Chicago Grains Rally
05/02/15 -- Soycomplex: Beans closed with near 10 cent gains. Weekly export sales of 489,700 MT for 2014/15 were down 35 percent from the previous week, but still at the top end of trade estimates. Meal sales of 296,300 MT also topped expectations. News that Indonesia is to boost its biodiesel subsidies substantially saw palm oil futures jump 5% overnight, which had a knock-on effect for soyoil and beans. MDA CropCast raised their outlook for Argentina's soybean crop by 500 TMT to 56 MMT. They were unchanged on Brazil at 93.5 MMT. The FAO raised their forecast for the global soybean crop by 4 MMT to a new record 313 MMT. They also upped ending stocks to 42 MMT, a 40% increase on a year ago. Informa estimated the world 2015/16 soybean crop at 312.3 MMT versus a previous estimate of 313.7 MMT and their 2014/15 estimate of 314.7 MMT. The Buenos Aires Grain Exchange were unchanged on their estimate for soybean plantings in Argentina at 20.4 million hectares. Their first production estimate of the year was released at a record 57 MMT, "if the current favourable weather conditions persist", they said. Mar 15 Soybeans closed at $9.81 1/4, up 9 1/4 cents; May 15 Soybeans closed at $9.87 3/4, up 9 cents; Mar 15 Soybean Meal closed at $331.40, down $1.30; Mar 15 Soybean Oil closed at 31.71, up 112 points.
Corn: The corn market closed with small gains. Weekly export sales of 844,900 MT for 2014/15 were in line with expectations. Crude oil continued with the recent erratic trade, rallying back up above $50/barrel today, adding spillover support to corn. The FAO estimated the global corn crop at 1020 MMT, unchanged from their previous forecast. They did however trim ending stocks back by 4 MMT to 208 MMT. "In Brazil, conditions are mostly favourable for the first crop however there is some concern over a delay in development due to the lack of rains in main producing areas and planting of the second crop has begun. In Argentina, planting is mostly complete and conditions remain generally favourable," they said. The Buenos Aires Grain Exchange estimated that corn planting in Argentina was now past 99% complete. They haven't yet issued a production forecast. Informa have the 2015/16 global corn crop estimated at 967.9 MMT, up from a previous estimate of 965.6 MMT, but below their 2014/15 crop estimate of 985.8 MMT. The USDA's FAS in Russia estimated the country's corn exports at 2.4 MMT this season. "Of note, today was the Ukrainian currency, which broke 34% against the USD after the Ukrainian Central Bank reported it would no longer be able to support it through monetary policy. A break of this magnitude will likely increase the rate of export sales out of the Black Sea," noted Benson Quinn. Mar 15 Corn closed at $3.85 1/4, up 1 3/4 cents; May 15 Corn closed at $3.93 1/4, up 1 3/4 cents.
Wheat: The wheat market closed with double digit gains across the three exchanges. Weekly export sales of 397,600 MT were in line with expectations. There's talk of Egypt buying 4-6 cargoes of US SRW wheat due to a special $100 million credit line extended to them by the US. The FAO trimmed 1 MMT off the world 2014/15 wheat crop to 724 MMT and knocked a similar amount off global ending stocks to 192 MMT. "In the southern hemisphere the harvest is complete and conditions at the end of the season were mixed in Australia and Argentina. In the northern hemisphere winter wheat is mostly dormant. In the EU, US, China, Ukraine and Canada the crop is dormant and progressing without any major concern. In Russia, conditions for the dormant crop are generally favourable except in the southern regions where there is some concern over limited protective snow cover and warmer than usual weather. In India, conditions are favourable," they said. Informa estimated the world 2015/16 wheat crop at 720.3 MMT, up from a previous forecast of 718.2 MMT, although down on their figure for 2014/15 of 722.5 MMT. They see improved prospects for Canada (up from 28 MMT to 29.5 MMT) and China (up from 122.5 MMT to 125 MMT). They cut their outlook for US wheat from 60 MMT to 58.5 MMT however. Mar 15 CBOT Wheat closed at $5.25 3/4, up 14 3/4 cents; Mar 15 KCBT Wheat closed at $5.64, up 11 1/4 cents; Mar 15 MGEX Wheat closed at $5.77 1/4, up 11 1/4 cents.
