• Today has seen the reversal of yesterday’s agri commodity price gains with the soy complex, corn and wheat (at the time of writing) all showing losses of some substance. The US weather outlook with relatively cool temperatures and frequent precipitation across much of the central region continues to favour crop development and the outlook for overall output in corn and soybeans.

• There is also the pressure added from technical chart derived support levels being breached today in corn and soybeans which has added some impetus to declines. Fund selling appears to have gained momentum as these price thresholds were hit.

• Ukraine grain output was estimated (by their AgMin) at 57.1 million mt, an all time record, and an  increase from last year’s 46.2 million mt. Stratégie Grains advised that the French winter barley harvest was all but complete with 90% of the area harvested with yield close to the five year average. The wheat harvest, which is under way, is progressing well in the south and has reached 30% nationally with yield again reported to be average. Initial wheat protein concerns have eased as the harvest has progressed from its commencement.

• Global wheat output estimates for 2013/14 were today increased by the International Grains Council to 687 million mt, an increase of 4 million mt. The increase is a reflection of improvements in the US, EU and India. It also increased its estimate for wheat imports by China to 7 million mt, following quality issues within their domestic crop. By way of comparison, the USDA’s estimate of China’s imports stands at 8.5 million mt. The 2013/14 global corn crop was forecast at 942 million mt, a record number, which is a significant (10%) increase over the previous year’s output. US corn output was trimmed by 5 million mt from a month ago to 350 million mt, which is significantly above last year’s 273.8 million mt.

• The USDA has today released its weekly export figures as detailed below:

Wheat; 596,900 mt which is within estimates of 500,000-725,000 mt.
Corn; 1,225,000 mt which is above estimates of 400,000-880,000 mt.
Soybeans; 1,109,400 mt which is above estimates of 400,000-825,000 mt.
Soybean Meal; 331,400 mt which is within estimates of 125,000-350,000 mt.
Soybean Oil; 11,500 mt which is within estimates of zero to 30,000 mt.

• In other news (again China related) China’s PMI Index for July was reported at 50.3%, marginally above the key 50% level below which economic contraction is deemed to be taking place. Whilst the reported level was not high, it was above expectations, and as such supportive. The slowdown in China would appear to be continuing albeit not at the anticipated pace.

• Brussels today granted export licences totalling 580,000 mt bringing the season total to 1.7 million mt, which is 822,000 mt above last season’s figure (92.9% increase).

• In the absence of weather threats we continue to look for lower levels.