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Wheat comes off 10-yr low on bargain-buying; corn, soy struggle (RT)

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  • Chicago wheat gains for 1st time in seven sessions
  • Wheat prices may have hit bottom around $4 a bushel
  • Corn trades near two-year low as U.S. harvest looms

SINGAPORE, Aug 30 (Reuters) – U.S. wheat futures rose for the first time in seven days on Tuesday, underpinned by bargain-buying after the market tumbled to a 10-year low in the previous session.

Corn hovered near Monday’s two-year low, under pressure from the harvest of an expected record U.S. crop. Soybeans slid for a sixth session in a row.

Chicago Board of Trade most-active wheat contract Wv1 gained 0.4 percent to $3.98-3/4 a bushel by 0229 GMT, after hitting its lowest since 2006 at $3.95-1/4 a bushel on Monday.

Corn Cv1 gained a quarter of a cent to trade at $3.21 a bushel, not far off of last session’s low of $3.20 a bushel, its weakest since 2014. Soybeans Sv1 gave up quarter of a cent at $9.64 a bushel.

“I don’t think wheat needs to be below $4 a bushel. Global supply and demand fundamentals haven’t changed in the last one week but we have seen a decline of more than 25 cents in prices,” said Ole Houe, an analyst with brokerage IKON Commodities in Sydney.

“From an Australian perspective, we won’t engage growers at these levels.”

Wheat faced renewed pressure after top importer Egypt reinstated a ban on wheat shipments containing even the slightest amount of a common grain fungus, ergot. The move baffled traders who had returned to the Egyptian market last month when the ban was lifted, and could boost already ample global supplies that have kept a lid on prices.

Russian wheat export prices fell slightly last week as a weakening rouble made Russian grains more competitive.

Black Sea prices for September deliveries of Russian wheat with 12.5 percent protein content were $172 a tonne on a free-on-board basis at the end of last week, down $1 from a week earlier, Russian agricultural consultancy IKAR said.

For corn, looming supply from an expected all-time high U.S. crop is weighing on prices.

The U.S Department of Agriculture rated 75 percent of the U.S. corn crop in good-to-excellent condition, unchanged from a week earlier. The soybean crop was rated 73 percent as good-to-excellent, up from 72 percent the previous week.

Commodity funds were net sellers of CBOT corn, wheat and soybean futures on Monday. Trader estimates of net fund selling in corn ranged from 7,000 to 15,000 contracts, in wheat from 6,000 to 7,500 contracts, and in soybeans from zero to 3,000 contracts. COMFUND/CBT

U.S. weekly crop progress highlights – USDA (RT)

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WASHINGTON, Aug 29 (Reuters) – Highlights of the U.S. Agriculture Department’s weekly crop progress report (all numbers expressed in percent):

Week ended                    08/28/16  08/21/16  08/28/15  5-year

RICE CONDITION

  - Excellent                     13       13       18       NA
  - Good                          47       48       48       NA
  - Fair                          27       26       28       NA
  - Poor                          8        9        4        NA
  - Very Poor                     5        4        2        NA

CORN CONDITION

  - Excellent                     21       21       19       NA
  - Good                          54       54       49       NA
  - Fair                          18       18       22       NA
  - Poor                          5        5        7        NA
  - Very Poor                     2        2        3        NA

COTTON CONDITION

  - Excellent                     9        8        9        NA
  - Good                          39       39       45       NA
  - Fair                          36       35       35       NA
  - Poor                          12       14       8        NA
  - Very Poor                     4        4        3        NA

SOYBEAN CONDITION

  - Excellent                     18       18       15       NA
  - Good                          55       54       48       NA
  - Fair                          20       21       26       NA
  - Poor                          5        5        8        NA
  - Very Poor                     2        2        3        NA
    RICE HARVESTED                22       15       24       21
    SPRING WHEAT HARVESTED        81       65       84       62
    CORN DOUGH                    92       85       90       87
    CORN DENTED                   60       40       54       52
    SOYBEANS DROPPING LEAVES      5        NA       8        5
    SOYBEANS SETTING PODS         94       89       91       92
    COTTON BOLLS OPENING          23       16       20       23
    COTTON SETTING BOLLS          95       92       91       94

Soybeans ease, corn falls for 2nd day on US crop report (RT)

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  • Soybeans, corn fall as USDA rates crops in healthy condition
  • Strong soybean demand limits price decline, wheat extends losses

SINGAPORE, Aug 23 (Reuters) – Chicago soybean futures lost ground on Tuesday, while corn slid for a second session, with renewed pressure on prices after a U.S. government report showed both crops thriving in near-perfect weather.

