MORNING GRAINS 6/21/13
Exports: None Visible.
Comments: Next week: end of month/quarter; USDA acreage/ quarterly stocks. Weather and forecasts seem ideal in some areas that get 90’s and periodic rains. China’s May corn imports fell 43% to 66,612t; Coceral raises its E.U. crop estimate to 66.1mln.m/t’s vs. 57.2mln.yr. and March’s 64.4mln. estimate; open interest fell 8,100 led by July off 17,700 amid moderate volume. Outside markets cooling off but some technical selling follow through looks evident. After Wed.’s ‘breakout’ July corn falls back to its high end of old trading range; December merely matched range highs and fell back. Outside markets an influence yesterday? Yes. But more European and China financial problems will be a big deal; plus, global crops are in good shape overall.
Exports: So.Korea buys 55,000t Argentine soymeal.
Comments: China economic trouble: will soybeans be bullet proof? China’s May soybean imports fell ‘only’ 3.4% on year to 5.1mln.m/t’s while much greater declines in corn, wheat. Both (record) South American and U.S. production is tied directly to China expanding soybean imports…..even a few % points less could be significant; China Bank crunch—“overextended loans and deteriorating asset quality”…ring any bubble bells? China futures lower on U.S. fed action and led by lower palm oil futures (government not keen on blaming their own economy); open interest fell 2,900, of note July drops and picked up by Q/X/K/H in light numbers (suggests to me buying just dried up), volume light-side. End of week correction at hand?
Comments: India’s government OK’s sale of 10mln.m/t’s in open market to alleviate heavy reserves ahead of a likely bumper crop coming in; Russian harvest early and yields good; Bangladesh says 2 South Korean companies default on 100,000t wheat sale; South Korea taking samples of French wheat as a substitute for U.S. after our GMO ‘scandal ‘; China’s May imports fell 49% on year to 283,177t; Coceral sees E.U. crop up 4.2% on year to 130.7mln.m/t’s and up 3.0mln. from prev. est.; open interest fell 2,150 led by July off 14,200 (picked up mainly by U/Z) amid very good volume. Global wheat supplies loom large, U.S. problems non-withstanding.