Morning Grain Comments, 12/22/2015

Tuesday, December 22, 2015


Soybeans rallied from lows on Thursday morning and haven’t let up since; can the front two contracts make a push to $9 and December highs? Chances are slim if BRZ rains come through as expected, though crop estimates there are already starting to reflect stressed northern soy conditions.

Tomorrow afternoon’s USDA Hogs & Pigs Report is expected to show all U.S. hogs as of December 1 at 101.5% of last year, with breeding hogs seen at 100.8% of LY and hogs kept for marketing at 101.6% of last season.

French consultancy Agritel yesterday pegged 2016 Ukraine winter wheat production at 17.2 MMT, down one-third from 2015 thanks to the lowest acreage of the last decade, at 4.65 million hectares (11.5 mln acres) versus 6.75 mln ha LY. Yields are also seen declining from 2015, at 3.7 tonnes/ha (55.0 bpa).

Dr. Michael Cordonnier cut his Brazilian soybean production estimate by two million tonnes this month to 97.0 MMT due to worsening drought in Mato Grosso; that’s only 800k tonnes above last year’s crop, with Cordonnier’s worst-case scenario for the crop down 5.0 MMT this month to 90.0 MMT. ‘15/16 BRZ corn output was left unchanged this week, however, at 81.2 MMT, with ARG soy and corn even also at 58.0 and 21.6 MMT, respectively.

 

Corn export inspections rallied to their highest number since September at 28.3 million bushels this week, up from 22.3 mbu the previous week but still below 31.6 mbu on the comparable week last season. Cumulative inspections stand at 336.6 mbu, easily the second-slowest pace—through almost one-third of the marketing year—behind the dismal ‘12/13 campaign. Inspections are near 100 mbu behind LY, with the USDA looking for a –114 mbu entire-year decline.

 

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