Chicago Grains Mixed, Trade War With China Looming?
14/09/16 -- Soycomplex: Soybeans closed mostly a touch lower on impeding harvest pressure and ideas that big crops get bigger. That spate of daily announcements of export sales to China seems to have dried up a little too. NOPA's monthly crush estimates for August are released tomorrow. Bloomberg have that at 138.2 million bu. Also out tomorrow are the regular weekly export sales numbers, with beans expected to come in around 900,000 MT to 1.2 MMT and meal ideas of 80,000 MT to 180,000 MT. A Reuters survey of traders pegged Brazil's 2016/17 soybean crop at 103.1 MMT, an 8% increase on this year despite talk of a switch in plantings to corn. Exports for 2016/17 were pegged at 57.0-59.7 MMT versus 56.6 MMT a year previously. Sep 16 Soybeans settled at $9.72, up 3 3/4 cents; Nov 16 Soybeans settled at $9.44, down 2 cents; Sep 16 Soybean Meal settled at $315.70, up $5.30; Sep 16 Soybean Oil settled at 31.50, down 5 points.
Corn: The corn market closed with small gains. Supportive news was that of weekly ethanol production being back up over 1 million barrels/day (1.004), versus 998,000 bpd for the previous week. There's talk of a trade war developing with China. "The Obama Administration has launched a new trade enforcement action against the People's Republic of China at the World Trade Organization (WTO) concerning excessive government support provided for Chinese production of rice, wheat, and corn. United States Trade Representative Michael Froman and United States Secretary of Agriculture Tom Vilsack were joined by bipartisan members of Congress in announcing the complaint which challenges China's use of "market price support" for three key crops (rice, wheat, and corn) in excess of China's commitments under WTO rules," the USDA said in an announcement on their website. Forecasts for tomorrow's weekly export sales are 800 TMT to 1.1 MMT. Dec 16 Corn settled at $3.31 3/4, up 1 3/4 cents; Mar 17 Corn settled at $3.42 1/2, up 1 3/4 cents.
Wheat: The wheat market closed with small gains. FranceAgriMer cut their forecast for the French soft wheat crop to 28.47 MMT, down more than 30% on a year ago. The average spec falls well short of that required for export as far as bushel weights are concerned. Exports in 2016/17 will drop 43.4% to 11.90 MT, estimate FranceAgriMer. Others aren't struggling so badly though. Australia’s crop was pegged at 28.1 million tonnes, their second largest crop on record (24.2 MMT a year ago). Russia's wheat harvest has now reached 70.5 MMT off 86.3% of the planned area. India is said to be buying wheat off Ukraine. Egypt look set to be buying wheat off nobody due to it's new zero tolerance to ergot. Morocco is said to be seeking 300,000 MT each of EU and US wheat. Japan is in the market for it's regular 149,231 MT combo of US, Canadian and Australian wheat. Export sales tomorrow are called in the region of 350-550 TMT. Sep 16 CBOT Wheat settled at $3.76 3/4, up 2 cents; Sep 16 KCBT Wheat settled at $3.94 3/4, up 2 1/2 cents; Sep 16 MGEX Wheat settled at $4.93, up 1 1/4 cents.