Chicago Grains Mixed, US Weather In For A Change?

01/06/15 -- Soycomplex: Beans closed lower, meal was sharply lower and oil posted big gains for a second session. Oil continued to benefit from Friday's EPA announcement revising up the US biodiesel blending mandate for 2015 to 1.7 billion gallons, up from the 1.2 billion previously proposed. The USDA reported weekly export inspections of only 73,190 MT, a pretty low number even if it did include the Memorial Day holiday. Safras e Mercado estimated the Brazilian soybean crop at 95.5 MMT, a 1.1 MMT increase from their previous forecast. Abiove aren't quite so high, although they did raise their forecast from 92.7 MMT to 93.1 MMT. Oil World estimated Canada's 2015 canola crop at 16 MMT versus 15.56 MMT a year ago, and forecast 2015/16 exports to rise 0.64 MMT to a record 9.3 MMT. The production figure is much higher than the 14.9 MMT from the IGC and the USDA's 14.8 MMT estimate. The Argentine crush workers strike is said to have been suspended until Monday. After the close the trade was looking for the USDA to report soybean planting at maybe 75-80% complete as of Sunday night, up from the 5-year average of 70% done, according to Benson Quinn. However they only reported a figure of 71% complete, meaning that things are only one point ahead of the 5-year average, and are also in fact now 4 points behind this time last year. Maybe the recent plentiful Midwest rains are becoming too much of a good thing? The USDA reported that 49% of the crop is emerged versus 46% a year ago and compared to 45% for the 5-year average. Contrary to market expectations they didn't release any crop condition ratings, so I guess that we will have to wait another week to get these. Jul 15 Soybeans closed at $9.26, down 8 cents; Nov 15 Soybeans closed at $9.01 1/4, down 4 1/2 cents; Jul 15 Soybean Meal closed at $296.60, down $9.10; Jul 15 Soybean Oil closed at 34.51, up 118 points and the highest since early November.

Corn: The corn market posted small gains, helped by good gains in wheat. Weekly export inspections of 975,985 MT were pretty decent. The USDA reported that US corn plantings had only advanced 3 points on the week to 95% complete. That's now little different to the 5-year average of 94%, which is also where progress was this time last year. They reported that 84% of the crop was emerged versus 79% for the 5-year average and 77% a year ago. Crop conditions were pegged at 74% good to excellent, which is unchanged on a week ago. "Spring weather has so far been very favourable for corn. Periods of heavy rain have alternated with strong sunshine, promoting strong growth and development. Topsoil moisture is mostly adequate, as less than 10% was short-very short moisture on most Midwest farms late in May," said Martell Crop Projections. "A favourable beginning does not necessarily lead to an abundant corn harvest in the end, however. Out of the last 5 years with similar favourability late in May, only 2 made a productive corn yield," they note. "The El Nino influence is an important factor for corn production as it promotes very generous summer rainfall that boosts the yield. The best rainfall typically favours the western corn belt in Nebraska, Iowa, Missouri, Minnesota and South Dakota. Less heavy rain is more common east of the Mississippi River. Indeed summer drought may develop with an El Nino in Illinois, Wisconsin, Indiana, Ohio and Michigan," they add. Russia said that it had exported 2.69 MMT of corn so far this season, down 29% on a year ago. Exports to Asia have picked up in recent weeks though. The leading Black Sea port of Novorossiysk shipped out 136 TMT of corn in May, a 4.4% increase versus April, with 76% of those exports going to South Korea. APK Inform said that Ukraine seaports exported almost 365 TMT of corn last week. Russian seaports shipped out 40,600 MT of corn, they added. Russia's Ag Ministry said that it's 2015 corn crop was 93.7% planted on 2.6 million ha. Jul 15 Corn closed at $3.52 1/4, up 3/4 cent; Dec 15 Corn closed at $3.69, up 1 cent.

Wheat: The wheat market closed with strong gains. Weekly export inspections weren't too bad at 359,693 MT. The USDA trimmed back winter wheat crop conditions by one percentage point to 44% good to excellent. They said that 84% of the crop is headed versus the 5-year average of 77%. Spring wheat is 91% emerged versus a 5-year average of only 69%. Spring wheat conditions were raised 2 points in the good to excellent category to 71%. Dryness concerns for Canadian wheat remain. "High pressure is stubbornly hanging on in the Canadian prairies, reducing rainfall chances in spring wheat. Less than 40% of normal rainfall developed in May in Saskatchewan and Alberta, the two leading wheat provinces. It’s the driest start to spring wheat planting since 2009," said Martell Crop Projections. US weather is in for a change however. "A sudden reversal in the weather is predicted, just the opposite from what occurred in May. The wave pattern in the jet stream is changing, as the calendar turns over to June. Much drier weather is predicted this week in the southern Great Plains following relentless rainfall in May that flooded Texas, Oklahoma and Kansas," they add. That should allow for some progress to be made with the winter wheat harvest. The market is therefore maybe a little nervous (and thus prepared to bank some profits on heavily short fund positions) in case more widespread quality issues emerge. In other news, Egypt said that it had bought 5 MMT of wheat on the domestic market since it's 2015 harvest began. That's far more than the government's intended 3.7 MMT target, but hardly that surprising when you consider that they are paying local growers the equivalent of around $366/tonne! Russia said that its spring wheat crop was 87% planted and that 88% of the spring barley was in. The Ukraine Space Research Institute, using satellite technology, suggested that winter wheat yields in Ukraine this year could fall 5-38% across the country's 25 oblasts. The mean figure was 20%. Sep 15 CBOT Wheat closed at $4.98 3/4, up 16 1/2 cents; Sep 15 KCBT Wheat closed at $5.23 1/4, up 15 1/2 cents; Sep 15 MGEX Wheat closed at $5.58, up 16 1/2 cents.