Chicago Soybeans Sharply Higher On Renewed Chinese Interest
21/05/14 -- Soycomplex: Beans finished sharply higher, with front end months showing the biggest gains. Fund money was estimated as being a net buyer of around 6-9,000 soybean contracts on the day. Better Chinese crush margins are said to have them back in the market, buying US and South American beans in the past few days. A Bloomberg survey said that Chinese crushers had bought over 600,000 MT of beans last week for September onwards shipment. Trade estimates for tomorrow's USDA weekly export sales report are zero for old crop and 500-700 TMT of new crop. Some of these reported Chinese sales may show up in that. Chinese customs data shows that they imported 6.5 MMT of soybeans in April, up almost 64% versus 12 months previously. US soybean exports to China last month were said to account for over 2.5 MMT of that total, with Brazil's at 3.95 MMT. China's Jan/Apr soybean imports were 21.95 MMT, up more than 41% on a year ago, with 16.3 MMT of that coming from the US and 5 MMT from Brazil. Japanese customs data shows that Japan imported 280,463 MT of beans in April, up 20.2% from a year ago, and with 242,156 MT of that coming from the US. Jul 14 Soybeans closed at $15.05 1/4, up 35 1/2 cents; Aug 14 Soybeans closed at $14.30 3/4, up 25 1/2 cents; Jul 14 Soybean Meal closed at $498.10, up $11.40; Jul 14 Soybean Oil closed at 40.47, up 40 points.
Corn: The corn market ended with little change. The weekly ethanol grind came in at 925,000 barrels/day, up slightly on last week but below the level required to hit USDA targets. Chinese customs data showed that they only imported 93,062 MT of corn last month, down 78% from a year ago. Of that total only 8.5 TMT came from the US, with more than half April's corn imports coming from Ukraine. The MIR 162 problem is clearly having a major effect on Chinese demand for US corn. They were said to have imported 787 TMT of US corn in November, before the dispute over the MIR 162 variety broke. China's Jan/Apr corn imports total 1.27 MMT, down 12% on a year previously. Imports from the US during that period are down 40%. The Ukrainian Agrarian Confederation estimated their 2014 corn crop at 28.5-29.0 MMT, down only a relatively small amount from last year's record 30.9 MMT, given that output from Crimea no longer counts and for all the recent talk of reduced plantings and crop inputs. Russian corn plantings for the 2014 harvest are said to be 88% complete. Ukraine corn plantings are 90% done. IMEA said that Brazil's Mato Grosso state will reduce it's corn area for the 2014/15 harvest by 19% and production will fall 32% to 15.4 MMT. The European Commission estimated the EU-28 corn crop at 69.2 MMT versus 64.9 MMT a year ago. They see 2014/14 EU-28 corn ending stocks rising to 14.9 MMT from 13.7 MMT this season, as usage declines to 71.3 MMT from 73.7 MMT in 2013/14. Trade estimates for tomorrow's weekly export sales report are around 300-500 TMT of old crop and 100-200 TMT of new crop. Jul 14 Corn closed at $4.74 1/2, up 1 cent; Sep 14 Corn closed at $4.72 1/2, up 1/4 cent.
Wheat: The market closed mostly lower once more, with another attempted rally fizzling out. The Ukrainian Agrarian Confederation estimated Ukraine’s 2014 wheat crop at 22.0-22.5 MMT, which is essentially unchanged from a year ago, despite the recent troubles. The market appears to have put the Ukraine issue to the back of it's mind, as the news out of the region has slipped from the front pages of every newspaper around the world. That doesn't necessarily mean that the issue has gone away. I hear that Ukraine needs to pre-pay Russia's GazProm for it's June gas requirement by Jun 2 or risk having the gas turned off. The amount being quoted as due is $1.658 billion. China only sold 5% of the 811 TMT of wheat it put up for auction today. Recent sales have been very poorly received, and this one was no different. Chinese customs data shows that they imported 373,606 MT of wheat in April, up 84% versus a year ago. Jan/April imports are 2.2 MMT, a 148% increase versus the same period in 2013. Rusagrotrans estimated Russia’s 2014 grain crop at 95-97 MMT, up from 92.4 MMT in 2013, and better than SovEcon's forecast of 90 MMT from yesterday. They see Russia’s 2014/15 grain exports increasing 27-28 MMT from 25.3 MMT in 2013/14. That's probably bad news for wheat prices, especially in the first half of the season when they are normally their most aggressive. Russian wheat was the cheapest offer in an Iraq tender for 150 TMT of wheat for Sep/Oct shipment today. The European Commission forecast the 2014/15 EU-28 soft wheat crop at 135.9 MMT versus 134.3 MMT a year ago. They see exports at 22.0 MMT versus 27.0 MMT this season, and ending stocks at 11.9 MMT versus 9.5 MMT in 2013/14. Weekly export sales for tomorrow are seen at 50-150 TMT of old crop and 150-300 TMT of new crop. Jul 14 CBOT Wheat closed at $6.64 1/4, down 6 1/4 cents; Jul 14 KCBT Wheat closed at $7.61 1/2, down 6 3/4 cents; Jul 14 MGEX Wheat closed at $7.38 3/4, up 1/2 cent.
