- The new week has started with red being the predominant colour on the screens once again as soybeans and wheat both post lower numbers in Chicago. Corn is trading either side of unchanged with just over half an hour to go.
- The wheat market has been pressured by further heavy snow forecasts across the Plains, but strangely the reported Chinese soybean buying has not provided the support we expected to see in the market today. Out of the huge vessel lineup in Brazil we understand that Chinese soybean vessels account for some 8 million mt. Their dependence upon loading is vast to say the least, and any disruptions (such as last week’s port workers strike) will not relieve the pressure. This is perhaps the reason why additional enquiry is seen in the US, to ensure pipelines are filled; at the expense of an extremely tight US S&D!
- We hear that winter wheat crops in Russia are enduring similar conditions to those being experienced in the US, in need of further moisture following autumn drought. Southern regions would appear to have endured dry planting conditions followed by well below normal precipitation (below 50%); key regions have experienced poor germination and emergence on a reduced acreage. Early 2013 rains improved the outlook but February conditions have reverted to dry with many areas receiving little, if any, rainfall.
- The bottom line is that heavy rainfall is needed in order to prevent the crop deteriorating, autumn drought has left depleted subsoil moisture levels. Russian wheat growers need a good season to replenish stocks reduced by heavy exports and strong domestic consumption which has also drawn down on intervention stockpiles which also need to be rebuilt.
- Argentina’s Rosario Grain Exchange has today forecast their 2012/13 corn crop at 25.5 million mt, one million mt lower than previously estimated last month. Their soybean estimate stands at 48 million mt, a full 5 million mt down from last month.
- In Brazil, Celeres reported the soybean harvest as 28% completed, an improvement fro 19% a week ago.