Chicago Market Mixed Ahead Of USDA Data Due Tomorrow
10/07/13 -- Soycomplex: For once old crop beans performed the worst, although they do go off the board on Friday so some erratic trade to close the last few days of a contract with very thin open interest is maybe only to be expected. Customs data revealed that China imported 6.93 MMT of soybeans in June, an increase of 36% versus a month previously. The US weather forecast is far from ideal. Potentially heavy rains in the Eastern Corn Belt, caused by tropical disturbance Chantal, may be a mixed blessing further delaying the wheat harvest and thwarting any lingering double planting with soybean hopes. Meanwhile the Western Corn Belt remains hot and dry, whilst northern states are turning cooler. "A Canadian air mass has begun descending into the US heartland dropping morning temperatures in North Dakota into the lower 50's F," said Martell Crop Projections. The trade is expecting the USDA to cut US old crop soybean ending stocks to 121 million bushels tomorrow, even though they've doggedly refused to go below 125 million in previous reports. New crop 2013/14 carryout is expected to come in near 263 million bushels, down slightly from 265 million in June. On a global level, for beans the average guess for 2012/13 world ending stocks is 60.94 MMT versus 61.21 MMT in June, and in 2013/14 they are forecast at 73.56 MMT versus 73.69 MMT last month. Trade estimates for tomorrow's weekly export sales report for soybeans are 150-500 TMT. Jul 13 Soybeans closed at USD15.91 3/4, down 21 1/2 cents; Nov 13 Soybeans closed at USD12.84 3/4, up 8 1/2 cents; Jul 13 Soybean Meal closed at USD520.50, down USD0.30; Jul 13 Soybean Oil closed at 46.98, down 10 points.
Corn: The corn market maintained the recent theme of old crop strength. Reuters reported that the corn basis in Cedar Rapids was now USD1.75 over CBOT futures as opposed to just 25 cents a year ago. Weekly US ethanol production rose to 881,000 barrels/day from 863,000 the previous week. The USDA reported the sale of 120 TMT of new crop corn to China. South Korea bought 120 TMT of optional origin corn at USD241.17 C&F for December shipment. IKAR forecast the Russian corn crop at 9.2 MMT, with exports at 2.7 MMT. FranceAgriMer estimated French 2012/13 corn exports at 6.78 MMT, down 1.7% on a year previously, with ending stocks up 15.8% to 2.82 MMT. Hotter temperatures in the Central US this week are a mixed blessing, say Martell Crop Projections. "Shallow rooted corn and soybeans, planted very late, are subject to decline as topsoil moisture is depleted. Better established crops with deeper roots are tapping into subsoil moisture, benefiting from the heat and sunshine and putting on good growth," they commented. In tomorrow's WASDE report the trade is looking for 2012/13 US corn ending stocks to come in at 725 million bushels, down from 769 million in June. The 2013/14 carryout is expected to come in near 1.895 million bushels, down from 1.949 in June. The range of estimates is for that is split by a whopping 720 million bushels. Dock workers at the Brazilian port of Santos began a 24 hour strike today in protest over a plan to privatise port terminals. Port authorities said that the strike disrupted containerised traffic, but that bulk cargoes were loading relatively normally. Trade estimates for tomorrow's weekly export sales report for corn are 300-600 TMT. Jul 13 Corn closed at USD7.09 3/4, up 5 3/4 cents; Dec 13 Corn closed at USD5.21 1/2, down 1/4 cent.
Wheat: The wheat market finished mixed. There are signs of a pick up in international demand on the recent price slump. Iran are said to have bought around 450 TMT of wheat this week, split 250 TMT of Russian origin and 200 TMT from the Baltic. Algeria bought 50 TMT of optional origin wheat overnight for September shipment. Jordan are tendering for 150 TMT of wheat for delivery between November and February. Japan are tendering for 120,000 MT of feed wheat, and 200,000 MT of feed barley. For once wheat isn't expected to be consigned to play only a minor role in tomorrow's USDA report. The market is expecting a cut to US HRW wheat production, tempered by a potential raise in SRW wheat output. The bottom line is for US all wheat production in 2013/14 to come in at 2.070 billion bushels, down slightly from the June estimate of 2.080 billion but down sharply from 2012 levels of 2.269 billion. US 2013/14 wheat ending stocks are expected to come in at 632 million bushels versus 659 million in June. World 2012/13 wheat carryout is estimated at 179.34 MMT versus 179.87 MMT in June. World 2013/14 wheat ending stocks are seen at 180.29 MMT versus 181.25 MMT last month. It will be interesting to see what, if anything, they do with Russian and Indian production and exports along with Chinese imports. The Russian grain harvest is said to currently stand at 16.7 MMT, with average yields up 26% at 3.27 MT/ha. The Ukraine grain harvest is at 11.85 MMT with yields up 37% at 2.68 MT/ha. Trade estimates for tomorrow's weekly export sales report for wheat are an impressive 600 TMT - 1 MMT. Jul 13 CBOT Wheat closed at USD6.72, down 3 1/2 cents; Jul 13 KCBT Wheat closed at USD7.12, up 5 1/4 cents; Jul 13 MGEX Wheat closed at USD7.97 1/2, down 1/2 cent.
