Early Call On Chicago

06/02/12 -- The overnight grains ended mixed with beans up 5 cents or so, wheat down 1-3 cents and corn up a fraction to 1 1/2 cents lower. Crude is a dollar or so easier on concerns that a Greek debt deal is never going to get sorted, and the implications for the global economy that that entails.

The IMF warned today that Chinese growth could be cut in half if the European debt crisis gets any worse.

There's a distinct lack of fresh concrete fundamental news about, with the market already looking set to drift along impatiently waiting for the USDA reports due out on Thursday.

The main issues being currently discussed are difficult to quantify at this stage.

It's too early to say how much, if any, damage has been done to winter crops across Europe, Russia and Ukraine by the recent cold snap, although certainly it seems that 20-30% of Ukraine's area will need replanting once the thaw sets in.

There are also voices being raised over a dry, mild and snow free winter for much of the US corn belt ahead of spring planting.

Meanwhile there are plenty of weather issues in South America too, although decent rains are in the forecast for Argentina again midweek.

It looks certain that corn & soybean production estimates will be cut for both Brazil and Argentina on Thursday, and probably corn output in Mexico too.

Celeres have cut their Brazilian corn crop estimate from 62.0 MMT to 60.2 MMT, and say that the harvest is around 8% complete.

Rains may have come just in the nick of time for Argentina's soybean crop with the Ministry of Agriculture there placing good/excellent conditions at 64%, an 8 point increase in a week. Unfortunately only 35% of the corn crop gets the same thumbs up.

China says that it will import 24% fewer soybeans in February, despite rumours that they have been active buyers of US beans this past week since returning from their New Year celebrations.

Russia has dismissed the idea of export restrictions for now, raised it's 2011 grain production estimate and increased its self-imposed maximum limit to 27 MMT for 2011/12.

Early calls for this afternoon's CBOT session: beans up 3-5 cents, wheat & corn mixed, up 2 cents to down 2 cents.