Wheat fell, adding to Monday’s more than 2 percent decline, as abundant global supplies continue to weigh on the market.

Chicago Board of Trade most-active corn contract Cv1 fell 0.5 percent to $3.40-3/4 a bushel by 0301 GMT, having closed down by about a similar amount in the previous session.

Soybeans Sv1 dipped 0.3 percent to $10.13 a bushel and wheat Wv1 gave up 0.7 percent to $4.32-1/4 a bushel.

“Growing conditions for beans are fantastic across the U.S. Midwest,” said one agricultural commodities analyst.

“The U.S. crop has been estimated to be a record large and it is likely to get bigger as the weather outlook for next week or two looks perfect.”

The U.S. Department of Agriculture (USDA) rated 75 percent of the U.S. corn crop in good-to-excellent condition, up from 74 percent the previous week, while soybean ratings held steady at 72 percent rated good-to-excellent. US/CROPS

Analysts had expected the USDA to report a decline in the condition of the corn crop, with soybeans seen as unchanged. At this time of last year, 69 percent of corn and 63 percent of soybeans were rated good-to-excellent.

Still, strong demand is underpinning the soybean market.

The USDA said private exporters sold 120,000 tonnes of soybeans to unknown destinations for 2016-17 delivery.

The agency also reported export inspections of U.S. soybeans in the latest week at 961,414 tonnes, above a range of trade expectations of 650,000 to 850,000 tonnes.

The European Union’s crop monitoring service significantly cut its forecast on Monday for average maize and soft wheat yields in this year’s EU harvest after adverse weather.

However, Russia is seen more than offseting the weather-related crop shortfalls in Europe.

Commodity funds were net sellers of CBOT corn and wheat futures on Monday and net buyers in soybeans and soymeal, traders said.

Trader estimates of net fund selling in corn ranged from 3,000 to 6,000 contracts, and in wheat from 3,000 to 8,000 contracts. For soybeans, trader estimates of net fund buying ranged from 3,000 to 7,000 contracts.

PM markets: soybean futures fall, as focus shifts to US crop (am)

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20:44 GMT, Friday, 19th Aug 2016, by William Clarke

…

Consolidation was the name of the day, as traders closed out positions for the end of the week.

Corn and wheat rallied on short covering, while in soybeans, where traders are long, prices fell.

Jim Sullivan, at Leese Trading Group, told Agrimony “as we approach the end of the week, we see profit taken by the speculative bulls”.

Soybean futures fell by 1.0%, to finish at 10.04 Ѕ a bushel.

read more…

Brazil 2016/17 corn crop seen at 84 mln tns -Ag Ministry secretary (RT)

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Aug 18 (Reuters) –

  • Neri Geller, secretary of farm policy at the Agriculture Ministry, said on Thursday that he thought that Brazil’s 2016/17 corn output would reach 84 mln tns due to increased planting in Parana state
  • Brazil suffered severe losses to its larger winter corn crop due to poor rains earlier in 2016, driving prices on the domestic market to record highs
  • Prices have since pulled back from highs but remain nearly twice the prices registered at this time last year
  • Brazil’s crop supply agency Conab forecast the current corn crop at 68.48 mln tns, down 19 pct from a year ago

USDA forecast gives mixed signals to soybean market -Braun (RT)

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Karen Braun is a Reuters market analyst. Views expressed are her own.

CHICAGO, Aug 19 (Reuters) – Although last Friday’s soybean supply and demand report from the U.S. Department of Agriculture delivered a bearish feel to the market, there were quite a few bullish components lurking within.

USDA projected record U.S. soybean yields for this year’s harvest, offsetting a massive demand-based decrease in domestic old-crop carryout of 95 million bushels.

As a result, new-crop carryout for the world’s No. 2 soybean supplier rose by 40 million bushels despite demand increases for the 2016/17 marketing year. Traders still interpreted the overall news as bearish, since soybean futures contracts fell to end the week.

Traders said they expect the production forecast to cap rallies in the soybean market. (Full Story) This may be true in the short term, but it would not take much for the supply situation to tighten back up.

Based on recent trends, strong demand, and favorable weather for the current soybean crop, both supply and demand are likely to increase for U.S. soybeans in the upcoming marketing year.

But whichever one wins out will determine the direction of the soybean market, which is very sensitive to shifts in both supply and demand. So the latest figures from USDA are no cause for complacency.

