Nogger's Blog

Soybeans Collapse On Solar Panel Worries!

18/05/12 -- Soybeans: Jul 12 Soybeans closed at USD14.05, down 33 cents; Nov 12 Soybeans closed at USD12.88, down 18 1/2 cents; Jul 12 Soybean Meal closed at USD417.90, down USD10.10; Jul 12 Soybean Oil closed at 50.32, down 40 points. The end result of a very volatile week, astoundingly, is that front month soybeans closed the week within a penny of where they began it. Nov 12 beans were down 33 1/4 on the week, meal rose USD6.00 and oil fell 158 points. Beans seemed to lose out today to unwinding of spreads with funds selling an estimated 7,000 soybean contracts, whilst being featured buyers of corn and wheat. Here's a new one for you, Chinese solar panels may have been partly to blame for some of today's declines. Yes, some newswires are reporting that today's selling in soybeans may have been linked to a US move to suddenly introduce a 30% import duty on Chinese solar panels, which they say are being unfairly dumped on the US market. A Chinese Ministry spokesperson said: "The US decision lacks fairness and China expresses its strong displeasure." China of course is far and away the largest home for US soybean exports.

Corn: Jul 12 Corn closed at USD6.35 1/2, up 10 1/2 cents. Dec 12 Corn closed at USD5.37, up 8 3/4 cents. Funds were said to have bought around 11,000 corn contracts on the day, so due to unwinding of long soybeans/short corn spreads. Corn also derived spillover support from soaring wheat prices this week. For the week overall nearby corn gained 27 1/2 cents, with new crop Dec 12 up 31 3/4 cents. Some pundits are already trying to get a US weather market going, with calls for a warmer and drier outlook for the next ten days being behind some of today's strength. Meanwhile Iowa, Illinois and Indiana may be in for their third warmest May since 1895, according to T-Storm Weather.

Wheat: Jul 12 CBOT Wheat closed at USD6.95 1/4, up 37 1/2 cents; Jul 12 KCBT Wheat closed at USD7.05, up 33 cents; Jul 12 MGEX Wheat closed at USD7.92, up 24 3/4 cents. Chicago wheat jumped more than a dollar this week to post a 17% gain compared with last Friday. Kansas wheat was also up more than a dollar, with Minneapolis gaining over 50 cents. Funds were estimated to have covered in around 10,000 of their short position in Chicago wheat today. Jul 12 Chicago wheat managed to post its highest close on the weekly chart since the first week of November. Weather concerns around the world, including on the southern Plains, have spooked funds into closing out some of their shorts in Chicago wheat this week.

New Crop Paris Wheat Jumps To 11-Month Highs

18/05/12 -- EU grains finished higher with May 12 London wheat ending up GBP1.00/tonne at GBP175.00/tonne, new crop Nov 12 was GBP5.00/tonne higher to GBP158.80/tone. Nov 12 Paris wheat was up EUR8.25/tonne to EUR215.25/tonne.

On the week as a whole May 12 London wheat gained GBP2.50/tonne whilst Nov 12 added an impressive GBP10.60/tonne to close at its highest in more than six weeks. Nov 12 Paris wheat was EUR19.00/tonne higher on the week, closing at it's best levels in eleven months.

The second successive sharp monthly reduction to EU-27 wheat production prospects from Strategie Grains, and talk of potentially serious problems developing for Russian wheat unless rain arrives soon, were behind this week's rises.

Winter kill losses in France, Germany and Poland are said to have been heavier than realised, according to Strategie Grains. What has survived the winter appears to be in decent shape in France at least where FranceAgriMer now rate 67% of the wheat crop in good/excellent condition, up from 65% a week ago.

Wheat appears to have done a exceptionally good job of shrugging off outside market influences this week, with Brent and NYMEX crude both slumping to their lowest levels of the year so far on the back of the ongoing European debt crisis.

