Nogger's Blog

20/05/15 -- Soycomplex: Beans closed lower, setting fresh contract lows in many positions. Good planting progress and a "warm and wet" US weather forecast keep the pressure to the downside. The strong US dollar isn't helping either. The Argentine Ag Ministry estimated growers there to be 35.6% sold on their 2014/15 soybeans, up from 30% sold this time last year. Chinese cash soymeal prices are said to be near a 5 year low, which could keep a lid on their bean imports. The trade is expecting weekly export sales tomorrow to be 100,000–250,000 MT on old crop and 150,000–350,000 MT on new crop beans, according to Benson Quinn. It will be interesting to see if they manage to come in at those levels, given the recent resurgence of the US dollar. Sales last week came in at 136,600 MT on old crop and only a modest 88,000 MT on the new crop. The old crop sale of 132,000 MT of soybeans for delivery to China reported on Tuesday is only likely to show up in next week's report. The new crop soybean:corn price ratio ended the day at 2.44:1 versus 2.43:1 yesterday. Jul 15 Soybeans closed at $9.41 1/4, down 5 cents; Nov 15 Soybeans closed at $9.19 3/4, down 3 3/4 cents; Jul 15 Soybean Meal closed at $304.50, down $2.60; Jul 15 Soybean Oil closed at 32.20, up 2 points.

Corn: The corn market closed around 2-3 cents lower. The same factors that are grinding soybean prices lower also apply to corn: excellent planting progress, largely ideal weather conditions, and the firm US dollar. "The first national crop ratings report is expected next week. Initial estimates are anticipating reported ratings near record high levels," said Benson Quinn. "The US Climate Prediction Centre now predicts an 80% chance of a full-fledged El Nino in the summer months. Very heavy Midwest rainfall is associated with the El Nino in summer. The last time the El Nino signal was this strong was in the summer of 2009 a year in which the US corn yield excelled, finishing 8% above trend. Another El Nino in the summer of 2004 promoted an even higher corn yield 13% above trend," said Martell Crop Projections. The Argentine Ag Ministry estimated growers there to be 44.8% sold on their 2014/15 corn, up from 36.2% sold this time last year. The weekly ethanol grind from the US Energy Dept was friendly, coming in at 958,000 barrels/day, a sharp jump from 912,000 bpd the previous week. South Korea's Kocopia tendered for 55,000 MT of optional origin corn. Trade forecasts for tomorrow's weekly export sales report are at 400,000–600,000 MT on old crop, and 50,000–200,000 MT new crop Jul 15 Corn closed at $3.60, down 2 cents; Dec 15 Corn closed at $3.77 1/4, down 3 cents.

Wheat: The wheat market closed mostly a little higher. Extreme wetness continues to hit winter wheat that's ready for harvesting on the Plains. Oklahoma City has already had its second wettest May on record, with more than 10 days of the month still left to go, picking up almost 14 inches of rain so far this month. Ditto Lincoln, Nebraska with over 10 inches. US spring wheat hasn't got off to a great start in some states either. "North Dakota received 2-4 times the normal rainfall in the past 10 days, capped off by a hard freeze May 18th and 19th. Approximately half of the state’s spring wheat had sprouted and emerged, when freezing temperatures developed," said Martell Crop Projections. The suddenly warmer forecast will be most welcomed there. Both the Ukraine and Russian Ag Ministries remain bullish on their crop production prospects this year. Ukraine today raised their 2015 grain crop forecast by 2 MMT to 60 MMT, with wheat up 1 MMT to 21 MMT. Russia are standing firm at a 100 MMT grain crop despite spring planting delays. The Argentine Ag Ministry estimated growers there to be 73.8% sold on their 2014/15 wheat, up from 51.7% sold this time last year. Trade estimates for tomorrow's weekly export sales are zero on old crop and maybe 300,000-400,000 TMT on new crop. Sep 15 CBOT Wheat closed at $5.20, up 1 1/2 cents; Sep 15 KCBT Wheat closed at $5.55, up 4 1/2 cents; Sep 15 MGEX Wheat closed at $5.78 3/4, up 3 1/4 cents.