Chicago Market Closing Comments - Thursday Night

19/03/15 -- Soycomplex: Beans closed lower after the US dollar regained its composure following yesterday's fall when the Fed indicated that interest rates looked set to stay on hold a while longer yet. Weekly old crop export sales of 342,000 MT were up noticeably from the previous week, even if down 13 percent from the prior 4-week average. There were also new crop sales of 142,900 MT. Actual exports themselves were 488,900 MT, with China (272,400 MT) the leading destination. Total shipments plus outstanding sales now total 99% of the USDA forecast for the season. Lanworth were said to have estimated the Brazilian crop at a record 94.4 MMT and the Argentine crop at a record 60 MMT. MDA CropCast aren't quite so bullish, even if both of their estimates are also all time highs. They go for 94.34 MMT in Brazil and 56.12 MMT in Argentina, both unchanged from a week ago. They also gave us some numbers for 2015/16 production, putting Brazil slightly lower than this year at 93.95 MMT and Argentina likewise at 55.55 MMT. In the US they estimate the 2015 soybean harvested area at 33.78 million ha (83.4 million acres), up 1.1% from 33.40 million ha (82.5 million acres) last year. They see yields at the equivalent of 47 bu/acre, down a bushel/acre from last year and production at 106.71 MMT versus 107.99 MMT in 2014. They put the world 2015/16 soybean crop at 300.66 MMT, little changed from 301.15 MMT this season. The global rapeseed crop is also predicted to fall a little, down from 64.97 MMT to 64.07 MMT. Societe Generale estimated the 2015 US soybean planted area at 83.1 million acres, well below the 87.3 million predicted by Farm Futures Magazine earlier in the week. Informa are due to release their estimates tomorrow. SocGen forecast soybean prices in the range of $9.50 to $10.50 over the next 12 months. May 15 Soybeans closed at $9.61 3/4, down 3 1/4 cents; Jul 15 Soybeans closed at $9.66 3/4, down 3 cents; May 15 Soybean Meal closed at $319.30, down $1.50; May 15 Soybean Oil closed at 30.62, down one point.

Corn: The corn market closed around a cent lower, failing to hold onto early gains as the US dollar recovered some of yesterday's losses. Weekly export sales of 502,300 MT for 2014/15 were up 20 percent from the previous week, but down 31 percent from the prior 4-week average. There were also net sales of 64,800 MT for 2015/16. Pre-report trade estimates were for combined sales of 400-650 TMT, so these figures were in line with expectations. Exports themselves were 692,700 MT, down 41 percent from the previous week and 33 percent below the prior 4-week average. Cumulative shipments plus outstanding sales are at 80% of the USDA target for the season versus 74% typically at this time. MDA CropCast estimated Brazil's 2014/15 corn crop unchanged from a week ago at 76.9 MMT and also went unchanged on Argentina at 23.6 MMT. They forecast Brazil's 2015/16 corn crop at 74.1 MMT and Argentina's at 23.7 MMT. In the US they predict a 2015 corn harvested area of 33.5 million ha, which is 82.75 million acres, down from 33.7 million ha, or 83.2 million acres, a year ago. They see corn yields this year averaging 170 bu/acre versus the record 172.7 bu/acre set a year ago. That puts US production at 356.6 MMT in 2015, down 2.3% on last year's 364.9 MMT. On a world level they have the global 2015/16 corn crop at 961.2 MMT versus 973.4 MMT this season. The fact that US corn yields have declined sharply in the year following each of the last four record yielding years since 1990 is getting some airtime. The theory attached to it goes that due to low prices following a bumper production year, US growers will cut back on area, seeding rates and inputs in an effort to reduce costs. Yields subsequently suffer in the year following records being set. Whether this all happens again in 2015 remains to be seen. The balance of probability would however suggest that the US weather is unlikely to be quite so co-operative again this year, and thus reduced yields versus last season's record are more likely than not. With plantings also expected to be reduced, then US production in 2015 should be lower, all things considered. SocGen said that they are neutral on US corn prices. They predict plantings of 89.7 million acres this year, which is more than most. May 15 Corn closed at $3.73 1/2, down 1 1/4 cents; Jul 15 Corn closed at $3.81 1/2, down 1 1/4 cents.

Wheat: The wheat market closed mixed, but mostly lower. Weekly export sales of 391,900 MT for delivery in the 2014/15 marketing year were down 12 percent from the previous week, but up 4 percent from the prior 4-week average. There were also sales of 142,900 MT for 2015/16. Trade estimates had been for sales in the range of 300-650 TMT, so these numbers were in line with expectations. Exports of 488,900 MT were up 14 percent from the previous week and 9 percent above the prior 4-week average. Total exports plus outstanding sales now total 92% of the USDA's target for the season. Talk of some rain falling in parts of Kansas took the edge off the southern Plains drought story that has supported the market in recent days. The stronger dollar again has the US market wondering where the next export order is coming from. Europe continues to pick up the lion's share of international wheat business, with another 780,000 MT of soft wheat export licences this past week - significantly more than the US managed to achieve once again. SocGen forecast US wheat prices to fall below $5/bu in the next 12 months, saying that exports are consistently falling "well short of expectations". MDA CropCast forecast the world 2015/16 wheat crop at 716.7 MMT, down almost 3 MMT on this season, but still a strong total. They see US all wheat production at 59.6 MMT this year, up 6.4% versus 56 MMT last year. Russia's 2015 wheat crop is estimated at 53.9 MMT, down 7.2%. Ukraine's is seen down 4.5% at 23.3 MMT. Europe's will fall 2% to 147.08 MMT, they added. The USDA's FAS in Japan said that the country had imported 3.2 MMT of wheat in the first 7 months of this season, with the US the largest supplier (at 1.7 MMT), followed by Canada at 0.9 MMT and Australia with 0.5 MMT. They predict Japan's wheat imports to fall 0.3 MMT to 5.8 MMT this season, and hold steady at that level in 2015/16. Lower feed wheat demand due to increased corn utilisation in feed is behind the drop, they said. Reuters reported than China had bought 300 TMT of Canadian and 150 TMT of Australian wheat in recent days. Syria are tendering for 150 TMT of optional origin milling wheat. May 15 CBOT Wheat closed at $5.12, up 1 1/4 cents; May 15 KCBT Wheat closed at $5.50 1/4, down 2 3/4 cents; May 15 MGEX Wheat closed at $5.72 3/4, down 5 1/4 cents.