Nogger's Blog

Chicago Close

08/04/11 -- Soybeans: May 11 soybeans closed at USD13.92 1/4, up 28 3/4 cents; Nov 11 soybeans closed at USD13.96, up 30 1/2 cents; May 11 soybean meal closed at USD357.20, up USD6.30; May 11 soybean oil closed at 59.77, up 145 points. Crude oil was sharply higher, with NYMEX closing at a 30-month high and Brent at a 32-month high. The dollar slumped close to it's lowest levels since late 2009 on the budget impasse between the White House and Congress. The USDA's US soybean ending stocks number was left unchanged at 140 million bushels and Brazilian production was raised 2 MMT to 72 MMT. That put world ending stocks 2 MMT up on trade expectations at 60.9 MMT.

Corn: May 11 corn closed at USD7.68, up 9 cents; Dec 11 corn closed at USD6.53, up 8 3/4 cents. May corn ended up 32 cents on the week, with Dec increasing by 15 1/2c, further widening the old crop/new crop spread. A weak dollar and firm crude oil market added support. The market shrugged off the USDA leaving 2010/11 US ending stocks unchanged at 675 million bushels, contrary to the average trade estimate of a sharp cut to 586 million. Brazil's corn crop was estimated at 52 MMT, 2 MMT up on last month. The USDA's perception that corn usage will fall in the 3rd and 4th quarters, meaning that ending stocks won't tighten any further, is clearly being questioned by the market.

Wheat: May 11 CBOT wheat closed at USD7.97 1/2, up 24 1/4 cents; May 11 KCBT wheat closed at USD9.32 3/4, up 10 cents; May 11 MGEX wheat closed at USD9.53 1/4, up 12 1/2 cents. Chicago wheat narrowed the sizable gap between it and the higher quality wheats traded in Kanasas and Minneapolis on ideas that spiraling corn prices will lead to more wheat being fed in the US this summer. US ending stocks came in lower than expected at 839 million bushels in today's USDA stocks report. World ending stocks were up slightly to 182.8 MT against the 181.9 MMT estimated in March. The market is now concentrating on the fate of the US winter wheat crop after another week of hot and dry conditions on the southern Plains.

EU Grains Close

08/04/11 -- May London wheat closed GBP1.25/tonne higher at GBP206.75/tonne with new crop Nov up GBP0.25 to GBP169.50/tonne. May Paris wheat fell EUR2.50/tonne to EUR247.25/tonne whilst Nov was down EUR3.50/tonne to EUR215.00/tonne.

A firm euro on the back of the ECB's decision yesterday to raise eurozone interest rates by a quarter to 1.25% put Paris wheat under pressure. Even so French wheat stocks remain very tight with France having picked up 83% of the EU's 15.7 MMT worth of soft wheat export licences so far in the current 2010/11 marketing campaign.

An unusually dry March has given way to an unusually dry and warm April thus far, with temperatures in Cambridge hitting 23C earlier in the week. A glorious weekend lies in store for most parts of the UK, before colder and wetter weather sets in from the middle of next week and into the run-up to Easter. If it does arrive then these rains will be heartily welcomed by most growers.

May London feed wheat closed at around a EUR14/tonne discount to May Paris milling wheat, whereas November in London is around EUR25/tonne cheaper than in Paris.

Either May London wheat is too dear or Nov is too cheap. At well over GBP200/tonne again wheat finds only soyameal priced more expensive than it when looking down the list of popular raw materials featuring in a most feed manufacturers rations.

"They like to so it (wheat) on the ticket," said one to me this week. Meaning that livestock farmers like to see wheat featuring high on the list of raw materials included in their finished feed. They might like it on the ticket, but do they like the price of it on their invoice?

The USDA's world supply and demand numbers released today were largely bearish, particularly for corn where US 2010/11 ending stocks were left unchanged, as opposed to the sharp cut the trade was anticipating. After opening lower though Chicago quickly turned higher as the trade shrugged the numbers off as being unrealistic.

Egyptian wheat production was dropped 1.3 MMT to 7.2 MMT, although consumption there was also reduced by 900,000 MT to 17.5 MMT. World ending stocks were increased by 1 MMT to 182.8 MMT, 15.1 MMT or 7.6% down on last year, but pegging stocks to usage at a more than ample 27.6%.

