Chicago Grains: Beans End Just 5-Cents Off Multi-Year Lows

05/11/15 -- Soycomplex: Beans closed sharply lower, and within 5 cents of matching the recent multi-year low for a front month set on Sep 22. Weekly export sales shocked, coming in at only 655,600 MT for 2015/16 - a marketing-year low - being down 69 percent from the previous week and 61 percent below the prior 4-week average. Trade expectations were for sales of 1.4-1.8 MMT. Exports of nearly 2.2 MMT, with over 1.7 MMT of that going to China, were pretty good though, being up 17 percent from the prior 4-week average. There may have been a "risk off" element to today's trade ahead of next Tuesday's WASDE report from the USDA. Brazilian ports are said be be getting caught up in logistics due to heavy demand, and rain delays. Some ports are said to have loading delays of twice this time last year. Not a good time then for Brazilian truck workers to announce an indefinite strike starting Monday. MDA CropCast were unchanged on their forecast for the global (308.3 MMT) and US soybean crops (3.863 billion bu) from a week ago. The FAO raised their forecast for the world soybean crop by 1 MMT to 319 MMT, but lowered ending stocks by 1 MMT to 51 MMT. "In Brazil, conditions are generally favourable as planting progresses, though there is limited concern due to irregular rainfall, which is expected to increase in coming weeks and there is some concern in Rio Grande do Sul due to excess rainfall," they said. A Bloomberg survey into trader/analyst sentiment in beans returned - Bullish: 4; Bearish: 10; Neutral: 14. Nov 15 Soybeans settled at $8.67 3/4, down 14 1/4 cents; Jan 16 Soybeans settled at $8.64, down 20 cents; Dec 15 Soybean Meal settled at $296.40, down $5.40; Dec 15 Soybean Oil settled at 27.83, down 67 points.

Corn: The corn market settled around 5-6 cents lower. Weekly export sales of 556,000 MT for 2015/16 were down 22 percent from the previous week, but up 7 percent from the prior 4-week average. Trade expectations were for sales of 450-650,000 MT. Celeres estimated the Brazilian 2015/16 corn crop at 86.41 MMT, down 1.49 MMT from their previous forecast. MDA CropCast increased their global corn production estimate by 1.21 MMT to 948.3 MMT, largely due to an extra 1.23 MMT for Ukraine where they now have production at 22.6 MMT (although the USDA are at 25 MMT until next week at least). MDA went unchanged on US production at 13.695 billion bushels. The FAO lowered world corn production in 2015/16 by 3 MMT from a month ago to 1004 MMT, and cut ending stocks by a similar amount to 220 MMT. Consider that the USDA are currently 31 MMT lower on the size of the global corn crop than that, and 32 MMT below them on 2015/16 carryout. "In the US, harvest is almost complete and yields are good. In the EU, conditions are largely unfavourable due to the earlier summer heatwave and lack of rain. In Ukraine, yields are expected to be down due to earlier dry and hot weather," they said. China's 2015/16 corn crop may be smaller than originally expected. "Corn production in China, the world’s second largest corn producer, is expected to shrink by 5.8% this year due to drought and wind damage, Bloomberg News reported yesterday. New data on China corn potential comes from a SGS SA, a researcher hired by Bloomberg, who conducted an extensive survey among corn farmers. Heilongjiang, the leading corn province, would see a 12% reduction in corn output, based on survey results, due to drought and insect damage the report said. This is China’s leading corn province accounting for 15% of the harvest," said Martell Crop Projections. A Bloomberg survey into trader/analyst sentiment in corn returned - Bullish: 5; Bearish: 8; Neutral: 15. Dec 15 Corn settled at $3.74 1/2, down 6 cents; Mar 16 Corn settled at $3.82 3/4, down 5 1/2 cents.

Wheat: The market closed flat to 8 cents lower. Weekly export sales of just 84,600 MT for delivery in marketing year 2015/16 were down 85 percent from the previous week and 80 percent from the prior 4-week average. That was frankly an atrotious weekly total that could easily have had the market posting double digit losses. Exports of only 176,900 MT weren't much help either, being down 45 percent from the previous week and 52 percent below the prior 4-week average. Kansas wheat lost again relative to the Chicago market on anticipation of rain relief for US winter wheat. Soft wheat mills continue to search for quality in the east, providing support to Chicago but adding more to the discrepancy with Kansas City, said Arlan Suderman of Water Street Solutions. MDA CropCast were unchanged on their global wheat production estimate at 723.4 MMT, as well as that for the US crop at 2.218 billion bushels. The FAO added 1 MMT to their global wheat production and ending stocks estimates, taking them up to 736 MMT and 207 MMT respectively. "In the northern hemisphere the spring wheat season is complete and planting of winter wheat is ongoing under mostly favourable conditions with the exception of the Russian Federation and Ukraine where there is concern over dry conditions. In the southern hemisphere, conditions remain mixed. In Australia, conditions deteriorated due to lack of rains. In Argentina, conditions are generally favourable and in Brazil, mixed weather during all the season is expected to negatively impact yields. In South Africa, conditions are poor," they said. The Buenos Aires Grain Exchange said that Argentine wheat harvest progress is being delayed due to rains. Concerns remain over dryness in Russian and Ukraine winter wheat areas where planting is delayed, emergence is also retarded and "poor" crop ratings are far higher than a year ago. A Bloomberg survey into trader/analyst sentiment in wheat returned - Bullish: 7; Bearish: 6; Neutral: 15. Dec 15 CBOT Wheat settled at $5.26 1/4, unchanged; Dec 15 KCBT Wheat settled at $4.86, down 6 3/4 cents; Dec 15 MGEX Wheat settled at $5.16 1/4, down 8 cents.