Chicago Beans And Corn Sink To New Lows
04/09/14 -- Soycomplex: Beans sunk to new lows for the second day running, and we are now at levels not seen on a front month since October 2010. The outlook for a impending record US crop, followed by the potential for further records to be broken in South America early next year is behind the move. A stronger dollar isn't helping either. MDA CropCast raised their forecast for this year's US soybean crop by 71 million bushels from last week to 3.775 billion bu on improved late season conditions. Many other estimates are even higher, some pushing the 4 billion mark. Informa are due to release their latest thoughts tomorrow. FCStone joined in with other recent analyst's forecasts for increased Brazilian plantings, and higher and record soybean production in 2014/15, coming out with an estimate of 93 MMT. They see plantings at 31.0 million ha, up 5% from a year ago. Planting in some parts of the country will begin very soon. Dr Cordonnier said that many growers are looking at planting fast maturing, short cycle beans this year as a way of saving money as they require fewer fungicide and insecticide applications. This might take the top off some of these production estimates (Lanworth were as high as 98 MMT the other day), although it would also mean more beans coming onto the market earlier. Trade estimates for tomorrow's one day delayed weekly export sales report for beans are zero to net cancellations of 200 TMT on old crop and 800 TMT to 1.1 MMT on new crop. Sep 14 Soybeans closed at $10.64 1/4, down 16 1/2 cents; Nov 14 Soybeans closed at $10.03 1/4, down 16 3/4 cents; Sep 14 Soybean Meal closed at $431.40, down $15.80; Sep 14 Soybean Oil closed at 31.97, up 24 points.
Corn: The corn market closed around 5-6 cents lower. The same factors dragging soybeans down are being replicated in the corn market. The potential for the USDA to significantly raise projected US corn production in next week's WASDE report, non-threatening weather, reports of bumper yields in early harvested corn in the south and a strong dollar all see US corn prices also at 4-year lows. MDA CropCast left their US corn production estimate unchanged at 14.427 billion bushels. That puts them in the same ballpark as many other analysts who almost all now line up around the 14.4-14.6 billion range versus the USDA's August estimate of "only" 14 billion. Informa are expected to raise their forecast from a fraction under 14 billion tomorrow. FC Stone estimated Brazil’s 2014/15 total corn crop at 76.84 MMT, which is only marginally down on last year despite a near 5% drop in plantings. Lanworth yesterday said 79.0 MMT versus 78.6 MMT a year ago. Celeres earlier in the week said that Brazil would still produce a record 85.1 MMT of corn in 2014/15. "The sharp increase in the value of the US dollar..by default cheapens global (corn) offers," said Benson Quinn Commodities. Ukraine new crop corn offers are now said to be down to $176/tonne versus bids now at only $172/tonne on a FOB the Black Sea basis. A week ago those offers were at $183/tonne. South Korea's KFA bought 63,000 MT of Brazilian corn for Feb shipment. The USDA today announced 120,000 MT of corn sold to unknown for 2014/15 shipment. Trade estimates for tomorrow's weekly export sales report for corn are in the region of around zero on old crop and 600-800 TMT on new crop. Sep 14 Corn closed at $3.35 3/4, down 5 1/2 cents; Dec 14 Corn closed at $3.46 1/2, down 5 1/2 cents.
Wheat: The wheat market closed mixed across the three exchanges. Japan bought 110,146 MT of milling wheat for Oct-Nov shipment in their usual mix of US, Canadian and Australian origin. South Korea's CJ bought 26,100 MT of US wheat for Jan shipment. Russian analysts ProZerno forecast the grain crop there at 105 MMT, a near 14% rise on last year. That total includes 59.7 MMT of wheat, a near 15% rise, with wheat exports at 23.5 MMT in 2014/15 - an increase of over 28%. IKAR estimated Russia’s 2014/15 grain exports at 33.0 MMT, including 23.0 MMT of wheat. This year's Russian grain harvest is currently 61% complete at 78.8 MMT, according to the Ag Ministry. Wheat accounts for 49.3 MMT of that total so far, with barley adding an additional 18 MMT. The Ministry said that Russia may start buying grains for state reserves in October. MDA CropCast cut their forecast for the 2014/15 Australian wheat crop by 280 TMT from last week to 24.04 MMT, a 10.6% fall on a year ago due to dryness in the east of the country. The Saskatchewan weekly crop report said that cool and wet weather continues to delay harvest there. Stats Canada are due out tomorrow with their Jul 31 stocks numbers. Due to last year's record harvest, and early season logistical problems, these are expected to be very large. The trade is anticipating Canadian all wheat stocks at 10.7 MMT, more than double those of a year ago and a 20 year high. Trade estimates for tomorrow's weekly export sales report are around 250-500 TMT. Sep 14 CBOT Wheat closed at $5.25 1/4, up 1 3/4 cents; Sep 14 KCBT Wheat closed at $6.08 1/4, up 7 1/2 cents; Sep 14 MGEX Wheat closed at $6.22 1/4, down 1 3/4 cents.