DEMAND IS NOT GOING AWAY

Global soybean demand is stronger than ever and is still on the rise. Over the past couple of years, USDA has had the habit of increasing both exports and crush throughout the marketing year in response to the increasing demand (http://reut.rs/2bBIIVw).

Soybean exports and crush projections for the 2016/17 marketing year, which does not begin until Sept. 1, have increased by 3 percent and 1 percent, respectively, since the initial estimates were released in May.

Ending stocks have had the opposite trend. Although forecasts for the 2014/15 and 2015/16 carryout had at times topped 450 million bushels, both years ultimately fell far short of that at 191 million and 255 million bushels, respectively. Note that the latter figure is still subject to adjustment (http://reut.rs/2bBID4a).

Soybean use is already far outpacing long-term expectations, making the ceiling difficult to identify. Exports and crush are well ahead of USDA’s latest annual 10-year forecast, which is released each February.

U.S. soybean exports are annihilating these long-term projections. The latest estimate for the new marketing year, 1.95 billion bushels, is not even reached within USDA’s 10-year forecast period. The last season in the series, 2025/26, has 1.925 billion bushels slated in.

For the same marketing year, crush in 2015/16 is currently forecast 10 million bushels ahead of the February projection and 2016/17 crush is 30 million bushels ahead. The 1.94 billion bushels of soybeans expected to be crushed in the 2016/17 season were USDA’s target for the 2018/19 season.

With no evidence that the world’s appetite for soybeans and soybean meal is going away, U.S. exports and crush seem unlikely to fall below the current expectations and in fact are very good candidates for a continued increase.

In addition to the longer-term demand trends, short-term demand is holding its own. So far in August, daily soybean sales announcements to China and unknown destinations have been made on 11 separate days. For reference, there were only six such days in all of August 2015.

YIELD HAS CONTROL

Soybean yields are in the driver’s seat as they completely washed out the massive month-on-month drop in old-crop carryout. The market had expected an increase in both yields and carryout for 2016/17, but not to such a large degree in either one.

USDA’s soybean yield of 48.9 bushels per acre tops last year’s record (48 bushels per acre), the average pre-report analyst estimate (47.5 bushels per acre), and USDA’s initial 2016/17 trend yield (46.7 bushels per acre).

Such a high yield is not at all hard to believe. Not only are crop conditions the best since 2004, but the weather has been very supportive and will likely continue this way, at least in the near-term.

A couple of good, soaking rains are key for higher soybean yields, especially during August, the most critical month for pod setting and filling. Over the past week, ample rain showers blanketed the Midwest, including parched areas in the Eastern belt, and the forecast for next week holds moderate temperatures with scattered rainfall.

A higher realized yield at the end of the harvest is also likely based on USDA’s recent trend of underestimating final soybean yields in August. This has been the case for the past five years, showing that USDA certainly has not had a bias of being too high early on (http://reut.rs/2batdTJ).

However, the soybean balance sheet is highly sensitive to even the slightest tweaks in yield. If this year’s yield were to evenly match last year’s record of 48 bushels per acre, carryout would be slashed by 25 percent. And this makes the highly dubious assumption of no further increases to demand (http://reut.rs/2bpLelk).

Another factor on the supply side that is subject to change is planted/harvested area. In the past two seasons, final soybean area came in lower than what had been expected during late summer. This year’s soybean-friendly economics may quash that trend, but it is something that cannot be ruled out.

CLARITY COMES IN OCTOBER

Even though the 2016/17 U.S. soybean crop should be completely harvested in about three months, the associated balance sheet will not be “finalized” until October 2017. But the 2015/16 situation will become clearer in October, and this will set the tone for the new marketing year.

With the soybean marketing year ending on Aug. 31, the necessary pieces of information do not all become available until about a month afterward and are therefore not reflected until the October supply and demand report.

In early October, final trade data from the U.S. Census Bureau as well as crush data from USDA’s Fats and Oils report will be available to adjust both old-crop exports and crushing accordingly. USDA’s Sept. 30 quarterly grain stocks report will inform on the latest supply situation.

With this updated information, the market will be able to settle on 2015/16’s carryout, which has been relatively volatile to the downside over the past few months. This will set the starting point for the 2016/17 soybean balance sheet.

But with more than a year to go until the final picture of 2016/17 U.S. soybeans emerges, what we are talking about today may be something entirely different from what we are talking about a year from now.

