Chicago Market: Beans Hold Steady As Corn And Wheat Sink
07/01/15 -- Soycomplex: Beans closed mixed and meal was a little lower at the end of a choppy session. "The rally back to the recent highs on the front month couple with rally in the US dollar to 9-year highs today may have attracted new selling from the Brazilian producer that capped gains," said Benson Quinn. Informa estimate world 2014 soybean production up 575,000 MT from their previous forecast at 312.96 MMT (the USDA are at 312.8 MMT). They see 2015 output up 500,000 MT from their previous estimate at 313.7 MMT. They see world rapeseed production in 2014 at 71.89 MMT, which is 755,000 MT up from their previous estimate (and very close to the USDA's 71.87 MMT). Output in 2015 is seen falling to 68.9 MMT, which is 2 MMT below their previous forecast. FC Stone estimated Brazil’s 2014/15 soybean crop at 93.5 MMT versus a previous estimate of 93.1 MMT. A Reuters survey estimated the US 2014 soybean crop slightly lower than last month's 3.958 billion bushels from the USDA at 3.956 billion. US 2014/15 ending stocks are seen at 393 million bushels versus 410 million from the USDA last month. The USDA release their revised estimates on Monday. Trade estimates for tomorrow's weekly export sales report for beans are around 500-700,000 MT in a holiday shortened week. Jan 15 Soybeans closed at $10.52 3/4, up 1 3/4 cents; Mar 15 Soybeans closed at $10.56 1/4, up 1/2 cent; Jan 15 Soybean Meal closed at $368.50, down $2.30; Jan 15 Soybean Oil closed at 32.98, up 29 points.
Corn: The corn market closed 8-9 cents lower, slipping back below the $4/bu mark on front month March. "After multiple weeks of good ethanol production, this morning’s EIA data offered evidence of the perils of ethanol trading a premium to gasoline," said Benson Quinn. US ethanol production was down 23,000 barrels/day to 949,000 bpd, and stocks were up 700,000 barrels to 18.8 million. Is this finally a sign of a slow up in demand, or is it simply down to the data being for a holiday shortened week? Many are saying that ethanol at a premium to gasoline is simply unsustainable. WTO crude oil hit a new more than 5 year low, and now seems comfortable trading below $50/barrel. Brent also dipped below $50/barrel for the first time since May 2009 today. Informa raised their forecast for the 2014 world corn crop by 8.3 MMT to 990.1 MMT (the USDA are at 991.6 MMT). They cut world 2015 production by 2.3 MMT to 965.6 MMT however. FC Stone estimated Brazil’s 2014/15 corn crop at 73.8 MMT versus a previous estimate of 74.3 MMT. South Korea MFG are tendering for 70,000 MT of optional origin corn for Apr-May shipment. Monsanto said that it expects a significant drop in corn seed sales to both North and South American farmers in the year ahead. Weekly export sales tomorrow are expected to be in the region of 600-800,000 MT. Mar 15 Corn closed at $3.96 1/4, down 8 3/4 cents; May 15 Corn closed at $4.04 3/4, down 8 3/4 cents.
Wheat: The wheat market closed generally around 9 to 12 cents lower. The market seems to be more focused on the fact that US wheat is generally too expensive to pick up much in the way of export interest to all but traditional homes, rather than buying into the possible US winterkill story. Trade estimates for tomorrow's weekly export sales report are only a modest 200-400,000 MT, which is a pretty poor total even for a holiday week. On the weather front however "a polar air mass dominates the Canadian prairies and United States. Minimum temperatures have dropped as low as -25 F in Canada this morning, while 0 to -11 F is being reported in the northern US. There are worries over potential freeze damage in US winter wheat. Only a thin layer of snow exists, not providing much insulation from the bitter cold. Soft red winter wheat is in jeopardy in the Midwest. Poor conditions in the Southern Great Plains is another worry for the national wheat outlook. In the bread wheat states Oklahoma and Texas wheat has not recovered from a year-long drought, placing 20% of hard red winter wheat in jeopardy. Oklahoma producers this week reported subsoil moisture at 24% very short and 36% short. Texas field conditions are similarly dry as pockets of 'extreme' and 'exceptional' drought have persisted, hampering wheat growth and development," said Martell Crop Projections. Mar 15 CBOT Wheat closed at $5.79 1/2, down 12 1/4 cents; Mar 15 KCBT Wheat closed at $6.20, down 11 1/4 cents; Mar 15 MGEX Wheat closed at $6.15 3/4, down 9 3/4 cents.