Nogger's Blog

21/01/15 -- Soycomplex: Beans closed with small gains. China bought 176 TMT of US beans for 2014/15 delivery, despite having cancelled almost 500 TMT of similar purchases in recent days. Now that the January WASDE and stocks reports are out of the way, fresh news is lacking. Celeres raised their forecast for the Brazilian 2014/15 soybean crop to a record 94.2 MMT. "Brazil soybeans have been subject to hot, dry weather in January, especially in the tropics, though the forecast is more hopeful for rain," said Martell Crop Projections. "Mato Grosso’s top soybean producing area, the centre-west, received only 40-55% of normal rainfall the past 30 days, while the centre-east was even drier with 35-40% of average rain. Much better rainfall close to average has developed in the southeast, though this area of the state produces fewer soybeans," they add. Mar 15 Soybeans closed at $9.83 1/2, up 1 1/2 cents; May 15 Soybeans closed at $9.89 1/2, up 1 3/4 cents; Mar 15 Soybean Meal closed at $330.50, up $4.00; Mar 15 Soybean Oil closed at 32.41, down 43 points.

Corn: The corn market closed around a couple of cents lower. Ukraine said that they'd shipped 8.3 MMT of corn so far this season. The USDA have exports down at 16.5 MMT, which means that they are around halfway through their anticipated 2014/15 campaign total. "Reports have it (corn) trading out of Ukraine at $6-$10 MT discount to FOB US equivalent. It’s a bearish sign that the market feels comfortable enough to continue to book offers out of the Ukraine at (only) a slight discount to US origin corn," said Benson Quinn Commodities. Today's regular weekly ethanol production data from the US Energy Dept is delayed a day due to Monday's Martin Luther King Day holiday. The trade will be scrutinising that for any sign of a slowdown in demand for US corn. Last week's production was 978,000 barrels/day, up from 949,000 the previous week. Crude oil is off the recent multi-year lows, but not by much. Analysts at the World Economic Forum in Davos are now suddenly lining up to tell us it will be a long time before we see $100/barrel again. Mar 15 Corn closed at $3.88, down 2 1/4 cents; May 15 Corn closed at $3.95 3/4, down 2 cents.

Wheat: The wheat market closed lower, with Chicago faring the best of the three. The market seems surprisingly relaxed about the developing situation in Russia and Ukraine. Rather than pushing through as much of their existing wheat contracts as possible in the last fortnight of January, before the new export duty comes in, the pace of Russian shipments out of the Black and Azov Sea hardly seems to have picked up at all. There are reports that all vessels loading grain for export now must have a phytosanitary official present to obtain the necessary customs clearance documentation. This is slowing loadings down considerably as the Feb 1 export duty introduction date nears. Rusagrotrans today cut their forecast for Russia's January grain exports from 1.5 MMT to 1.3 MMT. They were 3.15 MMT in December. The Russian government meanwhile have only very limited success in securing the kind of volumes of wheat they want for their state-owned stocks via their intervention purchase programme. Morgan Stanley forecast Russian inflation at 13.7% by the end of 2015, which will encourage growers to sit on their stocks even more. Mar 15 CBOT Wheat closed at $5.36 3/4, down 1/4 cent; Mar 15 KCBT Wheat closed at $5.72 1/4, down 5 1/2 cents; Mar 15 MGEX Wheat closed at $5.81, down 8 1/2 cents.