Early Call On Chicago

08/04/11 -- The overnight grains closed higher with beans up 16-17c, corn up 6-8c and wheat 2-4c firmer. However the Globex session closed before the USDA came out with their April WASDE and US ending stocks estimates.

Whilst the market was expecting a further erosion of US 2010/11 corn ending stocks, the USDA once again chucked in a curve ball leaving stocks unchanged from last month at 675 million bushels. Meanwhile although world ending stocks were reduced slightly from last month they still came in 1.4 MMT higher than trade expectations as a result of Brazil's corn crop coming in 2 MMT higher than previously at 52 MMT.

The soybean numbers were a bearish too, although not as much as they were for corn, with US ending stocks there also left unchanged and Brazilian output rising 2 MMT to 72 MMT. That placed world ending stocks 2 MMT up on trade expectations at 60.9 MMT.

The wheat numbers were perhaps modestly friendly being to only one of the three to see US ending stocks decline, and that contrary to expectations of a small increase. World ending stocks were up almost 1 MMT however to 182.8 MT.

A weak dollar and firmer crude oil may underpin early losses, and it would be of no surprise at all to see "bargain-hunting" (if you can call it that at these levels) kicking-in depending on how low prices fall this afternon.

Where the market ends tonight is perhaps far more important than where it opens, and will tell us more about current trade sentiment.

Early opening calls for this afternoon's CBOT session: corn down 10-15c, wheat do2wn 8-10c, beans down 15-20c.

USDA Numbers

08/04/11 -- Here's the all important numbers guys and gals. Quite bearish for corn (not that is likely to deter the corn bulls for long), a bit bearish for beans and a bit bullish for wheat:

WHEAT

US ending stocks came in lower than expected at 839 million bushels, against the average estimate of 857 million and 843 million last month. World ending stocks were up, pegged at 182.8 MT against the 182 MMT estimated and 181.9 MMT in March. There were no significant changes to wheat production around the world.

CORN

US ending stocks were left unchanged at 675 million bushels, against the average estimate of a sharp cut to 586 million. World ending stocks came in at 122.4 MT against 121 MMT estimated and 123 MMT in March. Brazil's corn crop was estimated at 52 MMT, 2 MMT up on last month. Argentine output was unchanged at 22 MMT.

SOYBEANS

US ending stocks were also unchanged coming in at 140 million bushels, against the average estimate of 137 million. World ending stocks pegged at 60.9 MT against 58.9 MMT estimated and 58.3 MMT in March. That increase came from Brazilian where output was increased 2 MMT to 72 MMT. Argentine production was left unchanged at 49.5 MMT, as too was China at 15.2 MMT.

CBOT Close

07/04/11 -- Soybeans: May 11 soybeans closed at USD13.63 1/2, down 13 cents; Nov 11 soybeans closed at USD13.65 1/2, down 10 3/4 cents; May 11 soybean meal closed at USD350.90, down USD4.70; May 11 soybean oil closed at 58.32, down 46 points. Weekly export sales were lower than anticipated at 190,300 MT compared to pre-report estimates of 300,000 to 450,000 MT, that's three of the past four weeks where sales have been below expectations. News of another major earthquake and tsunami alert for Japan ahead of tomorrow's USDA reports was enough to prompt some profit-taking and book-squaring. For beans the trade expects only minor adjustments, with 2010/11 ending stocks seen falling slightly from 140m bu to 137m bu.

Corn: May 11 corn closed at USD7.59, down 4 cents; Dec 11 corn closed at USD6.44 1/4, down 3 1/4 cents. Weekly export sales were 808,900 MT, towards the top end of estimates of 550-850,000 MT. China didn't feature. Ending stocks estimates for tomorrow's USDA report are around 586-595m bu, depending on who's figures you rely on. Global corn stocks are also forecast to decline from around 123 MMT to 121 MMT. Once tomorrow's report is out of the way the trade will start to focus on US planting progress, or lack of it.

