Chicago Grains Move Higher On Excessive Rains
17/06/15 -- Soycomplex: Beans closed with double digit gains, building on yesterday's advances. Everyone is now looking at the US weather, and pondering how much rain is too much. Reuters reported that flooding had halted barge traffic on the Illinois River today. "CME, which owns the Chicago Board of Trade (CBOT) and other markets, said a majority of shipping stations on the river were unable to load crops due to high water levels," the report said. The trade is now wondering whether or not US growers will get all their intended soybean acres in this year. As Benson Quinn point out "the June 30th (acreage) report will offer as many questions as answers". This is supposed to inform us what the final area will be for soybeans and corn, but as of Sunday night there was still around 11 million acres of soybeans unplanted. The figures in the report are based on a survey conducted Jun 1-10, and as we now know things have got worse since then. The trade will also be mulling over what sort of yield will beans planted in mud and then sitting in water will produce. Keep in mind that fund money is sitting on a net soybean short of around 100k contracts. Trade ideas for tomorrow's weekly export sales report are around 250,000-500,000 MT for beans for both crop years combined. Jul 15 Soybeans closed at $9.69, up 11 1/2 cents; Nov 15 Soybeans closed at $9.39 3/4, up 12 1/4 cents; Jul 15 Soybean Meal closed at $323.70, up $2.90; Jul 15 Soybean Oil closed at 32.85, down 5 points.
Corn: The corn market closed around 5 cents higher as the corn belt continues to take a battering from the weather. "Reports of ponding and yellow corn have made it to the top of the headlines as central MO, southern IL, and southern IN have received upwards of 2 inches of rain in the last 24 hours. Forecasts continue to lean wet in those areas with the five day accumulation estimates near 5 inches," said Benson Quinn. Fund money has reduced the magnitude of it's short position in corn significantly, but it still holds a sizable one nevertheless. The USDA reported 100,000 MT of old crop corn delivery to unknown destinations for the 2014/15 marketing year. The US Energy Dept reported ethanol production at 980,000 barrels/day, down from last week's record 992,000 bpd. Livestock numbers in the US are falling. One report in the media says that bird flu could cause the loss of 47 million chickens and turkeys in the US before the problem is eradicated. Additionally, a Bloomberg survey predicted that "US feedlots probably purchased or placed into their herds 8 percent fewer cattle last month than a year earlier". Ukraine said that it had exported 18.1 MMT of corn so far this season. Ukraine's Jun 1 corn stocks were said to be 4.8 MMT. Germany's DRV cut their forecast for this year's corn crop there to under 4.7 MMT, a 9% reduction on a year ago, due to dryness issues. Trade estimates for tomorrow's weekly export sales report are around 200,000 MT of old crop and 300,000 MT on the new crop. Jul 15 Corn closed at $3.59 1/4, up 5 1/4 cents; Dec 15 Corn closed at $3.75, up 5 cents.
Wheat: The wheat market closed mixed, garnering some limited support from higher corn and soybeans. Taiwan was a buyer of US wheat overnight, but they are regarded as a stonewall US customer. Non-traditional US wheat buyers are still spoilt for choice when it comes to international suppliers fighting for their business. The weaker US dollar today may have added a bit of support, after the Fed indicated that it has not seen the economic conditions needed to raise interest rates for the time being. The vast majority of analysts had been forecasting a US rate rise in September. Ukraine said that it is on target to export a record volume of grain this season, having shipped out 33.5 MMT so far, including 10.7 MMT of wheat. Russia's exports are also increasing again now that the old export duty has been abolished, and before the new one kicks in on Jul 1. As prices currently stand, the new tax will only be minimal after Jul 1. IKAR estimated this year's Russian grain crop at 96-103 MMT, with wheat accounting for 55-59 MMT of that. The combines are now said to be rolling in southern Russia, harvesting winter barley. The Russian Ministry say that the spring planting campaign is now complete on 31.1 million ha. That includes 13.4 million ha of spring wheat and 8.3 million ha of spring barley. Germany's DRV cut the size of this year's wheat crop there to 25.8 MMT, down 4.2% from a month ago and 7.2% below production last year due to persistent dryness. Northern France has been experiencing similar conditions. FranceAgriMer has been paring back on crop conditions there in the past couple of weeks. Trade estimates for tomorrow's weekly export sales are around 250-400,000 MT. Jul 15 CBOT Wheat closed at $4.91 1/4, up 2 1/2 cents; Jul 15 KCBT Wheat closed at $5.05 1/2, down 1 cent; Jul 15 MGEX Wheat closed at $5.47 3/4, up 1/4 cent.