Chicago Soybeans End Lower, Corn And Wheat Rise On Weather Concerns
06/05/14 -- Soycomplex: Beans closed lower. Last night's planting progress report showed soybean sowings at only 5% complete, half of what the trade expected, although ahead of only 2% this time a year ago. There's plenty of time to get the crop in yet, and plantings may be even larger than anticipated if some corn acres get switched to beans. Informa estimated the 2014 US soybean crop at a record 98.4 MMT, up 10% on 89.5 MMT last year. They also see production for 2014/15 rising to record levels in both Brazil (88.5 MMT) and Argentina (55 MMT). Global soybean production in 2014/15 was pegged at a new record 297.3 MMT, up from the 296.8 MMT forecast previously and up almost 5% on 283.6 MMT this season. For the current marketing year, Dr Cordonnier estimated the 2013/14 Brazilian soybean crop at 86.5 MMT, unchanged from his previous estimate. He increased his Argentine production estimate from 53.5 MMT to 54 MMT. Informa estimated the world rapeseed crop at 68.1 MMT versus a previous figure of 69.2 MMT and 71.7 MMT in 2013/14. They cut Canada to 15.5 MMT from 16.9 MMT last month and 18 MMT last year. They have Europe's 2014/15 rapeseed crop at 21.1 MMT, unchanged from both last month and last year. Strategie Grains predict the EU-28 rapeseed crop rising to 21.6 MMT this year. Oil World have the EU-28 rapeseed crop at 21.5 MMT, and Canada's at 16.3 MMT. China are said to be preparing to begin auctioning off 3 MMT of soybeans from state reserves later this month. Trade could be choppy ahead of Friday's USDA report, with fund money heavily long in beans there could be some further liquidation ahead. They were estimated as being net sellers of around 2-3,000 soybean contracts on the day today. May 14 Soybeans closed at $14.64, down 8 cents; Jul 14 Soybeans closed at $14.59 1/2, down 3 3/4 cents; May 14 Soybean Meal closed at $486.60, down $2.50; May 14 Soybean Oil closed at $0.91, down 7 points.
Corn: The market managed to post decent gains, with fund money ending up a net buyer of an estimated 9-11,000 lots on the day. This is despite them already holding a significant long position in corn heading into another important USDA report at the end of the week. Last night's statement from the USDA that only 19% of the 2014 US corn crop was in the ground as of Sunday night was supportive. The trade had been expecting/hoping for a figure of around 35-40%. However some estimate that a decent week weather-wise this week could see that figure closer to 50% by the close of the weekend. Recall that US farmers planted 43% of the 2013 corn crop in a single mid-May week last year. "Strong warming is predicted this week in the Midwest corn states, but periods of heavy rain may interfere with planting," said Martell Crop Projections. "Early sowing is not always a guarantee for a successful yield. In 2012, the fastest spring planting campaign on record, corn finished with a poor harvest due to summer drought and heat stress. The 2012 national mean corn yield at 123.4 bushels per acre was the worst in 24 years. Conversely, last year’s very slow corn planting, similar to this spring, ended remarkably well with a near-average yield of 158.8 bushels per acre," they noted. Informa estimated the 2014/15 world corn crop at 963.9 MMT, up from the 957.5 MMT forecast in April, although down on the record 971.4 MMT produced last year. Russia said that it had planted 57% of it's planned corn area, and Ukraine said that it was 67% done. The USDA's FAS in Ukraine estimated their 2014 corn crop at 25 MMT versus the record 30.9 MMT produced last year. Informa peg Ukraine's corn crop a little higher at 26 MMT this year. Ukraine said that it had exported 2.19 MMT of grains in April (including 1.4 MMT of corn), and that their 2013/14 season to date exports are now 29.9 MMT (including 18.8 MMT of corn). The USDA reported 220 TMT worth of 2013/14 corn cancellations. May 14 Corn closed at $5.13, up 9 3/4 cents; Jul 14 Corn closed at $5.17 1/2, up 9 1/2 cents.
Wheat: The market closed higher again, with fund money coming in for an estimated net 3-4,000 Chicago wheat contracts on the day. That meant that Chicago wheat closed at it's best levels in 13 months tonight, with hot temperatures and little rain in the forecast for winter wheat on the southern Plains. "The 5-day outlook does not include much rain for Kansas, Oklahoma and Texas. A historic drought has unfolded winter into spring in the top bread wheat states. Kansas wheat conditions declined last week to 17% good-excellent, 36% fair and 47% poor-very poor, a season low. These were the worst conditions since 1996 for early May," said Martell Crop Projections. Informa estimated the 2014/15 US all wheat crop at 56.4 MMT, down sharply from 59.7 MMT a month ago, although not that much different versus 58 MMT in 2013/14. Nevertheless, they see the 2014/15 global wheat crop still usurping last year's record 712.3 MMT, coming in at 713.1 MMT, which is up on the 710.8 MMT estimated last month despite these US losses. Production in Russia was raised from the 49.5 MMT estimated last month to 51 MMT. Argentina's crop was increased from 12.5 MMT to 13 MMT and Brazil's from 4.8 MMT to 6.7 MMT. They held steady on India at 104 MMT, which would easily be a record output, and is up 10.5 MMT from a year ago. The Australian Bureau of Meteorology released an El Nino weather alert. Typically an El Nino weather pattern would cut wheat production in Australia, bringing dryness. It would also bring wetness to South America, which could harm the Brazilian crop in terms of quality, and possibly yields). It would also normally bring generally favourable weather to the US Midwest, boosting corn, soybean and spring wheat production. Libya bought 30,000 MT of Black Sea origin wheat for Apr/Jun shipment. Jordan bought 50,000 MT of optional origin milling wheat for August shipment in a tender for 150,000 MT. The USDA's FAS in Ukraine estimated the 2014 wheat crop there at 20 MMT versus 22.3 MMT last year. They see exports at 9.5 MMT versus 10 MMT in 2013/14. Ukraine said that it had exported 661.6 TMT of wheat in April, and 8.5 MMT of wheat in 2013/14 so far. Informa estimated Ukraine's wheat crop at 20.5 MMT. May 14 CBOT Wheat closed at $7.31 3/4, up 10 1/2 cents; May 14 KCBT Wheat closed at $8.43, up 4 1/4 cents; May 14 MGEX Wheat closed at $7.92, up 16 3/4 cents.