Euro weakness is seen remaining, which should at least help to support Paris wheat. Soft wheat exports out of Rouen more than doubled to 123,400 MT this week, helped by shipments of more that 75,000 MT to Algeria.

Chicago wheat gained more than a dollar a bushel, around 17%, this week - way outperforming corn and soybeans. Dryness concerns also exist here, particularly in the top producing state of Kansas where the USDA cut good/excellent ratings by eight percentage points on Monday.

Sugar Beet

18/05/12 -- Got a seller with up to eight loads of "maxibeet" sugar beet pulp pellets to sell for May delivery. Price £179 deld Cheshire (zone 11). Can potentially be delivered to other areas at the appropriate haulage differential. Email me if interested: info at nogger dot co dot uk. Subject unsold.

EU Rapemeal Prices

18/05/12 -- Rapemeal prices on the continent are higher, playing catch up with two days of gains in Chicago soymeal after the market was closed yesterday for Ascension Day.

Latest guide prices for EU rapemeal today, basis FOB Lower Rhine in euros/metric tonne, with change from previous trading session:

Early Call On Chicago

18/05/12 -- The overnight grains were mixed with beans mostly 4-6 cents lower, corn 3-4 cents higher and wheat 3-5 cents higher. Crude oil and the dollar are both slightly weaker.

For the week so far we have beans up 28 1/4 cents, corn up 21 cents and wheat up 70 1/2 cents including the overnight market.

Wheat has led the way this week on talk of yield loss potential in Russia and Europe and a hot and dry finish to the growing season in the southern Plains. Combine that with the hefty fund short position that we began the week with and it's easy to see why the market got a little spooked.

There's an interesting graphic here showing where Russian wheat is grown, combined with thirty day rainfall and temperature maps, courtesy of my chums at Martell Crop Projections.

My information is that there is still time for wheat in the region if it gets rain in the next couple of weeks. It would only take between .50 and 2 inches of rain to wipe out the deficit. The problem is that the exceptional heat has increased evaporation making moisture stress worse. The evaporation rate is twice as high at 90 F than at 70 F, says Gail Martell.

The Kansas wheat harvest will begin next week I hear, it will be interesting to see what early yield results are.

The outside markets have fared less well this week, weighed down by European debt woes. NYMEX crude is down by almost USD4/barrel on the week so far.

More and more analysts are using the word "when" as opposed to "if" with regards to a Greek Eurozone exit. Shares in De La Rue Group, the world's largest commercial printer of banknotes, are up more than 11% in the past month in anticipation of them getting a large order to print drachma's, according to a report on Reuters today.

Meanwhile a report in the Wall Street Journal suggests that JPMorgan Chase's recently reported USD2-3 billion losses could end up being as much as USD5 billion.

Early calls: corn up 3-5 cents, wheat up 4-6 cents, soybeans down 3-5 cents.

Chicago Close - Thursday

17/05/12 -- Soybeans: Jul 12 Soybeans closed at USD14.38, up 16 cents; Nov 12 Soybeans closed at USD13.06 1/2, up 4 1/4 cents; Jul 12 Soybean Meal closed at USD428.00, up USD3.00; Jul 12 Soybean Oil closed at 50.72, up 29 points. Weekly export sales were well below trade ideas at 673,400 MT vs the 1.1-1.6 MMT expected. However almost all of that was old crop (616,256 MT) and in addition the USDA reported the sale of 480,000 MT of old crop beans to China, making an already tight supply line even tighter. US weather forecasts are turning warm and dry, non threatening at the moment in the Midwest. Similar conditions in winter wheat ares though may discourage double cropping ideas. Macquarie Group meanwhile say that they believe that soybean prices will peak "in the June-August period when global supplies will be tightest" - July is the seasonal favourite peak month for CBOT beans.

