Nogger's Blog: 9 Jun 2013

Chicago Mixed, But Mostly Lower, Heading Into Weekend

14/06/13 -- Soycomplex: Beans closed mixed with old crop higher and new crop lower. Old crop remains supported by the tight supply line and strong crusher demand. Talk of an upcoming Argentine dock workers strike is also supportive. The spectre of potentially record US production in 2013 still hangs over new crop however. The Buenos Aires Grains Exchange estimated Argentina's soybean harvest at 99% complete, forecasting production at 48.5 MMT, well below the USDA's 54.5 MMT. Argentina's Ag Ministry estimate their 2012/13 soybean crop at 50-51 MMT. Argentine farmers start a well timed 5-day strike on Saturday. The local markets there will also be closed on Thursday and Friday for a holiday. Various investment banks are lining up to predict sharply lower soybean prices by the end of the year. Goldman Sachs said that prices could drop to US11/bu inside the next three months, and that even USD10/bu was possible by the end of the year if the USDA's predicted record 2013 US soybean crop comes to fruition. Deutsche Bank said soybeans face "significant downside" and that November beans may fall below USD11/bu. CNGOIC estimated China’s 2013 soybean crop at 12.3 MMT, down 3.9% from 2012. Private industry analysts estimated China’s June soybean imports at 6.9 MMT versus 5.1 MMT in May. The USDA will issue their latest planting progress report on Monday night. The trade is looking for soybean plantings at 85-90% done versus 71% a week ago. Jul 13 Soybeans closed at USD15.16 1/2, up 6 1/4 cents; Nov 13 Soybeans closed at USD12.99 1/4, down 2 1/4 cents; Jul 13 Soybean Meal closed at USD450.70, down USD1.90; Jul 13 Soybean Oil closed at 48.48, up 64 points. For the week that puts Jul 13 beans down 11 3/4 cents, with Jul 13 meal USD1.80 weaker and Jul 13 oil down 5 points.

Corn: The corn market also saw old crop gains and new crop declines for similar reasons to those for soybeans. The Buenos Aires Grains Exchange estimated Argentina's corn crop this year at 66.3% harvested versus 61.3% a week ago and 67.6% a year ago. They estimated production at 24.8 MMT, unchanged from their previous estimate and significantly lower than the USDA's 27 MMT. The Argentina Ag Ministry estimated the corn crop at 26-27 MMT. CNGOIC estimated China’s 2013 corn crop at 214.0 MMT, unchanged from their previous estimate. They forecast 2013/14 corn imports at 5 MMT versus 7 MMT from the USDA. As with soybeans, the sharks are circling new crop corn. Goldman Sachs forecast corn prices down to USD4.75/bushel from a previous forecast of USD5.25/bushel, adding that a further downgrade to USD4.25/bushel was possible if the US got a corn crop of 13.6 billion bushels this year. The USDA forecast production at 14 billion on Wednesday. Goldman recommended to customers "a short new crop corn and bean basket trade" according to reports. The Deutsche Bank meanwhile are even more bearish, saying that new crop prices could fall as low as USD3.60/bushel. The USDA will report on US corn planting progress on Monday night. Last week's report suggested that 95% of the 2013 US corn crop was in the ground. That might be up to the 97% mark on Monday, which would mean 3 million acres of the USDA's forecast 97.3 million would still be unplanted. Jul 13 Corn closed at USD6.55, up 11 1/2 cents; Dec 13 Corn closed at USD5.33, down 2 1/4 cents. For the week Jul 13 was down 11 1/4 cents and Dec 13 fell 25 1/2 cents.

Wheat: Wheat was down on all three exchanges with news that the Black Sea barley harvest was underway and that early yields were up sharply on year ago levels. The wheat harvest in the region will not be far behind. The US winter wheat harvest is in full swing in Texas and Oklahoma and is now into Kansas. Reports so far suggest good quality and a wide range of test weights. Protein levels are said to be high, which may suggest lower yields. CNGOIC estimated China’s 2013 wheat crop at 120.63 MMT, down from a previous estimate of 121.9 MMT due to excessive rains. Ukraine's State Stats Office said June 1st grain stocks there were 6.3 MMT, down 42% from a year ago, including 2.5 MMT of wheat, 2.6 MMT of corn and 700 TMT of barley. The barley harvest there has begun in the Crimea and Odessa regions. Iran are said to have bought at least 800 TMT of wheat in the past two weeks ahead of this weekend's upcoming elections. Germany and the Baltic are the most likely origins it is thought. In Canada's Saskatchewan, spring crop plantings are said to be 96% complete versus the 5 year average of 89%. Argentine wheat plantings are said to be 30% complete and optimism is high for a strong rebound in production this year on increased plantings and better yields. The same can also be said for Australia. US harvest pressure and the threat of increased competition from a sharp rebound in production from the other major wheat exporting nations in 2013 sees the market grind lower. Jul 13 CBOT Wheat closed at USD6.80 3/4, down 4 3/4 cents; Jul 13 KCBT Wheat closed at USD7.11 1/2, down 7 cents; Jul 13 MGEX Wheat closed at USD8.04, down 8 cents. For the week that puts Chicago wheat 15 1/2 cents lower, with Kansas down 23 1/2 cents and Minneapolis 15 3/4 cents easier.

