Early Call On Chicago

14/06/11 -- The overnights closed lower with beans down around 4-6c, corn 10-14c weaker and wheat 2-4c lower on old crop and 7-13c down on new crop.

Corn is leading the pack lower, despite last week's bullish USDA report on news that corn planting in the US is amazingly 99% done. Talk of ethanol plants idling due to high prices and poor margins is also seen as a negative factor.

Corn crop conditions improved week on week to 69% good/excellent.

News that the Senate are due to vote today on whether or not to repeal the costly ethanol tax credit could prove to be crucial in terms of corn demand and therefore ending stocks for 2011/12.

Under Senate rules the amendment needs the support of 60 of the chamber's 100 members to get passed.

Given the weight of speculative length a yes vote could trigger some very significant corn liquidation, with wheat and soybeans also likely to get caught in the crossfire.

China has raised it's bank reserve requirements for the ninth time since October after data showed inflation there rising in May to 5.5 percent, its highest level in almost three years.

Egypt and Algeria are in the market to buy wheat, for the first time in four months in the case of the former. Breaking news confirms that Egypt bought one 60,000 MT cargo each of French and US wheat.

Early calls for this afternoon's CBOT session: corn down 10-12c, wheat down 2-4c, beans down 4-6c.