From The Linn Group
July 23, 2013
Linn Soybeans: Weather Pressuring Market Despite Condition Decline
Soybeans are trading mixed this morning, with old crop taking a little profit out of the market after yesterday’s sharp move higher. Front month beans and meal (August meal traded limit up yesterday) continue to keep the $13 mark in reach for new crop but we’re under pressure this morning as we start to retrace yesterdays move higher.
Promise of cooler temperatures and timely rains has the row crops under pressure despite a reduction in conditions yesterday (although expected). Soybean conditions dropped 1% in the good/excellent category to 64% in yesterday afternoons USDA crop progress report.
Regionally, the main declines were in the southwestern growing area-NE, KS, and MO. Both MN and SD were up +2%, and there was some improvement in the Delta in MS and AR. Soybeans blooming came in at 46% (vs last week 26%) and compared to 78% in the year ago week and the long term average of 59% for this period. IA, MN, and WI are well behind their 5 year average paces while IL is just slightly behind and IN is ahead.
Pod setting sits at 8% compared to the average of 19%. Weather isn’t affecting the bean crowd as much. A slow start to planting has most of the crop behind schedule with warmth and sunshine what the crop really needs right now. We’ll make our yields in August. Outside markets aren’t offering much support this morning with Energies and Metals lower, the Dollar higher and the Macro markets just modestly up.
Bean basis at the Gulf was off 15 cents to +140Q while bids in Decatur were off a dime to +110Q vs. +140Q just last week; some processers have begun moving bids out to new crop. We’re getting word that Decatur backed off another 20 cents this morning, putting bids at +90Q. Total volume in soybeans was back up to 162,576 in Monday’s active trading. OI was up 3,655 in the day’s trading.
Weekly export inspections came in at 2.847 million bushels which was about as expected. Cumulative shipments have reached 97.4% of the USDA forecast for the season as compared with 93% as normal for this time of the year.
LaSalle Street News Top News
– Crop scouts in western Illinois on Monday estimated soybean yield potential at 44.3 bushels per acre this summer, that compares to the long term average for the region at 44.5 bu/ac and up 12% over last year’s drought hit soy crop, acc. to tour officials with Doane’s tour
– Crop scouts in western Illinois, from St Louis to Sterling, IL are forecasting yields in that region this season to be around 183.3 bu/ac that’s up from last year’s drought stricken crop by 60% and 6.8% higher than the past 5 year average, acc. to participants on Doane’s tour.
– The Baltic Exchange dry bulk freight shipping index on Tuesday fell -8 points ending the session at 1,127
– Weekly USDA progress data shows Iowa soybean 2% setting pods vs average of 22%, while other top soy states were 2 to 8 percentage points behind.
– USDA soybean conditions in Monday’s USDA report were 8% vp-poor, 28% fair, 64% good-excellent vs last week 8% vp-poor, 27% fair, 65% good-excellent.
– Monday’s USDA weekly progress report pegged Soybeans blooming at 46% (vs last week 26%) and compared to 78% in the year ago week and the long term average of 59% for this period.
– Monday’s USDA weekly progress report pegged Soybeans setting pods at 8% compared to 33% in the year ago week and the long term average of 19% for this period.
– Monday’s USDA Weekly Soybean Inspections: 2.847 mln bu for w/e July 18; expected 4.0 mln bu
– USDA on Monday announced it will accept 1.7 million acres offered under the 45th Conservation Reserve Program (CRP) general sign-up. The Department received nearly 28,000 offers on more than 1.9 million acres of land. Currently, there are more than 26.9 million acres enrolled on 700,000 contracts.
– The USDA reported that on October 1 the CRP program will hold only 25.3 million acres its smallest number in 25 years. The peak CRP acreage came in 2007 at 36.8 million acres. The new pending farm bill would CRP acreage at 24 or 25 million acres.
– Liffe Paris Aug rapeseed futures trading +1 euro higher at 372.00 euros/mt, the Nov contract is up +0.75 euro at 379.25 euros/mt
– Dalian Jan soybean futures gained +13 yuan on Monday finishing the session at 4,640 yuan/mt, Jan soymeal futures jumped +48 yuan to 3,300 yuan/mt
– Dalian Jan soyoil futures rose +38 yuan to end Monday’s session at 7,284 yuan/mt, Jan palm oil futures were +10 yuan higher at 5,618 yuan/mt
– October crude palm oil futures on the Malaysian exchange Tuesday ended -14 ringgit lower at 2,258 ringgit/mt
– Cash sources say Aug delivered cash RBD palm oil in Malaysia was offered at $765.00/mt unchanged, palm olein was offered $775.00/mt also unchanged on the day.
– CBOT Soybean Volume & Open Interest for July 22nd 2013 was 162,576; Open Interest increased +3,655 to 523,770.
– CBOT Soybean Oil Volume & Open Interest for July 22nd 2013 was 75,510; Open Interest decreased – 678 to 343,521.
– CBOT Soybean Meal Volume & Open Interest for July 22nd 2013 was 104,955; Open Interest decreased -470 to 290,385.
– Weather: 6-10 Day Forecast: Below Temps east, Normal to Above West. Normal to Below Precip
– Outside markets. Crude Oil off -67c @ $106.27; Gold off -$7.60 @ $1328.40 ; Silver off -32c @ $20.18 ; US $ index up 10 pts @ 82.42
LaSalle Street News Cash Markets
– CIF Soybeans old crop off 10, new crop up 3. July +140 to +1650, FH Aug. +110 to +??, Aug. +70 to +90, FH Sept. +125 to +130, Sept. +110 to +120, Oct. +90 to +100, Nov. +91 to +93
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