EU Grains Slide Further Into The Mire As Harvest Begins In FSU

14/06/13 -- EU grains slumped to fresh lows for the current move, with London wheat down to front month levels not seen since February 2012 and Paris wheat at its lowest since January 2012. The last time Paris rapeseed prices were at this level meanwhile was November 2011.

Jul 13 London wheat finished the day GBP3.25/tonne lower at GBP163.25/tonne, and with Nov 13 ending GBP3.20/tonne down at GBP165.30/tonne. Nov 13 Paris wheat settled EUR1.50/tonne easier at EUR196.25/tonne. Aug 13 Paris rapeseed was EUR2.50/tonne weaker at EUR416.75/tonne.

At the end of another brutal week for European grains we see Jul 13 London wheat down GBP10.75/tonne versus last Friday and Nov 13 GBP9.95/tonne easier. Nov 13 Paris wheat lost EUR7.50/tonne on the course of the week and Aug 13 Paris rapeseed shed EUR9.50/tonne.

Brussels issued 160 TMT of soft wheat export licenses this past week, bringing the 2012/13 marketing year total to 18.4 MMT, up by almost 50% on this time a year ago. Whilst that might sound bullish, they also issued 161 TMT of corn import licenses, which takes this season's total to 10.4 MMT, up 79% on 2011/12.

The Russian and Ukraine harvests are now underway, around 10 days earlier than normal. Dow Jones report barley yields in Russia's southern Krasnodor region have averaged 5.28 MT/ha so far, up 28% on the early harvest results of last season. In Stavropol early barley yields were said to be 3.71 MT/ha, up 74% versus last year. Impressive looking results, although it is possible that growers in the region decided to combine the poorer looking crops first last year.

Goldman Sachs issued a very bearish looking report late Thursday night by all accounts, suggesting that US corn prices could fall to USD4.75/bushel and soybean prices to the 2011 lows of USD11.00/bushel. There's even mention of USD4.25/bushel and USD10.00/bushel should the USDA's current forecast for record corn and soybean production in the US this year come true.

The Argentine wheat crop meanwhile is 30% planted, the same as this time a year ago. What's different from 12 months ago though is that the Argentine agriculture minister says that the crop could be "about" 16 MMT this year which would be up almost 78% on last year. That would be around the kind of production that they regularly used to achieve in the last decade of the "noughties" when they were a stalwart figure in the world's top six wheat exporting nations.

Russia's Ag Ministry estimated Russia’s 2013 grain crop at 95.0 MMT, up 32.5% versus 71.7 MMT a year ago

Ukraine's Ag Ministry estimated 2013/14 wheat exports at 8-9 MMT, with corn exports at a record 17.0 MMT and barley exports at 2.0 MMT.

Bulgaria's Ag Ministry said that wheat production there this year would be up 7-9% on 2012 to 4.7-4.8 MMT.

Australia's ABARES yesterday raised their wheat production estimate there this year to 25.4 MMT, up 15% on last year on a combination of a higher planted area and better anticipated yields.

Essentially most of the big exporting nations, with the exception of the US and India, and the majority of the traditionally cheap sellers in the FSU and Eastern Europe are looking at a significant production recovery in 2013. To many of those sellers price is an almost secondary consideration.

The regular weekly crop report from FranceAgriMer shows that all is not ideal with the corn in particular there though. Corn planting only rose from 89% complete a week ago to 92% complete this week (versus 100% a year ago), and good/excellent crop conditions fell two percentage points to 60% versus 71% a year ago. Corn with 6-8 leaves visible is only 35% against 72% this time last year.

French winter wheat headed was at 90% versus 100% last year, good/excellent ratings held steady from a week ago at 68%, but down versus 74% in 2012.

French spring barley is only 23% headed compared with 87% a year ago. They said that 72% of the crop was rated as good/excellent, down one point from last week and compared with 88% a year ago. French winter barley is 67% good/excellent, the same as last week and last year.

The Morning Vibe, Oh Betty...

14/06/13 -- Like half the trade I've been away at Cereals 2013 this week, so apologies for the lack of blogging activity. You should be thankful that I dragged myself out of bed at 7 o'clock to write my Chicago report and then sit in the bar like Billy No Mates at 7pm surrounded by a load of drunken Jock machinery dealers knocking back double Jack Daniels - 50 pee for a wee splash of coke, dinnae bother wee lassie, just make it a treble - to write my London/Paris wheat report. Dedication, that's what it is. And money, of course.

By the way, the opening gambit of "where's the dog?" whenever I go anywhere is starting to wearing a little bit thin. It's a bit like going to see Michael Crawford in Phantom of the Opera and shouting out "Oh, Betty, Jessica's done a whoopsie on the carpet" if you get my drift.

He's a millstone around my neck that bleedin' thing. I'm thinking of doing away with the buy Nogger a beer button and replacing it with a "send me some money via PayPal now or I'm having the dog put down" button. I'd never have to work again if I had one of those!

