Soybean prices, on track to end the year with only modest losses, also eased. Wheat was pointed toward a yearly decline of more than 20 per cent, the biggest loss since 2008, with persistent pressure from an abundant global stockpile.

Corn futures were almost certain to end 2013 as the worst-performing major commodity market, having lost nearly 40 per cent of their value as a mammoth U.S. crop came to harvest at a time of diminished demand for ethanol and livestock feed.

Traders were already bracing for further losses ahead, particularly amid signs of an improving outlook for Latin America crops that are now in their prime growing period.

“We’ll be down again next year, but not 40 per cent. I think corn will fall to the $3.50 per bushel area so there is still nearly $1 per bushel excess in the deferred contracts,” said Art Liming, a futures specialist for Citigroup (all figures US$).

Chicago Board of Trade March corn fell four cents to $4.23-1/2 on Monday, the lowest in two weeks and nearly half of its 2012 peak. Deferred new-crop December 2014 corn futures were trading around $4.50 per bushel on Monday.

Rain fell over much of Argentina’s corn and soybean growing region during the weekend and more rain is expected in roughly the northern two-thirds of the country, said John Dee, meteorologist for Global Weather Monitoring.

“It was a big weather weekend, and the rains performed pretty well,” said Dan Cekander, an analyst for Newedge USA.

Argentina, the world’s third-largest exporter of corn and soybeans, has been suffering prolonged hot, dry weather that traders fear could damage crops, and has supported global prices. Weekend rain and forecasts of more wet weather have improved the country’s crop outlook.

Soy held up

The turn to good growing weather in Argentina also drove soybean futures down nearly one per cent and soy is on track to fall nearly seven per cent for 2013.

Chicago Board of Trade January soybeans closed down 3-1/4 cents per bushel at $13.28-1/4, and wheat for March delivery was down 8-1/2 at $6.00-1/2.

Argentina’s Rosario grain exchange said on Monday that Argentina will harvest 55 million tonnes of 2013-14 soy and 22 million tonnes of corn.

The U.S. Department of Agriculture (USDA) forecasts Argentina will harvest 54.5 million tonnes of soybeans in the new 2013-14 crop year from 49.3 million in the previous season. The Argentine corn crop is seen little changed at 26 million tonnes.

Corn and soybeans rallied on Friday following the release of the USDA’s latest export sales figures, which showed better-than-expected weekly sales.

USDA pegged net sales of corn for the 2013-14 marketing year at nearly 1.5 million tonnes, far exceeding trade estimates, while soybean exports of more than 720,000 tonnes also topped expectations.

Corn remained under pressure over concerns China is rejecting imports that contain a genetically modified corn strain not yet approved by Chinese authorities.

— Sam Nelson is a Reuters correspondent covering grain and oilseed futures markets from Chicago. Additional reporting for Reuters by Michael Hogan in Hamburg and Colin Packham in Sydney.

Related story:
China turns away U.S. DDGs over GMO, Dec. 27, 2013

The post U.S. grains: Corn, set for biggest annual drop, slips on Argentine rain appeared first on Alberta Farmer Express.

Corn was flat to firm on positioning with the big buildup in global corn stocks hampering attempts to rally prices while wheat fell to a fresh 19-month low on tepid exports and plentiful wheat supplies.

Chicago Board of Trade January soybeans closed 5-1/4 cents per bushel higher at $13.33-3/4, March corn was up 3/4 cent at $4.35 and March wheat was down 3-1/4 at $6.06-1/4 (all figures US$).

Trade volume was light ahead of the Wednesday Christmas holiday. Markets closed early at 12 p.m. CT on Tuesday and will remain closed on Wednesday.

Much of Tuesday’s focus was on the soybean complex and the modest strength in the spot January soybean and soymeal futures contracts.

“If you want to blame it on something, the exports would be okay. We got down near the bottom of the range and now it’s going back up,” said Art Liming, a futures specialist for Citigroup.

The U.S. Department of Agriculture on Tuesday said private exporters sold 185,000 tonnes of U.S. soybeans to an unknown destination and sold 114,000 tonnes to Egypt. Also on Monday, USDA announced a sale of U.S. soybeans to an unknown buyer.

Spot January soybeans have been in a narrow trading range since late November with a low of near $13.10 and a high of just above $13.50.

“With the tight U.S. stocks, I don’t see January going below $13 but with the big South American crop coming on, a move above $13.50 isn’t likely either,” Liming said.