  • Graphic- USDA carryout estimates for U.S. soybean crush and exports
  • Graphic- USDA carryout estimates for U.S. soybean ending stocks
  • Graphic- U.S. Soybean Yield, August to Final USDA Estimate
  • Graphic- U.S. soybean supply scenarios, 2016/17

GRAINS-Exports support soy; corn, wheat rise on short-covering (RT)

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CHICAGO, Aug 17 (Reuters) – U.S. soybean futures rose to their highest in nearly four weeks on Wednesday on strong demand from China, the world’s top buyer of the oilseed, traders said.

Corn and wheat futures posted mild gains on a round of short-covering. It was corn’s fourth positive close in a row.

“We had some short-covering, got a little bit of a technical bounce,” said Karl Setzer, market analyst at MaxYield Cooperative. “A lot of little things added up.”

A global glut of wheat and expectations for a record corn harvest in the United States quelled buying in the grains. The upcoming U.S. soybean harvest also has been forecast as the biggest on record, but a recent spate of export activity underpinned the market.

The U.S. Agriculture Department said on Wednesday morning that private exporters reported the sale of 381,000 tonnes of soybeans to China for delivery during the 2016/17 marketing year.

The USDA also said that exporters reported the sale of 129,000 tonnes of soybeans to unknown destinations, correcting an Aug. 4 announcement that said corn was the commodity sold in the deal.

“Soybeans are providing at least a little lift to the grain market today, with concerns over a big crop muted by strong demand,” Bryce Knorr, senior grain market analyst at Farm Futures, said in a note.

Chicago Board of Trade soybean futures for November delivery SX6 were up 8-3/4 cents at $10.16 a bushel. Prices peaked at $10.17-1/4 a bushel, the highest since July 21.

“There is market talk that U.S. soybean shipments to China in August will reach a hefty 1.8 million tonnes, which along with big shipments from Argentina and Brazil, could bring shipments to China in August to a massive 5 million tonnes,” a European trader said. “China’s economic slowdown is not braking soybean imports.”

Spillover strength from a 1.7 percent gain in soyoil futures BOv1, which have rallied to a four-month high on the back of surging palm oil prices, lent additional support to soybeans. Soyoil futures have risen for six straight sessions.

CBOT September soft red winter wheat WU6 was up 2-1/2 cents at $4.26 a bushel. Higher-protein K.C. hard red winter wheat KWv1 and MGEX spring wheat 1MWEc1 posted bigger increases.

CBOT December corn futures CZ6 were 2-1/2 cents higher at $3.39-3/4 a bushel. Corn hit its highest since Aug. 1 and closed just below its session peak of $3.40 a bushel.

Ukraine sees high 2016 grain harvest, record exports (RT)

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KIEV, Aug 17 (Reuters) – Ukraine’s 2016 grain harvest is likely to be around 63 million tonnes – 3 million more than last year, agriculture ministry official Leonid Sukhomlin said at a briefing on Wednesday.

He said better than expected weather this spring and summer had increased the yield of wheat and other grains.

Sukhomlin said that the wheat harvest could total 25.5 million tonnes in clean weight, but cautioned that the forecast might not be reliable.

“Against a background of changing rules and high taxes, some farmers prefer to hide the real volume of their output and the wheat harvest could even be 27 million tonnes,” he told Reuters.

Ukraine, one of the three top global grain exporters, harvested 60 million tonnes of grain, including 26.5 million tonnes of wheat, in 2015. Grain exports in the 2015/16 season, which runs from July to June, reached 39.4 million tonnes.

Sukhomlin also said that the harvest of maize, another top Ukrainian commodity, could reach 26 million tonnes this year, up from 23.2 million tonnes in 2015.

Ukraine’s UZA grain export union sees total grains production at 63.5 million tonnes, while exports could reach an all-time high of 41 million tonnes, UZA director Volodymyr Klimenko said at the same briefing.

Sukhomlin said this season’s exports could include 17 million tonnes of wheat. Ukraine exported 16.9 million tonnes of wheat in 2015/16.

Ukraine has exported 4.88 million tonnes of grain so far this season compared with 4.72 million a year earlier, according to ministry data.

The volume includes 2.4 million tonnes of wheat, 1.9 million tonnes of barley, 444,000 tonnes of maize and some tonnage of other grains.

WINTER SOWING

Sukhomlin said Ukrainian farmers were likely to increase the area sown for winter grains for 2017 to 7.3 million hectares from 7 million last year thanks to better weather.

Poor weather last autumn forced farmers to reduce the area under winter grains. The area under winter wheat could be up to 6.5 million hectares for the 2016/17 season, he said.

“This year the weather is much better and the final sown area will depend on it,” he said.

Ukraine is located in a risky planting zone and its winter wheat harvest is highly dependent on the moisture content in soil during the autumn sowing, air temperatures in winter and favorable weather in spring.