With the USDA numbers still ringing in our ears, Goldman Sachs seem to have turned as bearish as a very bearish thing on a double decker bus full of bears on it's way to the zoo, judging by this report on Agrimoney this morning: Goldman Sachs slashes corn and soy price forecasts.

Here they talk of corn getting down to USD4.25/bu and beans USD10/bu "should its most likely scenario - of a 13.6bn-bushel corn harvest and 3.37bn-bushel soybean crop – materialise."

If that doesn't make you feel bearish yet then maybe the news that the barley harvest is Russia is underway 10 days early in the southern districts of Krasnodar and Stavropol will tip the scales?

No? OK then, what about the news on Reuters that early barley yields in Russia are 5.28 MT/ha versus 2.98 MT/ha at the start of the harvest last year. That's a 77% increase by my calculations. Yikes!

Also on Agrimoney I read that our old mates the funds are pulling out of agricultural commodities, here: Hedge funds may be retreating from ag commodities. I never liked them anyway, as you probably know. Maybe that will be sufficient to tip the scales?

No, you want more? OK punk, Argentina are forecasting a wheat crop there of "about 16 MMT" this year, their agriculture minister says on Reuters. That would be up almost 78% on last year and potentially herald a return to the good old days for the hand-balling South American strike monkeys, maybe propelling them back into the top 6 wheat exporting nations. Hey gringo, I have wheeeeat for you, lookie, lookie, I make spethial price, see is beautiful wheeeeat, no? Very cheap...

The only caveat to add to most of this is that the USDA, Goldman Sachs and the Argy government do know their arses from a hole in the ground don't they?

Chicago Market Falls In Follow Through Selling

13/06/13 -- Soycomplex: The soybean market closed sharply lower for a second day, adding to yesterday's losses. Nearby beans bore the brunt as longs scrambled to exit the market despite old crop tightness. Weekly soybean export sales of 480,600 MT were mostly new crop (old crop accounted for only 33,500 MT of that total), in line with trade forecasts of 3-700 TMT. Meal sales were strong again at 97,700 MT of old crop and 47,100 MT of new crop, which should underpin demand for beans in the US. MDA CropCast estimated the US soybean crop at 3.129 billion bushels versus 3.39 billion from the USDA yesterday. World ending stocks for 2013/14 were estimated at 73.69 million by the USDA yesterday, as compared to 74.96 million tonnes in May. Chinese import demand was left at 69 MMT in 2013/14, up sharply from 59 MMT for the 2012/13 season. Taiwan bought 60 TMT of Brazilian beans for Aug/Sep shipment. The trade was a little surprised that the USDA didn't increase the 2013 soybean acreage yesterday, all eyes will now be on the June Plantings report due at the end of the month. Jul 13 Soybeans closed at USD15.10 1/4, down 30 1/2 cents; Nov 13 Soybeans closed at USD13.00 1/2, down 13 3/4 cents; Jul 13 Soybean Meal closed at USD452.60, down USD8.80; Jul 13 Soybean Oil closed at 47.84, down 27 points.

Corn: The corn market fell in follow through selling on yesterday's surprise from the USDA - leaving the 2013 US corn planted area unchanged at 97.3 million acres, contrary to expectations of a cut of around 1-3 million. However, it should be noted that the USDA have something of a track record of not lowering yield estimates in the June S&D report, usually waiting until July to do this. It may also be worth noting that they surprised the market last June by leaving US corn yields unchanged from their May projection at 166 bu/acre. In the July 2012 S&D report they then stunned the market by slashing fully 20 bu/acre off their June projection. MCA CropCast forecast the US 2013 corn crop at 13.291 billion bushels today, substantially lower than the USDA's estimate of just over 14 billion bushels yesterday. They estimated the world corn crop in 2013/14 at 913.9 MMT compared to 962.6 MMT from the USDA yesterday. Corn used in yesterday’s weekly ethanol production report was estimated at 92.8 million bushels. Corn usage needs to average 94.9 million bushels/week to meet this crop year’s USDA estimate of 4.6 billion bushels. On the international stage, South Korea bought 110 TMT of South American corn for Sep/Oct shipment. Weekly US corn export sales of only 149,500 MT offered little support (split 81,500 MT old crop and 68,000 MT new crop) versus trade forecasts of 2-400 TMT. Jul 13 Corn closed at USD6.43 1/2, down 7 1/4 cents; Dec 13 Corn closed at USD5.35 1/4, down 2 1/4 cents.

Wheat: The wheat market closed down, but well off the lows. Weekly export sales of 427,200 MT were at the low end of trade forecasts of 4-650 TMT, but did include some nice business to Brazil (130,700 MT). The USDA announced 1.19 MMT of old crop sales unfulfilled and carried over into 2013/14. Japan bought 157,439 MT of US, Canadian and Australian wheat in their tender. US Western White wheat was excluded again on GMO grounds. Taiwan tendered for 85,500 MT of US wheat but said that it wanted GMO exclusion guarantees to go with it. SovEcon upped their forecast for Russian wheat production from 50 MMT to 52 MMT, up sharply versus 37.7 MMT last year although 2 MMT less than the USDA predicted yesterday. With Russia needing to replenish government stocks depleted by intervention sales in excess of 3.5 MMT across the winter and spring, they forecast Russian wheat exports at 14-15 MMT compared with the USDA's estimate of 17 MMT yesterday. ABARES increased their forecast for Australian wheat production to 25.4 MMT versus 22.1 MMT in 2012/13 on increased plantings and better yields. The split is WA up from 6.9 MMT to 8.8 MMT; NSW up from 7.1 MMT to 7.6 MMT; SA up from 3.7 MMT to 4.1 MMT; VIC up fom 2.7 MMT to 3.1 MMT and QLD up from 1.7 MMT to 1.8 MMT. Jul 13 CBOT Wheat closed at USD6.85 1/2, up 2 1/2 cents; Jul 13 KCBT Wheat closed at USD7.18 1/2, up 2 cents; Jul 13 MGEX Wheat closed at USD8.12, up 5 3/4 cents.

