EU Grains Situation Becoming Clearer? And A Tip For Cheltenham - What Could Possibly Go Wrong?
17/03/16 -- EU grains closed mixed, rebounding this way and that in an effort to guide itself through the increasingly manipulative, and volatile markets in the UK and on the continent.
At the close of trading, Mar 16 London wheat was down GBP0.25/tonne at GBP100.80/tonne. In Paris, May 16 wheat closed down EUR3.50/tonne lower at EUR153.50/tonne, Jun 16 corn was down EUR0.25/tonne at EUR154.50/tonne and May 16 rapeseed was unchanged at EUR356.50/tonne.
On by one, various UK countries are stating that winter grain crops are coming out of the various stages of winter dormancy with little or no damage to that predicted 12 months ago.
They are also calling for 2016 production prospects broadly similar to those of a year ago.
Germany's DRV said just that yesterday, and the HGCA today joined them saying that all is well with regards to UK production when compared to 12 months previously.
Ukraine said that they probably need to replant around 15% of winter grains/oilseeds, and as they have adequate time in which to persue this then things should be well. Total winter wheat re-plantings are expected to be around 9% year on year, and -21% for rapeseed, they dded.
As winter turns into spring, we also have a better handle on prospective world currency, and thus commodity price movements.
The pound closed above 1.4450 versus the greenback last night, for a 4% rise in just a month so far.
The Fed is still looking for 2 more rate hikes this year, which is 2 more than any other major central bank.
Whisper it, but it just seems a whole lot more flexible on the timing of those increases.
Even more impressive is that NYMEX crude finished at $40.20/barrel last night, more than 50% higher where it was little over a month ago!
Didn't I say I had some good news for your? A Cheltenham hotpot to round off a week of splendid action from Prestbury Park? Zubayr 4/1 shot in the first race. For once, a home-trained nag that I'm optimistic will have Oirish reeling in it's wake come the home turn. What could possibly go wrong??
EU Grains Mixed, With Germany Production Seen Little Changed With Previously
16/03/16 -- EU grains closed mixed, but mostly a touch higher.
At the finish, front month Mar 16 London wheat was up GBP0.65/tonne at GBP102.05/tonne, May 16 Paris wheat was EUR0.25/tonne easier at EUR157.00/tonne, Jun 16 corn was down EUR0.25/tonne to EUR154.75/tonne and May 16 rapeseed was EUR1.75/tonne higher at EUR356.50/tonne.
Th German Farm Cooperatives Association estimated grain production there this year little changed from 2015.
THey see wheat production down 1.7% at 26.1 MMT, and the barley harvest about 1.9% lower at 11.4 MMT.
Winter rapeseed production will rise 0.7% to 5.04 MMT, they said. Slightly lower wheat and corn output will be mostly offset by an anticipated 8.7% hike in corn yields, taking production up 12.2% to 4.5 MMY, they say.
Coceral recently also forecast the German wheat crop at 26.0 MMT, with barley at 11.5 MMT and corn output of 4.7 MMT, so these new numbers are pretty similar to those.
In other news, Russia said that spring grain plantings were complete on 1.2% of the intended area (644k ha so far), significantly higher that 292k ha this time a yeat ago.
Ukraine said that they're all done on 431k ha of early spring grains, or 17% of the planned area compared with only 8% this time last year.
Egypt's GASC bought 240,000 MT of the 360,000 MT offered on their wheat tender, paying around $189/tonne including freight for two cargoes of French and on each of Romanian and Ukraine wheat.
They move does not however appeared to have clarified their stance on ergot, payment and other issues - hence the relatively low volume of cargoes put up for offer.
