Nogger's Blog

22/05/12 -- Soybeans: Jul 12 Soybeans closed at USD13.82 1/4, down 30 1/4 cents; Nov 12 Soybeans closed at USD12.82 1/4, down 24 cents; Jul 12 Soybean Meal closed at USD405.00, down USD11.50; Jul 12 Soybean Oil closed at 50.46, down 46 points. Outside markets helped to drag the soy complex lower with the US dollar firming on the usual "flight to safety" and Greek woes never far away funds sold an estimated 9,000 soybean contracts on the day. Reports of China cancelling/defaulting on coal and iron ore purchases that are now either too expensive compared to the spot market and/or no longer wanted due to a slowdown in growth were unsettling and may have contributed to some of today's selling. With soybean prices now well over a dollar off the highs there may also have been an element of stop loss selling. The fundamentals though haven't changed greatly, with Celeres dropping their Brazilian soybean production estimate to 64.95 MMT. The new 6 to 10 day US weather forecast has a wetter look which will help newly planted beans.

Corn: Jul 12 Corn closed at USD5.97, down 36 cents; Dec 12 Corn closed at USD5.22, down 18 1/2 cents. Funds were said to have dumped an estimated 25,000 corn contracts, once again proving (for old crop) no matter how tight the supply line is when there's a mass exit for the door the only way is down. Rumours of Chinese corn cancellations were circulating the floor today along with suggestions that they mave have switched allegiance to Brazil for their corn supplies. On the back of last week's "solar panel trade war" scaremongering that may also have unsettled a few. Reports that the Greeks had announced the existence of a Euro exit strategy will also have unnerved long holders. Revised weather models showing a cooler and wetter outlook, typical of a switch into an El Nino weather pattern, was also seen as bearish given the almost the entire crop is already in the ground nice and early. Monday’s crop progress report showing the corn crop being rated at 77% good/excellent is apparently the 2nd highest ever for this time of year.

Wheat: Jul 12 CBOT Wheat closed at USD6.85 1/2, down 18 1/2 cents; Jul 12 KCBT Wheat closed at USD7.01 1/2, down 13 1/2 cents; Jul 12 MGEX Wheat closed at USD7.80 1/2, down 16 1/4 cents. Wheat gor dragged into the mire by corn and beans with funds said to have been net sellers of around 6,000 Chicago contracts on the day. The USDA show spring wheat planting is just about done versus 78% normally, with good/excellent crop conditions pegged at a healthy 74%. Winter wheat crop conditions fell from 60% to 58% good/excellent, although that is well ahead of the 32% seen at this time last year. Profit-taking may have been a feature given the magnitude of last week's sharp rally. Forecasts for "normal" rains in Kansas in the coming 6-10 days may help some of the later maturing wheat there. The south of Russia could also be in for up to 2 inch rains in the next few days with temperatures also turning cooler, both of which will be very welcome.