“Weather in South America is not a big problem, Brazil is OK while there is some concern in Argentina,” he said.

Soybean and corn futures had found some price support since the end of last week from hot and dry weather in Argentina and pockets of dryness in Brazil, which raised doubts about expectations of bumper harvests.

“The weather situation is a concern for corn above all because it goes through pollination earlier,” a European trader said of South American conditions. “But U.S. corn will struggle to rally unless this weather risk is confirmed.”

Crop-friendly showers were expected this week into early next week in most of Argentina’s corn and soybean growing region, which will help ease dry weather stress on crops, said Drew Lerner, a meteorologist for World Weather Inc.

“All areas of Argentina should see some rain with amounts ranging from 0.5 inch to 1.5 inches (1.3 to 3.8 cm),” he said.

The key crop regions will receive the showers Friday through Tuesday and the rainfall will be followed by a return to hot weather next week, Lerner said. “The second half of next week will be dry and warmer again so the showers this week will bring only temporary relief,” he said.

Overall satisfactory crop weather continues in Brazil with some dry areas in southern Brazil expected to receive showers soon, Lerner said.

— Sam Nelson is a Reuters correspondent covering grain and oilseed futures markets from Chicago. Additional reporting for Reuters by Gus Trompiz in Paris and Colin Packham in Sydney.

The post U.S. grains: Soy rebounds after export U.S. sales announced appeared first on Alberta Farmer Express.

Corn held firm for the third consecutive trading session on short-covering and weather issues in Argentina, while wheat was lower on plentiful global supplies and only routine export sales out of the U.S.

Chicago Board of Trade January soybeans closed 10-1/2 cents per bushel lower at $13.28-1/2 per bushel, March corn was up one cent at $4.34-1/4 and wheat for March delivery was down four cents at $6.09-1/2 (all figures US$).

Traders said volume was fairly light in all markets, which is typical of a holiday trading session.

“Weather is expected to improve in South America by the end of the week, but there is definitely a holiday feel across the board,” said Sterling Smith, futures specialist for Citigroup.

Soybean and corn futures have been finding some support from hotter and drier-than-desired weather in Argentina and on pockets of dryness in Brazil.

Commodity Weather Group (CWG) said there are several opportunities for showers in southwest Argentina, but the broadest coverage is expected next week.

“The rains will be needed to prevent building concerns in early January for pollinating corn,” said CWG meteorologist Joel Widenor.

High temperatures and dryness is a concern in Argentina and far southern Brazil from Wednesday into the weekend. However, “rains next week are projected to limit concern,” Widenor said.

High temperatures and a lack of rain forecast for the coming days in Argentina’s farm belt will hurt the 2013-14 soy and corn crop, the agriculture ministry said on Friday.

Argentina is the world’s third-largest exporter of soybeans and corn, as well as the No. 1 supplier of soymeal and soyoil.

Ample supplies and slowing U.S. exports weighed on the wheat market, which slid 2.4 per cent last week.

Cold weather is forecast for the U.S. winter wheat region this week, but temperatures are not expected to fall enough to damage the crop.

Investors in the corn market are concerned about slowing demand from China which has cancelled around half a million tonnes of U.S. corn cargoes.

The Chinese government’s quarantine authority confirmed on Friday that it has rejected a total of 545,000 tonnes of corn from the U.S. because they contained an unapproved, genetically modified strain.

U.S. officials had earlier said they would urge China to act promptly to approve the variety, known as Agrisure Viptera and developed by Syngenta, and raised the issue with Beijing during annual trade talks between the two countries.

— Sam Nelson is a Reuters correspondent covering grain and oilseed futures markets from Chicago.

The post U.S. grains: Soy down on China concern appeared first on Alberta Farmer Express.

The January soymeal contract rose to a contract high of $449.30 per ton in reaction to the active exports and to tight soymeal stocks (all figures US$). It closed up $9 at $448 per ton.

Soybeans also were supported by the strong U.S. soybean crush as seen in Monday’s National Oilseeds Processors Association (NOPA) monthly crush report.

Corn rose for the second day in a row on short-covering despite China’s recent rejections of U.S. corn cargoes that contained a non-approved GMO variety.

Wheat eased in choppy trading as the market continued to hover at the lowest price levels in 1-1/2 years.

