Chicago Grains Trade Lower, Catching Fund Money On Wrong Side
27/07/15 -- Soycomplex: Beans began the week with heavy losses losses. Concerns about the Chinese economy drove the Shanghai Composite to post it's largest one day fall in more than 7 years today, prompting a wholesale commodity sell off. Fund money seems to be caught on the wrong side of this one, they were net long around 90,000 soybeans contracts in Friday's commitment of traders report. An improved US weather outlook adds to the bearish tone. "Drier weather forecasts are just what the doctor ordered for the rain saturated eastern Midwest corn and soybean crops. This week will be warmer with normal to below rainfall," said Benson Quinn. The trade is thinking that the USDA might increase soybean good to excellent crop ratings later today. Pakistan are said to have bought 126,000 MT of soybeans of South American origin overnight. At the close Aug 15 Soybeans finished at $9.61 1/4, down 30 cents; Nov 15 Soybeans closed at $9.33 1/4, down 31 3/4 cents; Aug 15 Soybean Meal closed at $344.20, down $10.60; Aug 15 Soybean Oil closed at 30.11, down 37 points.
Corn: The corn market also trades with double digit losses. Fund money has come off particularly badly in this break in corn prices, they were revealed to have added almost 77,000 contracts to their net long position in Friday's commitment of traders report, and are now net long to the tune of almost 280,000 lots. Ouch! South Korea are tendering for 70,000 MT of optional origin corn. The EU Commission's MARS unit cut their forecast for EU-28 corn yields from 7.22 MT/ha to 6.71 MT/ha today. That's now down sharply on 8.07 MT/ha a year ago and below the 5-year average of 7.02 MT/ha. "Prolonged and intense heat waves in July affected important cropland areas in northern Italy, France, Germany, Poland, the Czech Republic, Austria and Hungary. Maximum temperatures often exceeded 35°C and locally reached 40°C, hitting spring and winter crops during grain filling and maize while flowering," they said. The USDA are thought likely to increase good to excellent corn ratings by one or two points later today. Sep 15 Corn closed at $3.73, down 19 1/2 cents; Dec 15 Corn closed at $3.83 1/2, down 19 1/4 cents.
Wheat: The wheat market trades around 4-5 cents lower. MARS trimmed EU soft wheat yields a little, down from 5.85 MT/ha a month ago to 5.80 MT/ha. Ukraine said that their 2015 early grain harvest was 69% complete on 7 million ha, with yields averaging 3.36 MT/ha. That includes 4.7 million ha of wheat, producing a crop of 16.9 MMT so far. The Ukraine barley harvest is 76% complete at 6.25 MMT. Jordan tendered for 100,000 MT each of optional origin wheat and barley for Nov/Dec delivery. The Mexican wheat crop this year will come in at around 3.7 MMT, similar to a year ago, according to the USDA's FAS. Domestic consumption will rise from 6.85 MMT to 7 MMT in 2015/16, they say. Despite that imports will fall from 4.5 MMT to 4.4 MMT, they predict. Canada said that they'd exported 16.8 MMT of wheat (excluding durum) in the first 50 weeks of 2014/15, a similar level to a year ago. Durum exports were 4.5 MMT versus 4.7 MMT a year ago, and barley exports were 1.4 MMT against 1.3 MMT in 2013/14. Sep 15 CBOT Wheat closed at $5.02 1/2, down 9 1/4 cents; Sep 15 KCBT Wheat closed at $4.99 1/4, down 8 cents; Sep 15 MGEX Wheat closed at $5.37, down 8 cents.