Chicago Mixed, Mostly Lower, Weather Dominates

17/07/13 -- Soycomplex: The market was narrowly mixed, with beans closing only a few cents either side of unchanged. The nears remain tight on lack of domestic availability and ideas that this season's US crop will be late due to delayed plantings. Lanworth Inc lowered their forecast for that from 3.360 billion bushels to 3.315 billion. They also cut their world soybean production forecast from 284 MMT to 283 MMT. There are reports that a Brazilian soybean cargo is on the way to the US port of Wilmington, North Carolina. Taiwan made no purchase in tender to import 60 TMT of Brazilian beans for October shipment. The USDA announced the sale of 165 TMT of new crop soybeans to China. We are in the grip of the usual summer weather market. "A Canadian cool front will descend into the Midwest Friday, ending a heat wave and triggering scattered showers. There continues to be disagreement on how much rain would occur in the Midwest. The HPC Medium Range Forecast is drier, once again, than the automated GFS model forecast. I’m going with the wetter forecast, the GFS model. Even though the cool front would sink rapidly south through the Midwest, it is still capable of triggering strong thunderstorms. The atmosphere is very humid and unstable - ripe for showers," say Martell Crop Projections. Forecasts for tomorrow's weekly export sales report for beans are 350-700 TMT. Aug 13 Soybeans closed at USD14.77 1/2, up 2 1/4 cents; Nov 13 Soybeans closed at USD12.83 1/2, down 2 3/4 cents; Aug 13 Soybean Meal closed at USD469.10, up USD2.30; Aug 13 Soybean Oil closed at 45.79, up 8 points.

Corn: Some of the disagreement that had been in place yesterday, between the EU weather model (warm and dry) and the US weather model (cooler and wetter) disappeared, with the former falling more into agreement with the latter. That was enough to send corn prices lower, even though Lanworth cut their forecast for US corn production this year from 13.90 billion bushels to 13.65 billion (still a record). They reduced world output by 5 MMT to 956 MMT. China's crop was trimmed slightly, from 217 MMT to 216 MMT. Despite a cooler, wetter US weather outlook, some crop damage may have already been inflicted. "Delayed planting dates, shallow rooting from a wet spring, and irregular development from a strung out planting campaign argue for a reduced yield in corn and soybeans. Not all the intended acreage was planted in the northern areas, because of relentless rains," said Martell Crop Projections. A report on Agrimoney says that Societe Generale said "that it might lower its estimate for the US corn crop to 13.4m bushels, from a forecast made last month of 13.9m bushels." They particularly note "significant problems in portions of Iowa." Rainfall April-June was “much above normal” to “record wettest” in Iowa, Illinois, Minnesota and Wisconsin, noted Martell Crop Projections. Weekly US ethanol production fell to 876,000 barrels/day from 881,000 bpd last week. South Korea bought 60 TMT of Black Sea origin corn for Dec shipment. Trade estimates for tomorrow's weekly export sales report are 1-200 TMT of old crop and 1.0-1.4 MMT of new crop. Sep 13 Corn closed at USD5.38 1/2, down 6 3/4 cents; Dec 13 Corn closed at USD5.02, down 8 3/4 cents.

Wheat: Spillover weakness from corn was enough to send the wheat market modestly lower, despite the prospect of large Chinese buying in 2013/14. A report on Reuters suggested that 20 MMT of their recently harvested winter wheat crop may only be suitable for feed use, double earlier estimates. Imports could now exceed 10 MMT making them the largest wheat buyer in the word, the report suggested. China are currently said to be actively seeking "at least" 500 TMT of Australian wheat for Jan/Mar shipment. South Korea bought 42,300 MT of US wheat for Sept shipment, switching their attention to Australia for Oct/Nov where they also bought 40 TMT (Australian availability is now said to be tight until new crop comes in). Jordan bought 100 TMT of Black Sea/EU origin wheat for December delivery. Iran is said to have agreed a barter deal with Pakistan to take USD9 billion worth of wheat and rice in exchange for electricity. Pakistan's annual wheat production and consumption are currently running at similar levels, the deal may see them need to import more wheat themselves. They have been quite active buyers of late, booking at least 250 TMT of Black Sea wheat in the first couple of weeks of the month. Lanworth Inc raised their world wheat production estimate by 2 MT to 694 MMT. That included a Canadian crop of 29.8 MMT, which would be their highest output since 1991. Argentina are forecasting a 12 MMT wheat crop later this year, up from 9 MMT last year, but short of early official forecasts that a sharp rebound in plantings could see production in the 14.0-14.5 MMT region. Trade estimates for tomorrow's weekly export sales report are 1.0-1.3 MMT reflecting sales to China already known. Sep 13 CBOT Wheat closed at USD6.65, down 4 1/2 cents; Sep 13 KCBT Wheat closed at USD7.02 3/4, down 1 cent; Sep 13 MGEX Wheat closed at USD7.55 1/4, down 3 3/4 cents.