Chicago Soy Down, Corn And Wheat Up
14/03/13 -- Soycomplex: Soybeans were sharply lower for a fourth session in a row on continued fund liquidation, with expiring Mar 13 posting the heaviest losses. Weekly soybean export sales were strong at a combined 783,724 MT, and were heavily skewed towards old crop (657,700 MT), taking total commitments now to 97% of the USDA's target for the 2012/13 season. For old crop "unknown" bought 220,200 MT, China bought 183,500 MT and also took 126,000 MT of the new crop. For all the talk of possible Chinese cancellations there were none, nor any from anyone else. The NOPA February Crush report comes out tomorrow with the trade expecting a crush of around 141.6 million bushels versus the Jan crush of 158.195 million and the Feb 2012 crush of 136.35 million. MDA CropCast cut their Argentine soybean production estimate by 730 TMT to 49.34 MMT citing dryness earlier in the season. Brazilian output was left unchanged at 81.43 MMT. For 2013/14 they placed US soybean production at 87.56 MMT, up 3.38 MMT from last week and 15% up on last year. In Brazil they go for 80.67 MMT and in Argentina 54.08 MMT. Funds were estimated as net sellers of 4-5,000 soybean contracts on the day. Mar 13 Soybeans closed at USD14.57 1/4, down 17 3/4 cents; May 13 Soybeans closed at USD14.35 1/2, down 11 1/2 cents; Mar 13 Soybean Meal closed at USD422.80, down USD4.20; Mar 13 Soybean Oil closed at 49.09, down 27 points.
Corn: Whilst soybeans have been down every day this week, corn has been attempting to do the opposite (although technical and expiring Mar 13 closed lower today). Export sales of a combined 653,318 MT beat expectations of 200-500 TMT. China took 111 TMT of old crop and 191 TMT of new crop. Even so, total commitments are only 71% of the USDA projection for 2012/13 versus the 5-year average of 77%. China bought a trial 13,700 MT of Indian corn for April shipment. It will be interesting to see if it passes stringent Chinese quality standards. Indian corn is currently said to be priced at around 7% under US corn into China, and also has the advantage of being GM free. Vietnam bought 30 TMT Indian corn for Apr/May shipment. Census data shows that the US imported 680,318 MT of Argentine and Brazilian corn between September 2012 and January 2013. MDA CropCast left both their Brazilian and Argentine corn production estimates unchanged at 74.1 MMT and 23.1 MMT respectively. In Argentina "rains are expected to remain very limited in the region through next week, and harvesting should progress very well," they said. The outlook is wetter in Brazil, slowing harvesting attempts although "the rains in the north will favour safrinha growth," they added. Fund buying was estimated at around 4-6,000 contracts on the day. Mar 13 Corn closed at USD7.32 3/4, down 8 1/2 cents. New front month May 13 Corn closed at USD7.16 1/2, up 6 1/4 cents.
Wheat: Weekly export sales came in well above trade expectations at a combined 1,087,000 MT. That included a hefty 888,500 MT of old crop sales, of which 103,400 MT was to Egypt. New crop sales of 198,500 MT included 82,500 MT to "unknown" and 57,000 MT to China. In addition, weekly shipments of 787,100 MT were a marketing year high. Old crop sales now only need to be 353,300 MT/week to hit the USDA estimate, although that assumes that everything that is sold gets shipped in 2012/13. Strength in corn added support to wheat, so too probably did the existing fund short position in CBOT wheat. IKAR estimate the Russian grain crop at 90-92 MMT this year, with wheat accounting for 50 MMT of that. Japan bought 130,533 MT of milling wheat for April/June shipment of which around half was US origin. Indonesia bought 25 TMT of Australian wheat for April shipment. Malaysia deferred a 350 TMT wheat purchase for July/Sept shipment saying that they expect prices to fall. India are tendering to sell 100 TMT of wheat for Apr/May shipment but might not like the price. Strategie Grains cut their EU-28 wheat production estimate by 600 TMT but that still leaves output 5% higher than in 2012/13. Fund buying in CBOT wheat was estimated at 3-4,000 lots. Mar 13 CBOT Wheat closed at USD7.14 1/4, up 7 cents; Mar 13 KCBT Wheat closed at USD7.42 3/4, up 13 1/2 cents; Mar 13 MGEX Wheat closed at USD8.00 1/2, unchanged.