28/09/16 -- Soycomplex: Beans closed lower. The move came despite the USDA reporting sales of 133,000 MT of soybeans for delivery to China and 211,171 MT of soybeans for delivery to unknown, both for 2016/17, under the daily reporting system. So, demand is good at these near 5-month lows. The trade is looking for this to be backed up by weekly export sales of 1.0 and 1.4 MMT for beans tomorrow. Then all eyes will be on Friday's quarterly stocks report, with old crop Sep 1 bean inventories expected to come in around the 200 million bushel mark. Palm oil futures in Malaysia were lower overnight. Northern areas of Brazil remain very dry. Things are better in the south. Argentina is cold and dry. Nov 16 Soybeans settled at $9.45 1/2, down 7 cents; Jan 17 Soybeans settled at $9.52, down 6 3/4 cents; Oct 16 Soybean Meal settled at $299.70, up $0.40; Oct 16 Soybean Oil settled at 32.64, down 48 points.
Corn: Corn closed lower despite the USDA announcing a monster sale of 1,577,340 MT of US corn for delivery to Mexico under the daily reporting system. Of the total 1,036,320 MT is for delivery during the 2016/17 marketing year and 541,020 MT is for delivery during the 2017/18 marketing year. The US Energy Dept reported ethanol production up 8,000 barrels per day to 989,000 bpd last week. The average trade guess for Friday's USDA Sep 1 corn stocks figure is 1.754 billion bushels. Weekly export sales are forecast around 0.5 to 1.0 MMT. Safras reported Brazilian full season corn planting at 16% complete versus 21% typically at this time. Argentina have taken up the export baton from Brazil and shipped out a record 4 MMT of corn in August (versus only 1.54 MMT a year previously). South Korea's Kocopia were reported to have purchased 55,000 MT of US corn for Jan shipment in a tender. China are reported to have added a 10.7% anti-subsidy tariff to US DDGs imports. That's on top of the recently introduced 33.8% import duty. Dec 16 Corn settled at $3.29 1/4, down 2 1/2 cents; Mar 17 Corn settled at $3.39, down 2 3/4 cents.
Wheat: Wheat closed mixed. The average trade guess for Friday's Sep 1 stocks report is a large 2.438 billion bushels. The market is hoping that the US can pick up some export interest by playing the quality card that seems to be lacking from the hands of other global exporting nations this year. Trade forecasts for tomorrow's weekly export sales report are 400,000 MT and 650,000 MT for wheat. Trade gossip suggests that a problem might be looming for Australian wheat just prior to harvesting, where it's forecast to see temperatures dip below freezing in the most productive west of the country, whilst the east picks up heavy rain. The quality of the Canadian crop is also rumoured to be subpar, leading to an export demand shifting stateside, said FCStone. There's talk too that Russia's crop might be setting production records this year, but that the quality of that too is lower than normal. Argentina reported that it had exported 7.35 MMT of wheat Jan/Aug, double the volume shipped out in the same period in 2015. Dec 16 CBOT Wheat settled at $4.03 1/4, down 3/4 cent; Dec 16 KCBT Wheat settled at $4.21 1/4, up 2 cents; Dec 16 MGEX Wheat settled at $5.08 1/2, up 5 3/4 cents.
The day ended with Nov 16 London up GBP0.45/tonne at GBP126.20/tonne, Dec 16 Paris wheat was down EUR0.50/tonne at EUR161.00/tonne, Nov 16 corn was also down EUR0.50/tonne at EUR160.00/tonne and Nov 16 rapeseed fell EUR1.50/tonne to EUR373.75/tonne.
The Russian harvest is now reported to be 88.7% complete at 109.8 MMT. Wheat accounts for 74.2 MMT of that and barley a further 18.6 MMT (both 95% harvested). Corn harvesting is 20.7% complete at 3.1 MMT. Planting for the 2017 harvest is now 63% complete.
Winter plantings in Ukraine are slower at around a third done, with some concerns remaining over dryness. "This is behind the pace seen last autumn when below normal rainfall also hampered planting, and ultimately reduced the area of winter crops, including wheat and rapeseed," noted the HGCA.
