September Corn finished down 3/4 at 532 1/4, 7 off the high and 4 3/4 up from the low. December Corn closed unchanged at 502 3/4. This was 3 3/4 up from the low and 7 off the high.
Corn futures traded both sides of the unchanged today despite supportive news that China bought US corn cargos yesterday for the 2013/14 marketing which failed to inspire much bullish optimism in the market.
Weather conditions continue to favor bearish supply figures for next year as we head into the holiday weekend.
The bulls point to a ridging pattern that could impact the western Corn Belt by mid-July but confidence remains low at the moment. Ethanol production for the week ending June 28th averaged 863,000 barrels per day, down 2.5% vs. last week and up 0.70% vs. last year.
Total ethanol production for the week was 6.04 million barrels. Corn used in last week's production is estimated at 90.6 million bushels and this crop year's cumulative corn used for ethanol production is 3.72 billion bushels.
Corn use needs to average 96.06 million bushels per week to meet this crop year's USDA estimate of 4.6 billion bushels. Stocks as of June 28th were 15.45 million barrels, down 5.2% vs. last week and down 23.9% vs. last year.
A private grain analyst estimated US 2013/14 corn production at 14.259 billion bushels, down from their prior forecast but up from the most recent USDA estimate of 14.005 billion.
The projected yield was 160 bushels per acre as compared with the USDA estimate of 156.50 bushels per acre.
September Rice finished down 0.13 at 15.17, 0.11 off the high and equal to the low.
Soy Futures Closed Higher
August Soybeans finished up 7 3/4 at 1441 1/4, 8 3/4 off the high and 8 1/2 up from the low. November Soybeans closed up 8 1/4 at 1250 3/4. This was 9 up from the low and 9 off the high.
August Soymeal closed down 0.3 at 432.6. This was 0.5 up from the low and 4.7 off the high.
August Soybean Oil finished up 0.28 at 47.11, 0.11 off the high and 0.39 up from the low.
Old vs. new crop calendar spreads were well supported throughout the session due to profitable cash crush margins across the Midwest and steady meal demand in the domestic market.
Export demand inquiries have backed off as Argentina supplies hit the market but the tight supply situation in the US is helping to offset.
Weather continues to be a wild card with reports of soybean growth that is well behind normal in the northwestern tier of the growing region. Weather conditions remain favorable for the remainder of this week and into this weekend with showers showing up in the Eastern Corn Belt while the west will trend drier.
Temperatures will moderate in the mid-80s the rest of this week before heating back up into the weekend and next week.
Many traders are beginning to focus their attention on the mid-July forecast that shows more severe temperatures in the western Corn Belt.
Rainfall will be needed across the region next week. Basis levels in the interior of the US held steady today but remain at historically high levels with physical traders noting that it was becoming increasingly difficult to source supplies.
Many crushers only have 2 weeks of coverage at this point. A private grains analyst estimated US production at 3.376 billion bushels, down slightly from their prior forecast and down from the most recent USDA estimate of 3.39 billion.
The estimated yield was 43.9 bushels per acre as compared with the USDA forecast of 44.5 bushels per acre.
Wheat Futures Closed Higher
September Wheat finished up 6 3/4 at 665, 6 1/4 off the high and 7 up from the low. December Wheat closed up 6 1/4 at 677 1/2. This was 6 1/2 up from the low and 6 3/4 off the high.
Wheat futures traded higher on the day following a strong overnight session but traders sold into the opening bell despite positive demand-side headlines overnight.
The USDA reported that US private exporters sold 360,000 tonnes of Chicago wheat to China for the 2013/14 marketing year which takes total outstanding sales to China over 1.5 million tonnes. China holds the largest purchases book of US wheat for this year.
Keep in mind, the Egyptian tender sold by the Black Sea yesterday was only for 180,000 tonnes. Wire services also reported overnight that Australia sold 300,000 tonnes of wheat to China for the next marketing year.
So far this season, China has purchased wheat from the US, France, and Australia as they attempt to expand their supplier base and fill reserves.
This is a positive, long term demand development for not only the US, but the global wheat market. Production expectations are rising for Chicago wheat in the US with some traders now suggesting it could reach 550 million bushels, helping to offset the rising export and feed what demand.
A private grains analyst estimated the US wheat production at 2.016 billion bushels vs. the current USDA forecast of 2.080 billion.
Most of the decline was seen in the spring wheat market with production estimated at 482 million as compared with the USDA estimate of 542 million.
September Oats closed up 7 3/4 at 359. This was 7 up from the low and 1 off the high.
