Morning Grain Comments, 01/05/2016

Tuesday, January 5, 2016

The law of grain market clichés calls for higher trade today, particularly after contract lows yesterday, though an estimated record net managed money short in corn does lend some credence to any bounce today...

UkrAgroConsult raised their ‘15/16 UKR wheat export estimate from 13 to 14 MMT, with barley up from 3.6 to 4.0 MMT and corn steady at 16.5 MMT

Sources reported yesterday that three ships due to send more than 180k tonnes of French wheat to Egypt were still delayed off the country’s northern coast, due to letter of credit issues; they had been set for Dec 11-31 shipment.

Brazil’s Trade Min reported Dec soy exports at 731k tonnes, down from 1.44 MMT in Nov but well above 139k tonnes in Dec ‘14; corn exports of 6.27 MMT beat 4.76 MMT last month and 3.41 MMT last year, while Dec ethanol exports of 287 million liters beat 194 mln in Nov and 133 mln last year.

Argentine officials pegged the 2015/16 soybean harvest at 60.0 MMT, down from 61.4 MMT LY, with corn at 26.0 MMT, versus 33.8 MMT last year.

The USDA reported November soybean crush at 4.97 million tonnes, down from 5.10 MMT in October; that equates to 165.7 million bushels (versus 170.0 mbu in Oct), about 6% more than NOPA reported for the month, a number fairly consistent with the relationship since reporting began in May.

Total corn consumed for ethanol in Nov came in at 435.0 mln bu, down 1% from Oct but up slightly from last Nov; 1.935 million tons of DDG’s were produced, up from 1.771 mln LY. Also, 5.6 mln cwt of sorghum was used for ethanol production in Nov, up from 4.7 mln in Oct and 2.07 mln last year.

Yesterday’s holiday-delayed Disaggregated CFTC Report showed managed money funds dropping nearly 56k net corn on the week ending last Tuesday (12/29), against daily trade expectations for just a 3k net loss on the week; beans lost 27k, about double the expected loss. Chi wheat dropped 16k net there versus an estimated 1k net gain, with meal & oil down 5-7k net. Meanwhile, producers & merchants added 50.5k net corn with beans up 29.5k net.

Jan CBOT deliveries: soybean oil 127 contracts, next trade date 12/30/15.


Corn export inspections plummeted to just 12.8 million bushels this week, down from 22.6 mbu last week and 21.2 mbu on the comparable week last year. Cumulative inspections through one-third of the 2015/16 marketing year stand at 372 mbu, now down 106 mbu from last year’s Sep-Dec pace; cumulative shipments and sales stand 121 and 266 mbu behind LY, respectively, with the USDA still looking for only a 114 million bushel entire-year export decline.



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