There's talk of heavy rains in the east, and possible frost damage in the west, causing late problems for Australian crops just prior to harvesting. Temperatures in the west are forecast down to -4C, and parts of the eastern wheat belt could pick up rains of up to 100mm in the next few days, according to media reports.
Even if the rain doesn't damage yields then it could certainly lower wheat quality specifications in a year when this seems to be a common theme around the globe.
Russia's exports seem to be picking up now that the export duty on wheat has been abolished, with private firm Rusagrotrans forecasting these at 3.7-3.8 MMT in October (of which 3.0-3.1 MMT will be wheat) compared to exports of 3.5 MMT a year previously (of which 2.4 MMT was wheat).
Tunisia tendered for 67,000 MT of soft wheat, 42,000 MT of durum and 25,000 MT of feed barley.
Argentina is said to have exported 7.35 MMT of wheat in the first eight months of 2016, double the volume shipped out in the same period in 2015. Better production and the removal of export quotas/taxes will have helped. Brazil has been the top buyer.
27/09/16 -- Soycomplex: Soybeans closed higher, recovering from the 5-month lows hit earlier in the session which triggered bargain-hunting. The USDA announced another 120 TMT of US soybeans sold to China for the 2016/17 marketing year under the daily reporting system. Still, the possibility of further yield increases from the USDA in future WASDE reports remains an upside limiter. There may have been some short covering at the lows today ahead of Friday's stocks report from the USDA and the possibility of a surprise. Old crop ending stocks are guessed at around 200 million bushels, but there's a near 100 million difference between the highest and lowest guess. Nov 16 Soybeans settled at $9.52 1/2, up 7 1/4 cents; Jan 17 Soybeans settled at $9.58 3/4, up 7 1/4 cents; Oct 16 Soybean Meal settled at $299.30, up $1.70; Oct 16 Soybean Oil settled at 33.12, unchanged.
Corn: The corn market closed around 2-3 cents higher, correcting some of yesterday's losses in "Turnaround Tuesday" style. Spillover support came from rallying beans and wheat. Good demand also supports - US corn export inspections have been above 1 MMT for 17 weeks in a row now following yesterday's numbers. US harvest pace is running behind average but there's time to catch up. US growers are capable of harvesting 25% of the crop in a week if the weather plays ball. The EU Commission's MARS lowered their forecast for EU corn yields this year from 7.23 MT/ha a month ago to 6.84 MT/ha, although that's still more than 6.31 MT/ha a year ago. France was cut to 7.65 MT.ha versus 8.36 MT/ha a year ago and 9.11 MT/ha for the 5-year average. Ukraine's 2016 corn harvest is 15% done at 3.17 MMT. Russia's is 20% complete at 3 MMT. China offered 1.2 MMT of corn at auction today but picked up no interest. Dec 16 Corn settled at $3.31 3/4, up 2 3/4 cents; Mar 17 Corn settled at $3.41 3/4, up 2 3/4 cents.
Wheat: The wheat market closed with decent gains. Short covering was noted. There's some talk of quality perhaps becoming an issue for Canadian and Australian wheat, but there's little hard evidence of this yet. Trade gossip suggests a shortage is quality wheat is looming this year. Some say that growers with quality wheat are hanging onto it. Others say they simply haven't got it. Japan are in for 125,800 MT of US/Canadian wheat in their regular Tuesday tender. Morocco tendered for more US SRW. Ukraine winter wheat is said to be 33% planted. Russia is about 62% done. MARS lowered EU-28 soft wheat yields to 5.63 MT/ha from 5.86 MT/ha a month ago. French yields were cut to 5.62 MT/ha versus 7.92 MT/ha in 2015 and 7.34 MT/ha for the recent average. Argentina has turned cold and dry. "Temperatures in Argentina are quite cold with widespread freezing temperatures this week that could impact some of the developing wheat crop," said Dr Cordonnier. Dec 16 CBOT Wheat settled at $4.04, up 8 cents; Dec 16 KCBT Wheat settled at $4.19 1/4, up 5 1/4 cents; Dec 16 MGEX Wheat settled at $5.02 3/4, up 8 1/4 cents.