Corn: Jul 12 Corn closed at USD6.25, up 5 cents; Dec 12 Corn closed at USD5.28 1/4, up 2 cents. Funds were estimated to have bought around 7,000 corn contracts on the day even though weekly export sales of a combined 865,100 MT for corn were towards the low end of expectations of 800 TMT-1.4 MMT. China bought 72,700 MT of the old crop corn and 111,700 MT of the new crop with an additional 316,200 MT sold of unknown. Support for corn was also helped by spillover strength from resurgent wheat. Dryness in Eastern Europe, SE Ukraine, Southern Russia and Northern China is a concern. European woes are seen capping gains however, the Greek stock market fell to its lowest level since 1990 today. A strong dollar, the ultimate safe haven, is also likely to limit upside potential.

Wheat: Jul 12 CBOT Wheat closed at USD6.57 3/4, up 19 cents; Jul 12 KCBT Wheat closed at USD6.72, up 16 cents; Jul 12 MGEX Wheat closed at USD7.67 1/4, up 7 1/4 cents. Weekly export sales of 711,400 MT were towards the upper end of the 400-850 TMT expected. The near record fund short in Chicago wheat limits downside potential, especially when there is talk of heat and dryness in Southern Russia. Funds were said to have covered in around 6,000 of that short today. Strategie Grains said that winter kill losses in Europe were worse than originally thought and cut 4.2 MMT off their soft wheat production estimate there. The USDA confirmed the sale of 100,000 MT of new crop HRW wheat to Iraq. Heat and dryness on the Southern Plains may take the shine off what had been expected to be near record yields for US winter wheat there.

EU Wheat Gains On Crop Loss Talk

17/05/12 -- EU grains finished higher with May 12 London wheat closing up GBP1.00/tonne to GBP174.00/tonne, and Nov 12 rising GBP1.80/onne to GBP153.80/tonne. Aug 12 Paris wheat was up EUR3.75/tonne at EUR205.00/tonne and new crop Nov 12 was also up EUR3.75/tonne to EUR1207.00/tonne.

A leaked report last night suggesting that Strategie Grain would cut it's EU-27 soft wheat production estimate by 4.2 MMT to 122.7 MMT proved to be correct. The losses are mainly accounted for by much worse winter kill damage in February than had earlier been anticipated, they said.

The reduction means that the French analysts have lopped 8.5 MMT off their forecasts for EU-27 soft wheat output in the last two months alone, and this latest figure now represents an cut of 10.3 MMT on their original assessment of thia year's potential and a 5% drop on last season's production.

Germany (down 1.6MMT), Poland (down 1.4 MMT) and France (down 0.6 MMT) were the main countries responsible for the downgrade.

It wasn't all bullish news from them however. They cut their 2011/12 and 2012/13 soft wheat export forecasts too, reflecting a lack of competitiveness against other origins like the US, the Black Sea and South America. For the 2012/13 season soft wheat export of only 11.4 MMT are amongst the lowest in the last thirty years.

Concerns over Russian and Ukraine wheat production potential this year are also grabbing the headlines, although analysts on the ground paint a less disastrous picture. There's some talk also of US wheat prospects declining due to dryness.

The Eurozone crisis still weighs on the market however, and that is potentially what could still bring the grain market to it's knees no matter what the fundamentals say.

Many are now talking of a Greek exit as being almost inevitable. Greece’s benchmark ASE Stock Index fell to it's lowest level since 1990 today. Greek nationals are reported to be syphoning off large sums of money from their own banks to be deposited abroad. If and when they do depart the immediate concern will be who is next, and that could mean a possible run on Portuguese, Spanish and Italian banks too.

Early Call On Chicago

17/05/12 -- The overnight gains were mixed with wheat up 2-3 cents, beans 11 cents higher nearby to 5-7 cents firmer further forward and corn 1-4 cents lower.

Crude is a bit firmer for once, but so too is the US dollar.

The USDA's weekly export sales report came in at a combined 865,100 MT for corn, towards the low end of expectations of 800 TMT-1.4 MMT; Soybeans were well below trade ideas at 673,400 MT vs the 1.1-1.6 MMT expected; Wheat was OK at 711,400 MT vs 400-850 TMT expected.