EU Wheat Attempts Mini Recovery From Recent Rout

13/06/13 -- EU grains closed mixed after attempting a tiny recovery following yesterday's declines and the recent rout, although they did get dragged down heading into the close as US grains turned sharply lower for a second day.

As of last night front month Jul 13 London wheat was down GBP16.00/tonne, or 8.8%, for month of June so far. Nov 13 London wheat has fallen GBP9.50/tonne, or 5.3%, and Nov 13 Paris wheat is down EUR8.50/tonne, or 4.1%, in the same period.

Jul 13 London wheat finished Thursday unchanged at GBP166.50/tonne and Nov 13 ended GBP0.50/tonne easier at GBP168.50/tonne. Nov 13 Paris wheat settled up EUR0.25/tonne at EUR197.75/tonne. The two new crop November months are currently running at around parity.

The vibe at day one of Cereals 2013 was certainly a bit more optimistic for UK production prospects this year than it would have been if the event had been held a couple of months ago. ODA said that the UK wheat crop might come in around 11.5 MMT this year, the Anderson's Centre were very much in the same ballpark at 11.4-11.5 MMT, whilst the HGCA's Jack Watts was a bit more hopeful at 12.0 MMT. A crop of 11.5 MMT would be down 13.5% on last year, output of 12.0 MMT would be a 9.8% drop.

As we have already discovered though, there's plenty of opportunity for the UK to import wheat if the price is right. UK imports might finish up around 3 MMT this year, so there's no reason to think that they couldn't be at least that high again in 2013/14. The pound is doing it's best to help at nearly 1.57 against the dollar.

Talking of imports, the weekly export line-up out of the leading French grain hub of Rouen for the week through to Wednesday showed another 8,800 MT of French soft wheat heading for the UK.

SovEcon raised their estimate for the Russian wheat crop this year from 50 MMT to 52 MMT, up 38% on last year, although still 2 MMT lower than the USDA's revised forecast of yesterday. The respected Russian analysis group now forecast their wheat exports at 14-15 MMT in 2013/14 versus the USDA's 17 MMT, saying that some of this surplus production will be needed to replenish depleted government intervention stocks.

MDA CropCast estimated the Russian wheat crop very similar to SovEcon at 51.8 MMT today. They cut 2.1 MMT off their global wheat production estimate to 678 MMT, some 18 MMT lower than the USDA. They also forecast the EU barley crop at 54.7 MMT, versus 55.6 MMT from the USDA and 52.7 MMT in 2012. They have the EU rapeseed crop down 390 TMT on last week to 19.06 MMT, versus 19.7 MMT from the USDA and 18.51 MMT last year.

"Rains remained active across southern Germany, Poland, and Czech-Slovak Republics this past week, and also increased across southwestern France, Romania, and Bulgaria. The rains in Germany, Poland, and Czech-Slovak Republics maintained wetness and also increased flooding problems," they said.

Oil World side with the USDA on EU rapeseed production, pegging the crop at 19.72 MMT. They forecast output in Germany rising 14% to 5.5 MMT, although the French crop is seen falling more than 10% to 4.9 MMT and the UK crop dipping 26% lower at 1.9 MMT.

On a global level, Oil World estimate this year's rapeseed crop at 63.48 MMT versus 62.6 MMT in 2012. The Canadian crop is forecast up 4.3% to 14.5 MMT, with output in Ukraine rising almost 54% to 2.0 MMT - much of that will be destined for Europe. They see production in Australia falling nearly 19% to 3.2 MMT, the same as ABARES said yesterday, on reduced plantings.

Chicago Stumbles On Bearish USDA Data

12/06/13 -- Soycomplex: The eagerly awaited WASDE report re-affirmed that the USDA will not cut US soybean ending stocks for 2012/13 any lower than 125 million bushels. They maintained that stance today by raising imports as well as increasing exports. Seeing as the old crop export target had already been met to all intents and purposes, this was a last resort option. US new crop plantings were left unchanged. So, old crop stocks remain tight and the new crop harvest is likely to be late. Sounds like a volatile summer spot market to me! World ending stocks came in at 61.21 MMT for 2012/13, and 73.69 MMT for 2013/14, in line with trade estimates of 62.12 MMT and 74.04 MMT. Jul 13 Soybeans closed at USD15.40 3/4, up 1/4 cent; Nov 13 Soybeans closed at USD13.14 1/4, down 12 3/4 cents; Jul 13 Soybean Meal closed at USD461.40, down USD2.00; Jul 13 Soybean Oil closed at 48.11, up 7 points.

