Chicago Grains Dip, Led By Soybeans Back Below $10

02/12/14 -- Soycomplex: Beans slipped back below $10/bushel in a broad-based sell-off in commodities. "A fresh 4-year high in the US dollar triggered broad commodity market selling that a reversal of yesterday’s broad market price action. Few commodity contracts were spared with crude, energies, metals, grains, live cattle and hogs, and most of the softs down sharply as the funds liquidated positions and moved money back to the equities, where the Dow was seen closing back near Friday’s all-time record high," said Benson Quinn. South American planting has now pretty much caught up with normal, and the weather there has started to develop a more friendly look. IMEA estimated output in Brazil's largest producing state of Mato Grosso’s at 27.89 MMT versus 26.29 MMT a year ago. They see plantings at 8.87 million hectares versus 8.44 million a year ago. Stats Canada are out on Thursday with their latest crop production estimates. A Reuters survey puts the 2014 Canadian canola crop at 14.6 MMT, up more than half a million tonnes on their previous estimate, although still down on last year's bumper crop of almost 18 MMT. US farmer interest in selling beans now that we are back below $10/bushel will be light, at least until we get closer to the Brazilian harvest. Jan 15 Soybeans closed at $9.95 3/4, down 21 1/4 cents; Mar 15 Soybeans closed at $10.03, down 21 cents; Dec 14 Soybean Meal closed at $383.10, down $1.30; Dec 14 Soybean Oil closed at 31.17, down 105 points.

Corn: The corn market closed around 7-8 cents lower as it too succumbed to the general commodity sell-off. Funds were estimate as net sellers of around a net 8,000 contacts on the day. "Typically, the best bid has been the ethanol producer. EIA will release weekly ethanol stats tomorrow morning. Expect to see another weekly grind that rivals the record levels of the prior week," said Benson Quinn. It's interesting that demand from the ethanol sector is currently holding up whilst crude oil values hit 5-year lows. Brazilian growers are planting less corn in favour of soybeans. IMEA estimated Mato Grosso’s 2014/15 corn area at 2.83 million hectares versus 3.22 million a year ago, and only around a third of the area given over to beans. They see Mato Grosso’s 2014/15 corn crop at 14.6 MMT versus 17.72 MMT a year ago. Ukraine said that their 2014 corn harvest was now 96% complete at 26.4 MMT. They now appear to be concentrating the bulk of their efforts on corn exports, rather than those for wheat. Russia said it had harvested 95.8% of its 2014 corn crop, producing 11.2 MMT to date. News of more EU feed wheat heading into the SE of the US leans bearish for corn demand. Stats Canada are expected to peg the Canadian 2014 corn crop at 11.6 MMT on Thursday, up from 11.4 MMT previously but down on 14.2 MMT a year ago. Dec 14 Corn closed at $3.67 3/4, down 7 3/4 cents; Mar 15 Corn closed at $3.81 1/4, down 8 1/2 cents.

Wheat: The wheat market closed mixed, but mostly a little lower following strong gains yesterday. Falling corn and soybean values were a negative influence. Talk of possible Russian export restrictions in some form or other is keeping the market excited. Egypt's GASC tendered for wheat late in the day, with the results expected tomorrow afternoon. Who offers what, and at what price, will make interesting reading. Kazakhstan said that their grain harvest was almost 99% complete at 18.9 MMT. Ukraine said that their grain harvest was 98% complete at 63 MMT. Russia said that they are 99% done at 110.3 MMT. The latter includes 62.3 MMT of wheat (which is now 100% of their combinable area) in bunker weight. The Russian barley harvest is also over at 21.2 MMT, also before cleaning and screening. Stats Canada are expected to report a Canadian all wheat crop of 27.8 MMT on Thursday, up from the 27.5 MMT estimated in October, but down sharply on last year's record 37.5 MMT. Reuters report that some Canadian wheat buyers are becoming increasingly dissatisfied with problems including "underweight shipments, lower-than-expected protein content and gluten strength in the wheat, and even the occasional mixture of wheat with other agricultural products." That could push a but more business the way of the US, although the strong US dollar won't help. Japan are tendering for 146,660 MT of milling wheat for Jan-Feb shipment. Dec 14 CBOT Wheat closed at $6.05 1/4, down 1 1/2 cents; Dec 14 KCBT Wheat closed at $6.48 3/4, down 11 1/2 cents; Dec 14 MGEX Wheat closed at $6.56, up 6 cents.