Outside Markets: Dollar Index down 0.146 at 82.593; NYMEX-WTI up $0.45 at $92.91; Brent Crude up $0.10 at $107.57; Heating Oil down $0.0034 at $2.8929; Livestock markets are mixed/weaker; Gold down $6.20 at $1607.60; Copper up $0.0280 at $3.4630; S&P’s are up 3.25 at 1542.25, Dow futures are up 33.00 at 14,381.00 and Treasuries are firmer.
Despite the latest spate of headlines from Europe, global financial markets actually exhibiting a fair amount of calm and order. While the NIKKEI fell 2.35% overnight, Europe is flat this morning and the FTSE MIB is actually up 0.35%. Bond yields across Europe are easier this morning, and the Euro is rallying against all of its major trading partners. The EURUSD +0.462%, EURJPY +0.266% and EURGBP +0.299%. The latest headlines in the Cyprus Crisis is European officials rejecting an alternative plan from the Cyprus gov to save its banking sector and remain in the Eurozone. Cyprus needs to raise €5.8 billion to avert crisis and secure bailout financing by Monday. Expect a weekend chocked full of headlines heading into the Monday deadline. No economic data today.
The last 24 hours saw precip in AR/S-MO, and some snow fell in NE/SD with more still falling this morning. More precip will move into towards the weekend for the southern plains with all of KS expected to see 0.50-0.60” Sat/Sun. This will push into MO as well where amounts will be slightly heavier. OK sees moisture as well. This system moves into IL/IN/KY/OH by Monday with S-IL seeing as much as 0.94”. Following Sunday’s system, the Midwest will be quiet Monday through Friday. NOAA’s maps continue to point cold and dry in the 6-10 with a slight moderation in the temps for the 8-14, but still fairly dry in that period. Most of the WCB remains in some stage of drought and could use additional moisture as opposed to getting in the field early.
Slightly easier markets overnight as we consolidate recent gains in both grains and the sharp rally in oilseeds yesterday afternoon. Unfortunately, there is no chatter on the wires this morning as to the reason behind the soybean rally yesterday. Most traders will be watching the USDA website at 8:00am this morning to see if there were any sales reported to Washington. The rally was back end led, but CIF traders noted as much as 770,000 bushels of new crop beans changing hands yesterday. Between the logistical backups in Brazil, and the inability to source Argentine supplies until at least April (let alone their labor issues), it is possible we did some more old crop soybean business. Corn and wheat seem to be running into soft cash markets following a solid week of movement by farmers.
Bloomberg released several polls ahead of next week’s USDA reports. Rather than rehash them here, I’ve included them below. Only blatant observations would be slightly lower corn acreage estimates, slightly higher soybean acreage and the trade clearly anticipating a bullish Mar 1 Stocks number. With an average trade estimate below 5.00bbu, the trade is basically assuming Q2 corn feed demand didn’t slow to the level the USDA is currently implying. Just looking at estimates, would appear 5.0-5.1bbu is the range: above 5.1bbu is bearish and below 5.0bbu is bullish. News out of China overnight said March soybean imports may be 4.29MMT and 4.285MMT according to the Ministry of Commerce. China needs around 4.8MMT a month for its crushing needs. The slower pace of imports is thought to be due to logistical complications out SAM as opposed to slowing demand, but it’s too early to tell. The USDA is currently estimating 12/13 soybean imports for China at 63MMT, although the average analyst estimate according to Bloomberg has slipped to 59MMT.
Japan bought 37,188MT of food wheat in an S-B-S tender overnight from Canada and Australia. Articles from Russia said the price limit for purchasing milling wheat headed for state reserves in Aug-Sept is RU7,000/MT, or $210/MT ($5.71/bu). They are clearly banking on a very large crop and declining global prices. The Russian winter grain losses are being forecast at 1.3-1.6 million hectares vs. earlier estimates for 1.9 million according to the Ag Minister. Cattle on feed report this afternoon at 2:00. Estimates look like placements at 92.8%, marketings at 92.3% and Mar 1 on feed at 93.8%.
