Chicago Consolidates From Recent Gains

23/08/12 -- Soycomplex: Sep 12 Soybeans closed at USD17.27 1/4, down 20 3/4 cents; Nov 12 Soybeans closed at USD17.15, down 12 3/4 cents; Sep 12 Soybean Meal closed at USD527.80, down USD7.90; Sep 12 Soybean Oil closed at 56.12, down 5 points. Fund selling was said to have been around 7,000 contracts in soybeans on the day, enough to send the market tumbling following recent gains despite some decent fresh export sales business. The USDA reported the sale of 202 TMT of US beans to unknown along with 165 TMT to China, both for 2012/13 delivery. South Korea bought 110 TMT of US beans for Dec/Jan shipment and the USDA also reported the sale of 55 TMT of new crop US bean oil to China. All of those were on top of the usual weekly export sales report. That gave us sales of 132,900 MT for old crop and 585,800 MT for new crop beans, beating expectations for combined sales of 500-650 TMT. The 4th day of the Pro Farmer crop tour in Southern Minnesota found average bean pod counts of 1,003.7 pods in a 3 foot square area versus 1,124.3 pods a year ago and 1,115.9 pods for the 3-year average. That's a 10.7% reduction on last year versus the USDA's current projection that yields in the state will only decline by 1.3% this year.

Corn: Sep 12 Corn closed at USD8.08 3/4, down 21 1/2 cents; Dec 12 Corn closed at USD8.14 3/4, down 20 cents. Fund selling was estimated at 16,000 corn contracts on the day. Weekly export sales of 108,400 MT of old crop and 217,000 MT fell within the range of trade estimates for sales of a combined 200-350 TMT. The IGC estimated the 2012/13 global corn crop at 838 MMT versus their previous estimate of 864 MMT and 875 MMT last year. The US crop was estimated at 10.83 billion bushels versus their previous estimate of 11.81 billion although marginally above the USDA's current 10.78 billion. They did however also cut global corn consumption by 25 MMT, and raise world ending stocks for 2012/13 by 5 MMT from last month to 120 MMT, of which stocks amongst the major exporting nations were increased 8 MMT. This coming year will be the first time that we see a year-on-year fall in global corn consumption since 1993/94, they noted. "Exportable supplies in the US and Ukraine have tightened and, while the next crops in Brazil, Argentina and South Africa may be large, harvests are still several months away," they observed. The Pro Farmer crop tour in Southern Minnesota found average corn yield of 137.6 bpa versus 175.9 bpa a year ago and 182.2 bpa for the 3-year average. Final estimates from the tour are expected to be published tomorrow prior to the opening of the daytime open outcry CBOT session.

Wheat: Sep 12 CBOT Wheat closed at USD8.74 1/2, down 22 cents; Sep 12 KCBT Wheat closed at USD8.82 1/4, down 23 cents; Sep 12 MGEX Wheat closed at USD9.20 1/2, down 21 1/4 cents. Funds were said to have been net sellers of around 4,000 Chicago wheat contracts on the day. Weekly 2012/13 export sales of 468,800 MT (plus a further 6,000 MT for delivery in the 2013/14) were in line with trade estimates of 400-550 TMT. The IGC cut their world wheat production estimate by 3 MMT from last month to 662 MMT, some 34 MMT below last season’s record. World trade was also forecast to fall, by 13.3 MMT from last season’s record to 132.7 MMT. "Black Sea exporters have captured a high proportion of recent demand, but availabilities were soon expected to become short," they noted. Russia’s Ag Ministry said that the country has harvested 50.0 MMT of grains so far, of which 29.9 MMT is wheat with an average yield of 2.07 MT/ha, down 31.5% from a year ago. They cut their total grain harvest forecast to around 75 MMT. SovEcon suggest that even that is optimistic and estimate 70 MMT. A big rain event is in the forecast for the southern US Plains, ahead of wheat planting which is set to begin around a month from now. "The top US winter wheat states Kansas and Oklahoma are expecting heavy, soaking, rains with the updated forecast predicting 2-4 inches," say Martell Crop Projections.