Chicago Soybeans Hit Near 2-Month High On Strong Demand
22/11/13 -- Soycomplex: Beans raced to their best levels since late September on strong demand from China, and domestically within the US, although anything above $13/bushel does seem to generate producer selling. The USDA announced 115 TMT of US soybeans sold to China for 2013/14 delivery under the daily reporting system. Following Thursday's strong export sales of almost 1.4 MMT, cumulative soybean sales stand at 90% of the USDA forecast for current 2013/14 (current) marketing year. Talk that many of these sales will ultimately end up being cancelled, or switched to South America, remains to be proven true. For now, the shipment program of in excess of 2 MMT/week leaving the US, mostly for China, is supportive. The Chinese Ministry of Agriculture estimated Nov soybean imports at 6.17 MMT, most of which will likely come from the US. Palm oil hit a 14-month high this week after the Indonesian Palm Oil Association said that Indonesia and Malaysia could see yields down 15-20% this year. The Buenos Aires Grain Exchange estimated Argentine soybean planting at 37.3% complete, up from 21.8% a week ago and versus 36.6% a year ago. They estimated the Argentine soybean area at 20.2 million hectares, unchanged from their previous estimate. The Argentine government's crop report, due to be released Thursday, has been delayed to an hitherto unspecified date. Jan 14 Soybeans closed at $13.19 1/2, up 28 cents; Mar 14 Soybeans closed at $13.06, up 26 1/4 cents; Dec 13 Soybean Meal closed at $427.80, up $16.80; Dec 13 Soybean Oil closed at 41.16, down 38 points.
Corn: The corn market closed virtually unchanged on the day and for the week, as the market continues to move sideways. Corn is cheap relative to wheat, there's no doubt about that, the problem is that there's just so much of it that it's difficult to see an awful lot of upside just at the moment. The USDA will report on harvest progress on Monday night, with corn 91% done as of last week that figure should be around 95-96% this time round as they wind down harvesting an anticipated record 355 MMT crop. The Ukraine corn harvest is 88% complete, and they've already brought in a record 26.6 MMT of corn. The Russian harvest is 70.9% done, and they too have already harvested a record volume of corn - 9.1 MMT. The Buenos Aires Grains Exchange said that Argentine corn planting is 42.7% complete versus 45% this time last year. They estimated the Argentine 2013/14 corn area at 3.46 million hectares, unchanged from their previous estimate. The French corn harvest is well behind last year's pace of 95% complete at only 67% done. Harvesting in Eastern Europe is more or less over. The corn market is oversold, with funds sitting on a net short position in excess of 146k contracts, so it is therefore vulnerable to a corrective bounce. It's difficult to see what might generate that change in sentiment however. Dec 13 Corn closed at $4.22 1/4, down 3/4 cent; Mar 14 Corn closed at $4.29 1/4, down 1/4 cent.
Wheat: Wheat closed flat to 7 cents firmer on the day. Strong demand from Brazil is supportive for US wheat. Conab pegged Brazil's October wheat imports at 723 TMT, of which 544 TMT came from the US. That takes their Jan/Oct 2013 wheat imports to just shy of 6 MMT, up from 5.65 MMT a year previously. They've imported 2.5 MMT from Argentina in 2013, versus 4.5 MMT in 2012. Their wheat imports from the US have sky-rocketed to match those from Argentina this year, versus only 54 TMT in 2012. The Buenos Aires Grain Exchange estimated the Argentine wheat harvest at 13.1% complete versus 6.9% a week ago and 18.9% a year ago. They estimated the Argentine wheat crop at 10.35 MMT, unchanged from previous estimate and far higher than the Rosario Exchange's 9.1 MMT from a few days ago. The Bangladesh government said as of Nov 18th it's wheat stocks were 372 TMT, up 39% from a year ago. They're likely to continue to cover their requirements in from India. The Food ministry in India announced that they would release another 210 TMT of wheat for export on December 12th. Managed money increased its net short in CBOT wheat by 8k lots on the week through to Tuesday, to just over 55k contracts. US wheat is "priced to sell" on a FOB basis, but has been missing out into North Africa and the Middle East due to freight considerations. Corn at around $4.20-4.25/bushel limits upside. Dec 13 CBOT Wheat closed at $6.49 1/2, up 3/4 cent; Dec 13 KCBT Wheat closed at $7.01 3/4, up 7 cents; Dec 13 MGEX Wheat closed at $6.99 1/4, up 3 cents.