One of two of last night's newswires included the word "Sukhovy" - the infamous hot wind that helped slash Russian grain production two years ago. Nobody seems to be saying that this weather phenomena has struck yet, but that there is potential for it to do so. With funds holding a near record short in Chicago wheat and memories of wheat prices doubling in the second half of 2010 it's not surprising therefore that wheat posted 30 cent gains last night.

Stategie Grains meanwhile have chipped in with a 4.2 MMT cut to EU-27 soft wheat production, meaning that they've lopped 8.5 MMT off their forecasts in the past two months.

Jordan has bought 50,000 MT of wheat of unspecified origin in a tender. Japan has bought 500,000 MT of of South American corn for July-Sept shipment, and has more to buy. The Philippines are buying Australian feed wheat.

Helping support the already tight old crop soybean situation this afternoon will be the USDA announcing the sale of 480,000 MT to China. They've also reported the sale of 100,000 MT of new crop HRW wheat to Iraq which was already publicised earlier in the week.

The former is a pretty large sale for US beans at this time of year, suggesting that there isn't much on offer out of South America already, or at least that the pipeline is full.

Macquarie Group meanwhile say that they believe that soybean prices will peak "in the June-August period when global supplies will be tightest" - July is the seasonal favourite peak month for CBOT beans.

US weather is seen turning warmer/drier, which shouldn't initially be a problem but could quickly get turned into one.

As ever, keep an eye on European developments. Yields on Spanish bonds were sharply higher today. They had to pay 4.373% on bonds maturing in Jan 2015 versus 2.89% last month. Apr 2016 bonds were 5.106% versus 3.374% in March.

Early calls for this afternoon's session: corn flat to 2 cents lower, wheat up 2-3 cents, beans up 6-12 cents.

Hurry Up

17/05/12 -- The CME Group's plans to introduce 22-hour a day trading on the electronic Globex market are starting to resemble the contents of a woman's wardrobe.

The original plan to commence trading from midnight to 10pm (based on the current UK BST) starting on 14th May was shelved as they hadn't got CFTC approval in time. I wore this last time we went out with them.

Plan B was to begin trading those hours from Monday 21st May. Not with these shoes, surely.

That has also met with opposition, so Plan C it would appear is to start trading 21 hours/day commencing 11pm at night and running through to 8pm starting Monday 21st. No, seriously, does my bum look big in this?

Traders don't fancy this idea a whole lot either, as it means that USDA crop reports will be released during trading time, not when the market is closed as is currently the case. The black, or red? Blue it is then. Pink?

So, it currently appears that Plan C will not happen this coming Monday after all. Hair, up or down? Snatched back, right answer.

We don't know what Plan D is yet. All clear?

Chicago Closing Comments

16/05/12 -- Soybeans: Jul 12 Soybeans closed at USD14.22, up 9 cents; Nov 12 Soybeans closed at USD13.02 1/4, down 2 3/4 cents; Jul 12 Soybean Meal closed at USD425.00, up USD7.80; Jul 12 Soybean Oil closed at 50.43, down 104 points. Old crop beans gained on new crop on ideas that an early winter wheat harvest will see quite a few more soybean acres than the USDA currently predicts get planted this spring. With new crop beans at USD13/bu it would certainly make sense. Old crop availability though remains tight. The trade is expecting another week of bumper export sales tomorrow, with estimates in the region of 1.1-1.6 MMT. Chinese think tank CNGOIC said that China will import 58 MMT of soybeans this year, 2 MMT more than the USDA currently predict. They peg Chinese soybean production this year at 13 MMT.

Corn: Jul 12 Corn closed at USD6.20, up 22 3/4 cents; Dec 12 Corn closed at USD5.26 1/4, up 11 3/4 cents. Funds were said to have bought an estimated 18,000 corn contracts on the day, largely managing to shrug off Greek concerns. Spillover support came from a bullish performance from wheat. CNGOIC say that China will produce a record 197.5 MMT of corn this year, even so imports will rise 0.5 MMT in the year starting Oct 1 to 6 MMT, they added. Support came from news that the USDA had confirmed 900,000 MT of corn sold to China, although most of that was switches from already announced sales to "unknown" 240,000 MT of it was new business. Trade estimates for tomorrows weekly export sales report are 800 TMT - 1.4 MMT.

