Nogger's Blog

25/04/13 -- Soycomplex: Strength in outside markets spilled over into the soycomplex, despite net cancellations of 206,300 MT in old crop beans and sales of "only" 628,500 MT for new crop in today's weekly export sales report. The trade was expecting net combined sales of 600 TMT to 1 MMT. The Buenos Aires Cereals Exchange estimated the Argentine soybean crop at 48.5 MMT, unchanged from their previous estimate and 2 MMT lower than the USDA. They said that Argentina’s bean harvest is 56.2% complete. There's talk of Chinese crushers rolling old crop US bean purchases to new crop, it's unclear whether this is due to bird flu reducing domestic demand for soymeal or not. A weaker US dollar was supportive to the entire complex today. There's some talk of that enabling South American beans to be shipped into the US reasonably economically. Funds were estimated to have been net buyers of around 7,000 soybean contracts on the day. May 13 Soybeans closed at USD14.23 1/2, up 19 1/2 cents; Jul 13 Soybeans finished at USD13.72 1/4, up 27 cents; May 13 Soybean Meal closed at USD414.30, up USD8.40; May 13 Soybean Oil closed at 49.77, up 59 points.

Corn: Weekly export sales were in line with trade expectations, and heavily skewed in favour of old crop at 314,700 T for 2012/13 and only 21,200 MT for 2013/14 (the trade was expecting a combined 200-600 TMT). In addition to that the USDA also announced sales of 300,000 MT of US corn to China and 240,000 MT to unknown for 2013/1 delivery. The Buenos Aires Cereals Exchange estimated Argentina’s 2012/13 corn crop at 24.8 MMT, down slightly from a previous estimate of 25.0 MMT and versus 26.5 MMT from the ever optimistic USDA. They said that said Argentina’s corn harvest is 35.1% complete. The IGC estimated the 2013/14 world corn crop at a record 939 MMT, up 10% from a year ago. They placed 2013/14 world corn ending stocks at 143 MMT versus their 2012/13 estimate of 116 MMT. MDA CropCast increased their Brazilian corn production estimate by 780 TMT from last week to 74.88 MMT. They are forecasting US corn production at 13.3 billion bushels in 2013 (337.9 MMT versus 253.6 MMT in 2012). The CME group declared force majeure at a number of Illinois River terminals due to high water levels. Funds were said to have been net buyers of around 7,000 contracts on the day. May 13 Corn closed at USD6.45 1/4, up 5 3/4 cents; Jul 13 Corn is at USD6.2 4 1/2, up 6 1/4 cents.

Wheat: Wheat got support from more fears of winterkill on the US Plains this week. Weekly export sale of 71,700 MT of old crop and 234,700 MT of new crop were uninspiring against the expected 500-800 TMT. Japan bought 95,621 MT of milling wheat for May/Jul delivery in a routine tender, with around 66 TMT of that coming from the US. MDA CropCast increased their world wheat production estimate by 200 TMT from last week to 676.4 MMT, with increases for Canada (to 27.5 MMT versus 26.4 MMT in 2012) more than offsetting a reduction in US production to 57.4 MMT. The IGC estimated the 2013/14 world wheat crop at 680 MMT versus a previous estimate of 683 MMT, but up from 655 MMT a year ago. They estimated 2013/14 world wheat ending stocks at 181 MMT versus a 2012/13 estimate of 179 MMT. Analysts said China will continue to import wheat to help rebuild their strategic reserves. Sinograin has bought 1.0 MMT of 2013/14 US SRW wheat so far and is expected to buy 2-3 MMT more. Dry weather is allowing good progress to be made with spring plantings in the Black Sea countries. MDA CropCast noted dryness concerns are building for wheat planting in Australia. Funds were estimated as net buyers of around 4,000 Chicago wheat contracts on the day. May 13 CBOT Wheat closed at USD7.01 1/4, up 9 1/2 cents; May 13 KCBT Wheat closed at USD7.62, up 23 cents; May 13 MGEX Wheat closed at USD8.23 1/4, up 6 cents.