Chicago Closing Comments - Friday

01/03/13 -- Soycomplex: Beans closed around the middle of the day's trading range at the end of a choppy session. An improved weather outlook in South America and ideas that Brazil may be starting to get it's act together as far as exports are concerned weighed. So too did Informa Economics raising their Brazilian soybean production estimate by 0.5 MMT to 84.5 MMT, which is 1 MMT more than the USDA forecast last month. The Brazilian Trade Ministry said the country exported 959,600 MT of beans in February versus 284 MT in January. In Argentina rains are "expected to build across central and southern La Pampa, central and southern Buenos Aires, eastern Cordoba, Santa Fe, and Entre Rios this weekend. The rains will continue to build moisture in southern and northeastern areas, which will favour soybean growth. Additional rains are expected in these same areas in the 6-10 day period," said MDA CropCast. Good rains are also forecast in Brazil this weekend. The USDA announced a further 120 TMT of new crop soybean sales to China. Informa pegged Argentine soybean production at 51 MMT, which is 2 MMT less than the February USDA estimate. Oil World estimated the Paraguay soybean crop at 7.8 MMT versus a previous estimate of 8.2 MMT. Funds were estimated to have been net sellers of around 4,000 soybean contracts on the day. Mar 13 Soybeans closed at USD14.64 1/2, down 9 3/4 cents; May 13 Soybeans closed at USD14.43 1/2, down 8 3/4 cents; Mar 13 Soybean Meal closed at USD427.30, down USD7.50; Mar 13 Soybean Oil closed at 49.47, up 65 points. For the week nearby beans gained 3 1/4 cents, meal added 40 cents and oil lost 88 points.

Corn: Lower estimates from Informa for South American corn production this year were bullish. They estimated Brazil's corn crop at 71.6 MMT, versus the USDA estimate of 72.5 MMT. Informa also pegged Argentina’s corn crop at 25 MMT versus the USDA estimate of 27 MMT. The Brazil Trade Ministry said that the country had exported 2.29 MMT of corn in February versus 3.37 MMT in January. The Brazilian government said that starting May 1st the limit on the ethanol blend permitted in gasoline will be increased to 25% from 20% currently. Nearby tightness in physical availability in the US is reflected in the strong cash basis. Shorts in front month Mar 13 have got squeezed into covering their positions in as delivering against them isn't really an option if they haven't, or can't get, the physical corn. Recent very heavy precipitation in the US southeast and delta has removed most of the extreme drought concerns for states in the area, with talk now that they could in fact hamper fieldwork and cause significant delays to corn planting. Talk remains that China is eyeing US new crop corn. South Korea’s Nonghyup Feed Inc estimated South Korea’s 2013 US corn imports at below 2.0 MMT versus 2.84 MMT in 2012, saying that South American corn was cheaper. Fund buying was estimated at 4-6,000 corn contracts on the day. Mar 13 Corn closed at USD7.24 1/4, up 4 3/4 cents; May 13 Corn closed at USD7.08 1/2, up 5 cents. For the week that puts nearby Mar 13 up 34 cents, with May 13 gaining 24 1/4 cents.

Wheat: The wheat market followed corn higher, despite a much improved weather situation for US wheat. "February storms delivered very heavy precipitation to the United States heartland, with the 3 main winter wheat states Kansas, Oklahoma and Texas receiving 2-4 inches of snow melt. Scattered areas of northern Oklahoma received 5 inches of moisture. This is a game-changer for winter wheat. Normally, winters are very dry in the Great Plains bringing only 2.8 inches of moisture, overall, to the Southern Great Plains December-February. Storm precipitation in February has exceeded the normal expected winter precipitation, and then some," say Martell Crop Projections. "Additional snow is expected to cross the northern Plains into the Midwest later this weekend into next week, which will maintain extensive snow cover there. This will also improve soil moisture once it melts," say MDA CropCast. Thailand bought 30 TMT of Indian wheat for May shipment in a tender today. Tunisia bought 50 TMT of optional origin soft wheat along with 25 TMT of optional origin barley, both for April shipment. CNGOIC said China will auction 1.285 MMT of wheat from reserves next week. Fund buying in Chicago wheat was estimated at 2,000 lots on the day. Mar 13 CBOT Wheat closed at USD7.13 1/4, up 5 1/2 cents; Mar 13 KCBT Wheat closed at USD7.56, up 9 cents; Mar 13 MGEX Wheat closed at USD8.19 3/4, up 20 cents. For the week Mar 13 CBOT wheat lost 1 3/4 cents, KCBT gained 6 1/4 cents and MGEX added 17 cents.