Chicago Grains Closing Comments From Friday Night
20/02/15 -- Soycomplex: Beans closed lower on the day, but higher for the week. The USDA reported decent weekly export sales of 505,600 MT of old crop and 115,900 MT of new crop. Exports of 1.35 MMT were down 16 percent from the previous week and 21 percent below the prior 4-week average. Nevertheless, they are still holding up pretty well. The US now has 96% of its USDA soybean export target already sold. Meal sales of 316,600 MT for 2014/15 and a further 35,900 MT for next season also topped trade expectations. The final day of the USDA's Outlook Forum tentatively pegged the 2015/16 US soybean crop at 3.800 billion bushels versus 3.969 billion last year, a 4.3% decline. Yields were pencilled in at 46 bu/acre versus 47.8 bu/acre last year. Ending stocks however are seen rising to 430 million bushels, up 11.7% from this season. It was the latter piece of news that principally caused today's declines. With China closed, other fresh news was limited. Mar 15 Soybeans closed at $9.99 1/4, down 8 cents; May 15 Soybeans closed at $10.02 1/4, down 9 cents; Mar 15 Soybean Meal closed at $347.50, unchanged; Mar 15 Soybean Oil closed at 31.48, down 35 cents. For the week, front month beans were up 8 3/4 cents, meal was $15.50 higher and oil lost 92 points.
Corn: The corn market was lower on the day, and a bit easier for the week too. That came despite weekly export sales of 932,200 MT of old crop and 143,200 MT of new crop beating expectations. US corn sales are now 77% of the USDA target for the season versus 72% this time last year and 68% typically at this time. That's not too bad given the current strength of the US dollar. The USDA's Outlook Forum estimated this year's US corn crop at 13.595 billion bushels versus 14.216 billion in 2014, a 4.4% decline. Yields were pegged at a second highest ever 166.8 bu/acre versus last season's record 171.0 bu/acre. That might be setting the bar a bit high, even at this early stage in the game. US corn ending stocks were estimated at 1.687 billion bushels versus 1.827 billion this season. Corn used for ethanol production in 2015/16 was forecast at 5.225 billion bushels, or 38.4% of the crop. "Argentina;s corn prospects continue to improve with favourable summer growing conditions. Pollinating corn benefited from heavy rainfall in January, with most corn farms receiving 125-150% of normal rainfall. February weather has trended drier, but cool temperatures are promoting favourable grain filling," said Martell Crop Projections. The later than normal Brazilian soybean harvest is delaying planting of second crop corn there however. Mar 15 Corn closed at $3.85 1/4, down 4 1/2 cents; May 15 Corn closed at $3.93, down 4 3/4 cents. Front month corn lost 2 cents over the course of the holiday-shortened week.
Wheat: The wheat market closed lower on the day, and with some hefty losses for the week. This week's Egyptian pass on US wheat offers, followed by them booking 240 TMT of EU wheat, highlighted just how expensive US wheat is. The European wheat bought was more than $60/tonne cheaper than US material, and that's before more expensive freight is added on. Weekly US export sales of only 266,600 MT for delivery in the 2014/15 marketing year were down 35 percent from the previous week and 41 percent from the prior 4-week average, driving home the message. Marketing year to date sales are down a hefty 24% on where they were a year ago. Benson Quinn described this week's sales total as "awful". Sales so far this season are 86% of the USDA target versus 88% normally. Actual shipments this week of 391,900 MT were up 5 percent from the previous week and 9 percent above the prior 4-week average. They were still rather unspectacular though. "The negative momentum on the charts is building with sessions as poor as this one. New lows for the move everywhere and a new contract low for Kansas wheat doesn’t bode well for the length going forward," said Benson Quinn. In Washington, the USDA's Outlook Forum estimated the 2015/16 US wheat crop at 2.125 billion bushels versus 2.026 billion last year, a rise of 4.9%. Wheat ending stocks next season were pegged at 763 million bushels, up more than 10% from this year. Mar 15 CBOT Wheat closed at $5.10 1/4, down 17 1/2 cents; Mar 15 KCBT Wheat closed at $5.33 1/4, down 11 1/4 cents; Mar 15 MGEX Wheat closed at $5.66 1/2, down 7 1/2 cents. For the week that takes Chicago wheat 22 3/4 cents lower, with the market in Minneapolis down 20 1/2 and Kansas falling 29 1/2 cents.
