Chicago Rallies On Fund Buying, Brazilian Shipping Delays

28/02/13 -- Soycomplex: Strong weekly export sales of a combined 1.17 MMT were skewed in favour of an already tight old crop balance sheet at 689 TMT, along with 482 TMT of new crop. That was well above trade expectations of combined sales of 650-750 TMT and takes old crop commitments to 94.5% of the USDA target for the season with five months still left to go. Brazilian shipping delays are seen continuing to switch some demand back from South America to the North. China took 69% of the old crop sales and 73% of the new crop. In addition the USDA announced the sale of 123 TMT to them for 2013/14 delivery today. The Buenos Aires Grains Exchange estimated Argentine soybean crop at 48.5 MMT versus a previous estimate of 50.0 MMT. Unimar said that 167 ships are waiting at Brazilian ports to load 9.68 MMT of soybeans alone, up 10% from a week ago. Informa come out tomorrow with their latest world production estimates. CONAB come out next Thursday with their Brazilian production estimates, before the USDA are out on Friday with theirs. Funds were estimated to have been net buyers of around 5,000 soybean contracts on the day. Mar 13 Soybeans closed at USD14.74 1/4, up 16 3/4 cents; May 13 Soybeans closed at USD14.52 1/4, up 12 3/4 cents; Mar 13 Soybean Meal closed at USD434.80, up USD5.50; Mar 13 Soybean Oil closed at 48.82, down 45 points.

Corn: Weekly export sales for corn of a combined 512,600 MT beat expectations of 350-450 TMT, with China taking 67,000 MT of new crop. Even so old crop sales still trail the pace required to meet the USDA's projection for the season. Whilst the market was pleased to see a fourth consecutive weekly increase in the ethanol grind yesterday, corn used in this week’s report was estimated at 85.3 million bushels versus the 87.7 million bushels per week required to meet this crop year’s USDA estimate of 4.5 billion bushels. The Buenos Aires Grains Exchange estimated Argentina’s corn crop at 25.0 MMT, unchanged from their previous estimate. Unimar said that 23 ships are waiting at Brazilian ports to load 1.13 MMT of corn, down 9.3% from a week ago. Toepfer estimated the 2013/14 global corn crop at a record 976 MMT, up 14.3% from 854 MMT in 2012/13. Asian buyers have been picking up South American and Black Sea corn and/or feed wheat from the likes of India in preference to US corn. South Korea only imported 35% of their 2012 corn from the US - the lowest percentage since 2005 and down substantially from 78% in 2011. Informa are out tomorrow with their March production numbers. Last month they had the Argentine corn crop at 25.0 MMT and the Brazilian corn crop at 70.3 MMT. Fund buying was estimated at 12,000 corn contracts on the day. Mar 13 Corn closed at USD7.19 1/2, up 10 cents; May 13 Corn closed at USD7.03 1/2, up 8 1/4 cents.

Wheat: Weekly export sales of a combined 524,900 MT were towards the lower end of expectation of 500-700 TMT. Unknown was the biggest old crop buyer taking 134,800 MT along with 82,500 MT of new crop. China showed up as taking one cargo of new crop (59,300 MT). Brazil bought one cargo of old crop (56,500 MT). South Korea bought 21,800 MT of Canadian wheat for Mat 1-15 shipment. Germany bought 60 TMT of feed wheat from Brazil for March shipment. Traders will be hoping that the US picks up a share of the new Saudi tender for 550 TMT of a mixture of soft and hard wheat for Jun/Aug shipment. They should certainly be in with a shot at the soft wheat part of the tender. The results of that could be out tomorrow or over the weekend. Russia's 2013/14 grain crop will come in at around 87-92 MMT, according to IKAR. Local reports suggest that wheat production potential there this year is no better than average at the moment. Informa are expected to release revised world wheat production numbers tomorrow. Last month they gave us EU an wheat crop at 138.0 MMT, an Argentine wheat crop of 9.5 MMT and an Indian wheat crop of 91.0 MMT. The recent departure of the vice chairman of the Egyptian state wheat buyer, GASC, may have been the start of a change in the way they operate. Some are speculating that public tenders will become a thing of the past, bringing less transparency into the market. Fund buying was estimated at 1-2,000 Chicago contracts on the day. Mar 13 CBOT Wheat closed at USD7.07 3/4, up 3 1/2 cents; Mar 13 KCBT Wheat closed at USD7.47, up 12 3/4 cents; Mar 13 MGEX Wheat closed at USD7.99 3/4, up 12 1/2 cents.