The Morning Vibe

Posted by Nogger - a legend in his own mind at 10:53 | Categorized as

10/12/12 -- The overnight grains are mostly lower with beans generally a couple of cents weaker, corn down around 3-4 cents and wheat in the region of 5 cents easier.

It looks like we may be in for a bit more book-squaring ahead of tomorrow's USDA report.

The trade is expecting further reductions to US soybean ending stocks from the existing, and already very tight, 140 million bushels given the rampant rate of exports and the fact that soyoil sales have already exceeded the USDA's target for the entire season.

But hold on a minute, this is the USDA that we are talking about here. It may be that in order not to cut projected US ending stocks any further they simply increase the supply. A bit like printing more money, let's just print some more soybeans. An increase in US yields for 2012 would enable them to up the domestic crush and exports and still end up with unchanged ending stocks.

Whilst they're about it the may decide to print some more corn as well. If they also then lower US wheat exports as they have been pretty unspectacular so far this season then we could see ending stocks for both corn and wheat increase tomorrow.

US 2012/13 ending stocks estimates:

Corn: average trade estimate 663 billion bushels, from within a range of estimates of 493–752 million and the November USDA report estimate of 647 million.

Beans: average trade estimate 130 million, from within a range of estimates of 123–145 million and the November USDA report estimate of 140 million.

Wheat: average trade estimate 718 million, from within a range of estimates of 690–754 million and the November USDA report estimate of 704 million.

World 2012/13 ending stocks estimates:

Corn: average trade estimate 118 MMT, from within a range of estimates of 115.7-125.1 MMT and the November USDA report estimate of 118 MMT.

Beans: average trade estimate 59.4 MMT, from within a range of estimates of 56.7-60.7 MMT and the November USDA report estimate of 60.0 MMT.

Wheat: average trade estimate 173.4 MMT, from within a range of estimates of 170.0-175.7 MMT and the November USDA report estimate of 174.2 MMT.

South American 2012/13 production estimates:

Argentina: Soybeans average trade estimate 54.5 MMT, from within a range of estimates of 52.5-56.5 MMT and the November USDA report estimate of 55 MMT. Corn average trade estimate 26.1 MMT, from within a range of estimates of 24.0-28.0 MMT and the November USDA report estimate of 28 MMT.

Brazil: Soybeans average trade estimate 80.8 MMT, from within a range of estimates of 78.8-82.0 MMT and the November USDA report estimate of 81 MMT. Corn average trade estimate 70.2 MMT, from within a range of estimates of 69.0-73.5 MMT and the November USDA report estimate of 70 MMT.