Corn: The USDA shocked the trade by leaving their estimate for US corn plantings this year unchanged at 97.3 million acres. Many were expecting a 1-3 million acre cut, and they maybe still are. US yield potential this year was reduced slightly to 156.5 bu/acre, down 1.5 bu/acre from last month. Many others are in the 150-155 bu/acre camp. The USDA raised the old crop US ending stocks estimate by 10 million bushels to 769 million. The official 2013/14 US ending stocks estimate is now 1.949 billion bushels, with total production this year of just over 14 billion bushels (easily a record) versus most trade guesses in the 13.2-13.8 billion range. Jul 13 Corn closed at USD6.50 3/4, down 8 3/4 cents; Dec 13 Corn closed at USD5.37 1/2, down 13 1/4 cents.

Wheat: The wheat market was dragged lower by the USDA's forecast for what would easily be a record US corn crop this year. The USDA estimated US ending stocks for 2012/13 at 746 million bushels and at 659 million for 2013/14. Trade guesses were 744 million and 655 million respectively. They did however cut the world wheat crop and ending stocks in 2013/14 by around 5 MMT each. Russia had their output forecast cut to 54 MMT this year, although that's still at the high end of trade estimates. Ukraine's output was also reduced along with a minor downwards tweak for Europe. Jul 13 CBOT Wheat closed at USD6.83, down 13 3/4 cents; Jul 13 KCBT Wheat closed at USD7.16 1/2, down 13 1/2 cents; Jul 13 MGEX Wheat closed at USD8.06 1/4, down 9 1/2 cents.

EU Wheat Slumps To New Lows, Pressured By USDA Numbers

12/06/13 - EU grains closed with steep looses in what has been a bit of a bloodbath past seven days. Jul 13 London wheat closed GBP3.75/tonne lower at GBP166.50/tonne and with Nov GBP3.25/tonne lower at GBP169.00/tonne, that was the best new crop performance - other months were down GBP5.00/tonne. Nov 13 Paris wheat slid comfortably below the EUR200.00/tonne mark, down EUR4.25/tonne at EUR197.50/tonne.

This was the lowest close for a front month on London wheat in 15-months and a first sub EUR200/tonne close for a front month in Paris since a brief 3-day flirtation in May 2012.

It's all gone horribly wrong for wheat, and if you need or want a knight in shining armour to come to your rescue and save the day, then the USDA wouldn't normally be top of your list. That's a bit like asking Graham Norton and Frank Spencer to back you up when the Klitschko brothers have just found you in bed with their Mum. And so it proved once again today, but more of them in a minute.

The trade is getting nervous that the impending Black Sea harvest means that Europe, America and just about everywhere else can shut the export order book until Christmas at least.

Tunisia bought 75 TMT of soft milling wheat of optional origin, thought likely to be from the Black Sea for July/August shipment. Bangladesh bought 50 TMT of Indian wheat.

The NFU said that the UK wheat harvested area could fall 29% this year. Various analysts estimate the UK wheat crop at around 11.0-12.0 MMT versus 13.3 MMT in 2012 and the 5-year average of 14.9 MMT.

Things are a bit better on the continent though. The German Farmers' Co-op pegged the 2013 wheat crop at 24.01 MMT versus a previous estimate of 23.76 MMT and the 2012 crop of 22.38 MMT. Toepfer go 23.35 MMT.

ODA yesterday estimated the French wheat crop at 36.0 MMT versus 35.6 MMT a year ago. They have the Polish crop at 8.7 MMT versus 8.6 MMT a year ago.

Whist these are all modest improvements on last season, apart from here in the UK, they are hardly dramatic increases and all mostly lower than the USDA's May forecasts of 38.2 MMT in France, 23.8 MMT in Germany and 9.4 MMT in Poland.

Australia's ABARES did however up their forecast for wheat production there to 25.4 MMT versus a previous estimate of 24.9 MMT and the 2012/13 crop of 22.1 MMT.

The USDA threw a late spanner in the works by insisting that the US corn planted area would be the same as the 97.3 million acres that they forecast last month, contrary to expectation of a cut of around 2-3 million. Yield expectations were trimmed slightly, but final production was still estimated at over 14 billion bushels, far more than trade expectations. Corn slumped and wheat went with it in late trade, dragging European grains lower with it.

Chicago Rallies Pre-USDA Report

11/06/13 -- Soycomplex: The volatility continues. This time it was old crop months that saw the biggest gains on ideas that the USDA might be forced to reduce last month's 2012/13 ending stocks estimate of 125 million bushels due to the strong crush and export demand. They've managed to resist doing so up to now, but soybean export commitments are over 99% of their projection for the season already. We shall know tomorrow. World 2012/13 ending stocks are estimated at 62 MMT, versus 62.5 MMT last month. For 2013/14 the trade is forecasting US ending stocks at 273 million bushels and world carryout at 74.2 MMT. Brazil's soybean crop is estimated at 83.3 MMT and Argentina's at 51.5 MMT. Jul 13 Soybeans closed at USD15.40 1/2, up 28 3/4 cents; Nov 13 Soybeans closed at USD13.27, up 8 cents; Jul 13 Soybean Meal closed at USD463.40, up USD15.10; Jul 13 Soybean Oil closed at 48.04, down 3 points.

