Nogger's Blog

23/04/13 -- Soycomplex: Beans were firmer nearby on strong demand, but weaker further forward on an improved weather forecast for the Midwest and concerns about global economic growth, particularly in China - the world's biggest soybean buyer. The USDA announced the sale of 392,000 MT of new crop soybeans to China, although this seemed largely ignored. Talk that some US farmers had already made the decision to switch from corn to beans and better planting prospects had new crop on the defensive. China’s bird flu outbreak has now risen to 105 human cases, with 21 deaths. There's some talk of these instances being heavily under-reported. The market is wondering and debating how much effect bird flu could have on Chinese demand, conscious that March bean imports were down more than 20% versus March 2012 (although at least some of that will have been due to shipping delays out of Brazil). The Rosario Grains Exchange said that only 20% of the 2012/13 Argentine bean crop has been sold as local farmers hold back due to the weak peso and inflation concerns. Michael Cordonnier said that the Argentine bean harvest is about 40% complete, with Brazil about 90% done. He estimated production there at 50.0 MMT and 81.5 MMT respectively, unchanged from last week. US soybean planting is underway in the Deep South with Louisiana 20% complete, up from 11% a week ago but behind the 32% of a year ago. Mississippi is 7% complete versus 4% a week ago and 39% a year ago. Planting did get off to a flyer last year though. May 13 Soybeans closed at USD14.19 3/4, up 2 1/2 cents; Jul 13 Soybeans closed at USD13.58 1/2, down 5 3/4 cents; May 13 Soybean Meal closed at USD411.70, up USD1.70; May 13 Soybean Oil closed at 48.57, down 5 points.

Corn: A warmer and drier outlook for the Midwest kept corn under pressure. Although only 4% of the national crop was planted as of Sunday, it was noted that it was only 5% complete at this time in 2009 when final yields came in at a record 165 bu/acre. Clearly there is still time for a bin-busting crop yet if the weather co-operates. Last night's planting progress report had Illinois 1% planted versus 56% a year ago and 24% on average. Indiana was 1% planted versus 43% a year ago and 16% on average; Ohio was also only 1% planted versus 31% a year ago and 12% on average. When the weather is conducive though these states could all easily plant 25% of the crop in a week. CNGOIC estimated China’s 2012/13 corn imports at 3.0 MMT, down more than 50% on a year previously. They said China has imported 2.12 MMT of corn so far this season, down 26% versus a year ago. Michael Cordonnier said that the Argentine corn harvest is about 32% complete, with production estimated at 24.0 MMT, unchanged from his previous forecast. He pegged the Brazilian crop at 75.0 MMT, also unchanged from previously. There's lot of talk of 2nd crop corn in Brazil getting off to a great start due to plentiful moisture levels. On the international tender front Israel are in for 100 TMT, with Indonesia and Malaysia also in for optional origin corn. The Black Sea may be the favourite to win the Israel business with the latter two picked up by South American origin corn. US corn exports continue to lag the level needed to hit USDA targets. Fund selling was estimated at around a net 8,000 on the day. May 13 Corn closed at USD6.38 1/2, down 7 1/4 cents; Jul 13 Corn closed at USD6.14, down 9 1/2 cents.

Wheat: The wheat market was down quite sharply in early trade, but that may have flushed out some short covering and/or profit taking as fund money holds a significant short position in Chicago wheat. Another chance of freeze damage on the southern/central Plains tonight may discourage the bears from pressing the pedal too much lower yet. Monday night's crop condition numbers appeared to reflect some of last week's potential freeze yield losses with good/excellent down one point and poor/very poor up two. In the top three winter wheat states Texas was 12% good to excellent versus 17% a week ago; it was 60% poor to very poor, up from 50% a week ago. Oklahoma conditions were 27% good to excellent versus 25% a week ago; the state was 36% poor to very poor versus 37% a week ago. Kansas conditions were 30% good to excellent, unchanged from a week ago; the state was 37% poor to very poor, up from 33% a week ago. Yesterday's weekly export inspections of 24.85 million bushels were pretty strong, and above the 24.67 million needed to hit the USDA's target for he season. Talk however that both Russia and Ukraine could soon be back in the wheat export business, prior in fact to the 2013 harvest, highlighted what a short window of opportunity the US has to get some sales on before cheaper Black Sea material is back flooding the market. Stats Canada are out with their planting estimates tomorrow. The trade is using an average all wheat acreage estimate of 24.4 million, from within a range of estimates of 23.3-25.2 million and up 2.5% versus 23.8 million last year. May 13 CBOT Wheat closed at USD6.97 1/2, down 4 3/4 cents; May 13 KCBT Wheat closed at USD7.37 1/4, down 2 1/4 cents; May 13 MGEX Wheat closed at USD8.15 1/4, down 3 1/2 cents.