Author Topic: Corn & Seed/Oil Commodities  (Read 95476 times)

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Mustang Sally Farm

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Re: Corn & Seed/Oil Commodities
« Reply #240 on: November 15, 2012, 10:11:42 AM »

EUROTIER: China Changing Global Soybean Market
14 November 2012

GERMANY - China is changing the world in the soybean market according to the European president of the American Soybean Association, writes Chris Harris.

Speaking at EuroTier in Hanover Mark Andersen American Soybean Association International Marketing Regional Director for Europe, Turkey and Russia said that four years ago Europe had the largest consumption followed by the US and China.
Now, however, China has taken the lead in consumption.
"It has had a major impact on what is being consumed and what is being grown," he said.
Mr Andersen added that while the drought in the US has kept prices high, so too has the demand from China and he added that the growth of China as a nation with the population expected to rise from 1.348 billion to 1.395 billion in 2025 and a GDP of 7.8 per cent expected this year will maintain the pace of growth.
He added that as the Chinese population gains more wealth consumption of pork and poultry meat is expected to rise and production will rise alongside it to meet the demands of a growing middle class.
Next year the Chinese soybean crush is expected to reach 64.2 million tonnes and soy meal consumption is expected to rise to more than 50 million tonnes from 2012 to 2013.
Mr Andersen said that China has now because the driver in the market because the country now takes 50 per cent of US soybean exports.
"It used to be Europe. Now it is China. China is the driver," he said.
In total, China is approaching 30 per cent of the total world consumption of soybean meal.
He added that the market situation has been eased to export to China because it does not have any sustainability requirements and it also approves of biotech soybean and it orders large quantities ahead of supply.
The demand and the shift in market dynamics have also attracted many large companies such as Cargill and Bunge into the Chinese market.
Mr Andersen said that as China is now the major destination for US soybean, India could soon be the next big growth market. The population is growing and wealth in the country is growing in a similar way to China.

Chris Harris, Editor-in-Chief

Mustang Sally Farm

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Re: Corn & Seed/Oil Commodities
« Reply #241 on: December 06, 2012, 12:04:01 PM »

Continued Support for Corn Prices
05 December 2012

US - Corn prices peaked in August, moved sharply lower in September, and have been in a sideways pattern over the past two months, writes Darrel Good.