Chicago Board of Trade January soybean futures closed 8-3/4 cents higher at $13.46-1/2 per bushel, corn for March delivery was up 3-1/2 at $4.26-3/4 per bushel, and March wheat was down 2 at $6.19-3/4 per bushel.

Positioning underpinned all three markets, but there was reluctance to place fresh buy orders in wheat, corn or soybeans ahead of the results of a Dec. 17-18 meeting of U.S. Federal Reserve policymakers.

“Everybody’s waiting on the FOMC (Federal Open Market Committee) meeting tomorrow and that’s keeping a lid on activity. The market is a little nervous before the meeting,” said Sterling Smith, futures specialist for Citigroup.

There is concern the FOMC may begin to wind down its market-friendly, bond-buying economic stimulus program.

That stimulus has been a major contributor to gains in the equities markets this year and has affected market sentiment in commodities.

Domestic and export demand for soybeans and soymeal has been brisk, a fact demonstrated in Monday’s NOPA report.

“The NOPA numbers were healthy, but traders are nervous because there could be cancellation of Chinese orders for U.S. beans as they gain confidence in the South American crop,” Smith said.

NOPA on Monday said U.S. members crushed 160.1 million bushels of soybeans in November, up from 157.1 million in October and the most for any month since January 2010.

Gains in soybeans have been slowed by prospects for a bumper South American soybean harvest early next year and prospects for China to shift its buying of soy away from the U.S. to South America.

Satisfactory crop weather continues in South America with the few dry areas likely to receive showers soon, said Don Keeney, meteorologist for MD Weather Services.

“Temperatures reached the low 100s (F) in southwest Argentina this week but there is no major damage expected,” he said.

Keeney said the dry areas in Argentina were in small crop-growing regions and that corn and soybeans are not mature enough at this time to be harmed by heat or drought.

Overall satisfactory crop weather continues in Brazil, Keeney said.

— Sam Nelson is a Reuters correspondent covering grain and oilseed futures markets from Chicago.

The post U.S. grains: Soy up for third day on meal exports, cash meal appeared first on Alberta Farmer Express.

Wheat fell to its lowest in 1-1/2 years on technical selling and abundant world supplies, with new contract lows hit in Chicago Board of Trade soft red winter wheat, Kansas City Board of Trade hard red winter wheat and Minneapolis Grain Exchange spring wheat futures contracts.

Soybeans rallied on bargain buying after falling to a one-week low, and the spot December soymeal contract exploded higher ahead of its expiration.

At the Chicago Board of Trade, March corn ended down 8-3/4 cents at $4.25-1/2 per bushel, March wheat settled down five cents at $6.28-3/4 and January soybeans ended up 3-3/4 cents at $13.27-1/2 a bushel (all figures US$).

Analysts said there was nothing bullish for wheat, corn or soybeans in Tuesday’s USDA crop production or supply/demand reports, with plentiful supplies of each commodity to meet current demand.

“The Argentine crop got rain, so big South American production (soybeans and corn) is possible and wheat is under technical pressure. It looks like sub-$6 per bushel is possible now for wheat,” said Mike Zuzolo, an analyst for Global Commodity Analytics.

The U.S. Department of Agriculture this week estimated next year’s global ending supply of wheat at 183 million tonnes, up from 176 million this past season.

Corn ending stocks were pegged at 162 million, up from this past season’s 135 million, and the world supply of soy at the end of this marketing year was estimated at 71 million tonnes, up from the past season’s 60 million.

Corn market struggles

Traders and analysts said the focus was on the corn market because of China’s recent discovery of an unapproved, genetically modified (GMO) corn variety in cargoes of corn it received from U.S. exporters.

In addition to China’s refusal of several U.S. corn cargoes, the futures market was cooled by a group of U.S. senators’ proposal on Thursday to eliminate the country’s corn ethanol mandate.

“There is only bearish news out there for corn,” said Arnaud Saulais, of Starsupply Commodity Brokers.

Corn prices have been struggling to recover from a series of three-year lows hit during what appears to have been a record-large U.S. harvest this autumn.

Industry sources in China said that strict checks on imported corn are likely to continue until early next year as Beijing seeks to curb imports and support domestic prices in the face of what is expected to be a record Chinese harvest.

Traders are concerned about talk that the unapproved GMO corn trait might have been found in distillers dried grain (DDG) containers shipped to China from the U.S.