Corn: The corn market rose as US farmers struggle to get the last of the crop into the ground, and much of what has gone in already has been sown in less than ideal conditions. The trade is anticipating US 2012/13 ending stocks to be trimmed from 759 million bushels last month to an average 748 million in tomorrow's WASDE report. World carryout is seen little changed at 125.7 MMT versus 125.4 MMT last month. For 2013/14 the market is looking for US ending stocks of 1.758 billion bushels versus just over 2 billion in May. The world carryout next season is estimated at 150.5 MMT against 154.6 MMT last month. Argentina's corn crop is estimated at 25.8 MMT and Brazil's at 75.7 MMT. South Korea bought a total of 134,000 MT of corn in a tender today. Jul 13 Corn closed at USD6.59 1/2, up 9 1/2 cents; Dec 13 Corn closed at USD5.50 3/4, up 4 3/4 cents.

Wheat: The wheat market gained some traction from the continued slow spring wheat planting progress and ideas that some of the USDA production estimates around the world may be too high. The USDA attache in India estimated the wheat crop there at 87 MMT, some 5 MMT less than the USDA themselves currently predict. Russia’s Ag Ministry estimated 2013 Russian wheat crop at 50-54 MMT versus 56 MMT from the USDA. ODA estimated France’s 2013 wheat crop at 36.0 MMT versus 38.2 MMT from the USDA. Trade estimates for tomorrow place the US all wheat crop at 2.026 billion bushels, from within a range of estimates of 1.872-2.082 billion, and 2012 production was 2.269 billion. US 202/13 ending stocks are forecast at 734 million bushels and those for 2013/14 at 634 million. Jul 13 CBOT Wheat closed at USD6.96 3/4, up 7 cents; Jul 13 KCBT Wheat closed at USD7.30, up 4 cents; Jul 13 MGEX Wheat closed at USD8.15 3/4, up 4 1/4 cents.

London Wheat Hits 15 Month Low As Black Sea Harvest Looms

11/06/13 -- EU grains slumped to fresh lows pressured by the impending Black Sea harvest which is now just days away. Paris wheat at least managed to close with a few modest gains at the finish, but it was a different story for London wheat. Ukraine could be harvesting in the drier areas in the south and east within 7-10 days, 2-3 weeks earlier than normal, it is thought.

Jul 13 London wheat finished the day GBP1.25/tonne lower at GBP170.25/tonne, and with Nov 13 ending GBP0.25/tonne down at GBP172.75/tonne. Nov 13 Paris wheat settled EUR0.25/tonne easier at EUR201.75/tonne. Jul 13 London wheat traded below GBP170.00/tonne at one point - a near 15 month low for a front month.

The Ukraine Ministry estimate the wheat crop there at 20 MMT, up 27% on last year. Current new crop offers FOB the Black Sea are said to be around USD250/tonne for Ukraine feed wheat (close to GBP160/tonne) and USD255/tonne for milling wheat (circa GBP164/tonne). Those levels are well under European or US offers, with the latter quoted at around USD282/tonne FOB. Russian new crop milling wheat is also quoted at significantly cheaper prices than those in the West.

The Russian Ministry said that spring grain plantings are just about wrapped up at 99.8% complete on 30.2 million hectares. The corn planted area has exceeded expectations at 2.3 million ha, they added. That's a bit more than the USDA's 2.15 million ha prediction. The Ministry plan to buy around 5 MMT of mostly wheat to replenish their depleted intervention stocks in 2013/14, but may not begin buying until October or November they said, presumably hoping for a bit of harvest pressure to cause prices to drop a bit further yet.

The Russians sold 77,479 MT of intervention grains in a tender offering of 89,899 MT yesterday. That takes the total volume sold so far since sales began to just over 3.5 MMT.

Tunisia issued a tender for 75 TMT of soft milling wheat for July/August shipment. They bought a similar volume of optional origin feed barley yesterday. Qatar bought 40 TMT of optional origin, but thought to be Black Sea wheat, yesterday.

Japan said that they were extending their current "ban" on importing US wheat to include everything but SRW wheat, and only then if that's shipped from the Gulf and not the Pacific North West, following the recent discovery of GMO wheat growing in Oregon. Taiwan says US wheat imports are "under review" and South Korea has already temporarily suspended them pending the outcome of an investigation into how the wheat was found to be growing in the US 8 years after trials on the strain were suspended.

Informa estimated the 2013/14 world rapeseed crop at a record 65.2 MMT, up 4.5% on last year and almost 3 MMT more than the USDA forecast. They have production in the EU at 20 MMT, the same as the USDA and up 4.7% on last year. The Canadian crop is seen up 15% on last year to 15.3 MMT, which is 0.8 MMT higher than the USDA predict.

The French Farm Ministry pegged the 2013 winter rapeseed crop at 4.5 MMT, down 17% on last year. The crop there has been afflicted by similar problems to that in the UK.

