Morning Grain Comments, 03/03/2016

Thursday, March 3, 2016

The grains are holding on the high side this morning but it’s a tepid bounce, with low volume to boot; the trade awaits export sales this morning, and USDA trade estimates that are unlikely to provide any support...

Taiwan flour millers bought 100,975 tonnes of U.S. milling wheat for April-May shipment, with varieties/prices ranging from $204-225/tonne FOB.

India bought 60k tonnes of wheat from Australia, at $230/tonne C&F for April arrival; it was their first international wheat purchase of 2016. India bought about half a million tonnes of premium Aussie wheat in 2015.

Egypt’s GASC yesterday bought 180k tonnes of wheat for April 5-14, including 120k tonnes from Romania and 60k from Ukraine, at an average price of just under $185/tonne C&F. On a related note, Bunge said that it will deliver a cargo of French wheat that Egypt had rejected back in December to Spain.

The U.N. FAO reported a slight increase in their world food price index in February, at 150.2 points, compared to a revised 150.0 in January; that remains near a seven-year low after a total slide of 19% throughout 2015.

INTL FCStone Brazil increased their estimate for Brazil’s 2015/16 soybean crop from 98.0 to 98.6 MMT yesterday afternoon, with total corn output up from 81.05 to 84.2 MMT (28.2 MMT first crop, 56.0 MMT second crop).

Informa yesterday raised their 2015/16 South American corn forecasts, with Brazil up 900k tonnes this month to 82.5 MMT (now right in the middle of Conab above and the USDA below), and Argentina up 1 MMT to 27.0 MMT.
Argentine corn is seen gaining another 7 MMT to 34.0 MMT in 2016—that is up 4 MMT from Informa’s previous forecast. Brazilian soybean production rose 800k this month to 101.3 MMT, above Conab and the USDA and on the aggressive end of the trade range, while ARG soy lost 1 MMT to 59.0 MMT.

March CBOT Deliveries: beans 526 contracts, with next trade date 2/26; oil 157 & 3/1; Chicago wheat 233 & 2/26; KC wheat 1 contract and 11/25/15.


Total DOE fuel ethanol production declined to 987,000 brrels per day this week, down from 994k bpd the previous
week but still at an extremely strong record seasonal level— ast year came in at 931k bpd on this comparable week, and that itself was a record for that time of the year, with no previous season reaching even the 900k bpd mark. Jan sorghum used for ethanol came in at 12 mln bu—milo is on pace to use up 125+ mbu of corn’s share in this equation.



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