Nogger's Blog

13/03/14 -- Soycomplex: Beans closed higher, aided by weekly export sales of 113,500 MT of old crop and 776,900 MT of new crop, which beat trade expectations for a combined 350-700 TMT. Actual exports themselves are slowing, but boy do they need to. At 863,200 MT they were down 27 percent from the previous week and 40 percent from the prior 4-week average. The primary destination was unsurprisingly China at 389,500 MT. The US has now shipped 38 MMT of soybeans so far this season, and has another 6.2 MMT on the books waiting to go. That equals 106% of the USDA's target of 41.64 MMT for the entire season. Reuters reported that China had cancelled 5-600 TMT of South American soybeans booked for Mar-May shipment, seemingly confirming recent rumours. "They have washed out 10 panamax cargoes and want to cancel 30 more," an un-named Singapore-based trader was quoted as saying. There is no way of knowing how accurate these figures are though. What the trade does know is that very little in the way of US soybean purchases have been cancelled, and this is maybe where the direction of prices hinges from here. Safras cut their Brazilian soybean production forecast from 91.8 MMT to 86.1 MMT. Dr Cordonnier said that the soybean harvest in Brazil's Mato Grosso is approaching 75% done. Somar say that the 5-year average for the state is only 60% at this time. So much for the harvest being delayed by rains. MDA CropCast cut their forecast for Brazil by 2.16 MMT from last week to 86.37 MMT, due to late season wetness in the north west of the country. They also trimmed Paraguay by 0.53 MMT to 8.19 MMT. Allendale forecast that US farmers will plant a record 83.212 million acres this spring. That's a hefty near 6.7 million, or 8.7%, more than last year's 76.533 million and massively above the USDA's February Outlook Forum forecast of 79.5 million. Mar 14 Soybeans closed at $13.90 3/4, up 9 cents; May 14 Soybeans closed at $13.96 1/4, up 9 1/4 cents; Mar 14 Soybean Meal closed at $449.60, up $1.30; Mar 14 Soybean Oil closed at 42.77, down 43 points.

Corn: The corn market was mostly a little lower. Weekly export sales of 683,400 MT of old crop and 103,600 MT of new crop were in line with expectations of a combined 700 TMT to 1 MMT, but not greatly so. The old crop sales were were down 55 percent from the previous week and 37 percent from the prior 4-week average. Exports of 907,400 MT were down 20 percent from the previous week. Shipments this season now stand at 19.2 MMT, with outstanding sales of a further almost 19 MMT, taking total commitments to 38.2 MMT which is nearly 91% of the USDA's target of 42 MMT for the season. Note though that unlike in the case of soybeans, a large proportion of these commitments are still unshipped. Unshipped sales is just stock. Safras cut their Brazilian corn production estimate from 75.6 MMT to 71.2 MMT. Dr Cordonnier estimated that Mato Grosso safrinha corn is more than 90% sown, and said that plantings could be wrapped up by the end of the week. Russia said that they'd exported 422 TMT of corn in February, almost three times the volume shipped out twelve months previously. The traditional home for US corn of South Korea was the main recipient. Allendale forecast that US farmers would plant 92.349 million acres of corn this spring. That's a drop of more than 3% on last year's 95.365 million, although slightly higher than the USDA's February Outlook Forum estimate of 92 million. Funds were given credit for being net sellers of around 6,000 corn contracts on the day. The big question as to where we go from here maybe depends on whether they are now prepared to add to their newly established corn long, or if they feel that they may have over egged the pudding a bit too quickly in relation to the "crisis" in Ukraine. The USDA are playing down the effect that this is having on spring planting potential, saying that normal lines of credit are available to allow farmers to purchase seed, and that there is presently no shortage of it (or indeed other inputs). Mar 14 Corn closed at $4.84 1/4, unchanged; May 14 Corn closed at $4.85, down 3 1/2 cents.

Wheat: The wheat market had a very choppy day, trading with both double digit gains and losses through the day/night session. Mar 14 CBOT wheat traded at $7/bushel for the first time for a front month since last October during the overnight session, but couldn't hold onto those gains in daytime open outcry trade. All Mar 14 contracts go off the board tomorrow, so further erratic trade in those might be anticipated. Other months generally closed with losses of around 10-12 cents on the day across the three exchanges though. Weekly export sales of 476,900 MT of old crop and 89,200 MT of new crop were unspectacular, although in line with expectations. Maybe this indicates that the world doesn't want US wheat as badly as fund money has done recently? Again, they key to where we go from here might be spec money's willingness, or lack of it, to continue to buy US wheat like it's going out of fashion. On wag on Twitter said something like "wheat, one minute it's in the 70's, the 80's the 90's and then the 70's again. A bit like my haircut." It was that sort of a day. "While the posturing over Crimea continues to intensify with threats of sanctions from the west and Russian military exercises along the Ukrainian border, the major US media is more concerned about the missing plane at the moment. Many participants may be waiting for reaction to this weekend’s vote in Crimea before making their next move," Benson Quinn Commodities sagely observed. Kazakh wheat was said to be the lowest offer in a Lebanese tender for 25,000 MT of optional origin milling wheat for arrival by April 7 at the latest. Allendale estimated the US all wheat area at 55.324 million acres, versus the USDA's Outlook Forum forecast of 55.5 million and the 56.2 million planted last year. Mar 14 CBOT Wheat closed at $6.79, down 9 cents; Mar 14 KCBT Wheat closed at $7.30 1/4, down 11 cents; Mar 14 MGEX Wheat closed at $7.51, unchanged.