Nogger's Blog

07/04/14 -- Soycomplex: Beans began the week on the defensive, with the front end faring the worst. That's where the big premiums are, and that's what fund money was selling today as they began to roll their nearby longs into July. End user buying wasn't sufficient to stem the tide. Reports that a vessel carrying Brazilian beans had arrived in the US Gulf also lent a bit bearish. The trade seems to be expecting that this could be the first of many Chinese resale cargoes, and that this is how the US is going to reconcile the fact that it's already exported almost the entire USDA forecast for the season. Weekly export inspections came in at 509,603 MT versus 507,533MT last week. The marketing year to date total is almost 40.7 MMT versus 33.4 MMT this time last year, and within 1 MMT of the USDA's target for 2013/14 which doesn't finish until the end of August. The USDA reported the sale of 120 TMT of new crop beans to China. Strategie Grains increased their estimate for the 2014/15 EU-28 rapeseed crop to 21.55 MMT versus 21 MMT a year ago. Oil World projected the EU rapeseed crop a little lower at 21.4 MMT, whilst Informa go for 21.1 MMT. The trade is now looking to see what Wednesday's WASDE report from the USDA has to say. With regards to US soybean stocks at the end of 2013/14, these are expected to fall to 139 million bushels from 145 million last month, according to a Reuters survey. They may raise Argentina's soybean production from last month's 54 MMT estimate, but may also lower Brazilian output from the 88.5 MMT suggested in March. World ending stocks are forecast to fall 0.5 MMT to 70.14 MMT. Demand from China will be of interest, with the USDA seeing them importing 69 MMT of soybeans last month. A reduction to that could be on the cards, along with a probable increase in US imports. May 14 Soybeans closed at $14.64 1/4, down 9 1/2 cents; Jul 14 Soybeans closed at $14.48 1/4, down 6 3/4 cents; May 14 Soybean Meal closed at $474.30, down $4.80; May 14 Soybean Oil closed at 41.43, down 14 points.

Corn: The corn market closed a couple of cents lower in what may have been light profit-taking ahead of Wednesday's USDA report. Weekly export inspections were strong at 1,310,564 MT, similar to a week ago. The marketing year to date total now stands at 23.7 MMT versus 11.3 MMT this time last year. The USDA's target for the season is 42 MMT. Informa pegged the world corn crop in 2014/15 at 957.5 MMT, down from the record 964.6 MMT produced last year. Despite a drop in plantings, improved yields mean that the US corn crop will only fall a little, from 353.7 MMT to 351.5 MMT, they estimate. They see production in Brazil rising from 68 MMT to 69.3 MMT, with Argentina up from 21.7 MMT to 26.2 MMT and the EU-28 crop up from 64.7 MMT to 66.4 MMT. The Ukraine Ministry said that corn planting is underway there, they've also just started in France, according to FranceAgriMer. Russia said that it had exported 593 TMT of corn in March and that the marketing year to date total is now just over 3.1 MMT, versus the USDA's forecast for the whole of 2013/14 of 3 MMT. French corn stocks in commercial hands as of March 1 were 4.7 MMT versus 5.3 MMT a year previously. French Jul/Feb corn exports were 3.2 MMT versus 3.5 MMT a year ago, with 2.9 MMT of that going to fellow EU member states. Wednesday's USDA report is expected to show US corn stocks of just over 1.4 billion bushels at the end of 2013/14 versus the 1.456 billion estimated a month ago. Global stocks are estimated at 157.7 MMT versus 158.5 MMT last month. The Brazilian corn crop was forecast at 70 MMT last month, with Argentina at 24 MMT. Not much change is expected there. The USDA should have updated us after the close with it's first crop progress report of 2014, but this has been delayed until tomorrow. "Temperatures last week were still too cold to plant corn in the northern two-thirds of the corn belt. Soaking rains have softened frozen fields in the eastern corn belt. Observed rainfall the past 30 days shows above normal amounts in a swath from central Missouri through southern Illinois into Indiana and Ohio. However, drought has continued over much of the western corn belt," said Martell Crop Projections. May 14 Corn closed at $4.99 1/4, down 2 1/2 cents; Jul 14 Corn closed at $5.05 1/4, down 2 1/4 cents.

Wheat: The wheat market closed higher, regaining some of it's recent losses as weekend rains on the US Plains came in lighter than expected/hoped for. News reports of further pro-Russian activity in eastern Ukraine were also viewed as bullish. The USDA delayed their first weekly crop progress report of the year until tomorrow. It is expected to show sharp declines in crop ratings across the winter. Informa estimated the world wheat crop in 2014/15 at 710.8 MMT, a little below the record 712.8 MMT produced in 2013/14. Despite drought on the US Plains, they see US output in 2014/15 rising from 58 MMT to 59.7 MMT They reduced their forecast for India's wheat crop following rain in March, but still see that rising from 93.5 MMT to a bin-busting record 104 MMT this year. Harvesting of that is already underway. Elsewhere, they forecast the EU-28 wheat crop up slightly from 142.9 MMT to 143.1 MMT, although Canada's is expected to fall from last year's record 37.5 MMT to 26 MMT, they said. The Ukraine wheat crop was forecast at 20.5 MMT versus 22.3 MMT last year. The Russian attache in Moscow estimated wheat production there little change versus last year at 52 MT, with exports rising by 0.5 MMT to 18 MMT and ending stocks steady at 6 MMT. The USDA's FAS in Turkey forecast their wheat crop at 15.8 MMT this year, down from 18 MMT a year ago, with imports rising to 4.5 MMT versus 3.9 MMT in 2013/14. French commercial wheat stocks (excluding durum) as at March 1 were estimated at 6.8 MMT versus 7.8 MMT a year ago. French wheat exports Jul/Feb were said to be 10.8 MMT versus 9.5 MMT in the same period in 2012/13. APK Inform said that Ukraine had exported 619 TMT of grain via it's seaports last week. March exports were 2.74 MMT, including 294 TMT of wheat, they added. Wednesday's USDA report is likely to peg 2013/14 US wheat carryout at 583 million bushels versus 558 million in March, according to a Reuters survey. World ending stocks are estimated at 183.65 MMT, which is little changed on 193.81 MMT last month. May 14 CBOT Wheat closed at $6.76 1/4, up 6 1/2 cents; May 14 KCBT Wheat closed at $7.39 1/2, up 5 3/4 cents; May 14 MGEX Wheat closed at $7.22 1/4, up 3/4 cent.