Morning Grain Comments, 02/022/2016

Monday, February 22, 2016

The grains kicked off the week with strong volume and chart/ price action; South American crop areas look to be a bit more affected by heavy rains than what forecasters were previously letting on, but that abundant precip will prove generally beneficial for yield and production for most.

Egypt’s GASC on Friday bought 240k tonnes of wheat for March 15-25 delivery, at an average price of $194/tonne C&F; 60k of that came from France with the remaining 180k from Russia. In addition, USDA export sales data showed the first 30k tonnes of U.S. spring wheat sold to Egypt since 2010.

Chinese customs data showed January DDG imports at over 290k tonnes, down 30% from December’s 420k but over four times the volume from last January; nearly all of it came from the United States as usual. All their 924k tonnes of sorghum imports in Jan came from the U.S. as well—that was up from 734k tonnes in January 2015—with ethanol imports of 47k cubic meters all from her and up sharply year-over-year as well. Jan 2016 soybean imports of 5.66 MMT were down 18% from January 2015, with 4.6 MMT coming from the U.S. (down 30% from LY), 621k from Brazil, and 188k from ARG.

Friday’s USDA Cattle on Feed Report showed all U.S. cattle on feed as of Feb1 virtually even with last year at 10.709 mln head, with Jan placements at 99% of last year and Jan marketings at 98% of LY; the 1.589 mln head marketed was the lowest on record for the Jan since record-keeping began in 1996

Friday afternoon’s Disaggregated CFTC Report showed daily trade estimates once again missing the mark in corn, with managed money down 35k net contracts on the week to a net –137,563 overall; daily estimates had them as a net +7k over that span. Estimates fairly close across the rest of the grains as beans rose 22.3k net on the week to 2/16, with meal up near 3k and oil up just over 10k, and Chi wheat down 3.8k net. Producers and merchants added 17k net corn with the wheats up small amounts, while beans lost 17.9k net there.


Friday’s export sales report showed soybean sales declining slightly to 20.8 million bushels on the week ending Feb 11, down from 24.5 mbu the previous week (but above the week prior’s ugly 1.6 mbu net cancellation) but basically even with the comparable week last year. Cumulative sales (now 1534 mbu) have at least remained somewhat steady in the range of 180 mbu behind last year, since late Dec; the USDA is looking for a 153 mbu entire-year export decline.


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