR0.75/tonne at EUR160.25/tonne, Aug corn was EUR2.50/tonne lower at EUR169.25/tonne and Aug 16 rapeseed fell EUR0.50/tonne to EUR360.00/tonne.
"European weather fears have supported global wheat futures in the past couple of days. Concerns for French wheat in particular, currently rated in especially poor condition, relate both to yields and quality of the crop. However, from a feed wheat perspective the implication is less certain," said the HGCA.
The implications for London wheat are less wheat being around thereby supporting prices, but a higher proportion of what is available being feed wheat which is negative for prices, they noted.
Certainly French crop conditions have dropped like a stone in recent weeks - down 22 points in the good to very good in the last 3 weeks alone for wheat - and early harvest results appear to confirm poor quality as well as reduced yields.
In Germany however things don't seem as bad. DRV estimated the Germany grain crop at 47.5 MMT on Friday, down from 48.0 MMT previously but in line with the last 5-years.
Winter wheat will account for 25 MMT of that total (down 4.3% on last year) and winter barley 9.2 MMT (-4.4%). Spring barley (2 MMT) and corn (4.5 MMT) output will be close to last year's levels.
The barley harvest is underway and throwing up a wide variety of specific weights. The OSR harvest has also begun but it's too early to form a reliable estimate on quality, they say. The see production at 4.9 MMT versus 5.4 MMT for the recent average.
In Ukraine the early grains harvest is 47% complete on 4.5 million ha producing a crop of 16.1 MMT so far. Wheat accounts for 9.9 MMT of that with yields up 11% at 3.82 MT/ha.
The barley harvest in Ukraine is 61% complete at 5.7 MMT and the winter OSR harvest 58% done at 676.7 TMT.
The Russian wheat harvest is reported to have reached 23.3 MMT with yields up 14% at 4.3 MT/ha.
ProZerno forecast Russian wheat exports at a record 26 MMT in 2016/17. APK Inform are close by at 25.8 MMT. Last season's record was unofficially 24.9 MMT.
18/07/16 -- Soycomplex: Soybeans closed higher and towards the upper end of a fairly wide trading range. Concerns over drier weather later in the week won the day. Weekly export inspections were in line with trade ideas at 367,380 MT. After the close the USDA left soybean good to excellent ratings unchanged at 71%. They said that 59% of the crop is blooming (49% on average) and 18% setting pods (13% on average). Oil World said that China's soybean imports might drop from 83 MMT to 80-82 MMT this year - the first y-o-y decline in ten. The fall comes due to high domestic stocks, increased Chinese oilseed production and the fact that the government intends to auction 4.3 MMT of state-owned stocks, they said. Aug 16 Soybeans settled at $10.78 1/4, up 5 3/4 cents; Nov 16 Soybeans settled at $10.66 1/4, up 9 cents; Aug 16 Soybean Meal settled at $373.00, up $3.60; Aug 16 Soybean Oil settled at 30.94, up 5 points.
Corn: The corn market closed around 4-6 cents higher. Weekly export inspections of 1.328 MMT were at the top end of trade estimates. "Less favourable growing conditions are predicted this week on Midwest farms as hotter temperatures develop along with reduced showers. Prospects in corn have been favourable with ideal cool and rainy weather, up until now. Showers and thunderstorms are predicted today in Iowa and Illinois. Hardly any rainfall is foreseen elsewhere in Midwest corn, however," said Martell Crop Projections. The USDA said that corn conditions good to excellent were unchanged on last week at 76% (with a subtle 1 point shift into excellent). They said that 56% of the crop is silking versus 46% typically at this time. Ukraine seaports exported 85,600 MT of corn last week, according to APK Inform. Sep 16 Corn settled at $3.57, up 4 3/4 cents; Dec 16 Corn settled at $3.63 1/4, up 5 cents.
Wheat: The wheat market closed higher. Weekly export inspections of 439,484 MT were fairly good. The USDA reported 76% of the US winter wheat crop to be harvested as of Sunday night, in line with 73% normally at this time. Spring wheat headed was 96% against only 81% typically. Spring wheat conditions were down one point to 69% good to excellent (70% a year ago). Egypt bought Romanian and Russian wheat in their tender, paying around $166-167 FOB. The Russian wheat harvest is already past the 20 MMT mark. The Russian Ag Min say that they've exported 583,800 MT of grains so far this season ( a 34.5% increase on a year ago) of which 383,500 MT is wheat. Private reports out of Russia indicate that this year's harvest is likely to be every bit as good and official estimates of around 110 MMT. Sep 16 CBOT Wheat settled at $4.29 1/2, up 4 3/4 cents; Sep 16 KCBT Wheat settled at $4.20, up 6 1/4 cents; Dec 16 MGEX Wheat settled at $5.13 3/4, up 1 3/4 cents.
18/07/16 -- EU grains closed narrowly mixed, with Jul 16 London wheat was unchanged at GBP111.75/tonne. Sep 16 Paris wheat traded up EUR1.50/tonne at EUR161.005/tonne, Aug corn was EUR2.00/tonne lower at EUR171.00/tonne and Aug 16 Paris rapeseed was flat at EUR360.50/tonne.
Suddenly much warmer and drier conditions in western Europe should speed up harvest activity dramatically, although in the case of France in particular it seems like the damage is already done.
Egypt bought 300,000 MT of Romanian/Russian wheat over the weekend for Aug 21-30 shipment in it's second tender of the new season. The prices paid were reportedly $166.73-167.67/tonne FOB for the Romanian material and $166.50/tonne FOB for the Russian.
That's around $2/tonne more than they paid last week for Aug 10-21 shipment, although overall the general level of offers was lower.
APK Inform said that Russian seaports had shipped out 204,400 MT of grain last week, up from 142,000 MT the week before. Last week's total included 103,500 MT of wheat and 95,000 MT of barley. The top home was Saudi Arabia (62,500 MT) followed by Turkey (56,000 MT).
Despite those figures seeming to be unimpressive, the Russian Ag Ministry said that total exports for the first two weeks of the new season were 583,800 MT, a 34.5% increase on a year ago, Wheat accounted for 383,500 MT of that total, according to them.
Ukraine's seaports exported 423,500 MT of grain last week, including 51,400 MT of wheat, 286,500 MT of barley and 85,600 MT of corn. Jordan was their top buyer (56,900 MT).
The Russian Ag Min said that the wheat harvest there is already 20.5 MMT complete, with average yields of 4.32 MT/ha (20156: 3.78 MT/ha). Barley accounts for a further 3.0 MMT.