Chicago Ends Well Off Session Highs

27/06/12 -- Soycomplex: Beans finished mixed and well off session highs that saw Jul 12 26 1/2 cents higher at one stage on profit-taking ahead of Friday's upcoming USDA reports. Funds were estimated to have been light sellers of around 2,000 soybean contracts on the day. Whilst weather concerns remain, many analysts point to the fact that there is still time for the crop to recover and that Jul/Aug rains have more impact on final yields for soybeans. Will those rains come though? The GFS weather model keeps promising, but failing to deliver. Weekly export sales estimates for soybeans tomorrow are 500-700 TMT. After that all eyes will be on Friday's June acreage numbers and the quarterly stocks report.

Corn: Corn also closed well off session highs, with the Dec 12 more than 30 cents higher at one stage in typically choppy weather market trade. Funds were said to have bought a net 10,000 corn contracts on the day. If correct that would make them adding around 62,000 to their net length this week alone. US ethanol producers lowered production by more than 17,000 barrels a day last week according to the Dept of Energy weekly report. Valero Energy said that they are temporarily closing another ethanol plant - this one is in Linden, Indiana - due to high corn prices and tight availability. Chicago temperatures are expected to hit 100F tomorrow before cooling off a little into the weekend. Weekly export sales for tomorrow are expected to be in the region of 300-500 TMT. Unlike soybeans, the USDA aren't expected to alter the US corn planted area by too much on Friday from the already 75-year record 95.9 million acres.

Wheat: Just like the other two main commodities, wheat also closed modestly higher but well below the highs of the day. Funds were said to have been net buyers of around 3,000 Chicago wheat contracts on the day. Russia’s Ag Ministry said that Russia’s grain harvest has started 10 days earlier than normal due to the crops maturing faster due to the hot and dry conditions. Early yields are said to be 30-40% down on last year although quality is very good. Jordan bought 50 TMT of Black Sea origin wheat for October shipment. Tunisia bought 125 TMT of optional origin wheat for Aug/Sept shipment. Egypt stays out of the market, but despite the predicted lower exports out of the Black Sea in 2012/13 Russian wheat is still likely to undercut US and EU origin supplies at least until the end of the year. Estimates for tomorrow's weekly export sales are 450-650 TMT.