Chicago Corn Stuck In A Rut
18/03/16 -- Soycomplex: Beans closed around 4 cents lower, even though the NOPA crush number did come in higher (at 146.18 million bushels) than the market was expecting. Pre-report estimates were only 134.897 to 145.337 million and the average of that was 139.942 million. The Brazilian real was a bit weaker today, and the news yesterday that harvesting of their crop is now past halfway done seemed to add a bit of bearish sentiment. Aboive increased their forecast for the Brazilian soybean crop to 99.7 MMT. May 16 Soybeans settled at $8.92, down 3 3/4 cents; Jul 16 Soybeans settled at $8.97 3/4, down 4 1/4 cents; May 16 Soybean Meal settled at $268.20, down $3.30; May 16 Soybean Oil settled at 32.49, up 4 points.
Corn: The corn market closed virtually unchanged, although it's noteworthy that the Dec 16 contract posted its ninth daily gain in the last ten sessions (even if it was by only a fraction). Fresh news was scarce. Texas corn is 20% planted, double where it was this time last year. Rusagrotrans said that Russia would export a record 700,000 MT of corn in March (up from 642 TMT in Mar 2015). Ukraine's corn exports also remain brisk, accounting for 78% of all grain exports via seaports last week. Corn remains range bound - it hasn't closed outside the $3.50-3.75/bushel region on a front month since before Christmas. May 16 Corn settled at $3.68 1/2, down 1/4 cent; Jul 16 Corn settled at $3.73 1/2, unchanged.
Wheat: The wheat market closed mixed. Egypt tendered for wheat late, with the results expected tomorrow. That might clear the waters a little with regards to their ergot stance and/or traders willingness or otherwise to participate. The USDA reported Kansas winter wheat at 1 percent very poor, 6 poor, 37 fair, 50 good and 6 excellent. "For the week ending March 13, 2016, temperatures averaged nine to twelve degrees above normal across most of the State, according to them. Up to one inch of rain was received in portions of southeast and east central Kansas, while the rest of the State remained dry. Topsoil moisture rated 9 percent very short, 36 short, 54 adequate, and 1 surplus," they said. Jul 16 CBOT Wheat settled at $4.84 1/2, down 1 1/4 cents; Jul 16 KCBT Wheat settled at $4.98 3/4, down 1/4 cent; Jul 16 MGEX Wheat settled at $5.28 1/4, down 1 1/4 cents.
EU Grains Mixed, UK Exports Most Wheat Since 2011 In Jan
15/03/16 -- EU grains closed mixed, but mostly lower. Renewed sterling weakness ahead of tomorrow's budget was a bit supportive for London wheat. Not that the euro was strong either.
At the finish, front month Mar 16 London wheat was down GBP0.05/tonne at GBP101.40/tonne, May 16 Paris wheat was up EUR1.00/tonne to EUR155.25/tonne, Jun 16 Paris corn was down EUR0.25/tonne to EUR155.00/tonne and May 16 Paris rapeseed rose EUR0.50/tonne to EUR354.75/tonne.
It was interesting to see UK customs data report that wheat exports in January were 310,000 MT - the highest monthly volume since Dec 2011.
That takes the Jul/Jan marketing year so far total to 1.4 MMT, a 21% increase on a year ago. There was a bit more good news on the wheat imports front too - these fell to a near-two-year low of 82,319 MT in the first month of 2016.
Sterling weakness may indeed be helping a little, although that's still far short of the UK's exportable surplus of almost 4 MMT.
It also means that we'd need to ship out around 350,000 MT/month during the remaining Feb/Jun period of the season to avoid a year-on-year increase in carryover stocks at the end of 2015/16 - something that we haven't done since 2008/09, noted the HGCA.
Competition remains fierce, both on the continent and beyond. As noted above, the euro itself isn't exactly strong, and the Russian rouble stands only just above recent historic all-time lows versus the US dollar, so other countries are experiencing a currency benefit too.
Indeed, Russia's March grain exports were a record 2.3 MMT for the month, beating the previous all-time high 2.16 MMT by 6.5%.
That total included 1.4 MMT of wheat and 700 TMT of corn.