Wheat: Jul 12 CBOT Wheat closed at USD6.38 3/4, up 30 1/4 cents; Jul 12 KCBT Wheat closed at USD6.56, up 28 1/2 cents; Jul 12 MGEX Wheat closed at USD7.60, up 9 1/2 cents. Wheat was the star performer for once on short-covering following reports of "irreversible" crop deterioration in parts of Russia which has been hot and dry of late. Rains are in the forecast pushing east from Ukraine but may fizzle out before they get to Russia. Late news suggests that Strategie Grains are due to write down the EU-27 soft wheat crop by more than 4 MMT tomorrow, bringing their all wheat production estimate to 130.3 MMT, a 7.4 MMT drop on last year. Weekly export sales tomorrow are expected to be in the region of 400-850 TMT.

EU Grains Close

16/05/12 -- EU grains finished mixed but mostly higher with May 12 London wheat ending down GBP0.50/tonne to GBP173.00/tonne, and new crop Nov 12 up GBP2.70/tonne to close at GBP152.00/tonne. Aug 12 Paris wheat ended EUR3.75/tonne higher at EUR201.25/tonne, whilst Nov 12 was also EUR3.75/tonne firmer at EUR203.25/tonne.

Wheat was mixed throughout the morning, but headed higher in afternoon trade after the Chicago market came in stronger. That push higher was linked to reports of potential crop damage in Russia due to high temperatures and scant rainfall.

There is some trade talk of similar problems in Ukraine, although several commentators on the ground over there refer to crop conditions bordering on "perfect" - at least in the west of the country.

US wheat ratings in the top producing state of Kansas were downgraded sharply by the USDA on Monday, no doubt raising a few eyebrows amongst the heavily short fund fraternity.

A late and unconfirmed story appearing via Twitter that Strategie Grains will tomorrow cut it's EU-27 soft wheat production forecast by more than 4 MMT to 122.7 MMT may have been behind the strength in new crop months.

They cut their soft wheat estimate last month by a chunky 4.3 MMT to 126.8 MMT citing frost and drought damage, so this potentially pegs things well below what the market was expecting just a couple of months ago.

Iraq bought 400,000 MT of wheat of various origins, said to be a combination of Russian, Romanian, Kazakh, Australian and US wheat in a tender yesterday, adding support.

European debt worries appear to have been placed on the back burner, at least for today, but don't be surprised to see them retake centre stage at any time.

Meanwhile UK wheat exports in March slumped to a nine month low of less than 125 TMT customs data shows, and that was with the added bonus of a 47 TMT consignment shipped to the US. The latter is thought to have been sold around eight months or so ago, UK wheat is currently priced out of the export market and looks likely to remain so now until new crop comes along.

EU Rapemeal Prices

16/05/12 -- Rapemeal prices on the continent are lower mostly a little steadier today. Despite being lower on the electronic Globex market, Chicago soymeal prices are still showing net gains versus this time yesterday.

Guide prices, basis FOB Lower Rhine in euros/metric tonne, with change from previous session:

A Quick Update And A Few Thoughts On Greece

16/05/12 -- Blogging activity has been restricted this week by a combination of computer and mobile phone problems. The culmination to the latter difficulty being that I had to do a factory reset and have thus lost all of my contacts that were saved to the phone. Sadly that was most of them. Yes I know I should have done a back up. But then again we should only drink two halves of shandy a week, drive at 29mph in a 30mph zone and not eat a bacon & sausage growler for breakfast every day shouldn't we?

Meanwhile the market seems to be getting more erratic and unpredictable by the day. Greece: we all knew this was coming surely, so why is it such a big shock all of a sudden? Is it simply because it's been around in the market for so long that people have got complacent about it?

