- CBOT markets have been mixed today and corn closed a touch lower whilst wheat, soybeans and soybean meal closed higher all in low volumes. It would seem that index fund rolling and rebalancing has commenced today and a substantial volume of corn were purchased towards the close lending some support. The roll/rebalance has not impacted grain or soybeans to any degree.
- January soybeans and products contracts expired today with little in the way of fireworks as much of the position had already been unwound in earlier trade. With March now being the “front month” contract we would expect to see limited upside from here on in; there appears little in the fundamental arena to suggest that soybeans need to be priced above $13.20/bu.
- In Brazil, private agricultural consultants, AgroConsult, have estimated the 2014 Brazil soybean crop at a record 91.6 million mt, which is an increase from December’s estimated 90.7 million mt. Their corn estimate gee slightly to 76.2 million mt from 76.1 million mt. AgroConsult actually tour and survey crops rather than conduct desktop research, and as such their figures carry a reasonable degree of credibility. AgroConsult added that as much as 42% of the Brazilian soybean crop could be harvested by the end of February, making early stock available to crushers and exporters alike. The 2013/14 plantings were some three weeks earlier than in 2012/13. Some other forecasters have estimates as high as 93 million mt, and it should be remembered that only last weekend the Agricultural Minister stated that the soybean crop could “easily” exceed 95 million mt. One thing appears to be certain, and that is that the Brazilian crop is going to be a big one!
- Further news emerged today that China has rejected more DDGs overnight and active testing for non-approved MIR 162 continues and rejection follows positive test results. Trade in corn and products into China from the US has slowed significantly.
- We are still looking for lower prices, just in case anyone was confused!