- CBOT grains trading lower towards the close and soybeans/meal hardly setting the world alight with small gains. There seems little fundamental news to support soy but seemingly, the funds are still hanging in there with some buying today. Paris wheat levels are following CBOT and look vulnerable to further setbacks, possibly as much as €10.00/mt which would impact London futures as well as domestic physical prices. With harvest due to start early this year, possibly late June in southern Europe, we could well be approaching a point at which a “cheeky” bid might seem interesting to a keen seller.
- News from the US suggests that soybean and corn crops are looking “exceptional” following strong germination. Monday’s crop report is expected to show corn condition to be up amongst the best in many tears. If the forecast rains in early June actually materialise we could well see ratings improve still further, and the risk of heat and dryness looks remote right now, although there is time for change, despite the strong chance of El Niño conditions which would minimise this risks.
- The IGC’s latest grain monthly market report has trimmed 2014/15 global wheat production by 3 million mt, but increased corn by 5 million mt and soybeans by 2 million mt (all changes are month on month). Their total grains end stocks figure was increased by 8 million mt from a month ago. The 2013/14 forecasts showed an upbeat total grain output of 1.977 billion mt, up from the prior year’s 1.790 billion mt; of this wheat for 2013/14 was 709 million mt vs. 655 million mt in 2012/13. Corn for 2013/14 was 970 million mt vs. 655 million mt in 2012/13 and soybeans 272 million mt in 2013/14 vs. 241 million mt in 2012/13. Our point, which we have repeatedly mentioned, on global stock rebuilds is supported by these forecast numbers.