Nogger's Blog

03/06/15 -- Soycomplex: Beans closed lower, as Informa raised their forecasts for production this year in both Brazil and Argentina. For the former they now see output at 95.5 MMT, up 1 MMT from previously and also 1 MMT above the USDA's May estimate. In Argentina Informa now predict a crop of 60 MMT, up 1.5 MMT from previously and also 1.5 MMT higher than the USDA. Washington are due to release their latest supply and demand estimates next Wednesday Jun 10. The Argentine government said that growers there now have nearly 40% of their new crop soybeans sold versus 35% committed a year ago. The Brazilian Trade Ministry said that the country exported a massive 9.34 MMT of soybeans last month, up from the 6.55 MMT shipped out in April and versus the 7.61 MMT exported in May 2014. Meal exports were 1.59 MMT versus 1.20 MMT the previous month and 1.42 MMT a year ago. The US weather outlook remains largely non-threatening. An El Nino summer would probably be conducive for good US soybean yields, particularly in the western corn belt, although it can sometimes bring dryness to eastern states. Oil World cut their forecast for the global rapeseed crop to 67 MMT, down 2.9% on a year ago and 1.1 MMT below the USDA. Note also that the USDA has global consumption in 2015/16 at nearly 70 MMT. The trade remains concerned about recent frost damage to canola in Canada. Trade forecasts for tomorrows weekly export sales report for beans are in the 250-550,000 MT range for both crop years combined. Estimates for soybean meal are around 100-350,000 MT. Jul 15 Soybeans closed at $9.35 1/4, down 5 1/2 cents; Nov 15 Soybeans closed at $9.15, down 2 cents; Jul 15 Soybean Meal closed at $302.70, up $0.90; Jul 15 Soybean Oil was back on the offensive, closing at 34.73, up 56 points.

Corn: The corn market closed with little change. The EU Commission increased their forecast for corn production here from 66.3 MMT to 69.1 MMT, although that's still well below last year's record 77.8 MMT. Informa raised their view on Argentina by 1 MMT to 25 MMT, and also added 1 MMT to Ukraine taking their crop up to 24 MMT. The Argentine government said that growers there now have over 48% of their new crop corn sold, up 10 points on a year ago. The Brazilian Trade Ministry said that the country exported just 39 TMT of corn in May, down from 159 TMT in April and versus the 127 TMT shipped out in May 2014. The US Energy Dept reported weekly ethanol production at a decent 972,000 barrels/day last week, up 3,000 bpd from the previous week, reaffirming the notion that corn prices have got themselves low enough so that some idled plants have been brought back into production. In the coming years India, which produced 22.7 MMT of corn in 2014, is expected to drift towards planting more corn as it gains acreage from water-intensive crops such as wheat and rice due to depleting water tables, say Rabobank. The country could produce around 29 MMT by the end of the decade, they say, sustaining exports of around 3-4 MMT. The new crop soybean:corn price ratio finished at 2.43:1 tonight. The USDA reported DDGs shipments to China of over 600 TMT in April, the second largest monthly volume exported to the nation ever. It was also nearly two thirds of all US DDGs export in the moth. Taiwan tendered for 130 TMT of US, Brazilian, Argentine or South African corn. Trade estimates for tomorrow's weekly export sales report are around 550,000 MT to 1 MMT for both marketing years combined. Jul 15 Corn closed at $3.59, unchanged; Dec 15 Corn closed at $3.76 3/4, up 3/4 cent.

Wheat: The wheat market closed lower by varying degrees across the three exchanges. Informa estimated the US winter wheat crop at 1.481 billion bushels, down from a previous forecast of 1.486 billion following recent heavy rains on the Plains. They did however still increase US all wheat production from 2.132 billion bushels to 2.143 billion, which is also higher than the USDA's current 2.087 billion forecast. The EU Commission forecast a 2015 EU soft wheat crop of 141.5 MMT, down slightly from 141.6 MMT previously and 4.9% below a year ago. Mark Smulders, a senior economist at the FAO estimated the EU all wheat crop also down 4.9% to 148.5 MMT this year. Global wheat production may fall 1.4% to 719.1 MMT, he said. The Argentine government said that growers there now have nearly 77% of their 2014/15 wheat sold versus being 54% committed a year ago. Trade bodies in Russia are appealing to the government to make changes to the new rouble-price based export tax on wheat due to begin on Jul 1. There are some reports that the recent freeze damage to Canadian canola fields in Manitoba, Saskatchewan and Alberta might lead to increased spring wheat plantings, as availability of surplus canola seed is said to be "very tight". The FAO forecast a 7 MMT Moroccan wheat crop, up sharply from 5.1 MMT a year ago, helped by "timely and locally abundant rains". Barley production there was forecast to rise 47% to 2.5 MMT as well. There's talk of some winter wheat being cut again in Texas following recent heavy rains, with some farmers said to be using special rice tyres to get into the fields. There's said to be some evidence of sprouting among what has been cut. Trade forecasts for tomorrow's weekly export sales report are around 150-450,000 TMT. The official 2014/15 US wheat crop year is now over, although this data will only go up to May 28. Jul 15 CBOT Wheat closed at $5.10 3/4, down 1 3/4 cents; Jul 15 KCBT Wheat closed at $5.29 1/4, down 6 1/4 cents; Jul 15 MGEX Wheat closed at $5.63, down 8 1/4 cents.