Wheat: May 11 CBOT wheat closed at USD7.73 1/4, down 9 cents; May 11 KCBT wheat closed at USD9.22 3/4, down 16 3/4 cents; May 11 MGEX wheat closed at USD9.40 3/4, down 13 3/4 cents. Weekly export sales were robust at 722,900 MT against trade ideas of 350-450,000 MT. Projected US and global ending stocks in tomorrow's USDA reports are seen as relatively non-threatening for wheat. Another corn surprise though shouldn't be ruled out, which could have a spillover effect on wheat.

EU Grains Close

07/04/11 -- EU grains closed with May London wheat down GBP0.50/tonne to GBP205.50/tonne and with new crop Nov falling GBP2.10 to GBP169.25/tonne. May Paris wheat fell EUR0.75/tonne to EUR249.75/tonne and Nov was down EUR1.25/tonne at EUR218.50/tonne.

As strong earthquake and subsequent tsunami warning for NE Japan got the markets rattled late afternoon ahead of tomorrow's USDA reports. That was probably enough of a jolt to encourage some spec money to be taken off the table overnight.

London wheat fell GBP17.50/tonne and Paris wheat EUR31.00/tonne in three trading session immediately after the last major quake hit the region on March 11th.

Northern Europe has had a few showers over the past couple of days, but more is needed to restore depleted subsoil moisture, with very warm temperatures still in the forecast, according to Martell Crop Projections.

Tomorrow's USDA reports are likely to be of more importance for corn and soybeans than wheat, although the corn numbers in particular will also have a bearing on wheat demand.

US 2010/11 ending stocks for wheat are seen increasing from 843m bu (22.9 MMT) last month to 857m bu (23.3 MMT) this time round, whilst global ending stocks are forecast more or less unchanged at 182 MMT.

Corn stocks however are forecast to decline, from 17.1 MMT in the US to 14.9 MMT and globally from 123 MMT to 121 MMT.

Elsewhere, wheat continues to pour out of Australia with shipments from the east coast hitting record highs in February. The Australia & New Zealand Bank thinks that it's current estimate for wheat exports of 16 MMT in the current marketing year may be on the low side, even though that figure is 2.5 MMT higher than the USDA's March estimate.

Brussels issued 286,000 MT of soft wheat export licences for the week to Apr 4th, bringing the current marketing year to date total to 15.7 MMT, 2 MMT higher than at this time last year.

Lunchtime News

07/04/11 -- Not much time for blogging today as I'm up to my eyeballs in stuff, so here's a quick summary of what's gone on this morning:

The Bank of England left UK interest rates on hold at 0.5%, the ECB raised theirs by a quarter to 1.25%.

Weekly USDA export sales came in at 808,900 MT for corn, towards the top end of estimates of 550-850,000 MT. Wheat sales were 722,900 MT against ideas of 350-450,000 MT. Bean sales were disappointing again at 190,300 MT compared to estimates of 300,000 to 450,000 MT.

China didn't feature as a corn buyer once again.

China sold 628,000 MT of the wheat on offer at this week's government auction, bringing the total sold so far this year to 7.9 MMT.

On the overnight Globex market old crop corn ended around 7c firmer, with new crop one up to one down. Beans ended mostly 3-5c firmer and wheat was up 3-6c.

Crude oil and the dollar are slightly firmer.

The USDA are out tomorrow with their latest S&D numbers. US corn ending stocks for 2010/11 are seen falling around 100m bu from last month to 586m. Wheat stocks are expected to rise slightly to 857m bu and beans stocks to fall very slightly from 140m to 137m.

Early calls for this afternoon's CBOT session: Corn 5-7 cents higher, Soybeans 3-5 cents higher, and Wheat up 4-6 cents

My Dander Is Up

07/04/11 -- Getting my dander fully erect today are people offering online services for small amounts of money that simply fail to deliver. Bugger all. Not a sausage. Sweet Fanny Adams. Meaning that I now have to spend all day swapping stuff about and putting things right. They seem to presume that because you've only paid them a fiver or whatever that you will simply accept a total lack of service and go away. Which sadly I probably will. I'm hardly going to hop on a plane to Mumbai armed with a baseball bat am I? Mind you there's always the dog pooh through the post option. Chummy, here boy...

