Please, No More, Be Still My Aching Sides
India's junior agriculture and food minister K.V. Thomas has told reporters that the government are "considering" lowering the minimum price in their recently announced wheat tender.
Offering half a million tonnes under the Open Market Sale Scheme (OMSS) at way over world market price, has surprisingly not met with an avalanche of buying interest from Indian millers.
Curiously just yesterday Food and Agriculture Minister, Sharad Pawar, ruled out lowering the prices of food grains under OMSS.
Crikey, and you thought our government was bad. I think that these boys just like seeing their names in the papers.
It's a bit like the old....
Monday: Rooney Leaving Utd Shocker
Tuesday: I'm Staying Put - Rooney
Wednesday: Why I Have To Go - Rooney Exclusive
Thursday: Roo Who? - Fergie
Friday: I Hate That Stinking Manc Cess Pit - Rooney
Saturday: Fregie Hails Rooney Hat Trick
Sunday: I've Always Been A Manc Me La - Rooney
China - A Stock Take I'd Love To Do
The deeply dark and mysterious China National Grain and Oils Information Centre, or CNGOIC, have left their Chinese crop production numbers unchanged in their monthly crop report.
Despite the fact that every other official body on the planet say that this season's corn crop was badly hit by drought, the CNGOIC don't see it that way.
As long ago as September Shanghai-based JC Intelligence flagged up that all was not quite right with the Chinese corn crop. Back then JCI said that the crop would drop by around 20 MMT to 146 MMT.
Even the blind leading the blind USDA subsequently trimmed their production estimate to an erring on the side of caution 155 MMT.
The CNGOIC steadfastly insist that this season's corn crop is 163 MMT, a whopping 17 MMT more than JCI forecast. They also maintain that wheat production in 2009 was a smidge under 115 MMT, although many other analysts think that this number is also far too high.
This is the problem with China, we're simply never going to know, transparency is not something they do. The only problem is that's where 40% of the entire world's corn and 32% of global wheat ending stocks are supposed to be!
With Chinese corn consumption running at 159 MMT/per annum and wheat at 102 MMT/pa there isn't exactly a lot of room to just drop the odd 17 MMT here & there.
CBOT Closing Comments
Soybeans
January soybean futures closed USD10.44, down 9 cents, December soymeal futures at USD316.60, down USD4.80, and December soy oil futures at 40.11 cents, down 0.20 points. Outside markets were a disappointment, with crude oil and gold sharply lower and the dollar higher. Brazil's IBGE pegs the 2009-10 soybean crop at 64.9 MMT, Conab say 64.5 MMT. both estimates are well above last season's output of 57.1 MMT. The crop is 85% planted say Celeres. The USDA supply/demand report will be out Thursday, analysts estimate US soybean ending stocks at 235 million bushels, down from 270 million in the last report.
Corn
December corn futures closed at USD3.69 ½, up ¾ cents and March corn futures at USD3.85, down 1 ¼ cents. Over 10% of the US corn crop is still in the fields, and a foot or more of snow on the way for large parts of the Midwest. Martell Crop Projections report that 90% of corn yield losses associated with delayed harvesting occurred after mid November when corn dries much slower. Analysts are estimating 2009/10 corn ending stocks at 1.646 billion bushels for Thursday's USDA supply/demand report, up from 1.625 billion bushels in November. Weak outside markets also limited gains.
Wheat
December CBOT wheat futures ended at USD5.19 ¼, down 7 ¼ cents, December KCBT wheat futures at USD5.20 ½, down 4 cents and December MGEX wheat futures at USD5.33 ¾, down 5 ½ cents. ABARE lowered it's estimate for the Australian wheat crop by 700,000 MT to 22.0 MMT. Japan is looking for 131,000 MT of wheat in a tender Thursday, most of which will be US origin. Wheat ending stocks on Thursday from the USDA are expected to show a modest increase from 885 million bushels in November to 886.
EU Wheat Ends Lower
EU wheat closes Tuesday with Jan London feed wheat GBP1.25 lower at GBP105.50/tonne, and Jan Paris milling wheat down EUR1.00 at EUR128.75/tonne.
By recent standards things were quite active with London wheat trading over 600 lots and more than 10,000 lots of Paris wheat changing hands.
Certainly much of the London business looks like it was probably the rolling over of positions from January into March.
For all the talk that there is no demand, my spies tell me that the A19 was full of merchant's wheat lorries en-route to Ensus today. It seems like somebody is going to be pressing the big red button fairly soon, maybe they've got Mylene Klass booked? There's a joke in there regarding the releasing of my balls, but I won't attempt to find it.
Farmers generally seem like they don't want to sell, at least not this side of the New Year. Are they doing the right thing? Only time will tell.