Overnight maps continue to look very dry for South America, although haven’t heard whether this is an issue or not. Something to keep track of nonetheless. Corn basis remains weak. Wheat basis is steadying. Everyone seems to be of the opinion wheat basis should get sloppy due to the amount of wheat left on farm. While I agree with that in principle, it does concern me that logistics remain poor on rail, and that everyone seems to be of the same opinion on basis. MWK/MWN is reluctant to trade a carry.
Open interest changes yesterday included another 12,640 contracts of corn, wheat down 690, beans up 1,560, meal down 1,310, soy oil down 4,480 contracts. Corn open interest just keeps on climbing which is a short-term positive if the people doing the buying decide to defend their position. Chinese markets were firmer with beans up 14c, meal down $0.40, soy oil down 35c, corn up 1.25c, palm down 15c and wheat up 0.25c. Malaysian Palm Oil was up 47 ringgit at 2,493 (1.51%). Paris Milling Wheat is up 0.10%, Rapeseed is up 0.16%, corn down 0.22%, UK feed wheat is unchanged and Canola is unchanged.
Call things a little bit weaker to start off with but keep an eye on the wires at 8:00am this morning or Monday morning. Odds are good we did some export business to China per the rally yesterday. Otherwise, the low volume chop ahead of the March 28th reports could be setting in.
U.S. Soy Acres May Rise to Record, Survey Shows; Grain Area Up
2013-03-21 21:49:33.99 GMT
By Jeff Wilson
March 21 (Bloomberg) -- U.S. farmers will plant the most
soybean acres ever, and corn seeding may rise to the highest
since 1936, according to a survey of 32 analysts by Bloomberg
News. Wheat acreage may rise to the highest in four years.
The U.S. Department of Agriculture is scheduled to release
its estimates, based on a national survey of growers, on March
28 at noon in Washington.
Below are the estimates of how much land farmers intend to
plant, in millions of acres.
*T
Crop Production USDA Estimates
February
Average Range 2013 2012
Corn 97.339 96.5-98.5 96.5 97.155
Soybeans 78.351 77.0-80.0 77.5 77.198
All Wheat 56.32 55.6-57.3 56.0 55.736
Spring Wheat 12.39 11.91-12.8 n/a 12.289
Durum Wheat 2.13 2.0-2.3 n/a 2.123
Firm Estimates All Spring Durum
Corn Soybeans Wheat Wheat Wheat
============================================================
ABN Amro Clearing 98.000 78.000 56.20 12.40 2.00
A/C Trading Inc. 97.500 78.500 n/a n/a n/a
ADM Investor Services 97.000 79.500 56.00 12.40 2.00
Advanced Market Concepts 98.500 77.400 56.50 12.80 2.20
AgriVisor LLC 97.000 78.500 57.00 12.80 2.20
Allendale Inc. 96.956 78.342 56.26 12.06 2.18
Alpari 98.000 78.200 n/a n/a n/a
Citigroup Global Markets 96.800 77.600 56.10 12.32 2.19
Commodity Information 97.000 78.200 56.00 n/a n/a
EFG Group 97.500 78.500 56.50 n/a n/a
Farm Direction 97.500 78.200 56.20 n/a n/a
Farm Futures 97.430 79.090 56.12 11.91 2.06
Fintec Group Inc. 98.000 77.000 56.00 n/a n/a
Grain Service Corp. 98.200 78.000 56.50 n/a n/a
Global Cmd Analytics 96.900 78.100 57.10 n/a n/a