Greece will leave the Eurozone pretty soon in my humble opinion. The austerity pill is simply too bitter for them to swallow. The only thing we don't know is when. The immediate effect of that will almost certainly be a mass fund exodus from anything deemed risky. Like grains for example.

The almost immediate knock-on contagion-type ripple effect of that will probably be significantly lower prices than those you see on your screens today, regardless of how many soybeans China wants or what the weather is doing in Russia.

Once Greece go we will quickly move onto the "exactly what are the implications of this, and who's next?" question. Cue more money exiting the arena regardless of the fundamentals. One of the implications could easily be the ECB printing euros faster than a fast thing on its way to a fast thing's convention.

This is all starting to sound outrageously bearish isn't it? The bit I am struggling to get my head round is how long will these conditions prevail and what the more medium to longer term implications are.

The answer to the latter is probably easier to predict that the former, inflation.  Big time inflation. In a big time inflation scenario I'd want to be long all the grains, however there may be some downside pain (or pleasure depending on which way you swing) to endure first.

China To Produce Record Corn Crop In 2012/13

16/05/12 -- China's government sponsored think tank CNGOIC say that the country will produce a record 197.5 MMT of corn and a second highest ever 120.3 MMT of wheat in 2012/13.

In both cases the lucky old Chinese will therefore have managed to pull off successive production increases in nine out of the last ten years.

In the case of corn that's a 3% rise on this season and 4.5 MMT more than the USDA projected last week.

OK, we take these numbers with a large pinch of melamine. More land is expected to be given over to corn production this year though, at the expense of soybeans and rapeseed, for which CNGOIC forecast plantings decreasing by 6.5% and 2% respectively.

Chicago Closing Comments - Tuesday

15/05/12 -- Soybeans: Jul 12 Soybeans closed at USD14.13, up 26 cents, Nov 12 Soybeans closed at USD13.05, up 10 1/4 cents; Jul 12 Soybean Meal closed at USD417.20, up USD13.70; Jul 12 Soybean Oil closed at 51.47, up 17 points. The soy complex rallied as fund money came back into the market, buying an estimated 8,000 beans, 3,000 meal, 2,000 soyoil on the day. Better than expected German growth just helped the Eurozone avoid slipping into an official recession in Q1 of 2012. That seemed to ease a few Eurozone fears, although there seems to have been little progress on Greece which appears to be heading for another election next month. Beans managed to shrug off weak crude oil and a firmer dollar, led by front month July gaining on old crop tightness in supply. Developments in Europe look set to dominate in the coming weeks, as they dictate whether fund money flows into, or out of, the grains sector.

Corn: Jul 12 Corn closed at USD5.97 1/4, up 14 1/4 cents; Dec 12 Corn closed at USD5.14 1/2, up 9 cents. Funds were said to have taken advantage of the recent price dip to buy around 11,000 corn contracts on the day. Regardless of what the futures market is doing, cash availability is tight and looks set to stay that way until new crop comes along. With US corn plantings at 87% complete versus the 5 year average pace of 66% and emergence well ahead of normal there is every chance that the harvest will begin earlier than usual this year. As with soybeans, this was a fairly decent performance given crude oil setting to fresh 2012 lows and the dollar strength. Also as in the case of soybeans, Europe probably holds the key going forward.

Wheat: Jul 12 CBOT Wheat closed at USD6.08 1/2, up 10 1/4 cents; Jul 12 KCBT Wheat closed at USD6.27 1/2, up 13 cents; Jul 12 MGEX Wheat closed at USD7.50 1/2, up 24 3/4 cents. Funds bought an estimated 2,000 Chicago wheat contracts on the day, perhaps surprised by the sharp drop in winter wheat crop conditions reported by the USDA Monday night, with Kansas falling from 60% to 52% good/excellent in just a week. There is some talk of "irreversible" damage to winter wheat in parts of Southern Russia. Kazakhstan is only expecting an average crop this year, after bumper production in 2011. They will export a record 13 MMT of grains in 2011/12, according to their Ag Ministry. Wheat remains very much a follower of corn and soybeans, and will be the first to come under harvest pressure with the combines expected to be rolling in Kansas within the next few weeks.

