Chicago Beans Close Back In On $10/bu Level
08/09/16 -- Soycomplex: Beans settled with nominal gains as prices close back in on the $10/bu level. The strong demand/record US production conundrum dominates. There were no daily sales to China or unknown today to back up the demand side of the coin however. The trade is looking for the USDA to raise soybean yields to 49.2 bu/acre in next Monday's WASDE report (48.9 bu/acre currently), with production increased to 4.089 billion bushels (up 29 million). Old crop edning stocks are forecast tightening to 232 million bu (255m previously), with new crop carryout unchanged at 330 million bu. CNGOIC forecast China's 2016/17 soybean imports at 85 MMT, some 2 MMT less than the USDA. August imports were 7.67 MMT, little changed versus Aug '15 or Jul '16. CNGOIC see China's soybean production at 13.1 MMT vs. 12.2 MMT from the USDA. Trade estimates for tomorrow's weekly export sales report are 1.0-1.5 MMT. Oil World said that Brazil's Aug soybean exports were down 26% at 3.83 MMT. Jan /Aug exports though were still up 5% year-on-year at 48.17 MMT. Ukraine are seen increasing winter rapeseed plantings by 10% for the 2017 harvest. Production in 2016 was down 31% at only 1.1 MMT. Sep 16 Soybeans settled at $9.92, up 1/4 cent; Nov 16 Soybeans settled at $9.76 3/4, up 1 1/4 cents; Sep 16 Soybean Meal settled at $325.10, up $1.30; Sep 16 Soybean Oil settled at 32.94, up 13 points.
Corn: The market closed around 5-6 cents higher on short-covering. Weekly US ethanol production came in lower at 998,000 barrels per day. The trade is looking for an average US corn yield of 173.4 bu/acre in Monday's WASDE report (down from 175.1 bu/acre last month). Ending stocks are pegged at 2.329 million bu vs 2.409 million in August from the USDA. China sold 476.5 MMT of state-owned corn reserves out of the 3.6 MMT offered for sale at auction. Another 1 MMT will be auctioned off tomorrow. CNGOIC pegs China's corn crop at 219.5 MMT, up 0.5 MMT from August and a 5.1 MMT increase from 2015/16. South Korea's MFG are tendering for 70,000 MT of optional origin corn. Trade estimates for tomorrow's one day delayed weekly export sales report are in the region of 800,000 MT to 1.3 MMT. Warm and dry conditions may be taking their toll on corn production potential in Europe, some are saying. French production might be the lowest since 2003 in what has been a disastrous year for their growers. Romania, Bulgaria and Poland are also said to be suffering. Sep 16 Corn settled at $3.27, up 6 cents; Dec 16 Corn settled at $3.38 1/2, up 5 1/4 cents.
Wheat: The wheat market closed firmer on all three exchanges. Short covering and hopes for a pick up in US exports were behind the move. There may have been an element of position squaring ahead of Monday's WASDE report too. The US is expected to sell 300 TMT of wheat to Morocco under a special inter-governmental deal. Morocco are also in the market for what will probably be EU wheat. French wheat exports are slowing, as expected following the poor harvest there. Other EU nations (Romania/Germany) are picking up the baton for now, but may not have much to sell themselves once we get into the second half of the season. That could provide an opportunity for US wheat it is thought. Dr Cordonnier reports that wheat harvesting in Brazil's Parana state is 2% done (10% a year ago), with a harvest of 3.3 MMT expected - similar to a year ago despite a 14% reduction in plantings. Russia said that it had exported 10.9 MMT of wheat Jan/Jul 2016 up sharply from 6.8 MMT the previous year. Algeria are thought likely to have bough between 300-500 TMT of wheat in their tender. Weekly export sales for wheat tomorrow are expected to be in the region of 350-550 TMT. Sep 16 CBOT Wheat settled at $3.77, up 1 3/4 cents; Sep 16 KCBT Wheat settled at $3.92 1/2, up 7 3/4 cents; Sep 16 MGEX Wheat settled at $4.95, up 3 1/4 cents.
