- Rumour and counter rumour continues to dominate markets in the post holiday trading period as we lead into next week’s USDA report. Today’s US rally in wheat (which did not follow through to the close) was based on rumours that Russia had followed Ukraine in stopping VAT reimbursement on exports. MATIF closed flat as some “traders” (always nameless!) cited switching into corn from wheat as the reason because corn had more upside potential – dumb and dumber springs to mind!
- Early trade saw an attempt at “Turnaround” as we suggested yesterday, but concern over coming extreme cold in S Midwest soft red wheat areas put an end to that. We are told there is adequate snow cover, but fears still exist over winterkill (unjustified we are told).
- Other news is thin apart from a few fresh crop estimates, which includes Informa Economics’ latest figures. They peg the 2014 US corn yield at 172.7 bu/acre, below the last USDA figure of 173.4 bu/acre. Soybean yield was estimated at 47.6 bu/acre vs. USDA at 47.5 bu/acre. Their estimate for harvested corn acres rose to 83.527 million which is430,000 above the USDA. 2014 corn output was estimated at 14,425 million bu, 18 million above the USDA’s November figure (no Dec estimate). 2014 soybean production was put at 3,969 million bu, an increase of 11 million on the USDA’s November figure.
- There were no real surprises in the Informa figures, some raised an eyebrow at the rise in corn harvested acres, however we did suggest some while ago that the “official” data was incomplete this year and subject to revision – in time.
- Informa also estimated Brazil’s 2014/15 corn crop at 72.25 million mt, an increase of 3 million mt month on month. The Ukraine 2014/15 crop was also increased month on month, by 1.5 million mt to 28 million mt.
- Finally, the post holiday catch up in EU wheat export licences shows that 987,741 mt of certificates granted over the two week period. This brings the season total to 15.453 million mt, which is 352,261 mt (2.3%) ahead of last year.