DDGs are a valuable, high-protein feed byproduct of the corn-based ethanol industry. China is the top global buyer of the product, accounting for about 40 per cent of U.S. exports in the 2012-13 marketing season that just ended.

“Chinese buying is the demand wild card for 2014,” Rabobank analysts said in a report.

Low world prices had been expected to spur China to boost its strategic reserves, but the GMO issue has raised doubts.

“If (Chinese) imports drop much below the seven million tonnes projected by the USDA, prices could drop into the $3.70 to $3.80 a bushel range,” Rabobank said, referring to a forecast by USDA.

Soybeans turn higher

Soybeans rallied, posting modest gains on bargain buying after the benchmark January contract fell to a one-week low on the prospects for large South American soy harvests in early 2014.

Soybeans also drew support from soymeal as the lightly traded December soymeal contract expired in dramatic fashion, rocketing up 11 per cent to a contract high of $510 per short ton in its final minutes of trading.

December soymeal ultimately settled at $462.90, well off the high, based on its spread relationship to the January contract, traders said.

Traders attributed the spike in soymeal to short-covering ahead of expiration, and persistent strength in the cash market.

Export demand for soymeal has been at a near-record high this season, with the U.S. picking up market share from Argentina, typically the world’s biggest soymeal supplier.

— Sam Nelson and Julie Ingwersen report on agricultural futures markets for Reuters from Chicago. Additional reporting for Reuters by Gus Trompiz in Paris and Colin Packham in Sydney.

The post U.S. grains: Corn dips again as China rejects U.S. cargoes appeared first on Alberta Farmer Express.

Corn also eased on concerns about the fate of U.S. corn sales to China after the country began rejecting cargoes containing an unapproved GMO corn variety and on talk the unwanted variety may also be in some containers of distillers dried grain (DDG).

“I think (corn) reacted to the downside (due to the mandate worry) but this China corn rejection deal is still hanging over the markets head as well,” said independent trader Ken Smithmier.

Soybean futures fell more than one per cent, its biggest one-day loss since Nov. 15, on prospects for a bumper South American soybean crop early next year and despite export sales of U.S. soybeans last week that exceeded estimates.

Wheat fell to new contract lows due to a plentiful global stockpile and a tepid export sales pace for U.S. wheat.

Chicago Board of Trade March corn closed down five cents per bushel at $4.34-1/4, January soybeans fell 20-1/4 cents to $13.23-3/4 per bushel and March wheat slid seven to $6.33-3/4 (all figures US$).

A group of 10 U.S. senators introduced a bipartisan bill on Thursday to eliminate the corn ethanol mandate, arguing that current law pushes up the cost of food and animal feed and damages the environment.

“The proposal had a definite immediate shock to prices but long-term I don’t think it has a chance getting through Congress, it will have a tough time clearing the farm lobby,” said Sterling Smith, a futures specialist for Citigroup.

“Also, there is a lot of ethanol use built into fuel standards even without the mandate so I question how much of an impact ending the mandate would have,” Smith said.

Corn had already been labouring due to concerns about the future sales of U.S. corn to China after an unapproved genetically modified (GMO) variety was detected in several cargoes from the United States.

“Right now they really don’t need the corn; they had record production, so time is on their side and they can drag their feet on this whole approval process if they want to,” Shawn McCambridge, an analyst for Jefferies Bache, said.

China on Wednesday blocked the entry of another U.S. corn cargo, and three more may be turned away after tests found a strain of unapproved GMO corn.

“Going forward, there could be lower demand from China for U.S. corn,” said Vanessa Tan, an investment analyst at Phillip Futures in Singapore.

Traders said Wednesday that corn turned down by China was being switched to other Asian countries, sometimes with price cuts.

USDA, in its weekly export sales report Thursday, showed U.S. corn export sales last week within the range of estimates but soybean sales were well above estimates.

However, soybean futures fell despite the big export number.

“Soybean traders are looking at South American weather, which is excellent in Brazil,” said Dax Wedemeyer, an analyst for U.S. Commodities at Des Moines.

“Beans are running into a lack of news and are down despite the big export number … the volume is getting lighter in a holiday market,” Wedemeyer said.

USDA said Thursday U.S. export sales of soy last week for the 2013-14 marketing year totaled 1,108,500 tonnes, above estimates for 750,000 to 950,000 tonnes.

