Nogger's Blog

13/09/12 -- Soycomplex: Sep 12 Soybeans closed at USD17.43 1/2, up 2 3/4 cents; Nov 12 Soybeans closed at USD17.47 1/4, up 1 1/2 cents; Sep 12 Soybean Meal closed at USD533.50, down USD1.90; Sep 12 Soybean Oil closed at 56.46, up 55 points. September contracts go off the board tomorrow. Funds were said to have been buyers of around 3,000 soybean contracts on the day. The market was buoyed late in t he day by news of further QE stimulus measures from the Fed. Weekly export sales of 628,200 MT were in line with the expected 500-800 TMT. China was the biggest buyer at 340,800 MT. We are now into the new 2012/13 marketing year, US soybean exports in 2011/12 were down 8% on the previous year. An assortment of analysts are forecasting China's soybean imports to start to drop over the next few months. Chinatex estimate China’s Oct bean imports at 2.5 MMT, down by more than a third on the 3.8 MMT purchased a year previously, and their lowest monthly total since Feb 2011. The Chinese government sold almost all of the 400 TMT of state-owned soybeans offered at today's bi-weekly auction. Chinatex estimated China’s Oct12–Mar13 soybean imports at 25.0 MMT, a drop of more than 11% on the same period in 2011/12.

Corn: Sep 12 Corn closed at USD7.76 3/4, up 5 3/4 cents; Dec 12 Corn closed at USD7.73 3/4, up 4 1/4 cents. Funds were said to have been net buyers of around 5,000 corn contracts on the day. Weekly export sales of 214,800 MT for the 2012/013 marketing year were at the low end of trade expectations of 200-400 TMT. There were also sales of 212,500 MT for delivery in 2013/14. US corn exports in 2011/12 were down 16% on the previous year. The Fed announcement of QE3 is supportive and could lead to more fund money coming into the market for grains, and also underpin crude and other commodities. Strategie Grains cut their EU-27 corn production forecast by 4.3 MMT from last month to 53.7 MMT which is almost 3.5 MMT below the USDA's estimate released yesterday. CNGOIC estimated China’s 2012/13 corn output at 197.0 MMT up 2.2% from a year ago, corn imports in 2013 will only total 1 MMT, they said. Ag Canada estimated that Canada will export 1.2 MMT of corn this season, they're normally a net importer. Both Argentina and Brazil are forecast to export record volumes of corn in 2012/13, ensuring that the US doesn't have everything entirely it's own way.

Wheat: Sep 12 CBOT Wheat closed at USD8.79, up 12 cents; Sep 12 KCBT Wheat closed at USD9.03 3/4, up 11 cents; Sep 12 MGEX Wheat closed at USD9.39 1/2, unchanged. Fund activity had them attributed to being a net buyer of around 3,000 CBOT wheat on the day. Weekly export sales of 381,800 MT were at the low end of expectations for sales of 300-600 TMT. Still, the trade drew some solace from Egypt's seventh tender in a month, even if US wheat didn't feature once again. US and Canadian wheat was priced out to the tune of USD10-15/tonne, and that is before adding on more expensive freight costs. Strategie Grains pegged EU-27 wheat output at 131.6 MMT, 3.7% down on last year and 0.8 MMT lower than yesterday's USDA report. India's official weather office said that Sept 6-12 rainfall was 21% above normal. Wheat planting there will begin next month before the first big harvest of 2013 commences in March, for what is a short season crop. Wheat output next year is expected to be "at least 90 MMT" say the Ministry there. Meanwhile India continues to seek export business, with an estimated 2 MMT earmarked for foreign sales between now and the end of the year. Crop conditions in Australia (too dry) and Argentina (too wet) appear reluctant to go away.