Within that sideways pattern, prices have moved higher over the past two weeks, with March 2013 futures trading within $0.10 of the post-September high. The recent rally has been fueled by some supply concerns and more optimism about near-term demand.
There are two concerns about potential supply of corn in 2013. First, the on-going wet weather in Argentina may reduce the magnitude of planted area of corn relative to intentions. Fewer acres would threaten the projected rebound in production. The USDA has forecast the 2013 harvest at a record 1.1 billion bushels, a third larger than the drought-reduced harvest of earlier this year. The USDA will update the forecast in the monthly World Agricultural Production report to be released on 11 December, but a large change in that forecast is not expected this early in the season. During last year’s drought, the forecast of production was not reduced in December, but was reduced sharply in January and again in February. The potential implications of wet weather on acreage and yield are even more difficult to discern than the implications of drought conditions.
The second supply concern is for the upcoming US crop in the face of continuing widespread drought conditions. The latest US drought monitor map shows exceptional drought conditions in large portions of the Plains states and severe to extreme drought conditions extending to the Mississippi River and in northern Illinois and southern Wisconsin. Significant drought conditions also persist in some southeastern states. Very dry soil conditions underscore the need to replenish soil moisture and for timely rain during the 2013 growing season. The production risk of continuing drought conditions is being balanced against the potential of a record corn harvest if acreage is not reduced and 2013 growing season weather is generally favorable for corn yields. The balancing act is reflected in futures prices for the 2013 crop that are below old-crop prices, but high by historic standards.
The pace of US corn exports remains very low, but some increase in the demand for US corn is expected yet this marketing year. Export inspections during the first 13 weeks of the marketing year totaled only 208 million bushels, 48 per cent less than cumulative inspections of a year ago. The weekly rate of inspections needs to increase from the current average of 16 million bushels to 24 million in order to reach the projection of only 1.15 billion bushels for the year. Unshipped export sales totaled only 278 million bushels as of 22 November, 238 million less than on the same date last year. New sales need to average17 million bushels per week for sales to reach 1.15 billion bushels. Sales exceeded that average for the two weeks ended November 22 and the more rapid pace may continue as supplies of competing grains are reduced.
Domestically, ethanol production continues to be well below the rapid pace of a year ago. Production last year, however, was accelerated by the impending end to the blenders’ tax credit. Through the first quarter of the 2012-13 marketing year, cumulative ethanol production was about nine per cent less than during the same period last year. The USDA has projected a 10 per cent decline in the amount of corn used for ethanol production during the current marketing year. The decline in expected ethanol production reflects the plateauing of domestic consumption, increasing imports from Brazil, and steady to declining exports of ethanol. The so called blend wall will continue to limit domestic ethanol consumption and production, but corn use this year should at least reach the USDA projection.
The rate of feed use of corn is not known. The USDA projects use for the year at only 4.15 billion bushels, nearly nine per cent less than apparent use of last year. However, marketing year feed and residual use estimates and projections are confused by the harvest of a large quantity of corn before the start of the 2012-13 marketing year on 1 September. Taken together, current livestock inventories, slaughter numbers, and slaughter weights suggest strong overall feed demand. The number of cattle on feed on 1 November was five per cent less than that of a year ago, but the number of dairy cows during October was only 0.3 per cent less. The placement of broiler-type chicks during the first four weeks of November was only 0.7 per cent less than those of a year ago. The average number of layers on hand during October was 1.4 per cent more than that of a year earlier. October hog slaughter was record large and exceeded that of a year ago by 10 per cent. Average cattle and hog slaughter weights in October were near those of a year ago.

The USDA’s 1 December stocks estimate and 2012 final US production estimate to be released on January 11 will add some clarity to corn market fundamentals. Current conditions point to continued strong corn prices until then.

Mustang Sally Farm

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Re: Corn & Seed/Oil Commodities
« Reply #242 on: December 12, 2012, 08:22:15 AM »

Will Corn, Soybean Prices Return to Pre-Drought Levels?
11 December 2012

US - March 2013 corn futures dropped below $5.50 in early May 2012 and were drifting lower when US drought conditions turned prices higher starting in mid-June, writes Darrel Good.

