Chicago Closing Comments - Monday

27/08/12 -- Soycomplex: Sep 12 Soybeans closed at USD17.29 3/4, down 7 3/4 cents; Nov 12 Soybeans closed at USD17.18 3/4, down 12 3/4 cents; Sep 12 Soybean Meal closed at USD531.80, down USD1.60; Sep 12 Soybean Oil closed at 55.91, down 33 points. Funds were estimated to have finished up as net sellers of around 6,000 soybean contracts on the day, banking profits after prices surged to fresh highs in early electronic trade. Those early gains were likely tied to the news released after the close Friday that the Pro Farmer Crop Tour was pegging US soybean yields and production lower than the USDA's August estimate at 34.8 bu/acre and 2.6 billion bushels. Speculation that both China and the US will soon take further measures to stimulate their respective economies was also deemed supportive. Midway through the daytime session Informa came out with a new estimate on soybean yields of 37.2 bu/acre, which is 1.1 bu/acre more than the USDA said earlier this month. Weekly export inspections of 17.407 million bushels were also below trade estimates of 20-25 million. Big prices will encourage record plantings in South America for next year's harvest. Safras e Mercado estimate Brazil’s 2012/13 soybean planted area at 27.218 million hectares versus 25.0 million in 2011/12, an increase of nearly 9%. That puts Brazil’s 2012/13 soybean crop at a record 82.295 MMT, an increase of 24% on 2011/12 and more than a million tonnes above the USDA's current estimate. Argentina’s 2012/13 soybean area is estimated rising 14% to 19.9 million ha, with production seen up more than 40% to 57.7 MMT - both also a record.

Corn: Sep 12 Corn closed at USD7.94 1/2, down 7 3/4 cents; Dec 12 Corn closed at USD8.00 3/4, down 7 3/4 cents. As with soybeans, early strength was linked to the late release of the Pro Farmer Crop Tour yield and output estimates on Friday. These placed US corn yields and production at 120.2 bpa and 10.478 billion bushels, versus the USDA's 123.4 bpa and 10.779 billion bushels. Yet funds were said to have been net sellers of around 8,000 corn contracts on the day, meaning that they are thought to have liquidated around 40,000 corn contracts across the last four sessions. Corn continues to find the USD8/bu mark a difficult one to hold above. Weekly export inspections were below expectations of 20-25 million bushels at only 14.458 million, maybe a sign of further demand destruction at these levels? That was less than half the volume of corn inspected for export this time last year. Tropical Storm Isaac is closing grain elevators, which combined with low water levels on the Mississippi, is restricting movement of newly harvested corn. After the close the USDA cut corn crop conditions by one point to just 22% good/excellent, with poor/very poor raised by a corresponding amount to 52%. Harvesting is seen at 6% complete versus 2% normally. Fully 26% of the crop is mature against 8% on average at this time, they add.

Wheat: Sep 12 CBOT Wheat closed at USD8.62, down 5 1/2 cents; Sep 12 KCBT Wheat closed at USD8.73 1/4, down 3 cents; Sep 12 MGEX Wheat closed at USD9.12 3/4, down 5 3/4 cents. Funds were said to have sold 2,000 CBOT wheat contracts on the day. Weekly export inspections were at the bottom end of expectations of 18-24 million bushels at 18.884 million. Russia and Romania picked up an Egyptian tender over the weekend. French wheat was said to be priced at around USD18-20/tonne above the traded prices, with US wheat a further USD40/tonne out. Decent and needed rains are expected for winter wheat areas ahead of planting which should begin in around a months time. The USDA placed the spring wheat harvest at 89% done versus only 57% normally. Russia's wheat harvest is said to be around 60% complete, producing a crop of around 30 MMT so far. The Russian Prime Minister and the Ag Minister are said to be due to hold a meeting on Friday to discuss Russia’s grain crop/exports. Some are speculating that an export ban may be on the agenda, Russian officials currently say that this is not the case. Kazakhstan has harvested almost 4.6 MMT of grains off nearly 40% of the planted area with average yields coming in at just 0.74 MT/ha.