Nogger's Blog

28/05/13 -- Soycomplex: The soybean market began the week sharply higher on delayed planting concerns and strong demand. The USDA reported the sale of 120 TMT of new crop beans to China. Industry analysts pegged the Chinese Jan 1st-May 24th total soybean crush volume at 22,087,920 MT, up 1% from a year ago. Chinese May soybean imports are estimated at 5.30 MMT, rising to a record 7.8-8.0 MMT in June. Oil World estimated Brazil’s May soybean exports at 8.7-9.0 MMT versus 7.3 MMT in May 2012. They peg Brazil’s January–May 2013 soybean exports at 20.4 MMT, or 53% of Brazil’s expected 2013 total and versus 18.5 MMT in the same period in 2012. The USDA were expected to announce US soybean plantings at 42% complete after the close, according to the average trade estimate in a Reuters survey. They came out with a figure of 44%, slightly better than expected but well behind the 61% five year average. Weekly export inspections were poor, but in line with expectations, at just under 3.4 million bushels. Jul 13 Soybeans closed at USD15.09 1/4, up 33 cents; Nov 13 Soybeans closed at USD12.88, up 40 1/4 cents; Jul 13 Soybean Meal closed at USD442.30, up USD14.10; Jul 13 Soybean Oil closed at 49.54, up 30 points.

Corn: Weekly export inspections came in at 12.427 million bushels, versus the expected 9-14 million. After the close the USDA reported US corn plantings had advanced from 71% done last week to 86% complete as of Sunday night. That's bang on the average estimate in a Reuters survey and a pretty incredible achievement by US farmers, considering that planting was only 28% done two weeks previously. The five year average for this time is 90%. Even emergence isn't lagging by too much at 54% versus 67% normally. Heavy rain in many states continues to dog some farmers planting efforts. Elsewhere, Brazil's IMEA forecast Mato Grosso safrinha, or 2nd crop, corn production at a record 17.37 MMT as the rainy season in central Brazil has lasted longer than normal. That's well up on their previous estimate of 14.64 MMT and output of 15.59 MMT last year. The normal weekly ethanol production data from the Energy Dept is delayed until Thursday. Last week's production was an 11 month high 875,000 barrels/day. Fund buying was estimated at around 12,000 contracts on the day. Jul 13 Corn closed at USD6.66 1/2, up 9 1/4 cents; Dec 13 Corn closed at USD5.51, up 14 1/2 cents.

Wheat: Despite spillover support from a rising corn and soybean market wheat just couldn't manage to post a rally. Weekly export inspections of 21.220 million bushels were at the top end of trade expectations of 15-21 million. For the US the 2012/13 marketing year is about to end with a larger carryover into 2013/14 than currently forecast by the USDA. US exports are also likely to tail off markedly once the Black Sea begin harvesting their 2013 wheat crop. The tender line up looks pretty thin. Oman bought 40 TMT of optional origin wheat, possibly Russian, for Aug/Sept shipment. The Ukraine Ag Min said that the country has exported 21.7 MMT of grain so far this season (Ukraine’s season ends June 30th) including 6.6 MMT of wheat, 12.6 MMT of corn and 2.05 MMT of barley. They too look unlikely to meet the government target of exports of 24.5 MMT this season, also leaving larger carryover into 2013/14 to re-market. Their production in 2013/14 is seen sharply higher already. Funds were estimated to have been net sellers of around 1,000 CBOT wheat contracts on the day. Jul 13 CBOT Wheat closed at USD6.93 3/4, down 3 3/4 cents; Jul 13 KCBT Wheat closed at USD7.43 1/2, down 2 1/4 cents; Jul 13 MGEX Wheat closed at USD8.06 1/2, up 3/4 cent.