Chicago Closing Comments


July soybeans closed at $12.32 1/2 up 7 cents, whilst November soybeans finished at $10.51 3/4, down 10 cents, further widening the old/new crop spread ever closer to $2/bushel. Nearby it's all about the tight old crop ending stocks likely to be projected at the lowest stocks to usage since 1968 on Wednesday by the USDA. China says it will import a record amount of beans in June, 4.62 MMT, although much of that will likely come from Brazil (maybe half?), that still leaves a fair old chink still expected to come from the US in light of the Argentine problems. An anticipated late harvest in the US this year will exacerbate the tightness in old crop supplies. New crop, conversely, has to be bearish with increased US plantings and sharply higher ending stocks for the 2009/10 marketing year.


July corn ended down 9 cents to $4.35 per bushel. A firmer dollar and weaker crude were negative influences for corn today, as too were falling equities and rumours that China will shortly begin auctioning off upto 15 MMT of domestic corn reserves. Ahead of Wednesday's USDA report there was an inclination to bank profits from the recent rally. Some intended corn acres will likely end up getting switched into beans, additionally the USDA may decide to drop 2009 yields a bit to reflect the generally late planting progress. That could also have a negative impact on 2009/10 ending stocks.


CBOT July wheat ended down 23 cents $6.00 a bushel. Unlike the other two main market protagonists this upcoming USDA report isn't likely to be so significant for wheat. For now wheat is more of a follower, and today it followed the firmer dollar, and weaker crude and equities. Winter wheat production is expected to be tweaked slightly lower on Wednesday, whilst 2009/10 ending stocks may also be revised down a little. Argentine plantings are well behind normal, and comfortably set to be the lowest on record. Before we get to that, all eyes will be on US and European yields once the harvest gets into full swing. Very early US yields on winter wheat have been disappointing.