High productive winter wheat accounts for around 95 percent of Ukraine’s total wheat output.

Soybeans, corn recover from losses after forecasts for record harvests (RT)

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  • USDA sees record corn, soy harvests and yields
  • Chinese soy demand seen supporting price recovery

Adds comment, updates prices

MANILA, Aug 15 (Reuters) – U.S. soybean futures climbed more than 1 percent on Monday, recovering from losses in the previous session after the U.S. Department of Agriculture projected a record harvest, with demand from top market China seen staying strong.

Corn and wheat tracked the gains in soybeans, helping corn bounce back after falling to its weakest since 2014.

In its monthly outlook, the USDA on Friday pegged the corn crop at 15.153 billion bushels, based on an average yield of 175.1 bushels per acre, while the soybean harvest was seen at 4.060 billion bushels, with yields expected to average 48.9 bushels per acre. Both topped the high end of market expectations.

Good weather for crop development during July across broad swaths of the U.S. Midwest, the key growing area for corn and soybeans, allowed crops to mature with relatively little stress.

While global soybean supply is high, particularly in the United States, “demand from China is looking pretty favourable,” said Phin Ziebell, agribusiness economist at National Australia Bank.

“Having said that, supply looks very good. It’d be hard to see any upside for prices in the medium term,” he said.

The most-traded soybeans contract on the Chicago Board of Trade Sv1 rose 1.3 percent to $9.94-3/4 per bushel by 0244 GMT. It fell as much as 2.2 percent to $9.62-1/2 on Friday.

Chicago corn Cv1 was up 0.8 percent at $3.35-3/4 a bushel. The contract touched $3.22-1/2 on Friday, its lowest since October 2014.

Corn recovered to close firmer on Friday, which some analysts attribute to firm demand for the grain as animal feed going forward.

“Global feed demand is growing strongly, so perhaps the market is realising that the scale of supply required for ‘comfort’ will also need to be higher,” Commonwealth Bank of Australia analyst Tobin Gorey said in a note.

Chicago wheat Wv1 climbed 0.7 percent to $4.25–1/2 per bushel.

ABN forecasts seasonal grain rally, but supplies remain heavy (am)

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16:10 UK, 11th Aug 2016, by Agrimoney.com

Grain prices will rally from their seasonal summer lows, but the size of global supplies will leave markets trading sideways by the end of the year, ABN Amro said.

The bank maintained its price forecasts, despite the recent sell-off, with a rally expected by the end of the summer period.

But there is “still more than enough” supply around, ABN said.

Summer sell-off

Grain markets saw a broad sell-off from their June peak leaving wheat, corn, and soybean futures in Chicago all down 20%.

“Traders evidently have little faith in a strong price recovery in the near future and there was widespread profit-taking before the start of the holiday period,” said ABN.

The June grain market rally was driven by global weather worries, including potential dryness in the US Midwest and heavy rain in Europe.

“Now that the impact of these weather events appears to have been limited, prices are starting to go down again,” ABN said.

And ABN said that “unrest” in the market caused by La Nina threats was easing, as crops are now sufficiently advanced that any impact from an event “will not be too severe”.

Wheat to rally, up to a point

ABN forecast Chicago wheat prices to hit $5.00 a bushel by the end of the year. December Chicago wheat futures are currently trading at $4.37 a bushel.

But the bank noted the continued global wheat surplus, with production forecast to once again outstrip demand this year.

“After the summer period, prices are expected to pick up again due to the seasonal effect, but will then settle into a sideways trend,” ABN said.

Ample corn stocks

Corn futures were forecast to rise to $4.15 a bushel, compared to December futures currently trading at $3.31 a bushel.

“Corn, like wheat, is amply available,” ABN said.

“As noted, previous fears that weather damage might dampen output in the upcoming season proved unfounded so that the crop forecasts have been revised up.”

ABN said that the expected output will exceed consumption so that, after a brief revival at the end of the summer period, corn prices are also expected to move sideways in the rest of 2016.

Good soybean supplies

Soybean futures were forecast for modest gains, finishing the year at $10.50 a bushel. The January contract is currently trading at $9.84 a bushel.

But soybeans are in a stronger position that other grains, as global demand remains strong.

“Soybean production is set to break all records in the coming season,” ABN said, noting that the USDA forecast for global production is up some 4% year on year, at 325m tonnes.

“This increase, however, is insufficient to meet the growing demand,” ABN said, with consumption seen at a record 328m tonnes, driven by “persistently high Chinese demand”.