CBOT Close

06/04/11 -- Soybeans: May 11 soybeans closed at USD13.76 1/2, up 3 1/4 cents; Nov 11 soybeans closed at USD13.76 1/4, down 2 1/2 cents; May 11 soybean meal closed at USD355.60, up USD2.00; May 11 soybean oil closed at 58.78, down 7 points. Beans are starting to look cheap relative to corn and wheat. Recent price action may well encourage higher spring corn plantings, and potentially lower sowings of soybeans, than last week's USDA estimates. Conab peg the Brazilian crop at a record 72.2 MMT, 2.2 MMT higher than the USDA's March number. The USDA issue revised production estimates on Friday.

Corn: May 11 corn closed at USD7.63, down 3 3/4 cents; Dec 11 corn closed at USD6.47 1/2, up 3/4 cent. Corn retreated from yesterday's record highs, although only nominally. Nearby May declined as funds rolled longs out of the May and into July. The USDA announced the sale of 101,600 MT of new crop corn to "unknown". The US Grains Council say that China "could" import 2-3 MMT of corn this year to redress draw-downs on state-owned reserves. However, they do have a vested interest, and the word "could" doesn't exclude the words "might not".

Wheat: May 11 CBOT wheat closed at USD7.82 1/4, down 4 cents; May 11 KCBT wheat closed at USD9.39 1/2, down 10 1/2 cents; May 11 MGEX wheat closed at USD9.54 1/2, down 7 3/4 cents. US wheat is balancing ample old crop stocks against potential new crop yield losses. Increased demand for wheat due to the erosion of the traditional corn/wheat price differential is also supportive. Extremely poor US winter wheat conditions, and a potentially high level of abandonment this season also look like limiting downside for wheat at the moment.

EU Grains Close

06/04/11 -- EU grains closed with May London wheat up GBP2.00/tonne to GBP206.00/tonne and with new crop Nov climbing GBP0.30 to GBP171.35/tonne. May Paris wheat rose EUR0.25/tonne to EUR250.50/tonne and Nov was unchanged at EUR219.75/tonne.

There wasn't a lot of fresh news about today. US corn was off yesterday's record highs although not by much, and the US wheat crop remains in a very poor state.

India are expecting a record high wheat crop this year of around 82-84 MMT, according to various trade sources. China say that wheat conditions there are better than last year, although that doesn't really say much.

In Russia, slow to melt heavy snow in the northern areas, the Black Earth and Volga, has hampered farmers efforts to prepare fields for spring planting, say Martell Crop Projections.

Spring sowings may only muster around 15.5 million hectares compared to 17-18 million hectares normally, they add. That would leave Russia able to only play a bit part role on the world wheat export stage in 2011/12.

Closer to home German wheat is suffering. Winterkill issues, followed by a prolonged unseasonably dry spell in the first quarter of 2011, look set to cut wheat yields for the second year running unless soaking rains arrive soon. There are none in the 14-day forecast.

Early Call On Chicago

06/04/11 -- The overnight grains closed with beans around 9-10c higher, and corn & wheat narrowly mixed. Crude oil is a bit firmer and the dollar a little easier.

May corn is 4c off yesterday's all-time high of 7.70 1/4, although it would be no enormous surprise to see it set a fresh record high this afternoon given the euphoric high-five cheerleading going on.

An interesting report on the FarmAssist.com website throws this thought into the mix:

"Since last Wednesday's close, a Midwest farmer that uses 175 bpa for his corn calculations has seen new-crop revenue projections jump $90 per acre. If that same farmer uses 50 bpa for his soybean calculation, new-crop soybean revenue has increased just under $8 per acre. What message do you think he is getting?"

A valid point, well made. Given that almost all the talk at the moment surrounds "extremely tight corn stocks, the need to ration demand, record prices, China has bought (the USDA just haven't confirmed it yet) and need more, and the insatiable demand from the ethanol sector" then what would you do if you were a Midwest farmer? Plant more of course.

From a demand perspective, the higher the price of corn, the more likely it is that the ethanol blenders tax credit won't get renewed at the end of the year, I'd say. That could have far more of an impact on US corn demand in the 2011/12 crop year than China buying the odd million or two.

