Chicago Grains Post Nominal Gains
01/10/14 -- Soycomplex: Beans put in a new contract low before rebounding to finish the day with modest gains. FCStone raised its US 2014 soybean yield estimate to 48.4 bu/acre, up from 47.6 bu/acre previously and the USDA's current 46.6 bu/acre forecast. Given that the USDA said yesterday that last year's yield was 44 bu/acre, then a figure of 48+ this year is plausible given the improved weather scenario. FCStone now have production at 4.066 billion bushels versus the USDA's September estimate of 3.913 billion. "Today’s price action seemed to be another breather pause in an otherwise bearish market. Harvest has just begun and based on yield reports the producer if very undersold," said Benson Quinn Commodities. They noted that Goldman Sachs pegged the 3-6 month US soybean price at $8/bushel. Goldman also see US 2014/15 soybean ending stocks rising to a bountiful 456 million bushels versus the record tight 92 million at the end of 2013/14 that the USDA presented us with yesterday. Thailand are tendering for up to 430,000 MT of optional origin soymeal for Jan-June shipment. Trade estimates for tomorrow's weekly export sales report for beans are around 700 TMT to 1 MMT. Nov 14 Soybeans closed at $9.16 3/4, up 3 1/2 cents; Jan 15 Soybeans closed at $9.25, up 3 3/4 cents; Oct 14 Soybean Meal closed at $305.30, up $0.70; Oct 14 Soybean Oil closed at 32.66, up 39 points.
Corn: The corn market closed with nominal gains. FCStone estimated the 2014 US corn crop at a huge 14.958 billion bushels based on an average yield of 178.4 bu/acre. Their previous production estimate was 14.595 billion and the USDA's September figure was 14.395 billion. Their previous yield estimate was 174.1 bu/acre and the USDA's September figure was 171.7 bu/acre. Goldman Sachs said that corn prices would hit $3.00/bushel in the 3-6 month time frame. They have 2014/15 US corn ending stocks estimated at 2.278 billion bushels versus the USDA's 2013/14 ending stocks estimate of 1.236 billion. "Today’s pause from the downtrend seems a little premature to be called a consolidation for a variety of reasons. One being that only 12% of the crop had been harvested as of Sunday night and reports of extraordinary yields have not stopped being reported," said Benson Quinn Commodities. All eyes are now firmly fixed on next Friday's WASDE report from the USDA. The Energy Dept reported US weekly ethanol production was down 8k barrels/day versus the week previously. Trade estimates for the USDA weekly export sales report tomorrow are 650-900 TMT. Dec 14 Corn closed at $3.21 1/4, up 1/2 cent; Mar 15 Corn closed at $3.34, up 1/2 cent.
Wheat: The wheat market closed narrowly mixed. Egypt's GASC bought two cargoes of French wheat in their tender, with the price reportedly paid beating Russian offers by around $10/tonne. US SRW wheat, which was successful in the last tender, wasn't offered this time round. Morocco bought 9,000 MT of US soft wheat for Dec shipment. Goldman Sachs reportedly pegged US wheat prices at $4.50/bushel in the 3 to 6 month time frame. The USDA attaché in Brazil estimated the country's 2014/15 wheat crop at 7.5 MMT, up 30% versus 2013/14. Brazil were a featured buyer of US wheat last season due to the shortfall in their own, and neighbouring Argentina's, wheat crop. Ukraine's Ag Minister estimated the 2014 grain crop there at a record 64.4 MMT, up from a previous estimate of 60.0 MMT and compared to 63 MMT last year. How they will achieve that, given the loss of Crimea and that some crops in the Lugansk and Donetsk region are expected to go unharvested due to the fighting there remains to be seen. UkrAgroConsult estimated the Ukraine grain crop at a more realistic looking 57.4 MMT earlier in the week. Trade estimates for tomorrow's weekly export sales report for wheat are in the region of 400-600 TMT. Dec 14 CBOT Wheat closed at $4.79, up 1 1/4 cents; Dec 14 KCBT Wheat closed at $5.57 1/2, down 1/2 cent; Dec 14 MGEX Wheat closed at $5.31 3/4, down 1 3/4 cents.
