US Weather Latest
Monday night's USDA crop progress report shows that harvesting is running 3 to 4 weeks late due to very poor weather, says Gail Martell of Martell Crop Projections. The majority of Midwest and Mid South farms have received 50% above-normal rainfall over the past month. In addition, crop drying has been poor due to cold temperatures, 9 F below average last week in the Corn Belt, she says.
The weather is not improving and in fact looks extremely wet again this week. The updated GFS model indicates heavy rain in the entire grain belt, except in parts of Michigan and Ohio, she adds.
A hard freeze on the weekend damaged immature corn in the Eastern Midwest. Corn ripe and safe from frost was 70-80% in Wisconsin, Michigan, Illinois, Indiana and Ohio, when a hard freeze occurred Sunday night. Ordinarily, a mid October freeze would not be cause for concern, but slow development this year is causing 2-4 week delays in maturity, warns Gail. However, corn that matured safely before the freeze will make very high yields, she says.
Meanwhile, two soybean diseases - sudden death syndrome (SDS) and soybean white mold - are wide spread in Iowa this season, she warns. Plant pathologist XB Yang at Iowa State University said that SDS showed up in August in almost every Iowa region. White mold was so abundant in northern Iowa that Yang found this yield-reducing disease in almost every field on a September 18th scouting trip. The high incidence of disease makes the USDA Iowa soybean yield at 52 bushels per acre seem too high, as that estimate is 5.5% above trend, concludes Gail.
Gail is just getting here website up and running, so why not take advantage of it - whilst it's still free!
Martell Crop Projections
Russian Grain Harvest Latest
As the Russian grain harvest winds down, it would seem that yet again final production is significantly higher than recent official estimates. Anyone spotting a trend here?
Having said that, it looks like final production is probably in line with other trade estimates from more reliable sources like SovEcon.
To date the total Russian grain harvest is 98.8 MMT in bunker weight, say the Ag Ministry, which is down on the 112.2 MMT harvested in bunker weight last season.
The wheat harvest has amounted to 62 MMT, they say, and the barley harvest 18.5 MMT.
If we convert that to clean weight then we should end up with a wheat harvest of around 59.5-60.5 MMT and a barley harvest of 17.5-18.0 MMT. That compares with a clean weight harvest of 63.3 MMT and 24 MMT last season.
CBOT Closing Comments
Soybeans
November soybean futures closed at $9.82 1/2, down 13 3/4 cents; December soymeal futures at $292.50, down 5.80 points and December soy oil futures at 37.47 cents, down 12 points. The continued slow pace of this season's harvest remains a serious concern. Harvest only improved from 23% last Sunday to 30% as of this Sunday, which is still 34 points behind last year and 42 points behind the five year average. South American group Celeres, estimate that the Brazilian soybean crop is currently 12% planted.
Corn
December corn ended down 1 3/4 cents at $3.84 1/2, and March corn ended down 1 1/4 cents at $3.96 3/4. Harvest progressed from 13% last week to just 17% as of Sunday, and consequently remains well behind last years 28% and the five year average of 46%. The states remaining most behind their averages are Illinois, Indiana, Minnesota, Michigan and Ohio. Harvest pace is now at the slowest level since the USDA began publishing weekly progress reports in 1985.
Wheat
December wheat closed down 1/4 cent at $5.17 1/2. The very slow progress in the corn and soybean harvest is seen adversely affecting winter wheat plantings, especially SRW in eastern states like Illinois and Ohio. World wheat demand seems to be picking up, but a firmer dollar today won't help that come the way of US wheat too much. The Russian wheat harvest is now seen at around 62 million tonnes in bunker weight.
EU Wheat Ends Higher
EU wheat futures closed a little higher Tuesday with Paris November milling wheat closing up EUR0.25 at EUR127.75/tonne, and London November feed wheat ending up GBP0.75 at GBP102/tonne.
Dryness in many parts of Europe has not got newly-planted winter wheat off to the best of starts. Meanwhile, excessive wetness is the problem in the US, with the corn and soybean harvest severely delayed threatening to cut winter wheat acres.
In Illinois, the second top US corn and soybean state, only 13% of the state soybeans have been gathered and 11% of corn. For both crops this represents delays of more than one month. Corn here would be 68% complete normally and the soybean harvest 795 done.
