- Key news today has been another week of significant soybean exports with the reported volume reaching 80 million bu bringing the season total to 418 million bu. This is slightly lower than last season’s same date total but has triggered further upside in CBOT soybeans which have closed above the 50 day moving average (basis Jan ’14) and fund buyers have latched onto this as a potential buy signal. Time will tell as to whether this will create further follow through buying.
- There has been a suggestion that the huge flotilla of soybean cargoes heading towards China, due to arrive within around four weeks, will overwhelm and spark some cancellations, renegotiation or wash-outs, which will have a negative impact on the market. This will be a significant event, should it materialise and we will be keeping a close eye on any signs of it happening.
- Today has seen Goldman reduce its forecast for corn and soybean prices for the 2014/15 season. Corn price forecasts were cut $0.25/bu to $3.75, and soybeans forecasts were reduced to $9.50/bu; corn stocks were seen close to 2 billion bu and record soybean acres were expected. Record S American soybean production was also taken into account. The current rally in corn prices was expected to be short lived according to the release and near term soybean tightness was expected to provide support.
- Stratégie Grains today anticipated additional EU maize imports driven largely by competitive pricing, particularly from Ukraine. Third country imports for 2013/14 were forecast 400,000 mt higher at 10 million mt, which compares with 11.4 million mt a year ago.
- A number of commentators share our view of forthcoming price downside and suggestions that a price “top” is forming which will only be negated by adverse S American weather conditions. Given the outlook for global stock rebuild which is in progress the downside looks greater than any upside risk right now.