Nogger's Blog

29/06/12 -- The USDA numbers are already fish & chip wrappings within ten minutes of their release. Corn plantings came in 300,000 acres more than the average trade guess at 96.4 million, a 5% increase on last year. June 1st corn stocks were slightly lower than expected at 3.148 billion bushels. Considering that the trade is already factoring in a yield figure of around 155bpa versus the USDA's current 166bpa then 300,000 extra acres isn't going to go a long way in compensating for that.

Soybean plantings were estimated at 76.0 million acres, 1.5% up on last year and 500,000 more than the average trade guess. June 1st stocks were a little surprise, at 667 million bushels they were above the highest trade estimate.

This increased corn and soybean area appears to have largely come at the expense of spring wheat where plantings were pegged 600,000 acres lower than anticipated, taking the all wheat area 900,000 acres below expectations to 56.0 million. Even so that is still 3% more than a year ago.

So in the blinking of an eye, now that that is all over and done with we are back to trading a weather market.

Beans are around 18 cents higher, corn up 15-17 cents and wheat 8-10 cents firmer in early afternoon trade.

Elsewhere crude oil is now more than USD4.00/barrel higher following a wave of initial relief over the EU debt "deal" which appeared to show a more willing to compromise approach from Germany. The more cynical amongst us would note that allowing Spanish banks to fail would not have been in the interests of German banks, many of whom were the ones that lent them the money that they are struggling to repay in the first place.

German lenders’ exposure to Spanish banks, corporates and governments amounts to EUR113 billion, according to the Bank for International Settlements.

The US dollar is down sharply in a "risk on" move, which is adding further support to US grains.