All eyes are now on the USDA for tomorrow's June World Supply and Demand numbers. No huge changes are expected for wheat. The trade is expecting not much alteration to 2012/13 global wheat ending stocks, pegged at just over 180 MMT last month. The 2013/14 carryout is seen down a little from 186.4 MMT in May to around 185.1 MMT this time round.

EU Rapemeal Prices

11/06/13 -- Rapemeal prices on the continent are mostly a bit easier today following losses in soymeal values in the US last night. The French farm ministry forecast the 2013 winter rapeseed crop there at 4.5 MT, down 17.2% on last year, according to a report on Reuters this morning.

Latest guide prices for EU rapemeal today, basis FOB Lower Rhine in euros/metric tonne, with change from previous trading session:

Jun13	unq	n/a
FH Jul13	314.00	-3.00
LH Jul13	300.00	+1.00
Aug/Oct13	238.00	-6.00
Nov13/Jan14	236.00	-2.00
Feb/Apr14	234.00	-3.00
May/Jul14	232.00	-3.00
Aug/Oct14	210.00	-1.00

Chicago Drops Ahead Of USDA Reports

10/06/13 -- Soycomplex: The soybean market closed sharply lower on positioning ahead of tonight's planting progress report and Wednesday's upcoming WASDE numbers from the USDA. Having risen to 7-month highs last week then I guess some consolidation was only to be expected. A warmer and drier forecast for the week ahead was also seen as bearish. Weekly soybean export inspections of just over 3 million bushels were in line with recent weeks and the 2-5 million expected. Chinese customs data showed China imported 20.57 MMT of beans in Jan–May, down 12.2% from a year ago. May imports were 5.1 MMT, down 3.4% from a year ago. Brazilian customs data shows that they exported a record high 7.95 MMT of beans in May, up from 7.15 MMT in April. Argentine farmers are expected to start a week long strike tomorrow. Brazil stevedores are threatening that they will strike in all ports on June 25th. The USDA reported after the close that 71% of the US soybean crop is now planted, in line with trade expectations even if below the 5-year average of 84%. Iowa is only 60% planted versus 95% normally. Emergence is also lagging as you might expect at 48% versus 67% normally. Jul 13 Soybeans closed at USD15.11 3/4, down 16 1/2 cents; Nov 13 Soybeans closed at USD13.19, down 11 1/4 cents; Jul 13 Soybean Meal closed at USD448.30, down USD4.20; Jul 13 Soybean Oil closed at 48.07, down 46 points.

Corn: The corn market also posted double digit losses on promises of a drier and warmer week ahead. Customs data shows that Argentina exported a record 3.3 MMT of corn in May, up 0.5 MMT from April’s 2.8 MMT. China are said to have approved new varieties of Argentine corn and soybeans, paving the way for more imports from the South Americans. The Argentine Ag Secretary estimated the country's 2013 corn crop at 26-27 MMT and pegged exports at 18.0 MMT. South Korea's MFG are tendering for 140 TMT of US, South American, South African or Eastern European corn for October shipment. Ukraine's Ag Ministry estimated their 2013 corn crop at a record 27-28 MMT, up sharply from 20.9 MMT a year ago. They estimate exports at 14.0 MMT. Weekly US corn export inspections came in at 6.365 million bushels versus trade forecasts of 5-10 million. The USDA estimated corn plantings at 95% complete, towards the top end of the expected range, up from 91% last week and not too far off the 5-year average for this time of 98%. The percentage of the crop rated good/excellent was unchanged form a week ago at 63%. Iowa has 14% of it's crop already rated poor/very poor, with Illinois not far behind at 13% in the bottom two categories. Emergence is at 85% versus 92% normally. Jul 13 Corn closed at USD6.50, down 16 1/4 cents; Dec 13 Corn closed at USD5.46, down 12 1/2 cents.

Wheat: The wheat market also fell, although not as heavily as corn or beans. Weekly export inspections of 24.37 million bushels were above the expected 10-15 million. Ukraine's Ag Ministry estimated their 2013/14 grain exports at 25-27 MMT versus 23 MMT this season, of that 9 MMT will be wheat (versus 7 MMT in 2012/13), they said. Russia’s Ag Ministry estimated their 2013/14 grain exports at 18-20 MMT. This season's exports are expected to be around 15 MMT. Unlike wheat states on the northern US Plains, spring planting across the border in Canada is going well. Alberta was 97% complete as of Friday. The USDA estimated spring wheat plantings up from 80% last week to 87% complete as of Sunday night. Normal for this time would be 96%. Emergence is at 71% versus 89% for the 5-year average. Winter wheat harvesting was placed at 5% complete versus 16% for the 5-year average. Good/excellent crop ratings fell from 32% to 31%. The percentage of the crop rated poor/very poor is far higher at 42%. The top producing state of Kansas has 47% of its crop rated as poor/very poor, with second top state Oklahoma having 53% of its crop in the bottom two categories. Jul 13 CBOT Wheat closed at USD6.89 3/4, down 6 1/2 cents; Jul 13 KCBT Wheat closed at USD7.26, down 9 cents; Jul 13 MGEX Wheat closed at USD8.11 1/2, down 8 1/4 cents.

