Chicago Grains Mostly Higher Heading Into USDA Report
09/12/13 -- Soycomplex: Beans and meal posted sharp gains, led by nearby months, heading into tomorrow's USDA report. That is expected to show 203/14 US soybean ending stocks falling from last month's 170 million bushels to around 155 million (from within a range of 118-170 million) on continued strong demand. To highlight the latter the USDA today confirmed the sale of 230,000 MT of US soybeans sold to China for 2013/14 delivery, along with a further 60,000 MT for 2014/15 delivery. In addition, weekly export inspections of 60.430 million bushels were robust once more and beat the expected 48-55 million. Oil World estimated China’s 2013/14 soybean imports at new record 70.0 MMT, and 1 MMT more than the USDA's current projection. Will they nudge that up a bit tomorrow? AgRural said that Brazil's soybean crop is 94% planted, up 5 points from last week and 4 points ahead of this time last year. Safras e Mercado estimated the Brazilian 2013/14 soybean crop at a record 89.453 MMT versus the previous all time high 2012/13 crop of 82.125 MMT. Conab come out tomorrow with their Brazilian 2013/14 crop estimates. Last month they estimated plantings at 29.5 million hectares, with production at 87.9-90.2 MMT. Wet and humid conditions in the north of Mato Grosso are said to be raising Asian rust concerns. The average trade guess for Brazilian soybean production tomorrow is 88.736 MMT, with Argentine output forecast at an average 55.329 MMT. Jan 14 beans closed at 13.43 3/4, up 18 1/4 cents; Dec 13 meal closed at $461.60, up $14.30; Dec 13 soybean oil closed at 40.05, down 23 points.
Corn: The corn market closed around 3-4 cents firmer, with funds reportedly continuing to close out short positions ahead of year-end and tomorrow's USDA report. They were estimated to have been net buyers of around 5,000 contracts on the day. Tomorrow's USDA report is expected to show 2013/14 US corn ending stocks at around 1.86-1.87 billion bushels versus 1.887 billion previously. The Argentine corn crop is seen falling from 26 MMT last month to around 25.5 MMT this time round, with Brazil's crop maybe slightly higher than the 70 MMT forecast last month at around 70.3-70.4 MMT. Conab are also out tomorrow, last month they forecast Brazil's corn crop at 78.5-79.2 MMT. Safras e Mercado estimated the Brazilian corn crop at 77.238 MMT versus the 2012/13 crop of 82.070 MMT. They said that 99% of the summer corn crop has been planted versus 97% a year ago. As you can see these local estimates are far higher than where other trade forecasts are lining up. Weekly US export inspections for corn came in at 40.246 million bushels, higher than the expected 28-32 million. The Russian corn harvest is ongoing, producing 11.3 MMT to date. Talk that China has rejected, or is holding, around 10-15 US corn cargoes at various ports due to them containing unapproved GMO strains is bearish, but as long as funds need/desire to cover in their shorts heading into year end then the market will remain supported. Dec 13 corn closed 4 1/2 cents higher at $4.28 1/2; Mar 14 corn was up 3 3/4 cents at $4.38.
Wheat: The wheat market closed mixed across the three exchanges. Weekly export inspections were fair at 19.76 million bushels, and beat the low ball 11-15 million that the trade was expecting. Extremely cold temperatures across almost the entire US is raising the prospect of some winterkill in wheat, although losses are not expected to be higher than 5% and possibly as low as 1% depending on who's opinion you run with. Tomorrow's USDA report is seen trimming US 2013/14 ending stocks from the 565 million bushels estimated last month to around 540-550 million. Argentine wheat production is seen falling from the 11 MMT estimated last month to 10 MMT this time round, but increased output in Canada and Australia should more than compensate for that. World wheat ending stocks in 2013/14 are seen rising to around 179 MMT from 178.5 MMT last month. Safras e Mercado estimated the Brazilian wheat crop at at 5.525 MMT versus 4.698 MMT in 2012/13. There's talk that Egypt could be back in the market for wheat this week after last week's winning bid subsequently got cancelled. The French Farm Ministry estimated soft wheat plantings there to be 89% complete and said that the final area would amount to 4.9 million hectares, a 1.2% drop on last year. Winter barley plantings are seen almost 1% higher at 1.15 million hectares, they added. Dec 13 CBOT wheat closed at $6.39, up 1 3/4 cents; Dec 13 KCBT wheat closed at $7.03 1/2, down 1 3/4 cents; Dec 13 MGEX wheat closed at $6.68, up 5 cents.