Of course, on the flip side, increased corn plantings may mean that soybean acreage is lower than the USDA currently predict.

Meanwhile the water cavalry didn't arrive and the US winter wheat crop looks to be in a serious mess, and spring plantings look like being late. Maybe the water cavalry went to the wrong address?

Estimates for Brazilian soybean production are rising again in some quarters, Conab now peg the crop at 72.2 MMT. That's 2.2 MMT higher than the USDA's March number. The latter will of course be issuing revised production estimates on Friday.

Some also see Paraguay chipping in with a crop of 8-8.4 MMT this year, also higher than the USDA said last month.

The USDA have just announced the sale of 101,600 MT of new crop corn sold to "unknown".

Early calls for this afternoon's CBOT session: corn flat to 2c higher, beans up 8-10c, wheat up 1-3c.

EU Rapemeal Prices

06/04/11 -- Here's the latest guide prices for EU rapemeal, basis FOB Lower Rhine in euros/metric tonne, with change from previous day:

Morning Vibe

06/04/11 -- My mate Joachim from Dienstleistungszentrum Ländlicher Raum (DLR) - which I think is a kind of German equivalent to Harper Adams, but I stand to be corrected on that as my knowledge of the language consists of "two large beers please" and "you appear to have forcibly annexed my sun lounger" - has sent me this picture of the winter rapeseed in his neighbourhood (you can click the image to enlarge).

It's certainly looking far from great, one word that describes it might be "patchy". Germany only got between 10 and 30% of normal rainfall in March, according to Martell Crop Projections, and it's certainly showing in this picture taken on 3rd April.

It doesn't look like they've had an awful lot of rain in the past few days either from what I can tell. The weather front that's brought some rain to the UK and northern France over the past couple of days seems to have fizzled out before reaching Germany. Any rain that they have had looks like it's been very light and scattered over central and southern areas.

The overnight Globex grains see corn down a little, retreating from last night's record highs, but wheat and soybeans are firmer again.

For wheat there are now several bullish stories gathering momentum:

• Soaring US corn prices leading to increased feed usage


• Extremely poor US winter wheat conditions, and a potentially high level of abandonment (forecast at 19% by Informa), encouraged by the high price of other alternative crops


• Slow Russian spring plantings due to the late arrival of spring


• Downgrades to Ukraine production


• Dryness concerns in many parts of Europe

See also Oklahoma sees driest 4 months since Dust Bowl

The pound hit 1.6360 against the dollar this morning, trading close to it's best levels since Jan 2010 as ideas of an early interest rate hike resurface. It peaked around 1.64 a fortnight ago, and as with previously this has proven a difficult nut to crack.

So it would seem again this morning as we have now slipped back below 1.63 after disappointing industrial and manufacturing production data for February came out at 9.30 BST. That showed UK Feb industrial output rose by 2.4% year-on-year compared to analysts forecasts of 4.3%. Manufacturing output rose by 4.9% annually, compared to predictions of 5.8%.

CBOT Close

05/04/11 -- Soybeans: May 11 soybeans closed at USD13.73 1/4, 10 3/4c lower; May soymeal settled USD3.40 lower at USD353.60; May soyoil ended 3 points lower at 58.85. Chinese demand is still seen stitching away from US origin beans. Talk persists that they are cancelling or postponing shipments, Thursday's export sales report may shed further light on this. Despite popular reports that rain is inhibiting harvest progress, Celeres estimate that the soybean harvest in Brazil is 67% complete,up from 56% the last week and the 59% five-year average. Informa Economics upped their Brazilian production forecast to 71.5 MMT today.

Corn: May corn rose 6 1/2 cents to USD7.66 3/4 after reaching a record intraday high of USD7.70 3/4. Corn may have closed even higher if it wasn't for China raising interest rates by a quarter percent for the fourth time in the past five months. The USDA reported the sale of 101,600 MT of corn to "unknown". The trade is now expecting the USDA to further tighten old crop ending stocks when it comes out with it's latest S&D reports on Friday. US planting conditions in the Midwest are less than ideal, meaning that much of this season's crop may go into the ground late although it won't be lacking in moisture.

