Nogger's Blog

08/10/13 -- Soycomplex: Beans closed lower on harvest pressure and continued reports of better than expected yields. The weather looks favourable for increased harvest activity in the week ahead. Dr Michael Cordonnier apparently raised his forecast for US soybean yields from 40.5 bu/acre to 41.0 bu/acre, pegging production at 3.13 billion bushels. China re-opened after a week long holiday. Despite the holiday Chinese buyers are said to have booked around 8-900 MT of US beans in the past week. JC Intelligence of Shanghai said China had imported 4.9 MMT of beans in September versus 6.36 MMT in August. They estimated China's October bean imports at 4.7-4.9 MMT, rising to around 6 MMT each in November and December. Taiwan's BSPA bought 60 TMT of Brazilian beans for April shipment, they cancelled a tender to buy 40-60 TMT of US beans off the Gulf for Jan shipment due to high prices. Strong global demand for meal has some analysts forecasting that India could export 5 MMT of meal in 2013/14, up 25% from 2012/13. Oil World estimated US Q4 2013 soybean exports at a record 20.0 MMT versus 19.2 MMT a year ago and 14.3 MMT in Q4 of 2011. They said that Brazil had exported 40.6 MMT of beans in the first 9 months of the year and has 1.4 MMT left for export in Q4 of 2013. They estimated Argentina’s Q4 bean exports at 1.74 MMT versus 600 TMT a year ago. Nov 13 Soybeans closed at USD12.88 3/4, down 7 3/4 cents; Jan 14 Soybeans closed at USD12.87 3/4, down 9 1/4 cents; Oct 13 Soybean Meal closed at USD428.70, down USD5.00; Oct 13 Soybean Oil closed at 40.20, up 55 points.

Corn: As with beans, corn closed lower on a pick up in harvest activity now that Midwest showers have cleared away and the weather outlook for the next few days seems conducive for decent progress to be made. The combines will be going flat out ahead of a 6-10 day forecast that shows another round of showers with up to an inch in the Western Plains. Better than expected also remains the theme as far as yields go. Rumours that China had bought substantial volumes of US corn over the past few days were downgraded to a couple of cargoes. They are said to have been looking at sorghum as an alternative. Taiwan bought 60 TMT of Brazilian corn for April shipment. Ukraine weather has improved which should speed up the corn harvest significantly this week and into next. If we believe the Ukraine Ministry then corn plantings in 2014 are set to increase sharply, which could push their crop up to around 35 MMT next year. It was only 10 MMT a few years ago. Reports suggest that the French corn harvest is now underway. The French Farm Ministry cut their forecast for corn production there from 15.6 MMT to 15.5 MMT, although that's still up almost 3% on last year. Production in Eastern Europe is expected to be sharply higher this year. Despite the US government's partial shutdown the Energy Dept are expected to release their weekly ethanol production data tomorrow. Last week's output was 875,000 barrels/day. Dec 13 Corn closed at USD4.41 3/4, down 7 1/2 cents; Mar 14 Corn closed at USD4.54 1/2, down 7 1/4 cents.

Wheat: Wheat closed mixed with the front month Dec 13 Chicago contract shying away from testing the USD7/bu mark. Constant talk of much lower than anticipated winter wheat plantings in Russia and Ukraine are adding support despite the net result of that being many, many months away yet. Whilst Russia growers would probably increase spring wheat plantings to compensate (even though they would yield lower), Ukraine farmers would probably look at other crops such as corn, spring barley and sunflower. Back to what's happening now, the Russia grain harvest stands at 81.3 MMT off 83% of plan, and the wheat harvest at 49.8 MMT of 86.8% of plan. These figures suggest that official Ministry estimates for the 2013 harvest are too low, and by some distance. The Kazakh harvest is 90% done at just over 18.5 MMT in bunker weight. Winter wheat has been planted on 3.6 million hectares in Ukraine, around 54% of the original forecast. "Don't underestimate the speed at which Ukraine soils dry out," said Ukraine agronomist Mike Lee. "Farmers need to plant 140k ha of wheat/day over the next 20 days to hit the target. With current weather forecasts I think that can be done," he added. Trade gossip suggests that Mexico bought wheat from Canada for March/May shipment. French customs data showed that France exported 2.6 MMT of soft wheat between July – August up 17% from a year ago. Dec 13 CBOT Wheat closed at USD6.93 1/2, down 1 1/4 cents; N/P KCBT Wheat closed at USD7.60, up 3 1/2 cents; Dec 13 MGEX Wheat closed at USD7.53, up 2 3/4 cents.