27/09/16 -- EU grains closed mostly a little higher as the EU Commission's MARS unit lowered their forecast for EU wheat, corn and barley yields this year.
The day ended with Nov 16 London wheat up GBP0.10/tonne at GBP125.75/tonne, Dec 16 Paris wheat was up EUR1.50/tonne at EUR161.50/tonne, Nov 16 corn was unchanged at EUR160.50/tonne and Nov 16 Paris rapeseed was up EUR1.50/tonne to EUR375.25/tonne.
MARS cut average EU-28 corn yields from the 7.23 MT/ha predicted last month to 6.84 MT/ha. "In many regions, the analysis period (Aug 21-Sep 23) was one of the warmest on our records. Hot and dry conditions in eastern Romania, Bulgaria and southern Ukraine as well as in southern France and western Italy partially affected water supply and shortened the duration of grain filling in maize and sunflower crops, thus reducing yield expectations," they said.
Corn yields in France, Europe's largest producer, were pegged at only 7.65 MT/ha versus 8.36 MT/ha a year ago and 9.11 MT/ha for the 5-year average.
EU soft wheat yields were estimated at 5.63 MT/ha from 5.86 MT/ha a month ago. French yields were cut to 5.62 MT/ha versus 7.92 MT/ha in 2015 and 7.34 MT/ha for the recent average.
EU barley yields were also lowered from 4.85 MT/ha to 4.77 MT/ha, although those for rapeseed were left unchanged at 3.20 MT/ha.
In the UK, wheat yields were estimated at 8.08 MT/ha, barley yields at 6.08 MT/ha and rapeseed yields at 3.30 MT/ha.
In Ukraine, winter wheat for the 2017 harvest is said to be 33% planted, and winter OSR 94% done. Grain harvesting is 74% complete at 42 MMT, including a corn harvest that's 15% done at 3.17 MMT.
Russian winter plantings are 62% complete on 10.8 million ha (10.1 million this time last year). The Russian harvest is 88% complete at 109.2 MMT in bunker weight. That includes 73.9 MMT of wheat, 18.6 MMT of barley and 3 MMT of corn so far.
There's talk of heavy rain possibly causing late damage to the Australian wheat crop just before they begin harvesting. Eastern areas are set to receive up to 100mm of rain in the coming days, according to the forecasters.
"It is still early days, but if these worries are realised, Australian quality issues would follow similar issues reported in many of the world’s main wheat producing/exporting regions, such as Russia. Global feed grain markets, already feeling the pressure of expected record world supplies, could become even heavier," say the HGCA.
Sterling dropped to a 3-year low against the euro today, which should underpin London wheat going forward.
Dry conditions across many parts of Europe and Ukraine are said to be causing emergence problems for newly planted winter crops, rapeseed in particular.
26/09/16 -- Soycomplex: Beans closed lower on harvest pressure and demand worries. Weekly export inspections of only 383,953 MT were the lowest since July and down 30% on last week. The USDA did report the sale of 240,000 MT of US soybeans for delivery to unknown destinations during the 2016/2017 marketing year, but that was largely ignored today. A lean spell is likely looming for US sales when China begins a week long holiday beginning October 1st. The USDA will release its quarterly stocks report on Friday with trade ideas for beans around 185 million bushels (as of Sep 1st) versus 195 million previously. After the close the USDA left weekly crop conditions unchanged at 73% good to excellent and said that 10% of this year's crop was now harvested (13% on average). Dropping leaves is 68% of the crop compared to 64% on average. The weather is turning drier this week which should advance harvesting. Seasonal lows are frequently set early October. Nov 16 Soybeans settled at $9.45 1/4, down 9 3/4 cents; Jan 17 Soybeans settled at $9.51 1/2, down 9 1/2 cents; Oct 16 Soybean Meal settled at $297.60, down $5.70; Oct 16 Soybean Oil settled at 33.12, down 19 points,
Corn: The market closed around 7 cents lower despite weekly export inspections of 1.335 MMT. That was nearly 65% larger than the same week a year ago. The forecast for better harvest weather across the next 10 days was however the deciding factor. The USDA said that harvesting of this year's crop was 15% complete as of Sunday night, 4 points behind the 5-year average. Crop conditions were left unchanged at 74% good to excellent. They said that 73% of the crop is mature (64% on average) and that 97% of the crop is dented, one point ahead of the norm. Early French corn yields are "confirming a disappointing season" and the harvest there might now struggle to reach 12 MMT, said Agritel. That would be more than 1 MMT below last year. High temperatures will cut this year's Romanian corn crop to "no more than" 8.75 MMT, according to one analyst. Production last year was 12 MMT. The USDA's FAS in the Philippines said that the country might produce 7.9 MMT of corn this year (7.5 MMT a year ago). Imports in 2016/17 are seen at 0.9 MMT versus only 0.1 MMT in 2015/16. Dec 16 Corn settled at $3.29, down 7 1/2 cents; Mar 17 Corn settled at $3.39, down 7 1/4 cents.
