Early Thoughts Thursday

The overnight grain markets are modestly higher. Talk of a possible frost for parts of the Canadian Prairies this weekend is a concern. With wheat and canola crops an estimated 2-3 weeks behind schedule in Canada heat and dry weather is what growers are hoping for to speed the crops along to maturity. A little further forward, the next full moon cycle between September 4 and 11 is also seen carrying a significant frost risk, according to some forecasters.

Argy wheat plantings are said to be complete at 2.75 million hectares by the Buenos Aires Cereals Exchange, that's a 40% decrease on last season. They aren't yet forecasting production yet, but hope that better weather conditions than last year will mean that production is not also down 40% on last year. The Rosario Grain Exchange's first estimate on output this season is 7.4MMT.

Corn plantings are also seen sharply lower, down almost 20% to just 2 million hectares, as Argy farmers prepare to plant wall-to-wall soybeans. The Rosario Grain Exchange's first estimate on soybean plantings is 18.5 million hectares, other private estimates are as high as 20 million, That would be 20% up on last season's record 16.6 million hectares. Soybean planting doesn't start for a month or more yet, so there is still plenty of time for those numbers to be revised yet.

Sunseed planting is underway with the Buenos Aires Cereals Exchange saying that acreage this season will be 2.2 million hectares.

You've heard of Cash for Clunkers, now we have Cash for Corn. In an attempt to shift some corn, the Chinese government say that they will offer a subsidy to some buyers at its weekly auctions on over 5MMT of the stuff, provided that they fulfil certain criteria.

Talking of China, there's a bit of rain in the forecast for the next few days which may help alleviate drought in the north.