“The bean export number was above even the biggest estimate, which was mine, so there is still good demand especially from China,” said Sterling Smith, a futures specialist for Citigroup.

“China wants to lock in supplies until they get more confident in the South American crop,” Smith said.

Wheat remained under pressure from a USDA report Tuesday that showed expected U.S. and global wheat supplies were above expectations.

“Wheat is under pressure from the big global supplies, big supplies in the U.S. and everywhere else,” Wedemeyer said.

— Sam Nelson is a Reuters correspondent covering CBOT grain and oilseed markets from Chicago.

The post U.S. grains: Corn eases on proposal to nix ethanol mandate appeared first on Alberta Farmer Express.

Wheat tumbled for the second day in a row, and at 1.5 per cent, posted its biggest one-day decline in over two months.

European wheat futures, which hit a near seven-month high on Wednesday, tracked U.S. prices lower.

Corn fell for the first time in four days as a short-covering bounce from a three-year low petered out, while soybeans also eased.

“The weather in South America continues to be non-threatening so that I think is having some impact on the soybean market as well,” said Don Roose, analyst and president of U.S. Commodities at Des Moines, Iowa.

All three commodities were pressured by lower-than-expected exports of each as seen in the U.S. Department of Agriculture’s weekly export sales report, which was released on Thursday.

Wheat declined despite the potential for some winterkill damage to the U.S. winter wheat crop late this week as bitter cold temperatures and ice threatened to harm some of the crop in the U.S. Plains and in the U.S. southern Midwest.

“There may be some winterkill in the Plains but I don’t think it’s a major problem. A bigger issue will be the ice cover from northeast Texas into the Delta,” said Don Keeney, a meteorologist at MDA Weather Services.

Chicago Board of Trade December wheat closed down 9-1/4 cents per bushel at $6.38 per bushel, December corn was down 2-3/4 at $4.22-3/4, and January soybeans were down 1-1/2 at $13.28 (all figures US$).

Although grains and soy ended lower the closing prices were above the day’s lows due to a weak dollar and slow country movement.

“Part of it is probably the (weakness in the) dollar,” said Jack Scoville, analyst for the Price Futures Group.

“And I don’t think there is much for sale right now. Farmers are pretty tight holders,” he said.

“Once it gets put in the bin and the temperatures drop into the 20s (F), and to the south they are going to get a couple inches of ice, who wants to go out and open a bin door, fill a truck and take it into town?,” Scoville said.

Big Canadian wheat crop

“The big news in wheat was the (Statistics Canada) production figure (…) and I think this is driving the movement today,” said Brett Cooper, senior manager, markets, at FCStone Australia.

Statistics Canada said on Wednesday that farmers produced a record 37.53 million tonnes of wheat in 2013, up 38 percent from 2012 and well above market expectations.

The estimates dampened a rally in wheat that had been driven by strong export demand at a time of fading competition from Russia and Ukrainian supply, as well as worries over freezing weather forecast this week in the U.S. wheat belt.

In Europe, March milling wheat on the Paris Euronext market was down 0.7 per cent at 211.50 euros a tonne as it pulled away from a near seven-month high of 211.25 euros hit on Wednesday.

Corn remains within sight of a three-year low of $4.10 for front-month prices that was hit on Monday as the market faces the arrival of a record U.S. harvest and China’s rejection of some cargoes of U.S. corn.

China confirmed on Wednesday it had rejected the entry of five U.S. shipments tainted with a non-authorized genetically modified strain, and analysts said the move could be a sign of a tougher Chinese line on imports.

— Sam Nelson reports on grain and oilseed futures markets for Reuters from Chicago. Additional reporting for Reuters by Julie Ingwersen in Chicago, Gus Trompiz in Paris and Colin Packham in Sydney.

Related story:
StatsCan shows shockingly large crops all around, Dec. 4, 2013

The post U.S. grains: Wheat drops on poor exports appeared first on Alberta Farmer Express.

“I don’t see any thing fundamental to this, it was technical with buy-stops hit and there also was buying of March $13.20 calls in options, which helped,” a trader said (all figures US$).

U.S. wheat was lower while European wheat futures held firm, with Paris prices near a seven-month high. A clutch of international tenders kept focus on brisk export demand, while cold weather posed a threat to some U.S. winter wheat areas.

A much bigger-than-expected official estimate of the wheat harvest in Canada pushed U.S. wheat market lower and curbed the rise in European wheat values.