Wheat: The wheat market closed sharply lower. Weekly export inspections of 875,049 MT were impressive (up more than 150% from the previous week) but, as with corn, largely ignored. The USDA reported winter wheat planting at 30% done, in line with the 5-year average and trade expectations. Emergence was placed at 8%, also in line with normal. In Brazil, the state of Parana's wheat harvest is said to be 22% done and quality very good this year. That would be detrimental to US export hopes. The Russian Ag Ministry increased their forecast for wheat production there this year to 71 MMT, estimating a total clean weight grain crop of 113 MMT which easily beats the post-Soviet era record of 108 MMT set in 2008. Planting for the 2017 harvest (mostly wheat) is already nearly 60% complete. Russian grain exports have thus far been slow though at 7.83 MMT to Sep 21, a 9% decline versus the same period in 2015/16. Exports were though much better last week at 747.4 TMT versus a poor 229.4 TMT the previous week. Some 595.3 TMT of that was wheat. Dec 16 CBOT Wheat settled at $3.96, down 8 3/4 cents; Dec 16 KCBT Wheat settled at $4.14, down 7 1/2 cents; Dec 16 MGEX Wheat settled at $4.94 1/2, down 9 1/4 cents.
26/09/16 -- EU grains closed mostly lower to start the week. Fresh news was relatively scarce.
At the close Nov 16 London wheat was down GBP1.05/tonne at GBP125.65/tonne, Dec 16 Paris wheat was EUR1.25/tonne weaker to EUR160.00/tonne, Nov 16 Paris corn was down EUR2.25/tonne at EUR160.50/tonne, Nov 16 Paris rapeseed was EUR2.00/tonne lower at EUR373.75/tonne.
Rapeseed remains range-bound, having only closed outside the EUR370-380/tonne area once since Aug 12. That seems more heavily influenced by palm oil and soybean prices than rapeseed S&D fundamentals which are tight.
Early French corn yields are "confirming a disappointing season" and the harvest there might now struggle to reach 12 MMT, said Agritel. That would be more than 1 MMT below last year.
Spain on the other hand is expecting a total grain harvest 28% higher than a year ago at 23.82 MMT, according to the Spanish Co-operatives Association. They see wheat output (excluding durum) at 6.93 MMT versus 5.24 MMT a year ago and are forecasting a barley crop of 9.52 MMT (6.85 MMT in 2015). Corn production will however be lower due to a reduction in acreage (3,73 MMT from 3.98 MMT a year ago).
The Russian Ag Ministry increased their forecast for wheat production there this year to 71 MMT, estimating a total clean weight grain crop of 113 MMT which easily beats the post-Soviet era record of 108 MMT set in 2008. Planting for the 2017 harvest is already nearly 60% complete.
Russian exports have thus far been slow though at 7.83 MMT to Sep 21, a 9% decline versus the same period in 2015/16. How much of this is due to the now rescinded wheat export tax, or a lack of quality, remains to be seen. Certainly some of this could be attributed to Egypt's recent shenanigans re ergot.