Wheat: CBOT May wheat fell 3 3/4c to USD7.86 1/4;, KCBT May wheat rose 2c to USD9.50; MGEX May wheat climbed 3/4c to USD9.62 1/4. There wasn't a lot of fresh news about for wheat once again. The problems with winter HRW crops are well-documented, as too are potential planting delays for spring wheat. Last night's winter wheat crop conditions report from the USDA was predictably abysmal at 13% very poor, 19% poor, 31% fair, 30% good and 7% excellent. Informa estimate that 19% of the current winter wheat crop won't make it through to harvest.

EU Grains Close

05/04/11 -- May London wheat closed GBP0.25/tonne higher at GBP204.00/tonne with new crop Nov down GBP0.15 to GBP171.05/tonne. May Paris wheat rose EUR4.25/tonne to EUR250.25/tonne whilst Nov was up EUR2.50/tonne to EUR219.75/tonne.

Wheat was strongly higher in early trade, but fell away later in the session, particularly London wheat as the pound rose against both the dollar and the euro.

Early strength was tied to the USDA last night reporting US winter wheat crops in their worst condition since the 2002/03 crop year. That season saw the lowest US wheat production since the early 1970's.

Ukraine downgraded it's wheat production forecasts for 2011 to 20.5 MMT from earlier estimates of 21.3 MMT.

Front month US corn rose to it's highest price ever this afternoon, even eclipsing the 2008 previous record high on strong demand and very tight projected ending stocks. The USDA are set to report on those again on Friday and may tighten the old crop balance sheet even further. That could potentially peg US stocks at less than four days worth of demand.

The market remains almost universally bullish with confidence more or less fully restored following a heavy shake-out in the wake of the Japanese tsunami and subsequent nuclear crisis and the escalation of conflict in North Africa, particularly Libya.

The so-called "smart" money is back into buying agricultural commodities - funds have bought an estimated 100,000 lots of CBOT corn over the last three trading sessions,.

As ever, they usually have a good run at having their own way. Also, as ever, the ability of the livestock sector to afford to pay these levels is of no concern to them.

EU Rapemeal Prices

05/04/11 -- Latest guide prices for EU rapemeal.

Basis FOB Lower Rhine in euros/metric tonne, with change from previous trading session:

Early Call On Chicago

05/04/11 -- The overnight grains closed mixed with wheat the strongest leg of the trilogy on the back of last night's poor winter wheat crop ratings from the USDA. Beans and corn were a little lower as China raised interest rates by a quarter percent for the fourth time in five months. Seeing as the last three rises have done little to hurt demand for agri-commodities it looks unlikely that this one will either though.

Beans closed around 7-10c lower, with corn down 4-6c and wheat a cent or two either side of unchanged.

Brent crude is now firmly entrenched above USD120/barrel and the US dollar is weaker.

The USDA pegged the winter wheat crop at only 37% good/excellent versus 65% a year ago, with the trade reckoning that this weekend's hot, dry and windy weather may have harmed the crop even further by the time next week's ratings come out.

Wheat also continues to benefit from corn prices at multi-year highs and the narrow price gap between it and corn.

In the Midwest and northern Plains cold and wet conditions aren't conducive to timely spring planting. Similar can be said for the Canadian Prairies.

Ukraine's wheat, barley, rapeseed and corn crops have all been downsized. Whilst output is still seen ahead of last season, it won't be by as much as had been earlier anticipated.

Funds appear to have regained their appetite for things, having bought an estimated 100,000 contracts of corn in the past three sessions. Whilst they remain in that sort of mood downside looks limited.

The USDA have just reported the sale of 101,600 MT of corn to "unknown".

Early calls for this afternoon's CBOT session: wheat 1-2c higher, corn down 3-5c, beans down 7-9c.

Ukraine Crop Prospects Declining

05/04/11 -- Crop production prospects in Ukraine are declining with UkrAgroConsult cutting their estimates for wheat, corn, barley and rapeseed.

The late arrival of winter has delayed spring plantings, which are currently around a third done according to the Ag Ministry there.

Wheat production is now seen at 20.5 MMT say UkrAgroConsult, down from their previous forecast of 21.3 MMT, although still a 19% increase on last season's drought-ravaged crop.

