Chicago Beans End Higher, Corn And Wheat Lower - But All Three Lower On The Week
07/11/14 -- Soycomplex: Beans ended higher on the day, but lower for the week. "The theme of the soy market continues to be tight pipelines that are being exasperated by railroad logistical problems and the futures market has responded by resuming its upward trajectory to source new beans after the early week break in the board shut off producer selling," said Benson Quinn. The focus is now on Monday's upcoming WASDE report from the USDA. For beans the trade is expecting 2014 US production at 3.967 billion bushels versus the October estimate of 3.927 billion, with yields up to 47.6 bu/acre from 47.1 bu/acre previously. The very strong pace of early season exports and good domestic crush demand means that 2014/15 US ending stocks are seen declining from the 450 million bushels forecast a month ago to somewhere around 442 million, although the range of estimates is quite wide at 403-513 million. World ending stocks are seen little changed from last month's 90.67 MMT at 90.37 MMT. Both stocks numbers are described by Benson Quinn as "lofty" - they said that the price outlook for beans is "expected to return to lower trend once US soybean and meal pipeline situations have been resolved." After that we will get the latest Brazilian crop production estimates from CONAB on Tuesday. The Buenos Aires Grain Exchange said that rain is delaying soybean plantings in Argentina. These are now 7.2% complete, up only a little from 6% a week ago and 8 points behind the 5-year average. They left their planted area estimate unchanged at 21.6 million hectares. Nov 14 Soybeans closed at $10.40 1/4, up 9 1/4 cents; Jan 15 Soybeans closed at $10.36 3/4, up 8 3/4 cents; Dec 14 Soybean Meal closed at $390.40, down $1.30; Dec 14 Soybean Oil closed at 32.40, down 13 points. For the week, front month beans fell 6 1/4 cents, with meal up $1.40 and oil almost 240 points lower.
Corn: The corn market ended around 3-4 cents lower on the day, and the best part of 10 cents easier for the week. Position squaring ahead of Monday's USDA report, combined with spillover pressure from weakness in wheat, was probably a feature today. Argentina announcing 8 MMT worth of new crop corn export licences was another negative. Monday's WASDE report is expected to show US 2014 corn production tweaked higher to a new record 14.551 billion bushels, up from 14.475 billion in October. Yields are forecast averaging 175.2 bu/acre versus 174.2 bu/acre a month ago. US 2014/15 corn ending stocks are seen at 2.135 billion bushels compared to 2.081 billion in October. World ending stocks are expected to be around 190.77 MMT, little changed from last month's 190.58 MMT. Rain in Argentina has virtually ground corn planting to a halt this week, said the Buenos Aires Grain Exchange in their weekly newsletter. Planting of the 2014/15 crop is now said to be 37.4% done, up only 1.6% versus a week ago, although not too far behind the 38.8% that was sown this time a year ago. These rains should at least promote good crop development though, they said. In the US, harvest progress "will be hit and miss over the weekend as the weather isn’t cooperating like it had for the last couple of weeks. Forecasts point to a stretch of cold temps," said Benson Quinn. The Russian corn harvest is 84.5% complete on 2.2 million hectares, producing a crop of 10 MMT to date, said their Ag Ministry. The Ukraine Ag Ministry estimated their corn harvest at 22.33 MMT so far, 83% done. The delayed start to soybean planting in Brazil's Mato Grosso could mean that the state's "safrinha" corn acreage could decline as much as 30%, according to the Mato Grosso Corn and Soybean Producers Association. The state accounted for around 35% if the national "safrinha" corn crop in 2013/14. German analysts FO Licht estimated the EU-28 corn crop at 74 MMT versus a previous forecast of 70.4 MMT and up almost 15% on production of 64.5 MMT last year. Dec 14 Corn closed at $3.67 1/2, down 3 3/4 cents; Mar 15 Corn closed at $3.80 1/2, down 3 1/2 cents. For the week Dec 14 was 9 1/4 cents lower.
Wheat: The wheat market closed lower on the day, and for the week, across all three exchanges. "Global competition remains the key fundamental input offering the negative tone," said Benson Quinn. Yesterday's weekly export sales of only 265,800 MT highlighted how uncompetitive US wheat has become, and this was the second weekly total below 300,000 MT in the past 3 weeks. The Buenos Aires Grain Exchange said that heavy rains this week had disrupted the wheat harvest in Argentina. That's now seen at 8.9% complete, a week on week progress of 3.6 percentage points. They held steady with their crop production forecast at 11.5 MMT. The Argentine government issued 1.5 MMT worth of wheat export licences for the 2014/15 season. South Korea bought 28,800 MT of US milling wheat for March–April shipment. Iraq bought 200,000 MT of hard wheat from Canada and Australia for Dec-Feb shipment. Kazakhstan said that their 2014 grain harvest is 93% complete at 17.5 MMT. Russia's Ag Ministry said that their wheat harvest is 96.7% complete at 61.8 MMT. The Russian Central Bank said that it is "ready at any moment" to enter the financial markets to support an ailing rouble that fell to record lows against the US dollar and euro today. Russian grain prices rose by an average 3.5% in October, partly due to the decline of the domestic currency, prompting farmers to hold back on sales. It is thought that they won't be able to do this indefinitely however, with many having loans to repay by the end of the year. Russian winter grain plantings are complete on 16.4 million ha of the expected 16.5 million ha, according to the Ag Ministry. Rusagrotrans said that the probability that winter-planted crops will recover and gain strength is high, and that they currently only expect winter losses to be "moderate". The Russian Ag Ministry said that they will assess winter crop losses in January. Ukraine said that it had exported 12.7 MMT of grains Jul 1- Nov 7, including 6.8 MMT of wheat. Monday's USDA report is expected to show 2014/15 world wheat inventories at 192.15 MMT versus the 192.59 MMT estimated last month. Dec 14 CBOT Wheat closed at $5.14 1/2, down 5 3/4 cents; Dec 14 KCBT Wheat closed at $5.69 1/4, down 9 3/4 cents; Dec 14 MGEX Wheat closed at $5.46 1/4, down 7 3/4 cents. For the week, Chicago wheat was down 18 cents, with Kansas 24 1/2 cents lower and Minneapolis 28 cents weaker.