Corn rose to a two-week high on technical short-covering, despite bearish news that China rejected some U.S. corn cargoes.

Chicago Board of Trade January soybeans were up 9-3/4 cents per bushel at $13.29-1/2, while December wheat was down 6-1/2 at $6.47-1/4.

Some traders have become more optimistic about export prospects for European and U.S. wheat.

The U.S. and the European Union appear to be among the best placed in the short term to supply wheat to major importing countries in north Africa and the Middle East as export competition from Russia and Ukraine fades.

Egypt, the world’s top wheat importer, held its fifth international tender in as many weeks on Tuesday, while Algeria and Tunisia launched tenders this week, signs that rising wheat prices have not curbed demand for the food staple.

Forecasts for freezing weather this week in the U.S. wheat belt also supported prices by raising the risk of damage to developing crops.

“Russian wheat export prices strengthened despite being bypassed by Egypt, so U.S. wheat is even more competitive,” said Vanessa Tan, investment analyst at Phillip Futures in Singapore.

“There are also forecasts that the U.S. will experience very cold conditions, which could put up to five per cent of the winter wheat crop at risk.”

Bitter cold weather and blowing snow were expected in the U.S. Plains late Wednesday and into the weekend, posing a threat to wheat and livestock, an agricultural meteorologist said.

Wednesday’s crop estimate from Statistics Canada, which put 2013 all-wheat production at a record 37.53 million tonnes against an average trade forecast of 33.8 million, cooled prices by turning attention back to a larger global supply this year.

In Europe, March milling wheat on the Paris-based Euronext market was up 0.48 per cent at 210 euros a tonne. It earlier reached 211.25 euros, a level last seen on the contract on May 9 as it tested chart resistance at 211 euros.

Egypt bought 60,000 tonnes of Romanian wheat on Tuesday for shipment between Dec. 20 and Dec. 31, the main government wheat buying entity said.

Although Egypt’s GASC turned down offers of French wheat, a tender being held by Algeria, the top destination for France’s wheat exports, maintained a bullish mood on the French market.

“The volumes available for export are shrinking in the Black Sea area. In 2014, American and French origins will be on the front of the stage,” French consultancy Agritel said.

CBOT December corn was up 3-1/2 cents per bushel at $4.25-1/2 a bushel.

Front-month prices on Monday sank to a new three-year low of $4.10 as talk that China had rejected more U.S. corn due to an unauthorised genetically modified variety added to pressure from an expected record-large U.S. harvest.

Subsequent confirmation on Wednesday that China rejected the entry of five batches of U.S. corn did not have a significant impact on prices, although analysts said the move could be the sign of a tougher Chinese line on imports.

— Sam Nelson reports on grain and oilseed futures markets for Reuters from Chicago. Additional reporting for Reuters by Gus Trompiz in Paris and Colin Packham in Sydney.

The post U.S. grains: Canada’s big crop hits wheat appeared first on Alberta Farmer Express.

Corn closed firm as well on short-covering and on spillover from the gains in wheat while soybeans were mixed with gains slowed by bright soy production prospects in South America.

Corn’s gains were curbed by news that China may reject U.S. corn cargoes that contain an unapproved GMO variety; additional overhead pressure on soy also stemmed from talk that a Chinese buyer may be set to reject U.S. soy cargoes as well.

Chicago Board of Trade December wheat closed four cents per bushel higher at $6.53-3/4, December corn was up 5-1/2 at $4.22 and January soybeans were down 1-1/2 at $13.19-3/4.

A cold snap late this week could pose a threat to portions of the U.S. hard red winter wheat crop, an agricultural meteorologist said on Tuesday.

“Forecast temperatures are not quite as cold as previously, but still about 5 percent of the crop is at risk of winterkill,” said Don Keeney, a meteorologist for MDA Weather Services.

Traders and analysts said the cold snap probably would not harm much of the crop and was not likely to be a major market mover.

“The Arctic blast is not a good thing since we’ll see some damage to hard red winter wheat, but we are going to see pretty good snowfall, which will help prevent a lot of harm,” said Sterling Smith, a futures specialist for Citigroup.

Improved demand for wheat was a key reason for the firmer tone in the wheat market.

Wheat demand cited

“The (wheat) market is very much focused on the demand side of the equation,” said Andrew Woodhouse, a grains analyst at Advance Trading Australasia.