Corn production is estimated at 11.9 MMT, from 12.4 MMT previously, an 8% increase on last year. Barley output is seen at 9.8 MMT, 0.9 MMT below their previous forecast but 1 MMT above last season.

Rapeseed production this year will amount to 1.8 MMT, they say, down 300,000 MT from earlier forecasts but 300,000 MT ahead of last year.

Computers

05/04/11 -- They're great when everything goes according to plan and they all more or less look after themselves, aren't they? Today however is not one of those days. All I need now is for Richard Branston to pull the plug again and that would really make my day. Normal blogging will be resumed as soon as possible.

Chicago Close

04/04/11 -- Soybeans: May 11 soybeans closed at USD13.84, down 9 3/4 cents; Nov 11 soybeans were at USD13.89, down 1/4 cent; May 11 soybean meal ended at USD357.00, down USD3.90; May 11 soybean oil closed at 58.88, up 20 points. Beans were the poor relation on ideas that Chinese demand is switching to South America. There is continued talk of China cancellations/switching of existing purchases, that may lead the USDA to cut export projections for the current marketing year in Friday's WASDE report. The Brazilian harvest is well advanced at 67% complete, according to Celeres.

Corn: May 11 corn closed at USD7.60 1/4, up 24 1/4; Dec 11 corn finished at USD6.45 1/2, up 8 cents. The old crop/new crop spread continues to widen as the trade balances an extremely tight old crop supply situation against the second highest plantings since WWII for new crop. Fund buying was strong again, they were estimated to have bought 25,000 contracts today, meaning that they may have increased their net long by the best part of 100,000 lots since Thursday afternoon's USDA report. Friday's report from the USDA may cut ending stocks even further than they did last week the trade reckons.

Wheat: May 11 CBOT wheat ended at USD7.90, up 30 1/2 cents; May 11 KCBT wheat was at USD9.48, up 41 1/2 cents; May 11 MGEX Wheat finished at USD9.61 1/2, up 39 cents. It was another bad weekend weatherwise for US winter wheat, with high temperatures and strong winds likely causing further damage to an already vulnerable crop. After the close the USDA reported just 37% of the US winter wheat crop in good/excellent condition, compared to 65% a year ago. That was the lowest since 2002. They pegged 32% of the crop in poor/very poor condition against 6% last year.

Ask Nogger

04/04/11 -- Today's problem comes from Phil G of Ely, Phil writes:

Q: Dear Uncle Nogger, I have been reading your column with interest, and hope your vast experience and intuition may be able to help me. There is a large trade dinner this week in Cambridge which I very much look forward to, but history suggests my inadequate capacity for beer is likely to cause embarrassment. Furthermore, not only do I tend to fall over after two or three pints, but I’m also blessed with a tiny tank which, once full, needs emptying every ten minutes or so. How can I improve my staying power and be more like my peers?

A: I think you might have "come to the wrong shop" with this one Phil. I find that Tena Man are a God-send on these occasions, with the added bonus that if you use enough of them you also immediately adopt the appearance of Linford Christie in a dinner suit. This is especially useful in these modern times where females appear to have infiltrated the previously all-male bastion that is the grain trade. They're only in it for one reason Phil, and that is to meet incontinent two shandies and I'm anybody's Adonis-like guys like us. A hosepipe and a couple of large pedal bin liners also make an excellent temporary catheter whilst the speeches are on, according to my North Yorks medical correspondent - Potatofarmermike of Scarborough.

EU Grains Close

04/04/11 -- EU grains closed with May London wheat up GBP4.25/tonne to GBP203.75/tonne and with new crop Nov climbing GBP3.70 to GBP171.20/tonne. May Paris wheat rose EUR6.25/tonne to EUR246.00/tonne and Nov was up EUR4.50/tonne to EUR217.25/tonne.

London wheat is now around GBP10/tonne off contract high closes set mid-February, with Paris wheat more like EUR30/tonne away.

Showers were reported in all but south central Europe over the weekend with more expected today before rains push eastward later in the week. That will have helped winter crops, but not made up for the deficit encountered during the past few months.

Things have been particularly bad in northern Germany where only 10-30% of normal rainfall fell in March.

