Chicago Grains Rally Following USDA Numbers

30/09/16 -- Soycomplex: Soybeans closed higher in two-sided trade. The USDA pegged Sept 1 stocks at 197 million bushels, fractionally lower than the average trade guess but marginally higher than the 195 million estimated previously. Last year's soybean production was lowered to 2.82 million bushels on a downward revision in harvested acres. Now that this is out of the way the trade will be looking forward to the USDA crop production report on Oct 12. A Bloomberg survey into trader/analyst sentiment found only 3 soybean bulls, 9 bears and 7 neutrals. The USDA reported the sale of 118,000 MT of soybeans for delivery to China and 198,000 MT for delivery to unknown destinations, both for delivery during the 2016/17 marketing year, under the daily reporting system. Nov 16 Soybeans settled at $9.54, up 3 3/4 cents; Jan 17 Soybeans settled at $9.59 1/4, up 3 cents; Oct 16 Soybean Meal settled at $297.90, unchanged; Oct 16 Soybean Oil settled at 33.24, up 15 points. For the week front month beans were a cent lower, meal fell $5.30 and oil was down 7 points.

Corn: The corn market closed around 7 cents higher on the day and fractionally better for the week. The USDA estimated Sep 1 stocks at 1.737 versus an average trade guess of 1.754 billion. Some in the the trade had been prepared for an even larger number, so this was viewed as mildly friendly. China are reported to have authorised 2 MMT of corn exports in the coming year. the first exports of any volume in a decade as they increase their efforts to reduce their huge stockpiles. Another government auction of 2.4 MMT today met with virtually zero response. South Korea are reported to have been busy buying corn the past few days with KFA booking 120 TMT of optional origin for Jan/Feb shipment, MFG buying 69 TMT of optional origin for Jan shipment and NOFI taking 134 TMT of optional origin. The Buenos Aires Grain Exchange report Argentine corn at 21.5% planted, up from 15.2% a week ago. Dryness there remains an issue. A Bloomberg survey into trader/analyst sentiment found only 4 corn bulls, 7 bears and 8 neutrals. Dec 16 Corn settled at $3.36 3/4, up 7 1/2 cents; Mar 17 Corn settled at $3.46 1/2, up 7 1/2 cents. For the week Dec 16 corn was up 1/4 of a cent.

Wheat: The wheat market closed mixed on the day and for the week. The USDA put Sep 1 all wheat stocks at 2.527 billion bushels, larger than the average trade guess of 2.438 billion. These are the highest Sep 1 US wheat stocks levels since 1988. Total wheat production was 2.309 billion bushels. Bearish numbers, yet still the market managed a rally, helped by rising corn and beans. The USDA's FAS in Turkey cut the wheat crop there to 17.25 MMT (19.50 MMT a year ago) due to drought. Imports in 2016/17 were estimated up 25% at 5.0 MMT. Russia will likely be the main beneficiary of that. SovEcon estimated Russia's 2016/17 grain exports at a record 40 MMT, with wheat hitting an also all-time high 31 MMT. Russia said that they'd harvested 75 MMT of wheat so far off 96.6% of plan. Ukraine said that they'd exported 6.47 MMT of wheat so far this season. Morocco tendered for 130,000 MT of soft wheat. A Bloomberg survey into trader/analyst sentiment found 5 wheat bulls, only 3 bears and 11 neutrals. Dec 16 CBOT Wheat settled at $4.02, up 3 cents; Dec 16 KCBT Wheat settled at $4.15 1/2, down 1 3/4 cents; Dec 16 MGEX Wheat settled at $5.14 1/2, up 4 3/4 cents. For the week Chicago wheat was down 2 3/4 cents, Kansas was 6 cents lower and Minneapolis rose 10 3/4 cents.