Egypt’s main wheat-buying agency, the General Authority for Supply Commodities, on Tuesday bought 60,000 tonnes of Romanian wheat for late December shipment. It was the fifth international tender in less than a month.

Algeria and Tunisia also are tendering for wheat.

Dealers said improved crop prospects in major exporter Australia helped to limit gains.

The Australian Bureau of Agriculture and Resource Economics and Sciences (ABARES) forecast wheat output of 26.213 million tonnes, up from its September estimate of 24.467 million.

Corn/soy market on alert

News that China may be set to reject cargoes of U.S. corn was dampening gains in CBOT corn futures.

China, one of the world’s largest corn importers, is likely to reject more U.S. shipments of the grain after they were found to contain a genetically modified variety not approved by Beijing, traders said.

“If China is not going to allow imports of beans or corn due to GMO, it will certainly have a chilling affect on demand,” Smith said.

“China sees the bearish pressure from the big corn supply, and this is giving them added incentive to find a reason to reject cargoes,” he said.

There are also rumors that a Chinese soybean buyer is asking to wash out of at least six cargoes of soybeans that were set to be delivered in January.

The Chinese concerns, combined with bright crop prospects in South America, slowed the gains in soybean futures.

“South American weather is very good. In Brazil it’s possible to see a 90-million-tonne crop, which will keep pressure on prices,” Smith said.

USDA’s latest forecast for Brazil’s soybean production for the 2013/14 marketing year is 88.0 million tonnes.

— Sam Nelson reports on grain and oilseed futures markets for Reuters from Chicago. Additional reporting for Reuters by Nigel Hunt in London.

The post U.S. grains: Wheat up on export demand, weather worries appeared first on Alberta Farmer Express.

Corn fell for the fifth consecutive session and at a 2.4 per cent drop, it was the biggest one-day decline this month.

Soybeans bucked the trend and gained amid a weak dollar, brisk export sales and a big number for soy in the U.S. Department of Agriculture’s weekly export inspections report.

Wheat turned down on spillover selling from the falling corn market.

CBOT December corn closed 10 cents per bushel lower at $4.12, January soybeans were up seven cents at $12.87-1/2 and December wheat was down 2-1/4 cents at $6.42-1/4 (all figures US$).

“Corn is king today, all eyes are on corn. There is left over nervousness from Friday about what the Renewable Fuel Standard will be,” said Sterling Smith, futures specialist for Citigroup.

The U.S. Environmental Protection Agency (EPA) proposed on Friday to slash federal requirements for U.S. biofuel next year, including corn-based ethanol.

Traders said some pressure on corn also surfaced following news that China had canceled a cargo of U.S. corn because it contained Syngenta AG’s unapproved Agrisure Viptera corn.

However, the lion’s share of weight on the corn market was stemming from the harvest of a likely record-large U.S. corn crop and concerns corn use may be trimmed if the required amount of ethanol to be used in fuel is reduced.

“The corn weakness can be attributed to the EPA proposal,” said Luke Mathews, commodities strategist at the Commonwealth Bank of Australia.

“Outside of that, we do need to recognize that the 2013-14 harvest has replenished global supplies. Even without the EPA announcement, there is little reason for the corn market to show strength at the moment.”

The EPA did not propose a specific 2014 volume for ethanol made from corn. But its proposed change in advanced biofuels implies a corn ethanol 2014 mandate of 48.1 to 50 billion litres, down from the previous mandate of 54.5 billion litres.

“This would mean lower demand for corn, just at the time when the U.S. is harvesting a record corn crop. It is likely to take months for a decision to be reached, however,” Commerzbank said in a market note.

CBOT soybean prices were higher due to strong demand but gains were slowed by improving prospects for crops in South America.

Informa on Friday estimated next year’s U.S. soybean plantings at a record-high 83.8 million acres, below its previous forecast of 83.9 million but still up from 76.5 million seeded in 2013.

— Sam Nelson is a Reuters correspondent covering the CBOT grain and oilseed markets in Chicago. Additional reporting for Reuters by Nigel Hunt in London and Colin Packham in Sydney.

Related stories:
Deep cut proposed for U.S. 2014 biofuel requirement, Nov. 15, 2013
China rejects U.S. corn cargo for unapproved GM variety: source, Nov. 18, 2013

The post U.S. grains: Corn tumbles to three-year low on ethanol plan appeared first on Alberta Farmer Express.