The price of that contract peaked in early August, just short of the $8.50 mark. March 2013 soybean futures dropped below $11.50 in December 2011 before South American drought conditions and then US drought conditions sent that contract above $17.25 by mid-September 2012.
Corn prices have declined by more than $1.00 since the late summer peak, while soybean prices have declined by more than $3.00. The general expectation has been that prices of both commodities would return to pre-drought levels as early as 2013 as consumption adjusted to the lower supplies and as production rebounded in both South America and the US The futures market currently reflects expectations that corn prices will moderate substantially from current levels by the fall of 2013 as larger crops are harvested in Argentina and then in the US December 2013 futures, for example, are priced $.95 below December 2012 futures. The soybean market expects prices to moderate from current levels by the summer of 2013 as a large South American crop is harvested. August 2013 futures prices are nearly $.60 lower than March 2013 prices. Further price reductions are expected into the fall of 2013 as a larger US crop is harvested. November 2013 futures are about $0.85 below the price of August 2013 futures. Still, the prices of both commodities for delivery in the 2013-14 marketing year are well above the levels prior to the drought of 2012.
Corn prices are being supported at relatively high levels due to a combination of production uncertainty and uncertainty about whether the rate of consumption has slowed sufficiently. These issues were described in more detail last week. The USDA’s December Grain Stocks and Annual Crop Production reports to be released on 11 January will provide more clarity about the rate of domestic feed and residual use of corn and the availability of US corn for the remainder of the current marketing year. Those reports are expected to reveal a high rate of feed and residual use of corn during the first quarter of the 2012-13 marketing year and a smaller 2012 harvest than previously forecast.
Production uncertainty, on the other hand, will persist much longer. The potential size of the South American crops will be clearer by February. Current concerns are focused on the impact of extremely wet conditions in parts of Argentina. Prospects for the U.S crop will not be cleared up for several months. In the past five decades, extreme drought conditions in the US, like those experienced in 2012, have been followed by generally favorable growing conditions and yields near trend values. However, current dry soil moisture conditions in much of the US and some recent forecasts that drought conditions could persist well into next year have raised concerns that such a rebound in yields may not occur in 2013. Five or six years ago, the corn yield discussion was dominated by ideas that corn yields were increasing at an increasing rate due to new seed technology and that corn yields were “bullet proof”. That discussion seemed to gloss over the impact of an extended period of very favorable weather. The pendulum has now swung in the other direction, with the current corn yield discussion dominated by the potential of an extended period of dry weather and sub-par yields. Only time will tell if the concerns are legitimate. For now, such concerns may motivate another year of large corn acreage. A return to a near-trend corn yield would then result in a very large crop in 2013. A large crop, along with a plateau in the amount of corn used in the production of ethanol, would result in a substantial build-up of stocks during the 2013-14 marketing year and corn prices at or below the levels prior to the drought of 2012.
Soybean prices are being supported by a rapid pace of exports and domestic consumption. However, prospects are still in place for a record harvest in South America. Such a crop, in combination with a rebound in U.S production in 2013, would likely result in a build-up of stocks next year and prices at the level of late 2011.
There is a relatively high probability of large crops, increasing stocks, and lower corn and soybean prices in the 2013-14 marketing year. Such a probability might warrant some aggressive pricing of next year’s production. However, current tight supplies and production uncertainty are expected to keep prices relatively high in the early part of the new year. If that is the case, the spring price guarantees for crop revenue insurance could once again be at very high levels, offering protection from low prices that would result from large crops.

Mustang Sally Farm

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Re: Corn & Seed/Oil Commodities
« Reply #243 on: December 21, 2012, 10:36:49 AM »
USDA Feed Outlook - December 2012
World coarse grain production in 2012/13 is projected to reach 1,284 million tons, up 7 million this month, mostly due to a huge record corn crop reported for China.


Increased Foreign Corn Production Finds Strong Demand
Global corn production is forecast up 9 million tons to 577 million. China’s corn crop is up 8 million tons to a record 208 million. The entire production increase is projected for use instead of stocks as demand is strong. Statistics Canada published a record estimated corn crop for 2012/13, up 1.5 million tons from USDA’s previous forecast to 13.1 million. World coarse grain ending stocks for 2012/13 are projected down 0.6 million tons this month to 146.5 million. The increase in projected use is slightly larger than the increase in supplies. Global corn trade projected for 2012/13 is raised 1.4 million tons this month to 97.0 million. EU imports are up 1.5 million tons this month to 8.0 million, supported by the strong pace of import licenses.
There was no change in US feed grain balance sheets this month. Prices declined for corn and sorghum, and ranges narrowed for all feed grains.

Figure 1. Global corn ending stocks
Sources: USDA, Foreign Agricultural Service, Production, Supply and Distribution (PS&D), and USDA, Grain: World Markets and Trade (Grain Circular).
 Domestic Outlook