The EU weather outlook leans a bit cooler than normal for parts of France and Germany, with drier then normal also seen prevailing over northern France, and much of Germany and the UK. Elsewhere, southern areas, Spain, Italy, eastern and much of Europe and the Balkans are seen wetter than normal for the next 14 days.
Chicago Grains Mostly Firmer, As US Sells Wheat To China
14/03/15 -- Soycomplex: Beans closed around unchanged levels. Weekly export inspections of 715,186 MT were fair for the time of year. Season to date inspections are only 6.7% smaller than this time last year. The USDA currently predicts these falling more than 8% for the 2015/16 season. Brazil's harvest is seen past halfway done at 52% complete. The Brazilian real made a slight correction today. The monthly US NOPA Crush report is due out tomorrow. Mar 16 Soybeans settled at $8.88 and Mar 16 Soybeans settled at $8.88, both unchanged; Mar 16 Soybean Meal settled at $268.10, down $3.90,l Mar 16 Soybean Oil settled at 32.25, up 32 points.
Corn: The corn market closed firmer, especially on the deferred positions. Weekly export inspections were OK at 804,499 MT, being down 17% from last week, but 9.4% larger than the same week in 2015. Season to date inspections of 16.54 MMT are still lagging 19% behind the 2014/15 pace. Ukraine's total grain exports via seaports fell to 532 TMT from 776 TMT the previous week. Corn accounted for 414.6 TMT, or 78%. Russian seaports exported 543 TMT worth of grains last week, down from 597 TMT the previous week, and including 157 TMT, or 29%, of corn. Crude oil was back on the defensive today, but still stands more than 40% up off the mid-Feb lows. Mar 16 Corn settled at $3.66 3/4, up 3/4 cent; May 16 Corn settled at $3.68 3/4, up 3 3/4 cents.
Wheat: The wheat market closed higher. Weekly export inspections of 406,577 MT were fair, but the fact that fund money is short, and doesn't seem to fancy pressing that short to the downside any more just yet, is what's supporting the market. Marketing year to date inspections are now 12.5% behind the pace set during the 2014/15 marketing year. The drier outlook for areas of the Western Plains leans supportive. Private exporters reported to the USDA this morning that 100,000 MT of US HRS was sold to China this morning for 2015/16 delivery, which was friendly. Russia said that they'd exported 357 TMT of wheat via seaports last week, Ukraine exporters shipped out 117.3 TMT. May 16 CBOT Wheat settled at $4.78 3/4, up 3 cents; May 16 KCBT Wheat settled at $4.89, up 6 cents; May 16 MGEX Wheat settled at $5.21 1/4, up 6 cents.
EU Grains Mixed As Egypt Devalues
14/03/16 -- EU grains closed mixed, with Paris rapeseed slightly easier, and everything else up a tad.
At the close of trading, Mar 16 London wheat was up GBP0.15/tonne at GBP101.45/tonne. In Paris, May 16 wheat closed EUR1.50/tonne higher at EUR1456.25/tonne, Jun 16 corn was up EUR1.75/tonne at EUR155.258/tonne and May 16 rapeseed was down EUR0.50/tonne to EUR354.25/tonne.
It was a dull start to what promises to be a dull week, with only the fact that it's Cheltenham week breaking through the gloom. That at least would be good news if you were a betting man, but hey, you're most likely a farmer/trader/merchant/shipper or a crusher if you're reading this, so I'm guessing that you probably are.
Of course, that's no use unless we've got a tip lined up, preferably one to take on the Oirish at their own game and a decent enough price to make it worth raiding the piggy bank. We do, although the only bit of bad news is that we've gt to wait until Friday for it to run. But if you're a farmer/trader/merchant/shipper or a crusher then you must have patience too I assume, so stay tuned.
Back to the fundamentals, if you can find them. Ukraine spring grains are 12% planted on 320k ha. Most of that is barley (252k ha). The Ag Ministry there don't report on later spring grains, mostly corn, plantings yet. Fertliser applications have been completed on 76% of winter grains and 72% of winter OSR.
