Nogger's Blog

23/07/12 -- Soybeans: Aug 12 Soybeans closed at USD16.98 1/2, down 59 cents; Nov 12 Soybeans closed at USD16.22 1/4, down 64 cents; Aug 12 Soybean Meal closed at USD523.00, down USD20.00; Aug 12 Soybean Oil closed at 53.75, down 61 points. An improved weather outlook may give this year's soybean crop a chance after all was the feeling today. Profit-taking was also a factored, encouraged by falling outside markets, with funds exiting an estimated 13,000 of their soybean longs on the day. "A powerful dome of high pressure responsible for Midwest heat and drought will come under attack from a Canadian storm, opening the door for heavy rainfall this week," say Martell Crop Projections. The USDA cut soybean good/excellent crop ratings by three points to 31%, which may have been a smaller reduction than some were expecting.

Corn: Sep 12 Corn closed at USD8.14, down 10 1/2 cents; Dec 12 Corn closed at USD7.85 1/2, down 10 1/4 cents. The decline in corn wasn't as pronounced as for soybeans given the general feel that the damage has largely already been done for corn. The USDA cut good/excellent five points to 26%, which was in line with trade expectations. Outside markets offered no support, and funds were estimated to have been net sellers of around 11,000 corn contracts on the day. China's CNGOIC indicated that they may import 2 MMT less corn than originally expected at current price levels. The Climate Prediction Centre's 6-10 day forecast for July 28 - August 1 calls for average to above-normal rainfall in the Midwest. "A solid inch of rainfall, but up to 2.5 inches, is predicted on 75-80% of US corn and soybean farms. Normal weekly rainfall is around one inch," say Martell Crop Projections.

Wheat: Sep 12 CBOT Wheat closed at USD9.12 3/4, down 30 1/2 cents; Sep 12 KCBT Wheat closed at USD9.14, down 27 cents. Sep 12 MGEX Wheat closed at USD10.05 1/2, down 26 cents. Fund selling in Chicago wheat was estimated at around 5,000 contracts on the day. The US winter wheat harvest is 82% complete, and spring wheat cutting is 12% done compared to zero normally. Spring wheat good/excellent declined five points to 60%. Jordan bought 100,000 MT of Black Sea wheat, suggesting that US and EU values are maybe a bit overdone. The prospect of an escalation of Europe's debt problems weighed on stocks as well as commodities. US wheat inspections for export were 316.9 thousand MT - around half of year ago levels.