It is worth considering that every arable farmer in the country (including those in Devon & Kent) seem to be thinking that Ensus will emerge as a forced buyer, pushing the domestic wheat market higher.
Simultaneously, every compounder/dairy farmer in the land reckons that they will also become a forced seller of DDGS.
So they will end up paying through the nose for their raw material, whilst selling their by-product at a knock-down price.
It could happen, but I don't think so somehow, the latter is far, far, more likely to be true than the former in my humble opinion.
CBOT Opening
Early CBOT calls were modestly higher with corn called up 2 to 4 cents, soybeans called 3 to 6 higher, and wheat called 1 to 2 higher.
As it happened the grains are mixed in early trade, with beans and wheat around 5-6 cents lower, and corn posting modest gains of a cent or so.
With over 10% of the corn crop still in the field, and a foot of snow on the way for large parts of the Midwest, it's not hard to see why corn is the strongest leg this afternoon.
Brazil's IBGE pegs the 2009-10 soybean crop at 64.9 MMT, Conab say 64.5 MMT. both estimates are well above last season's output of 57.1 MMT. The crop is 85% planted say Celeres.
Brazil's 2009/10 wheat crop will be 5.0 MMT say Conab, that's 14% down on last season.
ABARE lowered it's estimate for the Australian wheat crop by 700,000 MT to 22.0 MMT.
Japan is looking for 131,000 MT of wheat in a tender Thursday, most of which will be US origin.
In Thursday's supply and demand report the USDA is expected to raise 09/10 corn ending stocks from 1.625 billion bushels in November to 1.646. Soybean ending stocks are expected to decrease from 270 million bushels in November to 235. Wheat ending stocks are expected to show a modest increase from 885 million bushels in November to 886.
The reality of the situation is probably that soybean ending stocks will be lower than expected, and wheat stocks higher. But will the super cautious USDA figures report that?
They've been picking up Chinese soybean orders for fun of late, and exports combined with sales are running at 27.81 MMT, as of last week. That's 77% of the USDA's target for the whole of 2009/10, and we are only 13 weeks (a quarter of the year) into it. And China have booked another five cargoes of beans that we know of since then!
Wheat sales have not proved so promising, the recent hike in freight rates might have something to do with that. In last week's wheat tender offers of US grain to Egypt were well above Black Sea and European levels.
World Rapeseed Production, Use, Stocks
Oil World say that that 7.0 MMT of rapeseed was crushed in the EU in the first four months of marketing year 2009/10 (July/June). That is an increase of 3% from the 6.8 MMT crushed in the same period of previous season.
World rapeseed production for 2009/10 is now seen at 59.5 MMT (previous forecast 58.3 MMT, previous year 58.2 MMT), after revising Canadian output up to 11.8 MMT (10.5; 12.6), they say.
Global use is expected to reach 59.7 MMT (59.4; 55.8), including a crush of 56.3 MMT (56.1; 51.8). Ending stocks are forecast at 6.7 MMT (5.9; 6.9).
French Nov 1st Grain Stocks Up Almost 25 Pct
Commercial French grain stocks on Nov 1st were up almost 25% on year ago levels to 25.6 MMT (from 18.6 MMT), according to government data.
Sort wheat stocks were 11.2 MMT (2008: 9.8 MMT), barley stocks 6.8 MMT (4.9 MMT) and corn stocks 5.9 MMT (2.6 MMT).
The figures also show that France exported 3.9 MMT of wheat (excluding durum) in the first three months of marketing year 2009/10 (July/June), down 5% compared to 4.1 MMT exported in the same period of the previous season. Of that total 1.6 MMT (1.8 MMT) went to other EU countries and 2.3 MMT (2.4 MMT) were exported outside the EU.
Barley exports were 1.2 MMT (2008: 1.3 MMT), almost all of which went inside the EU. Corn exports came in at 1.7 MMT (1.2 MMT), of which 1.6 MMT went inside the EU.
The top French wheat export home was Italy at 357,000 MT, Belgium took the most barley at 321,000 MT and Spain took the most corn at 564,000 MT. Corn exports to the UK were up sharply in the period to 113,000 MT fro 75,000 MT in 2008.
Germans Offer 780,000 MT Barley Into Intervention
German farmers have offered 780,000 MT of barley into the EU Intervention scheme since it opened on November 1st, according to German agricultural agency BLE.
The Germans obviously fancy around EUR102/tonne a lot more than their UK counterparts, who have only put up around 13,000 MT of barley for intervention so far - and the vast majority of that has been in Scotland including a storage contract.
The Germans alone are expected to put around 1.5 MMT into intervention this season, the problem with that of course is that it's got to come back onto the market at some point.
Ditto everything else being offered up by the French, the Danes, the Eastern Europeans and Uncle Tomaz Cobblski.
