Morning Grain Comments, 10/28/2015

Wednesday, October 28, 2015


A U.S. dollar decline since midnight has given the grains surprisingly little help; with another massive corn crop in the bin, two big stories of the last two days have been a cargo of Brazilian corn coming into the S.E. U.S. and China now holding off on their record DDG import pace...

South Korea's NOFI issued an international tender for up to 55k tonnes of South American soybean meal this morning, for March-April shipment.

Industry sources reported that Chinese customers have temporarily stopped purchasing U.S. DDG's, due to worries that the government may launch another anti-dumping probe into imports. China buys nearly all its DDG's from
the U.S., while the lion's share of U.S. DDG exports currently go to China— Chinse imports of U.S. DDG's remained at record highs from July thru Sept.

Russia's Deputy Ag Minister said they'll consider either cancelling or changing their new wheat export tax "when the foreign exchange rate stabilizes"; meanwhile a Russian news agency expects 2015 grain production at nearly 105 MMT, basically in line with last year's record harvest.

Kazakhstan has harvested 19.9 MMT of grain so far this season, up 24% from last year, with basically all the country's crop area completed as of yesterday.

Algerian customs data showed cumulative grain imports at 9.92 MMT over the first nine months of 2015, up 7.6% from last year's pace, with Jan-Sept soft wheat imports up 21% to 4.95 MMT, and barley up 26% to 612k tonnes.

South Africa's Crop Estimates Committee pegged the country's 2016 corn plantings at 2.55 million hectares (6.3 mln acres), down from 2.65 mln ha (6.55 mln ac) in 2015, below the average estimate, and the lowest since 2011.

A USDA attaché in Australia estimated the country's 2015/16 wheat harvest at 24 million tonnes—below the official 27 MMT USDA estimate, that was increased by a million tonnes in the October S&D Report.

 



Today's charts show annual average spot CBOT corn and soybean prices over the last 20 calendar years, including 2015 so far. Corn prices have continually declined since the 2012 drought, with a decent 2013 harvest followed by two massive crops, pushing the average spot price thus far in 2015 to $3.78/bu, the lowest since '09 (and nearing the lowest since '06). Beans at $9.60/bu so far this year are easily the lowest-priced since 2007, down $5 from the 2012 peak.

 

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