US Feed Grain Balance Sheet Steady for 2012/13
The 2012/13 feed grain balance sheet was unchanged this month as forecast US feed grain supplies are steady and disappearance is unchanged. Production, projected at 284.7 million metric tons, is 12 percent below 2011/12. Projected supplies are 317.1 million tons, also down 12 percent from a year ago.
Forecast US feed grain use is unchanged this month at 297.6 million metric tons, down 10 percent from 2011/12. Forecast ending stocks of 19.5 million tons are 30 percent below the previous season. Tight ending stocks continue to support average prices received by farmers at record-high levels.
Feed Use
On a September-August marketing year basis for 2012/13, US feed and residual use for the four feed grains plus wheat is projected to total 116.4 million tons, up slightly this month due to an assumed increase in wheat feed and residual use during summer 2013. Corn is expected to account for 91 percent of feed and residual use, compared with 88 percent last year.
The projected index of grain-consuming animal units (GCAU) in 2012/13 is 90.8 million units, slightly lower than last month and below last season’s 92.6 million. Feed and residual per GCAU is estimated at 1.28 tons, compared with 1.41 tons in 2011/12. In the major index components, GCAUs are increased this month for cattle on feed, layers, and broilers.

Figure 2. US corn production and exports
Source: USDA, World Agricultural Outlook Board, WASDE.
Forecast Corn Price Projected Lower
The forecast US corn price received by farmers for 2012/13 is reduced by $0.15 per bushel on the low end of the range and $0.25 on the high end to $6.80 to $8.00 per bushel, putting the midpoint of the range down $0.20 to $7.40. The early corn harvest has boosted the share of marketings in the first months of the marketing year, when prices tend to be seasonally low relative to later months. Moreover, the average farm prices reported by NASS have been lower than prevailing market prices, reflecting earlier forward pricing when corn prices were lower. Early marketings may include a disproportionate share of corn with quality problems that have price discounts. The season average price received by farmers in 2011/12 was $6.22 per bushel.
No Change to Sorghum, Barley, and Oats Supply and Use
Sorghum, barley, and oats supply and use estimates for 2012/13 are unchanged this month.
The midpoint of the 2012/13 projected average farm price for sorghum is lowered $0.10 this month to $7.10 per bushel and is reflective of the lower outlook for the corn price. The forecast sorghum price range is reduced $0.15 on the upper end of the range and $0.05 on the lower end to $6.50 to $7.70 per bushel.
The forecast range for the barley price is reduced by $0.05 on the high end while the minimum is increased by $0.05. The midpoint of the 2012/13 average farm price is unchanged at $6.45 per bushel, compared with $5.35 per bushel in 2011/12.
The projected range for 2012/13 oats prices received by farmers is narrowed $0.05 per bushel on each end to $3.55 and $4.05 per bushel. The midpoint of the forecast Season-average price received by farmers in 2012/13 is $3.80 per bushel, compared with $3.49 per bushel in 2011/12.

Figure 3. US corn and sorghum exports to Mexico
Source: US Dept. of Commerce, Bureau of the Census, Foreighn Trade Statistics.

Figure 4. US oat imports and exports
Source: USDA, World Agricultural Outlook Board, WASDE.

Figure 5. US barley imports and exports
Source: USDA, World Agricultural Outlook Board, WASDE.
International Outlook

