Chicago Markets Mostly Lower In Turnaround Tuesday Trade
26/11/13 -- Soycomplex: Beans traded lower in classic "Turnaround Tuesday" style in a profit-taking retreat after prices hit 2-month highs yesterday, but managed to recover most of those losses by the end of the session to closed around unchanged to 3 cents lower. Very strong demand and only limited South American availability is supporting the nears. Private exporters reported 300 TMT worth of cancellations in soybeans sold to China, but that was more than matched by sales of 360 TMT to "unknown" in what looks like some sort of switch. Talk persists though that more Chinese cancellations are waiting in the wings. Dr Cordonnnier reported that Brazilian growers only have less than 40% of their 2013/14 soybean crop forward sold, versus 60% this time last year. Dr Cordonnier said that whilst long holders of old crop beans in Mato Grosso state can still make a respectable price, equivalent to around $12.49/bushel, the new crop price for delivery Feb/Apr has fallen to around the cost of production - $9.30/bu as at the end of October - which is keeping 2013/14 sales light. Mato Grosso growers have an estimated 45% of their 2013/14 soybean crop sold versus 65% this time last year. He estimates the 2013/14 crop in Brazil at a record 90 MMT, up almost 10% on 2012/13 and 2 MMT higher than the USDA's current forecast. Wet weather is in the forecast for Brazil, which is seen as being beneficial for newly planted beans. Jan 14 Soybeans closed at $13.29 1/4, unchanged; Mar 14 Soybeans closed at $13.12, down 2 3/4 cents; Dec 13 Soybean Meal closed at $450.20, up $13.00; Dec 13 Soybean Oil closed at 40.35, down 31 points.
Corn: The corn market closed around 6 cents weaker, with front month Dec 13 finishing the day only 6 1/2 cents off the contract's lifetime low close. Volume was light, and it's likely to stay that way in a holiday-shortened week. Various news services I use appear to only be releasing abbreviated market reports, or in some cases none at all, as traders fire up their ovens and deep fat fryers for Thursday's Thanksgiving Day holiday. Dr Cordonnier reported that Brazilian farmers in Mato Grosso are estimated to still have 28% of their old crop corn still to sell. Production in 2012/13 was a record you will recall, and prices locally are down to the equivalent of $2.45/bushel, he says. A large carryover into 2013/14 may limit the impact of lower production next year. The Russian corn harvest is now almost 75% done at 9.5 MMT. The Ukraine corn harvest is almost over. The latter are now very much concentrating their export efforts on corn. The trade will be looking to see if tomorrow's ethanol production report from the Energy Dept confirms the recent upswing in output is continuing, and hence supporting domestic demand for corn in the US. Last week's production was 904,000 barrels/day. There's some unconfirmed chatter/gossip that China may have rejected a second cargo of US corn on the grounds of containing strains of a non-approved GMO variety, which would obviously be bearish if true. Dec 13 Corn closed at $4.18 1/2, down 6 1/4 cents; Mar 14 Corn closed at $4.24 3/4, down 6 1/2 cents.
Wheat: Wheat closed around 3-6 cents lower, with the exception of front month Kansas wheat which closed modestly higher. This may have been due to unwinding of spreads across the three exchanges, with the Dec contract moving into delivery a few days from now. India offered a further 70 TMT of wheat up for tender out of the east coast for Dec 26-Jan 31 shipment. There's said to be a much larger 750 TMT tender waiting in the wings. IKAR said that Russia has sold 13.4 MMT (around 2/3rds) of the expected 20 MMT of grains that they will export this season. That 13.4 MMT includes 10.5 MMT of wheat. Russian winter grains plantings are now stalled at 14.6 million hectares, 89.4% of the original target. Jordan bought 50 TMT of the 100 TMT of feed barley that they tendered for. They are also in for 100 TMT of wheat. Bangladesh is a steady wheat buyer, picking up a lowest offer of $313.92 C&F in their tender, which is a bit better than the $314.60 that they were offered last week. Iran is said to be in the market for 300-500 TMT of wheat whilst the trade door remains open. German origin might be the most likely favourite for that. Morocco are also said to be shopping for wheat for delivery in the new year, with France their most likely supplier. Iraq meanwhile has bought Canadian and Australian wheat in the past few days. Dec 13 CBOT Wheat closed at $6.46 1/2, down 6 cents; Dec 13 KCBT Wheat closed at $7.04 1/4, up 3/4 cent; Dec 13 MGEX Wheat closed at $6.95 1/4, down 5 1/2 cents.
