Chicago Slump Continues As Funds Exit

12/11/12 -- Soycomplex: Nov 12 Soybeans closed at USD14.11, down 41 cents; Jan 13 Soybeans closed at USD14.05, down 46 1/4 cents; Dec 12 Soybean Meal closed at USD431.40, down USD18.30; Dec 12 Soybean Oil closed at 47.39, down 38 points. This was the lowest close on beans since June as funds dumped an estimated 11-12,000 contracts onto the market, adding to their recent liquidation phase. Friday's USDA report showing US yields and production at a better than expected 39.3 bu/acre and 2.971 billion bushels respectively, coupled with increased planting activity in South America sees fund money reducing their net soybean longs to the smallest in 8 months. Safras e Mercado said that Brazilian soybean plantings are now 54% complete versus 42% a week ago. That's still down on last year's 66% but now slightly ahead of the 5 year average of 51%. Celeres say Brazilian plantings are even more advanced at 58% complete. CONAB estimate the Brazilian soybean area at 26.4-27.3 million hectares versus 25.0 million a year ago, placing the crop at a record 80-83 MMT. Brazilian weather is also looking up. "Needed showers this week will improve moisture across east-central and northern corn/soybean areas," said MDA CropCast. In Argentina "drier weather is expected in most areas this week, which will allow wetness to ease and conditions to improve for corn and soybean planting and germination," they added.

Corn: Dec 12 Corn closed at USD7.18, down 20 3/4 cents; Mar 13 Corn closed at USD7.22 1/4, down 19 3/4 cents. For corn fund selling of an estimated 18,000 contracts drove nearby prices to within 2 cents of the lowest close since the first day of July. Safras said that Brazil's corn planting is 71% complete versus 60.6% a week ago and 78% a year ago. They placed the corn crop there at 67.9 MMT versus 72.3 MMT in 2011/12. CONAB are more optimistic for corn, placing 2012/13 production broadly in line with last year at 71.5-72.8 MMT. Corn exports however will fall from 19 MMT to 15 MMT, they add. The Argentine Ag Ministry estimates 49% of the corn crop has been planted there versus 64% a year ago. The weekly USDA export inspections report normally released on a Monday is re-scheduled for tomorrow due to the Veteran's Day holiday. Corn shipments need to average around 23 million bushels/week to hit the USDA's projections for 2012/13. Last week's total was less than 15 million as high prices ration demand. Ukraine are said to have harvested 16.5 MMT of corn off 81% of the planned area. They've also apparently struck a deal with China over quality standards to enable them to export corn to Chinese buyers in 2013.

Wheat: Dec 12 CBOT Wheat closed at USD8.57 3/4, down 28 3/4 cents; Dec 12 KCBT Wheat closed at USD8.90 1/2, down 31 3/4 cents; Dec 12 MGEX Wheat closed at USD9.24 1/2, down 26 cents. Fund selling in Chicago wheat was placed at 6-8,000 contracts on the day, although tonight's close still leaves wheat stuck in the same sideways range it has been in for around 4 months now. The Veteran's Day holiday also means that the usual Monday night crop condition report is delayed until tomorrow. The trade will be looking at that to see how US winter wheat is getting along, having been rated as poorly as it's ever been at this early stage in last week's report. IKAR said that Russia has exported 11.0 MMT of grain between Jul 1st – Nov 8 including 8.5 MMT of wheat. Ukraine said that they had exported a record 9.42 MMT of grain in a similar period, including 4.57 MMT of wheat. Traders in both countries have clearly been keen to ship before possible export restrictions are introduced. Kazakhstan says that it's harvest is over producing 14.7 MMT of grain in bunker weight, only around half of last year's total, and that the country will export "nearly" 7 MMT of grains in 2012/13.