Australia: NSW Plantings Latest
Industry & Investment NSW report mixed planting conditions in the state where "some districts have been able to capitalise on the good seedbed and full subsoil moisture profiles to almost complete winter crop plantings" yet other districts have almost no crops planted at all.
"Most areas are now in need of good rainfall to consolidate crops that have been sown, and enable the remaining crop to be sown," they say.
They forecast wheat plantings of of 2.91 M ha, 6% below the 3.10 M ha forecast at the same time last year. An estimated 1.63 M ha, or 56%, has been planted so far they say.
Current estimates have 36% of the north sown, 69% of the potential area sown in the centre and 54% in the south. Widespread rains (25-50 mm) are needed in the north east and south west to allow planting to recommence, they add.
Barley sowing predictions of 755,200 ha are similar to earlier forecasts, with around 47% planted so far. In the north only around 19% is sown, reflecting the dry conditions, 63% in the centre and 45% in the south, they estimate.
"The area estimated to be sown to canola is 304,050 ha, up 12,200 ha on the April forecast. About 91% of the crop has been sown, with the remaining area to be sown in the next two weeks," they conclude.
Early Call On CBOT
The overnights closed lower with beans down around 10-12 cents, wheat off around 5 cents and corn 5-6 cents easier.
Crude oil is sharply weaker, currently down the best part of USD2.50 at USD67.90/barrel. The API report on US crude oil stocks today and the US Energy Dept are out tomorrow, further inventory increases look like being on the cards. OPEC countries are said to be pumping oil at 2 million barrels per day over target.
The dollar is up again as it continues to benefit from the flight to safety with concerns over the size of European debt still hanging over the market.
US weather continues to look relatively benign. Corn crop conditions leapt 4 points to 71% good/excellent last night.
Meanwhile, North Dakota wheat planting is virtually finished aided by almost ideal sowing conditions last week.
Japan is shopping for 131,000 MT of wheat this week in it's usual tender.
Cooler and wetter conditions look like returning to European wheat areas this week, which should ease some crop production fears.
Early calls for this afternoon's CBOT session: corn and wheat called 4 to 6 lower; soybeans called 8 to 10 lower.
CBOT Closing Comments
Soybeans
July soybeans closed at USD9.40 1/2, down 1/2 cent; July soymeal ended USD1.90 lower at USD273.70; July soyoil was 0.56 cents higher at 37.52. The USDA pegged plantings behind the five year average at 53% versus 57% and towards the lower end of trade guesses. The dollar was higher again, limiting upside potential, whilst Euro debt concerns also weighed.
Corn
July corn ended at USD3.71, up 2 cents; Dec corn was at USD3.89, up 3 3/4 cents. The USDA's crop progress report showed corn planting at 93% complete versus the five year average of 89%. Emergence is at 71% compared to the five year average of 62%. The crop is rated 71% good/excellent, a four point improvement over last week.
Wheat
July CBOT wheat ended at USD4.67 1/2, down 4 1/2 cents; July KCBT Wheat was at USD4.90 1/2, down 4 1/2 cents; July MGEX Wheat ended at USD5.10, down 4 1/2 cents. Spring wheat plantings in the US are on par with the five year average at 91% with emergence at 70%. Winter wheat conditions were unchanged from last week at 66% good/excellent.
EU Wheat Closing Comments
EU wheat futures closed higher again, extending recent gains as dry weather continues to raise production concerns.
November London feed wheat closed GBP0.50 higher at GBP110.40/tonne and November Paris milling wheat ended up EUR1.75 at EUR146.75/tonne.
"Yield potential in wheat and barley crops is under threat after a cold dry spring. Winter cereals are very short this year and drought stress symptoms are apparent in many crops with reports of leaves curling in the heat of the day," say Farming Online.
The mercury hit 28C in various parts of the UK over the weekend, but things are set to cool down markedly this week, as winds shift to northerlies, with even a possibility of light frosts again in the north of Scotland.
It's still early days, as everybody keeps pointing out, but the trade seems suddenly nervous with few participants willing to swim against the tide and discount prices in order to obtain consumer orders.
Currency concerns also continue to play a part, with Spain needing to bailout a small provincial bank over the weekend the euro remains especially weak. That gives French and German wheat a competitive edge. Exports have been running ahead of anticipated levels this past few months, and ending stocks look like subsequently being a little less heavy than was projected a month or two back.
Defra Gets Budget Cut From Chancellor
New Chancellor George Osborne has announced that Defra will cop for a mere GBP162 million in cuts to it's budget, out of the proposed GBP6.2 billion the coalition government is attempting to save.
That's the gold monogrammed propelling pencils order cancelled then. But at least they're free to press ahead with the "Hilary Benn Is Not A Real Woman" promotional t shirts.
What To Keep An Eye On This Week
Tonight we have the USDA's planting progress reports and crop condition ratings (not for soybeans yet as it's too early for them). Further good progress is expected to have been made this past week. Corn was 87% planted and beans 38% done as of a week ago. I'd expect corn to be in the 95-98% region tonight and beans past halfway, maybe around 55% planted. The USDA had 67% of the corn crop rated good to excellent a week ago.
On Tuesday the US Senate vote on whether to extend the USD1/gallon biodiesel tax credit (which expired on Dec 31st 2009) until the end of the year. Biodiesel producers say that the industry isn't currently viable without the tax break, and have mothballed several plants since it disappeared. Tomorrows vote is part of a wider legislation to extend US unemployment benefits. If it gets the green light then that would be supportive for soybeans and oil.
The Chinese government's corn auction also takes place on Tuesday, they are offering up more corn than they did last week, but the vast majority of it remains in the northeast. Far away from the buyers in the south who have been booking US corn lately.
Will the Chinese be back for more US corn this week? Probably yes, if they are able to obtain the necessary import permits. Chinese corn prices on the Dalian exchange closed a little easier this morning, but shipping corn in from the US still offers significant savings for feedmills in the south of the country.
The USDA will report on export sales on Thursday, all eyes will be on the corn numbers for further confirmation of sales to the Far East.
Barley intervention in Europe comes to an end this week. It doesn't look like there will be a last minute rush, certainly not here where no offers at all were made last week at GBP90.97/MT less adjustments. So it looks like we will end this season with "just" 150,000 MT of intervention barley to dispose of sometime here in the UK.
The weather in the UK is set to cool down as the week progresses, so much so that there may even be light frosts on the cards again in the far north. Before that we have one last hot day, according to the forecasters, with a possibility of 30C in the capital today. The cool down has already started up here in Yorkshire that's for sure. Rain will be what everyone is hoping for, but so far only a few showers seem to be on the cards rather than the widespread soaking most farmers would appreciate.
That gets us through another week then, with a nice long weekend to look forward to. For the record the US is also closed next Monday for Memorial Day.
Russian Winterkill
The Russian State Statistics Service, or Rosstat, say that 10.8% of winter grains perished due to the harsh winter there. That's somewhat lower than the Ag Ministry estimate of 13.8%, but certainly towards the upper end of what would be considered normal.
Additionally, Russian losses have been quite light in the past few years. Rosstat say that only 1.5% of winter grains were lost to winterkill last season.
Winter wheat typically accounts for around 80% of all winter sown grains, and accounts for something like 70% of the national wheat crop.
Meanwhile, spring grain planting progress (excluding corn) is behind last years pace at 15.9% done as of May 1st at 6.6 million ha, according to Rosstat.
