Chicago Closing Comments

02/02/11 -- Soybeans

March beans settled 6 cents higher at USD14.44 a bushel; March soymeal traded USD3.10 lower at USD386.90; March soyoil ended 53 points higher at 59.25. China underlined robust demand for US soybeans by buying 440,000 MT of new crop overnight, even though they are on holiday. A much improved weather outlook for Argentina beans was however bearish, although on-off strikes there may continue to push export interest the way of the US. Private analyst Michael Cordonnier and Oil World both raised their Argentine and Brazilian soybean production estimates this week on the back of improved rains.


March corn ends up 3 1/4c at USD6.69 1/4 a bushel; May corn ended up 3 1/4c at USD6.79 3/4 a bushel. Private analysts Newedge USA forecast 2011 US corn plantings at 91.5 million acres, up 3.3 million from 2010. Informa Economics left their Argentine corn production estimate unchanged at 21 MMT, with Brazilian output also static at 53.2 MMT. South American analyst Michael Cordonnier left both his Argentine and Brazilian corn estimates unchanged at 19.5 MMT and 50 MMT respectively. Crude oil was fully steady, also lending support, as too was weaker US dollar.


CBOT March wheat climbed 27 1/4c to close at USD8.63/bushel; KCBT March rose 28 3/4c to USD9.52 3/4; MGEX March climbed 29 1/4c to USD10.10 1/4. Wheat set contract highs on protective snow coverage missing large parts of the HRW wheat belt in HRW wheat in KS, OK and TX. Egyptian concerns, drought in China and the impending damage from Cyclone Yasi in Australia also added to trader's worries. In short, nobody wants to be short of wheat on this market. EU stock tightness, Argentina's viability as a reliable supplier and Australia's woes don't leave too many shops left open if you want quality wheat this spring.