EU Wheat Stumbles To Fresh One Year Lows

10/06/13 -- EU grains slumped lower across the board on follow through selling from last week and competition from the Black Sea heats up. US grains offered no support on profit-taking and book-squaring ahead of tonight's planting progress and crop condition report, and Wednesday's global supply and demand numbers from the USDA.

Jul 13 London wheat finishing the day GBP2.50tonne easier at GBP171.50/tonne and Nov 13 ending GBP2.75/tonne weaker at GBP172.50/tonne. Nov 13 Paris wheat settled EUR2.25/tonne down at EUR201.50/tonne. New crop Paris milling wheat is the equivalent of around GBP1.00/tonne cheaper than London feed wheat based on tonight's close.

The Black Sea harvest gets closer every day, the Ukraine Ministry said on Friday that they expect the 2013 campaign to be underway within 10-15 days. They estimate this year's grain crop at 53-54 MMT, up 15-17% on last year.

The Russian harvest will also begin within weeks, and both countries will be eager to make up for lost time and hit the export ground running. Russia has only exported 619 TMT of wheat in the first four months of 2013 versus 4.5 MMT in the same period in 2012.

Iraq announced today that it had bought 250 TMT of new crop Russian wheat in a recent tender at prices said to be around USD50/tonne cheaper than the US equivalent. They immediately issued a fresh 50,000 MT tender, although they usually buy more, which closes June 23rd. Russia’s Ag Ministry estimate the 2013/14 grain crop at 95.0 MMT, up almost 33% on last season's 77.2 MMT.

North Africa's big wheat homes look likely to be much smaller net purchasers this year. The Moroccan Ag Ministry confirmed that they are expecting a record grain crop of 9.7 MMT this year, up 90% versus 2012, and that imports in 2013/14 will halve. Algeria are also said to be in for a bumper harvest this year, although Tunisia's grain crop is expected to fall from 2.2 MMT in 2012/13 to around 1.4-1.5 MMT, necessitating increased imports. Egypt remain absent from the market.

Iran bought 60,000 MT of feed wheat overnight from the Black Sea.

French soft wheat exports in April were up 29% on year ago levels at 1.53 MMT, with barley shipments rising 53% to 531 TMT and corn exports up 6% to 566 TMT Cumulative Jul/Apr soft wheat exports are now 14.64 MMT versus a full season estimate of 17.05 MMT from FranceAgriMer.

The latter tweaked their planted area estimates for the 2013 harvest today, estimating the soft wheat area up 2.9% on last year to 5.0 million hectares, with corn plantings up 2.4% to 1.71 million ha and the nation's barley area down 5.4% to 1.59 million ha. A week of warm and dry weather should see crop conditions improve when FranceAgriMer release their next set of ratings at the end of the week.

Spanish Farmers' Association Asaja said that wet and cooler than normal weather earlier in the year will cut their grain production levels below those forecast by the Ministry and USDA. They estimate the all wheat crop there at 5.8 MMT versus the Ministry's 6.6 MMT and the USDA's 7.1 MMT. They peg the 2013/14 Spanish barley crop at 6.8 MMT, compared with 7.0 MMT from the government and 8.4 MMT from the USDA.

Oil World trimmed their 2013/14 global rapeseed production estimate slightly, although at 63.5 MMT that's still a record crop. Production in the EU is forecast up from 19.0 MMT in 2012/13 to 19.7 MMT in 2013/14, whilst Canadian output will rise from 13.9 MMT to 14.5 MMT, they said. Canadian canola futures slumped 4% last week as the outlook for bumper production in 2013/14 improved. Prices in Paris also declined by more than EUR10/tonne last week.

EU Rapemeal Prices

10/06/13 -- Rapemeal prices on the continent are firmer, despite seed values being down on the French MATIF market today. Soybean and meal markets are also weaker in overnight trade. Oil World have trimmed slightly their forecast for the global rapeseed crop in 2013/14 to 63.4 MMT, although that's still a record and up 1.3% on last year.

Latest guide prices for EU rapemeal today, basis FOB Lower Rhine in euros/metric tonne, with change from previous trading session:

Jun13	320.00	n/a
FH Jul13	317.00	+5.00
LH Jul13	299.00	+5.00
Aug/Oct13	244.00	+5.00
Nov13/Jan14	238.00	+3.00
Feb/Apr14	237.00	+3.00
May/Jul14	235.00	+5.00
Aug/Oct14	211.00	+3.00

Nogger On Tour

10/06/12 -- Visiting Cereals 2103 on Wednesday? Why not pop along to Brown & Co's stand 9-H-911 where yours truly will be giving a bit of a talk on the grain markets at both 10.30 am and 3 pm.

I can't tell you what I'm going to be talking about but whatever it is, it's bound to be pithy and insightful. Not a knob gag in place. I may do the one about the little old lady who goes into hospital to have her bunions done and they get her mixed up with the page 3 model in the next bed who's in for a breast enlargement though, as it's kind of grain market related that one, in the loosest possible sense!

There's always the opportunity to buy me that beer that you've been meaning to as well. To register to attend all you have to do is Email: emma.caton@brown-co.com