Nogger's Blog

30/04/15 -- Soycomplex: Beans closed with double digit losses, despite strong old crop weekly export sales of 433,400 MT (versus expectations of 50,000 and 250,000 MT). That included 199,300 MT for China and a further 80,400 MT to unknown destinations. New crop sales were less impressive though at a negative 118,500 MT which included decreases for China of 134,000 MT - possibly this was a switch from new crop to old crop? Exports of 264,200 MT were up 70 percent from the previous week, but down 45 percent from the prior 4-week average. Total exports so far this season now stand at 45.4 MMT, add on an additional 3.7 MMT worth of outstanding orders, and total net commitments for 2014/15 are now 49.1 MMT versus a USDA forecast for the entire season of 48.7 MMT. That doesn't help explain the front end weakness. "After firmer overnight trade that had beans making fresh 1-month highs, the day session crashed and burned on what appeared to be month-end fund selling," suggested Benson Quinn. Further support for the nearby positions should have come from news that unions at river terminals in Rosario in Argentina have begun a threatened strike. News that the Buenos Aires Grain Exchange had raised their forecast for the Argentine soybean crop to 60 MMT, up 2.6% from a week ago and an all time high, wasn't so friendly though. They said that the harvest there is now 61.8% complete. The Argentine Ag Ministry estimated farmer selling for the 2014/15 soybean crop at 28% versus 23% this time a year ago. Tonight's close put the new crop soybean:corn price ratio at 2.48:1, down from nearly 2.5:1 yesterday. May 15 Soybeans closed at $9.78 1/2, down 10 cents; Jul 15 Soybeans closed at $9.76, down 12 cents; May 15 Soybean Meal closed at $318.90, down $5.30; May 15 Soybean Oil closed at 31.51, up 4 points.

Corn: The corn market closed a little lower. Weekly export sales of 832,500 MT for delivery in 2014/15 were down 4 percent from the previous week, but up 33 percent from the prior 4-week average. New crop sales were 113,300 MT. Trade expectations were for sales of 500,000-700,000 MT on old crop and from 50,000-200,000 MT on new crop. Exports this week were nearly 1.3 MMT. Wheat crashing to new 5-year lows was a negative influence on corn again today. Argentine strike news leans a little bit friendly in the short-term. In addition to the problems in Rosario, grain terminals in San Lorenzo and San Martín also being affected. The Buenos Aires Grain Exchange increased their forecast for the Argentine 2014/15 corn crop from 23 MMT to 25 MMT. They said that the harvesting of that is now 28.4% complete. The Argentine Ag Ministry estimated farmer selling for the 2014/15 corn crop at 40% versus 29% this time a year ago. MDA CropCast forecast the 2015/16 world corn crop at 951.7 MMT, down 0.2 MMT from a week ago and 2.5% down on last year. They see output in the US at 1.38 billion bushels compared to 1.44 billion in 2014. Ukraine's crop was forecast unchanged at 24.3 MMT versus 28.4 MMT in 2014. Russia's was also unaltered from a week ago at 10.8 MMT versus 11.1 MMT in 2014. Ukraine said that their 2015 corn crop has been planted on 1.7 million ha, or 37% of the government forecast area, that's down from the 2.4 million ha that had been sown this time a year ago. The Ukraine Ag Ministry said that the country had exported 29.3 MMT of grains so far this season, of which corn comprises the largest market share at 14.6 MMT. Good planting weather in the US continues to be a problem for corn's ability to stage a rally. "The USDA is expected to publish a value close to or better than 50% of the corn planted by Sunday night" in Monday's crop progress report, said Benson Quinn. May 15 Corn closed at $3.62 1/2, down 1 1/4 cents; Jul 15 Corn closed at $3.66 1/4, down 1 1/2 cents.

Wheat: The wheat market ended with hefty losses following a weekly export sales report that came in at a net negative 449,200 MT for 2014/15 - said to be the largest net negative result in at least the last 25 years and probably ever. That was the attention grabbing headline news, although the reality of the situation was that there was simply a large volume of old crop sales rolled into new crop - the US wheat marketing year finishes at the end of May. This meant that new crop sales came in at 852,900 MT, so combined sales for both marketing years were 403,700 MT, which was in line with trade expectations. Exports of 606,600 MT were up 9 percent from the previous week and 47 percent above the prior 4-week average. "While this morning’s net cancellation of old crop wheat sales was largely the result of sales being rolled to the new crop, the timing of such a move was negative," said Benson Quinn. In other news, the Argentine Ag Ministry estimated farmer selling for the 2014/15 wheat crop at 70% versus 49% this time a year ago. The Rosario Grain Exchange said that low margins and high input costs could see Argentine wheat plantings fall 25% for the 2015/16 harvest. MDA CropCast increased their estimate for the world wheat crop in 2015/16 by 0.31 MMT to 712.2 MMT, down a little from 719.6 MMT last year. The change was down to a hike in production in Canada. They see the US all wheat crop at 2.15 billion bushels, up 4.4% on a year ago, with winter wheat production at 1.5 billion bushels versus 1.42 billion a year ago. Russia's crop was estimated unchanged from last week at 53.9 MMT (versus 58.1 MMT a year ago) and Ukraine's pegged at 23.0 MMT (down from 24.4 MMT in 2014). The US Drought Monitor said that moderate-to-extreme drought in the High Plains was 44%, compared with 41% a week earlier and 33% a year ago. Ukraine said that they'd now exported 10 MMT of wheat this season, which takes them close to the supposed "informal" 10.2 MMT limit agreed by the Ag Ministry and exporters. May 15 CBOT Wheat closed at $4.67, down 10 1/4 cents; May 15 KCBT Wheat closed at $4.90 1/4, down 10 1/2 cents; May 15 MGEX Wheat closed at $5.23 1/4, down 12 cents.