Morning Grain Comments, 12/02/2015

Wednesday, December 2, 2015

Jan beans squeaked out a fresh move high early on last night but have repeatedly bumped up against that top, though wheat is still teetering above chart lows; range-bound trade is the name of the game today, with bulls looking for another strong weekly ethanol number amid all the RFS chatter.

Argentine traders are expecting the country’s farmers to plant at least 10% more corn than originally planned, with President-elect Macri taking office on Dec 10, and a six-week corn planting window going on until mid-Jan. An extra 300-400k hectares are expected on top of original estimates for 2.6-2.7 mln ha of corn plantings for 2015/16, compared to 3.4 mln ha in 2014/15.

The USDA reported October census soybean crush at 5.10 million tonnes yesterday, or 170.0 million bushels; that’s up from 4.04 MMT (134.7 mbu) in Oct, and a full 7% above the 158.9 mbu NOPA figure for the month. The government also pegged October corn used for ethanol at 444.1 million bushels, up from 427.5 mbu in Sept, and with no sorghum used since Oct 2014.

Brazilian Trade Ministry data showed November soybean exports at 1.44 million tonnes, down from 2.6 MMT in October but well ahead of 177k tonnes last November; corn exports of 4.76 MMT fell from 5.55 MMT last month but easily bested 2.98 MMT in November 2014. Nov ethanol exports hit 194 million liters, down from 259 mln last month but above 92 million a year ago.

Statistics Canada is expected to report all wheat production at 26.7 million tonnes Friday, in their final crop estimates for the 2015/16 marketing year; that would be up 2.5% from October’s 26.1 MMT estimate, but still down 9% from last year’s 29.4 MMT harvest. Canola output is seen up 1.3 MMT this month to 15.6 MMT (still down 5% from 16.4 MMT LY); durum, corn, and soybean production figures are seen slightly higher than October as well.

Dec CBOT deliveries: bean oil 230 contracts, with next trade date available 11/30/15; Chi wheat 478 contracts and 11/30; KC wheat 198 & 12/1/15.


Today’s charts show price action of the most-traded March corn and Jan bean contracts, for the first half of December, since 1990. March corn has seen varied results over this span in the last decade, though it did post its best action in the past four years last year, after CH5 dipped just below $3.80/bu early in the month. It went on to rally to a high of $4.12/bu on 12/15, and hung in in the $4.05-$4.15/bu range all the way up until 12/29 before reverting post-Jan-report.



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