Figure 6. China's corn area and yield
Source: USDA, Foreign Agricultural Service, Grain: World Markets and Trade (Grain Circular).
 Global Increased China Corn Production Boosts 2012/13 Global Output
World coarse grain supplies for 2012/13 are projected to reach 1,283.6 million tons, up 7.0 million this month, mostly due to a huge record corn crop reported for China. Foreign corn production is forecast up 9.4 million tons to 576.7 million, but this is partly offset by reductions for foreign barley, down 0.7 million to 125.3 million; foreign oats, cut 0.5 million to 19.7 million; and foreign sorghum, trimmed 0.3 million to 52.8 million. Expected 2012/13 production for millet, mixed grain, and rye are virtually unchanged this month.
China’s National Bureau of Statistics (NBS) published its first estimate of corn production at a record 208.1 million tons, and USDA adopted a slightly rounded version at 208.0 million, as some future revisions can be expected as the NBS gets additional details. This is up 8.0 million tons from the previous month’s forecast. Economic information, weather data, and satellite imagery support the large increase. NBS reported corn harvested area of a record 34.95 million hectares in 2012/13, a 4 percent-increase from the previous year. The price of corn at planting time was more attractive than that of alternative crops, especially soybeans or cotton. Favorable growing conditions limited losses in the harvested-to-planted ratio in most areas. Some corn was lodged early in September in the eastern part of the northeastern corn belt by Typhoon Bolaven, but much of the corn was still reportedly harvested. Area expansion has been strongest in the two northernmost provinces, Heilongjiang and Inner Mongolia, with the increased availability of short-season corn varieties. Warmer-than-normal temperatures and above-normal precipitation provided the moisture and growing degree days needed by corn in these provinces. Satellite imagery confirms the favorable condition of the corn crop throughout the North China Plain and Northeast. China’s 2012/13 corn crop exceeds the previous year’s record by 8 percent.
Statistics Canada recently published a record estimate for the 2012/13 corn crop, raising production 1.5 million tons from USDA’s previous forecast to 13.1 million tons. A record area harvested is combined with the second best yield, at 9.2 tons per hectare, up 11 percent this month. Corn area expanded notably in Quebec where this season’s warm temperatures were favorable.
Russia’s corn production is increased 1.0 million tons to a record 8.5 million based on harvest reports that indicate record yields. Both the Central District and North Caucasus report excellent yields, with some producers still harvesting in the North Caucasus.
North Korea has had a favorable growing season for corn, with 2012/13 production projected up 0.4 million tons this month to 1.8 million due to good yields. Rainfall through the season was favorable, with the typhoon damage that hurt South Korea passing to the west of North Korea’s corn area. The forecast corn yield is the highest since 1990.
A record 2012/13 corn harvest is projected for Chile, up 0.3 million tons to 1.8 million based on a record area. There is also a small increase this month for Australia’s corn production.
Partly offsetting the aforementioned increases in projected corn production are reduced prospects for several countries. Argentina, Moldova, and Ukraine are each reduced 0.5 million tons this month, with smaller declines for Belarus and Jordan. Argentina’s corn production prospects decline to 27.5 million tons as extensive heavy rains during the planting season are likely to cause some producers to switch to shorter-season crops, or in the most severely flooded areas, prevent planting. Moldova’s corn crop is cut in half this month to 0.5 million tons as severe drought devastated yields and trimmed area harvested. Ukraine’s corn crop is reduced to 20.5 million tons as snow has stalled corn harvesting, and fields harvested after snow melts in the spring will suffer reduced yields.
Australia’s 2012/13 sorghum production is projected down 0.3 million tons to 2.4 million and the previous year’s production is trimmed 0.1 million to 2.2 million. Area harvested is increased for both years, but yields are reduced. Area in 2012/13 is expected to expand as cotton prices are less attractive than sorghum prices, but dry soils are expected to prevent 2012/13 yields from matching the previous year. Oats area is reported lower, trimming 2012/13 production prospects 0.2 million tons to 1.1 million.
Statistics Canada reported oats area and yield as less than expected, reducing 2012/13 production 0.3 million tons to 2.7 million. Barley production is down 0.6 million tons to 8.0 million, with reduced yields more than offsetting a small area increase.
There are small mostly offsetting changes this month to EU barley, corn, mixed grain, oats, and rye. There is a slight reduction in area and production prospects for barley in Chile.
Coarse Grain 2012/13 Beginning Stocks Estimated Lower This Month