EU Grains Closing Comments

15/05/12 -- EU grains finished mostly higher with May 12 London wheat ending unchanged at GBP173.50/tonne, new crop Nov 12 was up GBP1.60/tonne to GBP149.30/tone. Nov 12 Paris wheat was up EUR4.00/tonne to EUR199.50/tonne.

After a couple of risk off day the market was perhaps due some kind of correction. Greek concerns haven't gone away though, with the pound rising to a new 3 1/2 year high of 1.2560 against the euro today. That perhaps explains why Paris wheat posted better gains than London wheat today.

The market is thin and looking for direction, it's been two months since London wheat has closed outside the GBP170's on a front month.

Dry and warm weather in parts of China, Russia, Ukraine and Kazakhstan is causing some concern, although it's too early to quantify any losses that may have occurred.

There are doubts over the health of US winter wheat too, after the USDA last night cut their national crop ratings by 3 percentage points in the good/excellent category to 60%. Top producing state Kansas saw the percentage of its crop rated in the top two categories slump by eight points to 52%. Ideally the crop there would like one more decent rain to see it through to harvest in a couple of weeks time.

Spring wheat planting in the US is progressing at a record pace, with 94% of the crop now in the ground.

Tunisia is forecast to have its largest grain harvest in decades this year, according to its Agriculture Minister. Harvesting there begins next month.

EU Rapemeal Prices

15/05/12 -- Rapemeal prices on the continent are mixed today, a bit steadier on nearby old crop months and unchanged to a tad lower on new crop.

Latest guide prices for EU rapemeal today, basis FOB Lower Rhine in euros/metric tonne, with change from previous trading session:

Chicago Close - Monday

14/05/12 -- Soybeans: May 12 Soybeans closed at USD13.90, down 14 cents; Nov 12 Soybeans closed at USD12.94 3/4, down 26 1/2 cents; May 12 Soybean Meal closed at USD406.80, down USD4.20; May 12 Soybean Oil closed at 50.80, down 110 points. Risk off mode continues, with funds selling an estimated 9,000 soybean contracts on the day on broad-based commodity selling. World stock markets were also lower after Greece failed to form a coalition government over the weekend, meanwhile crude oil hit its lowest levels of 2012. After the close the USDA reported US soybean plantings at 46% complete, up from 24% last week and well ahead of normal. Emergence is 16%, up from 7% last week and 5% average.

Corn: May 12 Corn closed at USD6.08, unchanged; Dec 12 Corn closed at USD5.05 1/2, up 1/4 cent. Corn managed to fare better than soybeans in today's rout on unwinding of spreads that were short corn and long soybeans. The USDA said that corn planting is now 87% complete, versus 66% normally. Emergence is also well ahead of the normal pace at 56% compared with 28% on average. With planting nearing completion the market will soon start to focus on US weather conditions, thus far they have been pretty benign. If we are heading into an El Nino weather pattern then it is possible that we may end up with the record 166bu/acre yields that the USDA are currently factoring in.

Wheat: May 12 CBOT Wheat closed at USD5.97 3/4, up 5 cents; May 12 KCBT Wheat closed at USD6.05 1/2, up 4 1/2 cents; May 12 MGEX Wheat closed at USD7.41 1/4, unchanged. Given the large fund short that already exists in wheat it too managed to fare better than soybeans on the day. The USDA cut their wheat ratings, dropping the percentage of the crop said to be good/excellent from 63% last week to 60% this week. Top wheat producing state Kansas had a dry week which saw its good/excellent rating cut from 60% last week to 52% this time round. The winter wheat crop remains very forward at 72% headed compared with 46% in a normal year. Spring wheat plantings are 94% complete versus 64% normally.