US winter wheat is under severe stress in the southern Plains. Dodge City, Kansas, hit 94 F yesterday - setting a record for the date. Gusty winds and low humidity are also giving wheat growers in Kansas, Oklahoma and Texas a serious headache, report Martell Crop Projections.

Further north in spring wheat areas "persistent cold and snow has set back the planting dates, jeopardizing chances for a bumper harvest. North Dakota growers do not expect to start fieldwork till April 25. Planting would follow perhaps 3 weeks later," they add.

US corn reached a near three year high today on tight stocks and bumper demand, that should make inroads into America's ample wheat stockpiles this spring/summer with the Chicago corn/wheat spread getting close to parity.

Early Call On Chicago

04/04/11 -- The overnight grains were firmer, with corn hitting a more than two year high on continued concerns about extremely tight old crop supplies. Corn was up around 12c on old crop and 5c on new crop. Wheat was around 12-13c higher and soybeans up 4-5c.

Outside markets are firmer, with Brent crude nearing USD120/barrel and gold, copper and silver also higher.

It was another dry weekend in the southern Plains combined with high winds that will have potentially caused more damage to ailing winter wheat. The USDA will report on crop conditions after the close tonight in what probably won't make pretty reading. That may support wheat tonight and again in the morning once the figures are known. Oklahoma, Texas and Kansas wheat are all looking in a pretty sorry state.

Meanwhile in the northern Plains cold and wet conditions aren't doing spring wheat plantings any favours either.

Russian spring grain plantings are making slow progress, at only around half of last year's pace due to the late arrival of spring.

Some welcome rain has arrived over the weekend for western Europe which will push eastwards as the week wears on.

Sowing of Australian winter grains will get started at the end of the month and last through until June under what looks like almost ideal conditions. Winter wheat plantings are expected to be up almost half a million hectares on last year.

The USDA are out on Friday with their world supply and demand numbers so we may end up treading a bit of water again this week until those are out.

Before that we get the latest weekly export numbers on Thursday. Any appearance by a certain Far Eastern buyer amongst the corn sales would get the market all excited. Soybean sales may be a bit flat again, offering further evidence that Chinese demand has switched to South America.

Beans look set to be the follower today also on reports that China is cancelling and/or deferring existing purchases of US beans.

Early calls for this afternoon's CBOT session sees wheat up 12-14c, corn up 10-15c and soybeans 3-5c higher.

EU Rapemeal Prices

04/04/11 -- Here's the latest guide prices for EU rapemeal, basis FOB Lower Rhine in euros/metric tonne, with change from previous day:

Morning Muse

04/04/11 -- In the UK March unofficially finished up as the driest in more than 50 years, according to the BBC. In my part of North Yorkshire we got 11.4mm of rain last month, compared with the average of 66.6mm.

There's been a bit of rain around over the weekend though, with more in the forecast today, especially in the west.

A band of rain stretching from Scandinavia through France and all the way down to southern Spain brought some welcome moisture for northern France yesterday. That front is pushing eastwards today, and may also bring some rain to central parts of Germany this afternoon. After that a largely dry and fairly warm week is in store much of Europe.

Growers in Australia are gearing up for winter crop plantings, with eastern Australia forecast to receive above average rainfall at least until June. Potentially near record winter wheat plantings are expected on the back of high world prices and much better than normal sub soil moisture levels. Rapeseed area may also increase at the expense of barley.

Ukraine’s Farm Ministry report 55% of the country’s winter crops in good condition, with 38% satisfactory, and 7% poor.

The USDA are out after the close of CBOT tonight with their first weekly crop progress report of 2011. It's already a given that winter wheat conditions are going to be bad, it may just be that seeing them in writing might somehow make things look worse.

The overnight Globex market is firmer across the board, with corn posting fresh two year highs this morning. May is currently up 13c at 7.49c/bu, 85 3/4c or 13% higher than last Wednesday night's close - immediately prior to the USDA's stocks numbers coming out.

Wheat is around 12c higher this morning, with beans up 8c or so. The USDA are out on Friday with their April WASDE report.

London wheat has opened with Nov11 trading up around GBP2/2.50 in early exchanges, still around GBP30/tonne below old crop levels.