In Russia, early spring grain plantings are complete on 614k ha, or just 1.2% of plan.
Russian seaports exported 543 TMT worth of grains last week, down from 597 TMT the previous week. Last week's total included 357 TMT of wheat, 157 TNT of corn and 39 TMT of barley. Turkey (86.5 TMT), South Korea (57.8 TMT) and Jordan (53.6 TMT) were the main importers.
Ukraine's exports via seaports fell to 532 TMT from 776 TMT the previous week. Wheat accounted for 117.3 TMT of that total, and corn a further 414.6 TMT.
Greece (108.3 TMT), Spain (53.8 TMT) and Egypt (43.9 TMT) were the main importing nations.
Jordan announced a tender for 100,000 MT of optional origin hard wheat for Sep/Oct shipment. Morocco are tendering for 149.5 TMT worth of optional or domestic origin feed barley
Bloomberg reported that Egypt was devaluing its currency by almost 13%, which should cheapen wheat imports still further.
Chicago Grains Mixed Friday, But All Showing Net Weekly Gains
11/03/16 -- Soycomplex: Beans closed higher for an eighth session in a row, although the gains have only been relatively moderate. The Philippines bought 90,000 MT of meal in a tender, thought most likely to be of US origin. A Bloomberg survey into trader/analyst sentiment in beans found: 8 Bullish: 12 Bearish: 3 Neutral. The latest commitment of traders report shows fund money cutting their net short position on beans for the week through to Tuesday night by around 38.5k lots to leave them net short nearly 43k contracts. Mar 16 Soybeans settled at $8.88, up 6 1/4 cents; May 16 Soybeans settled at $8.95 3/4, up 6 1/2 cents; Mar 16 Soybean Meal settled at $272.00, up $1.80; Mar 16 Soybean Oil settled at 31.93, up 52 point.s. For the week, that puts nearby beans 17 1/2 cents firmer, with meal up $4.30 and oil 102 points higher.
Corn: The corn market closed 2-3 cents higher on the day and with fair gains for the week also. Japan bought 170,800 MT of US corn today, announced by the USDA under the daily reporting system. Coceral said that EU-28 corn production will rise 8% to 63.2 MMT this year. Production in both France and Hungary will rebound by more than 1 MMT each, and in Germany by the best part of 1 MMT. A Bloomberg survey into trader/analyst sentiment in beans found: 9 Bullish: 8 Bearish: 7 Neutral. Fund money remains sitting on a record/near record short position in Chicago corn, potentially limiting downside. Mar 16 Corn settled at $3.66, up 3 1/2 cents; May 16 Corn settled at $3.65, up 2 1/4 cents. For the week, Mar 16 corn was 11 1/2 cents higher and May 16 gained 6 3/4 cents.
Wheat: The wheat market closed lower on the day but higher for the week. Dry conditions on the southern Plains and wetness in the Delta offer modest support, especially with fund money short. The commitment of traders report shows them knocking off around 15k lots of that CBOT short for the week through to Tuesday night. Their overall net short is still around 92k contracts though. Cocereal gave us their first 2016 EU crop production estimates, pegging the soft wheat crop there at 145.2 MMT, a 3.5% decline on a year ago. France, Germany, the UK and Poland will all see production declines. Only Spain will see increases in soft wheat output among the major producing nations. A Bloomberg survey into trader/analyst sentiment in beans found bulls, bears and neutrals evenly split on wheat with 8 of each. May 16 CBOT Wheat settled at $4.75 3/4, down 1 1/4 cents; May 16 KCBT Wheat settled at $4.83, down 1/4 cent; May 16 MGEX Wheat settled at $5.15 1/4, up 2 3/4 cents. For the week, Chicago wheat was 15 cents higher, with Kansas up 14 1/4 cents and Minneapolis gained 17 1/2 cents.