Russia's exports via seaports did pick up last week, at 747.4 TMT versus a poor 229.4 TMT the previous week. Some 595.3 TMT of that was wheat.
Ukraine's exports continue unabated, with their seaports shipping out 648.4 TMT of grains last week, according to APK Inform. That's up from 596.1 TMT the previous week and was mostly (575.9 TMT) wheat. Top home was Morocco 145 TMT followed by Saudi Arabia (59.9 TMT).
High temperatures will cut this year's Romanian corn crop to "no more than" 8.75 MMT, according to one analyst. Production last year was 12 MMT.
23/09/16 -- Soycomplex: Beans closed sharply lower to end the week. Continued anecdotal reports of big yields and the outlook for drier weather ahead weighed on the market. "Yield reports though are trumping any weather delays with 60 and 70 bushels yields being bandied about from MO to IA to western MN," said Benson Quinn. Palm oil was lower, and crude sharply weaker. Add in a firmer US dollar and there was little bullish news to end the week. Brazil's Mato Grosso has started soybean planting, so too has Parana where they are 3% done. Coceral estimated the EU-28 rapeseed crop at under 20 MMT compared to 22.3 MMT a year ago. The USDA are at 20 MMT, with consumption at almost 24 MMT. The weekly Commitment of Traders Report showed managed money increasing their net long position by 11,444 contracts for the week ending Tuesday night. Nov 16 Soybeans settled at $9.55, down 21 1/2 cents; Jan 17 Soybeans settled at $9.61, down 21 cents; Oct 16 Soybean Meal settled at $303.30, down $4.60; Oct 16 Soybean Oil settled at 33.31, down 65 points. Versus last Friday beans were 11 cents lower, meal was down $10.40 and oil was up 133 points.
Corn: Corn closed fractionally lower on the day and for the week. Harvest pressure is a negative, with an estimated 20% of the US crop thought likely to have been cut by Sunday night. Still, unlike beans, anecdotal reports from the field on corn are of lower yields than last year. As well as talk of lower yields there's also trade gossip that the wet weather has cause quite a few disease problems this year. That seems to be limiting downside for now. So too does the size of the short held by managed money, placed at -161,592 net contracts as of Tuesday night. One talking point today was the decision by China to place a 33% anti dumping levy on US DDGS imports as they struggle to dispose of their own domestic government-owned corn mountain. Coceral pegged EU-28 corn output 1 MMT down from June, but 3 MMT above last year, at 61 MMT. In Brazil Parana state is said to be 34% planted on corn. The market is drifting along directionless for now. Next Friday, the USDA release their quarterly stocks report that could provide some direction to the market. Dec 16 Corn settled at $3.36 1/2, down 1/4 cent; Mar 17 Corn settled at $3.46 1/4, down 1/2 cent. For the week Dec 16 was 1/2 cent lower and Mar 17 was down a cent.
Wheat: Wheat closed little changed on the day but higher for the week. The Indian government lowered its wheat import tax to 10% from 25% as part of an effort to curb food price inflation. Some are forecasting that this could trigger imports of up to 5 MMT this season. The USDA are currently at 2 MMT. Australian and Black Sea wheat are likely to be the main beneficiaries. Ukraine wheat has been scoring on price recently. The Buenos Aires Grain Exchange said that Argentine wheat is 49% excellent and 35% good out of a planted area of 4.3 million ha this year. Egypt were reported to have bought 240 TMT of Russian wheat in their latest tender, paying around $179/tonne FOB, or $187/tonne C&F. Coceral estimated the EU-28 soft wheat crop at 134 MMT, some 14 MMT less than their June forecast and 18 MMT below last year's record. Barley production in Europe is now seen at 59 MMT versus 61 MMT last year. That's 4 MMT below their June estimate. Dec 16 CBOT Wheat settled at $4.04 3/4, down 3/4 cent; Dec 16 KCBT Wheat settled at $4.21 1/2, up 3/4 cent; Dec 16 MGEX Wheat settled at $5.03 3/4, up 2 1/2 cents. For the week Chicago wheat was up 1 1/2 cents, Kansas was 4 1/4 cents higher and Minneapolis was up 11 cents.