COMMENTARY 2/29/16

 N Argentina recv’d good rain over the weekend. Brazil too had precip over the weekend but amounts were light in Mato Grosso.  Paraguay saw heavy rain. Widespread coverage of above normal accum is forecast for key areas of SA for the next 10 to 14 days. The wettest areas are expected to be Central and N Brazil.

St Louis river level ~EASING  ~ at 14.8′ and forecast to be 13.4′ by  3/5.

 CORN

DOWN 1

If our weather cooperates, the prospects of a 2 bbu Carry Out next year are becoming more likely.  Brazil’s Safrinha acres have increased by almost 8% now and our US exports are timid.  Monday’s Export Inspections were 29.0 vs expectations of 26-31 mill bu range with 41.1/week needed.  Japan’s total was disappointing at only 3.9 mill but South Korea did take a few more than expected at 8.1.  Brazil’s Safrinha crop is 74% planted, up from 51% from last week and 17 points ahead of 2015.  According to Safras & Meracado, the second crop acreage is expected to increase 7.8% to 10.12 million.

 

BEANS     

DOWN 2

Brazil harvest gains moment with good yields and existing stocks are plenty.  Still waiting for SA to need our beans for a quick vessel load, but starting to wonder if it is going to happen. Export Inspections were 38.5 vs expectations of  37-59 range.  Significantly better than the 23.9 mbu shipped last year during the same week. The latest four week average has shipments running nearly 10 million per week HIGHER than in 2015 at 50.6 versus 40.9 per week last week.  The Brazil government suspended its export tax on corn and soybeans from the state of Goias.  Mato Grosso’s harvest is 52.5% complete, just behind last year’s 53.4%.  Safros & Mercado estimates harvest at 33%, up from 24% last week and 5 points behind both last year and the 5-year average.  December biodiesel production will be out this afternoon.  Oil use is estimated at 500-510, up from 464 the prior month and versus 531 in Dec 14′.

 

WHEAT          

UP 2

Decent Export Inspections were up from 9.9 last week to 13.7 this week and vs expectations of 10-15 with 17.8 per week needed.  TX crop ratings are expected to show improvement this afternoon. OK and NE could slip with CO, IL, IN and SD mixed.  The Russian Ag Minister is opposed to the cancellation of the wheat export tax as it may cause their domestic prices to increase.