For once there wasn't too much change on the currency front, so that had little influence today.
Demand is finally picking up, according to some reports, and a little bit of interest is now also filtering through from spec money dissatisfied by the prospective dismal returns offered by historically low global interest rates.
Reports emanating from India suggest that local millers there might be back in the wheat import market before new crop supplies arrive on the market in the spring.
eCBOT Close, Early Call
The overnight markets closed mixed with beans down 4-6 cents, corn 1-2 easier and wheat mixed a cent or so either side of unchanged.
Last night's data from the USDA shows that this season's corn & soybean harvest is easily the latest in at least the last thirty years.
That's bullish for winter wheat, particularly SRW wheat in states like Illinois and Ohio where huge areas of soybeans are still to be harvested before any attempt at getting wheat into the ground can be made.
Three storms over the next two weeks will again put harvest in a holding pattern for many Corn Belt, Plains and Delta farmers, say QT Weather.
Crude oil briefly popped it's head up above the USD80/barrel mark, setting a new high for the year. A weak dollar is also supportive for grains.
Indian wheat futures hit limit up after the governments much-awaited release of state-owned stock tender prices were released, pegging levels significantly higher than millers had hoped.
Algeria bought 300,000 MT of optional origin wheat overnight, and Japan is tendering for 133,000 MT of US/Canadian and Australian wheat. As usual the majority will be of US origin.
European and Asian stocks rose ahead of further expected gains on Wall Street. Apple and Texas Instruments posted decent Q3 profits last night, whilst Caterpillar, DuPont and Pfizer are all making bullish noises today.
Early calls for this afternoon's CBOT session: corn called 1 to 2 lower; soybeans called 3 to 5 lower; wheat called mixed.
Big Day For The Pound Tomorrow
The release of the minutes from the Bank of England's October meeting tomorrow may be a defining moment for the pound.
Sterling has jumped by around 7 cents against the dollar and from 1.070 to 1.0950 against the euro since the early part of last week, largely on comments from MPC member Paul Fisher that QE was working.
Tomorrows minutes will cast some light on whether this is the general consensus amongst the MPC policymakers. Especially in the light of another member of the committee being quoted over the weekend as saying that the BoE should continue it's QE measures as the financial system is still not fully recovered.
Last month's minutes revealed that the MPC did not rule out expanding QE somewhere further down the road to recovery. Yesterday they said that "it is possible that sterling's depreciation may be part of a more prolonged process of rebalancing of the UK economy, generating a fall in the long-run sustainable real exchange rate."
Both statements appear to suggest that the recent recovery in sterling may only be temporary.
Meanwhile, news out today reveals that public-sector borrowing in the UK increased to GBP14.8 billion in September (from a revised reading of GBP14.7 billion in the previous month) marks the biggest deficit since record keeping began in 1993. Additionally, public sector net cash requirement rose to a 25-year high of GBP19.4 billion during the same period.
Crude Oil Breaches USD80/Barrel
Crude oil broke through the USD80/barrel mark this morning, albeit briefly, to set a new high of USD80.05/barrel for 2009.
The move seems to have more to do with outside influences than supply and demand fundamentals however.
Spec money certainly isn't turned on by US (or UK/Eurozone) interest rates and appears to be looking for better returns from commodities and equities as a bit of consumer confidence returns.
Good results for Q3 from Apple last night lent a bit of weight to ideas that a global economic recovery is underway.
With an estimated 125 million barrels of crude oil/other fuels still sloshing around on the high seas in floating storage waiting for a home, for some recovery can't come soon enough.
A weak dollar is also behind some of the positive tone behind crude, but most of the upside appears to be speculatively-led in anticipation of a spike in demand before one even occurs.
There is some talk that a concerted move above USD80/barrel will trigger further computer-driven buying, pushing prices still higher. A move to USD90/barrel would be interesting, as that marks the halfway point between the 2008 (was it really ONLY last year?) all-time high of $147/barrel and the more recent low of $34/barrel.
United Oilseeds 2009 Financial Results
United Oilseeds has reported a pre-tax profit of £1.03 million for its financial year ended 30 June 2009. During the same period, the group’s net worth grew by almost 5% to £4.23 million compared to £4.04 million the previous year. Turnover also increased by 34.5% to £54.6 million from £40.6 million the year before.
Get the beers in then.