EU Grains Close - Monday

14/05/12 -- EU grains finished mostly lower, although May 12 London wheat closed up GBP1.00/tonne to GBP173.50/tonne. Nov 12 fell GBP0.50/onne to GBP147.70/tonne. Aug 12 Paris wheat was unchanged at EUR197.50/tonne and new crop Nov 12 fell EUR0.75/tonne to EUR195.50/tonne.

Strategie Grains now say that 11% of German winter wheat and 13% of winter barley were lost to winterkill, an upward revision from the respective 6% and 9% estimated previously.

The German spring wheat, spring barley and corn planted area estimates are all revised higher on the back of these losses.

They estimate the German soft wheat crop at just under 22 MMT compared with 22.7 MMT last year. Barley output is seen 9% higher this year at 9.6 MMT, with corn production marginally higher at 5.3 MMT. Their wheat estimate is 0.5 MMT below the USDA's figure released Thursday, whilst their barley forecast is 0.5 MMT higher than the USDA.

They also say that the weather in France during April "was again rather unusual. The volume of national rainfall was almost 165 % of the average for this month. There were rainstorms and especially heavy rain in western France (double the seasonal average). The water balance since the start of March is now +30% in most regions but it remains in deficit compared to average for the period from September through May."

We maintain our estimate for total wheat area published April 17 of 4.8 Mha (4.99 Mha in 2011/12). Projected wheat yield is revised up at 7.13 MT/ha (7,09 MT7/ha previously and 6.81 MT/ha in 2011/12) due to the increases in Normandy, Picardie and Nord-Pas-de-Calais. We now expect soft wheat production at 34.22 MT (34.06 MT previously and 33.99 MT in 2011/12), they add.

EU Rapemeal Prices

14/05/12 -- Rapemeal prices on the continent are lower across the board today following steep losses in Chicago soymeal on Friday night and again this morning.

Guide prices, basis FOB Lower Rhine in euros/metric tonne, with change from previous session:

Monday Morning Risk Off

14/05/12 -- Friday's hangover has extended into Monday I see, with grains, stocks, crude and just about everything else lower this morning.

Greek jitters are very much back on the agenda. Spanish and Italian borrowing costs are rising rapidly. Senior executives at JPMorgan Chase are offering to resign for their part in the bank racking up USD2-3 billion in trading losses in just six weeks.

It's full on risk off mode. Soybeans are below USD14/bu for the first time since late March. Rapeseed is tanking in sympathy. Nymex crude is around USD2/barrel weaker, to its lowest levels of 2012. It's all suddenly gone the shape of a small soft edible fruit.

Buying opportunity, or sell before it gets worse? Nobody seems to know what to do, so I guess that the old adage "if in doubt do nowt" will come into play today.

May Chicago contracts go off the board this afternoon, which means that we will probably have a front month in corn starting with a five for the first time in four months. CBOT wheat is already below USD6/bushel in both the May and the July, only 20 cents or so above the mid-Dec lows. There haven't been many sub-USD6/bu trading days for a front month for either corn or wheat since 2010.

India is now actively seeking tenders to export up to 10 MMT of its surplus wheat.

The Chinese Ministry say that May soybean imports will total 5.63 MMT, up 15% on April's 4.88 MMT.

Strategie Grains now say that 11% of German winter wheat and 13% of winter barley were lost to winterkill, an upward revision from the respective 6% and 9% estimated previously.

The German spring wheat, spring barley and corn planted area estimates are all revised higher on the back of these losses.

They estimate the German soft wheat crop at just under 22 MMT compared with 22.7 MMT last year. Barley output is seen 9% higher this year at 9.6 MMT, with corn production marginally higher at 5.3 MMT. Their wheat estimate is 0.5 MMT below the USDA's figure released Thursday, whilst their barley forecast is 0.5 MMT higher than the USDA.

The pound is back up close to the highest in 3 1/2 years 1.25 level against a brutalised euro.