Nogger's Blog

21/06/13 -- Soycomplex: Beans slumped for a second session in a row, with the biggest losses coming on new crop on ideas that the US weather is finally cooperating and good strides will have been made in Midwest plantings this week. Last week's plantings were 85% done versus the 5-year average of 91%. The weekend forecast is warm and dry, which is seen as beneficial for now, and it's thought that plantings could be into the upper 90's complete in Monday night's report from the USDA. Crop condition ratings may also improve. As far as the demand side of the coin goes China holds the key to world soybean demand. Chinese customs data shows that they imported 5.1 MMT of soybeans in May, down 3.4% on May 2012. China's Jan/May 2012 soybean imports are 20.6 MMT, down 12.2% from a year previously. Many consider that the current USDA forecast for Chinese soybean imports of 69 MMT in 2013/14 is way too high and will need to be reduced in subsequent estimates, adding to global ending stocks. ABIOVE estimated the 2012/13 Brazilian soybean crop at 81.6 MMT versus a previous forecast of 82.3 MMT, although still a record. They estimated 2012/13 exports at 39 MMT versus a previous forecast of 38.20 MMT, and have 2012/13 carry out at 2.84 MMT versus 3.40 MMT previously. South Korea bought 55 TMT of Argentine origin soymeal for October shipment in a tender. Jul 13 Soybeans closed at USD14.93 1/4, down 4 1/4 cents; Nov 13 Soybeans closed at USD12.73 1/2, down 11 1/2 cents; Jul 13 Soybean Meal closed at USD447.70, up USD2.10; Jul 13 Soybean Oil closed at 48.02, down 38 points. For the week front month beans were down 23 1/4 cents, with meal falling USD3 and oil shedding 46 points.

Corn: The corn market also fell, but with the greatest losses in nearby Jul 13. Interior cash bids remain at relatively strong levels but are off the highs from last week, and yesterday's weekly export sales were poor. Wednesday's ethanol production data also fell short of the levels required to hit the USDA's target for the season, adding to the negative vibe. MDA CropCast raised their world corn production forecast by 1 MMT from last week, thnks to increases in output from Europe. Coceral estimated the 2013 EU-28 corn crop at 66.2 MMT versus their March forecast of 64.4 MMT. FranceAgriMer however cut their good/excellent ratings for the French corn crop by 2% from a week ago to 58%, and versus 72% a year ago. Only 95% of the crop has been planted so far versus 100% this time a year ago. Growth remains retarded with only 54% of the crop displaying 6/8 leaves versus 88% this time last year. French analysts Arvalis said that maybe 60,000 ha of intended corn acreage may not get sown this year. The trade is hoping for/expecting a significant improvement in the proportion of the US corn crop rated good/excellent on Monday night. Last week the USDA had 64% of the crop in the top two categories. Chinese customs data shows May corn imports at only 66,612 MT, down 42.7% from a year ago. Jan/May corn imports now stand at 1.5 MMT, down 19.31% from a year ago. Jul 13 Corn closed at USD6.61 3/4, down 11 1/2 cents; Dec 13 Corn closed at USD5.56 1/4, down 4 1/4 cents. For the week overall front month Jul 13 corn was 6 3/4 cents higher, with new crop Dec 13 up 23 1/4 cents.

Wheat: The wheat market consolidated a little in pre-weekend profit-taking following earlier gains during the first half of the week. MDA CropCast cut their world wheat production estimate by 5.4 MMT from last week, primarily due to lower output from India. They now see the crop there at 87.8 MMT versus 92.0 MMT from the USDA. Nevertheless, the Asian nation still has an abundance of wheat, and the government there have announced plans to release 10 MMT of surplus stocks onto the domestic market. Oil World said that Argentine wheat prices are "through the roof" and are currently 60% higher than those for soybeans as domestic supplies run out. Argentine farmers cut their planted area sharply for the 2012/13 wheat crop in protest to government interference in the market. The former major wheat exporting nation may end up having to import wheat this season for the first time in 60 years, say Oil World. The Argentine government have been offering growers there various tax incentives to increase production in 2013/14. With plantings in full swing, prices 60% higher than soybeans may offer them all the encouragement they need. Coceral estimated the EU-28 2013 soft wheat crop at 130.74 MMT versus a previous estimate of 127.77 MMT. Reports that Egypt could be back in the wheat market "by the end of the year" yesterday were apparently misinterpreted as meaning the end of the Egyptian financial year that ends this month. It is now understood that all they mean is by the end of the current calendar year. Jul 13 CBOT Wheat closed at USD6.98, down 2 1/2 cents; Jul 13 KCBT Wheat closed at USD7.36 1/2, down 1/2 cent; Jul 13 MGEX Wheat closed at USD8.14, unchanged, For the week overall CBOT wheat was still 17 1/4 cents higher, with KCBT up 25 cents and MGEX up 10 cents.