Chicago Grains Comment: USDA Report Provides Little Direction
09/03/15 -- Soycomplex: Beans closed around a cent or two higher on the day. The USDA appeared reluctant to make too many changes to it's WASDE report, cutting the US crush by 10 million bushels, and therefore raising ending stocks a similar amount. Brazilian and Argentine production was left unchanged. Brazilian exports were raised 1 MMT. World ending stocks fell 1.55 MMT. China's imports were increased from 80.5 MMT to 82 MMT. IMEA said that Brazil's Mato Grosso state growers are already 66% sold on new crop beans, up 6 points on this time last year (and they were well advanced with sales then too). Brazil said that they'd exported over 2 MMT of beans in Feb, up nearly 400 TMT versus Jan and more than double the volume shipped out in Feb 2015. Mar 16 Soybeans settled at $8.80, up 2 1/2 cents; May 16 Soybeans settled at $8.85 3/4, up 1 1/4 cents; Ma 16 Soybean Meal settled at $269.60, down $1.20; Mar 16 Soybean Oil settled at 31.52, up 60 points.
Corn: The corn market closed with little change following a USDA report that did little to provide any meaningful new direction. The US corn balance sheet was totally unaltered, as too was South American production. There were higher Brazilian exports last season, which resulted in reduced ending stocks getting carried into 2015/16 and hence a cut in carryout this year. South African corn production was reduced by 0.5 MMT to 6.5 MMT and imports were boosted a similar amount to 3.5 MMT. Nothing too startling in any of that lot. The US Energy Dept reported weekly US ethanol production at 987,000 barrels/day, down 9,000 bpd from a week ago. Brazil's IMEA said that farmers that had forward sold 60% of this year's new crop corn, some 18 points ahead of where they were this time last year. The market will now turn it's attention to US planting progress and the weather ahead of the Mar 31 planting intentions report. Some early planting is underway in Texas. Mar 16 Corn settled at $3.59, up 1/4 cent; May 16 Corn settled at $3.59 1/2, down 1 cent.
Wheat: The wheat market closed slightly firmer. The USDA left US all wheat ending stocks unchanged at 966 million bushels versus trade expectations of a small increase to around 975 million. World ending stocks were cut by 1.27 MMT. World production is still 7 MMT above last year and carryout is still 23 MMT over last year though, so there's no shortage of wheat just yet. Jordan bought 100,000 MT of hard wheat of optional origin for Aug/Sep shipment. It was said that a fair proportion of the recent Saudi wheat purchase was possibly of German origin. Pakistan's Ag Min said that they might harvest a record 26 MMT of wheat this year. versus 25.5 MMT in 2015. Media reports conflict surrounding Egypt's wheat imports. Some say that they've settled on a new ergot maximum inclusion level of 0.55% and some say that they have stated that they will continue to attempt to press home with their zero tolerance stance. We can expect a tender in the next week or so to maybe clarify the matter. May 16 CBOT Wheat settled at $4.68 1/4, up 3 cents; May 16 KCBT Wheat settled at $4.75 3/4, up 4 3/4 cents; May 16 MGEX Wheat settled at $5.05, up 1 1/4 cents.
