Nogger's Blog

16/08/12 -- Soycomplex: Sep 12 Soybeans closed at USD16.56 1/4, down 3 1/2 cents; Nov 12 Soybeans closed at USD16.25 1/4, down 9 1/4 cents; Sep 12 Soybean Meal closed at USD516.50, down USD3.50; Sep 12 Soybean Oil closed at 53.04, down 3 points. The electronic market was higher for much of the day, but heading into the open of the daytime session a report from the Farm Services Agency, surveying US spring planted acres, came out which appeared to imply a 1.2 million acre larger soybean area than the estimate that the USDA is currently using. Weekly soybean export sales came in at just over 1 MMT, a bit better than the 750-950 TMT that the trade was expecting. New crop commitments for the 2012/13 marketing year are already past halfway towards the USDA's full season target of 1.11 billion bushels. No sign of much rationing yet then, even at these levels. China sold the full 400TMT of state-owned soybeans on offer at today's government auction. CNGOIC estimated China’s 2012/13 soybean imports at 59.0 MMT vs. a previous estimate of 60.0 MMT. Funds were said to have been net sellers of 4,000 soybean contracts on the day.

Corn: Sep 12 Corn closed at USD7.97 3/4, up 3 3/4 cents; Dec 12 Corn closed at USD8.07 1/4, up 3 1/2 cents. The same FSA survey that implied a larger soybean planted area than the numbers that the USDA are using also suggested an extra 500,000 acres of corn got planted in the US this spring. Talk is that this will enable the USDA to hold their current forecast on harvested area, that was regarded as too high last week at 87.36 million acres, whilst increasing abandonment rates to close to 10% this year. Even so many consider that the true abandonment rate will be a couple of percentage points higher than that. There are signs of demand rationing at these levels though, corn weekly export sales were a combined 253,400 MT versus the 350-550 TMT expected. The former Chinese State Admin for Grain said that China is more likely to import what corn it needs in 2012/13 from South America due to high US prices. Strategie Grains cut their EU-27 corn production estimate by 7.1 MMT from their previous estimate to 58.1 MMT, although they added that "an improvement in the weather would provide better conditions for filling the grains than (currently) exist." Funds were said to have been net buyers of around 6,000 contracts on the day.

Wheat: Sep 12 CBOT Wheat closed at USD8.61 3/4, up 15 cents; Sep 12 KCBT Wheat closed at USD8.72 1/2, up 14 1/2 cents; Sep 12 MGEX Wheat closed at USD9.21 1/2, up 8 cents. Russia's on farm Aug 1st wheat stocks of 10.61 MMT are a nine year low, according to SovEcon. Total grain stocks of 15.73 MMT are at their lowest levels since 2006, they add. Meanwhile the Russian Ministry say that they have harvested 27.9 MMT of wheat to date off just over half the planted area. Yields are averaging 2.18 MT/ha versus 3.15 MT/ha in 2011, a fall of more than 30 percent. The Kazakh Ministry of Agriculture cut their grain harvest forecast from 14 MMT to 13 MMT, less than half last year's bumper output. Weekly export sales were 396,700 MT versus the expected 450-550 TMT. Cumulative sales are now 30.6% of the current USDA export target of 1.2 billion bushels, well behind the average 5-year pace of 37.7%. It is expected though that this could improve significantly in the second half of the season as Black Sea exports grind to a halt. Strategie Grains estimated the EU-27 wheat crop at 133.1 MMT, an increase of almost 2 MMT on last month, led by an extra 1.7 MMT from France. There were also increases for Germany and Poland. Funds were said to have bought around 3,000 Chicago wheat contracts on the day.