Hightower Report 97.500 78.500 56.50 12.50 2.10
Jefferies Bache 96.760 78.500 56.85 12.42 2.24
Kropf & Love 97.500 78.500 56.50 12.70 2.00
Linn Group 96.500 77.500 56.00 n/a n/a
McKeany Flavell 97.800 77.900 55.60 n/a n/a
Mcquarie Bank 96.600 79.700 57.30 n/a n/a
Newedge USA LLC 97.500 78.800 56.80 12.80 2.30
Northstar Commodity 98.200 78.100 55.80 12.35 2.15
PIRA Energy Group 97.000 78.000 56.10 n/a n/a
Prime Ag Consultants 98.000 80.000 n/a n/a n/a
Rice Dairy LLC 97.600 78.500 56.06 12.20 2.05
R.J. O’Brien 97.000 78.500 56.30 12.20 2.10
Risk Management 96.800 78.000 n/a n/a n/a
Stewart-Peterson 96.500 78.500 56.20 12.40 2.10
U.S. Commodities Inc. 97.500 77.500 n/a n/a n/a
Vantage RM 97.000 78.500 56.00 n/a n/a
Water Street Solutions 96.800 79.100 56.14 12.05 2.18
U.S. Corn, Soybean Inventories Fell on March 1, Survey Shows
2013-03-21 21:17:43.537 GMT
By Jeff Wilson
March 21 (Bloomberg) -- U.S. corn inventories on March 1
probably fell to the lowest in 15 years for the date, while
soybean stockpiles dropped to the lowest since 2004, according
to a survey of as many as 31 analysts by Bloomberg News. Wheat
inventories probably fell to a four-year low.
The U.S. Department of Agriculture is scheduled to update
its reserve estimates with a quarterly report at noon on March
28 in Washington. Figures below are in billions of bushels.
*T
U.S. March 1 Inventory Forecasts
Average Range Previous USDA
March 1, 2012 Dec. 1, 2012
Corn 4.995 4.743-5.248 6.023 8.030
Soybeans 0.948 0.900-1.059 1.374 1.966
Wheat 1.165 1.010-1.249 1.199 1.660
*T
*T
Analyst Estimates Corn Soybeans Wheat
===========================================================
ABN Amro 5.080 0.925 1.055
A/C Trading Inc. 4.950 0.940 n/a
ADM Investor Services 5.037 0.940 1.193
Advanced Market Concepts 4.783 1.015 1.125
AgriVisor LLC 4.990 0.955 1.180
Allendale Inc. 5.071 0.912 1.107
Citigroup Global Markets 4.960 0.984 1.211
Commodity Information 4.975 0.948 1.185
CHS Hedging Inc. 4.997 0.934 1.191
Doane Advisory 5.005 0.945 1.185
EFG Group 5.000 0.960 1.190
Farm Direction 5.050 1.000 1.170
Farm Futures 5.248 0.972 1.125
Fintec Group Inc. 4.743 0.910 1.210
Grain Service Corp. 5.056 0.928 1.166
Hightower Report 5.025 0.955 1.200
Jefferies Bache 4.941 0.936 1.238
Kropf & Love 4.985 0.930 1.197
Linn Group 5.020 0.912 n/a
Macquarie Bank 5.103 0.913 1.207
McKeany Flavell 5.020 0.900 1.010
Newedge USA LLC 4.948 0.921 1.205
Northstar Commodity 4.885 0.911 1.170
Prime Ag Consulting 5.100 0.940 1.200
Rice Dairy LLC 4.969 0.925 1.249
R.J. O’Brien 5.030 0.928 1.179
Risk Management 5.223 1.059 1.010
Stewart-Peterson 5.020 0.950 1.160
U.S. Commodities Inc. 4.952 0.970 n/a
Vantage RM 4.750 1.050 1.150
Water Street Solution 4.916 0.926 1.162
Tregg Cronin
Market Analyst
800-328-6530
651-355-6538
651-355-3723 fax
Market Analyst
800-328-6530
651-355-6538
651-355-3723 fax
CHS Hedging, Inc.
The Right Decisions for the Right Reasons
The Right Decisions for the Right Reasons
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