World coarse grain beginning stocks for 2012/13 are estimated down 1.0 million tons this month to 164.7 million tons. Argentina’s corn beginning stocks for 2012/13 are forecast down 0.5 million tons to 0.9 million as the strong pace of corn exports in local marketing year 2011/12 (ending in March 2013) is only partly offset by reduced domestic use. Coarse grain beginning stocks are reduced 0.2 million tons each for Colombia, Ukraine, and Australia, with smaller reductions for Peru, Serbia, Japan, the EU, and Chile. Colombia’s corn imports for 2011/12 are reduced, and Ukraine’s exports increased, based on recent trade data. Australia’s reduction in 2012/13 beginning stocks mostly reflects lower 2011 sorghum production.
Global coarse grain beginning stocks for 2012/13, at 164.7 million tons, are nearly the same as the 164.6 million estimated for the previous year, meaning that in 2011/12, total global disappearance matched production. However, global coarse grain supplies in 2012/13 are projected to be down 2.5 percent from the previous year because of reduced production. This month, coarse grain supplies forecast for 2012/13 are up 7.0 million tons, or 0.5 percent, supported by increased corn production in China.
Projected 2012/13 Coarse Grain Use Boosted More Than Supply
Global coarse grain use in 2012/13 is projected up 7.6 million tons this month to 1,137.2 million. China’s domestic corn use is increased 8.0 million tons this month to 209.0 million, an increase of 11 percent over the previous year. Food, seed, and industrial (FSI) use is forecast up 2.0 million tons this month to 64.0 million, supported by ample supplies in the northern part of the country and strong demand for both starch and corn alcohol. China’s FSI is projected up 12 percent over the previous year. China’s corn feed and residual use is increased 6.0 million tons to 145.0 million, up 11 percent year-to-year, partly because wheat feed is expected to decline in 2012/13. The entire production increase is projected to be used instead of stocked as demand is strong. The generally high prevailing prices of corn in China are evidence of the strong demand.
EU corn consumption in 2012/13 is projected 1.5 million tons higher this month to 64.5 million tons. Strong wheat and barley exports are limiting the feed use of those grains in the EU, and corn is being imported and used in compound feed rations to replace the small grains. Corn consumption for Canada and Russia is raised 0.6 million tons and 0.5 million tons, respectively, as more corn is expected to be fed in 2012/13 due to record large crops. North Korea’s corn use is up 0.4 million tons this month because of the larger crop, with most of the increase in FSI. There are smaller increases in projected corn use for Chile and Malaysia.
Corn feed use for 2012/13 is forecast down 0.5 million tons each this month for Argentina and Ukraine and 0.4 million for Moldova due to reduced production prospects. Small reductions in corn use are projected this month for Peru, Belarus, Paraguay, El Salvador, Uruguay, Australia, and Jordan.
Global barley feed use is forecast down 1.1 million tons this month to 88.5 million. Canada’s reduced production prospects cut forecast feed use 0.5 million tons.
Strong barley exports are limiting feed use for Russia, down 0.5 million, and the EU, trimmed 0.2 million. Jordan’s barley imports and feed use are forecast up slightly this month.
Sorghum feed use is projected down 0.4 million tons for Australia due to reduced production but up 0.2 million for Colombia because of strong imports from Argentina. Oats consumption prospects are trimmed in Australia and Canada, reflecting reduced production.
Global Coarse Grain Ending Stocks Reduced Slightly for 2012/13
World coarse grain ending stocks for 2012/13 are projected down 0.6 million tons this month to 146.5 million. The increase in projected use is slightly larger than the increase in supplies. There are numerous mostly offsetting changes to forecast stocks for different countries. Global corn stocks are trimmed 0.4 million tons this month, led by a 0.5-million-reduction for Argentina, caused by tighter supplies. Canada’s corn stocks are projected up 0.4 million tons due to increased production, but Colombia’s 2012/13 beginning and ending stocks are reduced 0.2 million this month as the pace of imports during the last months of 2011/12 was slower than previously expected. Changes for other countries are smaller and mostly offsetting. World barley and oats ending stocks are each trimmed 0.1 million tons, led by reductions for Canada.
World 2012/13 Corn Trade Forecast Higher
Global corn trade projected for 2012/13 is raised 1.4 million tons this month to 97.0 million. EU imports are up 1.5 million tons this month to 8.0 million, supported by the strong pace of import licenses. Increased export demand for EU wheat and barley is tightening grain supplies in the EU and encouraging corn imports to maintain fairly stable meat production. Malaysia’s corn imports are boosted 0.1 million tons this month to 3.1 million, reflecting strong demand and imports revealed by the 2011/12 import data. Partly offsetting these increases is a small reduction in Uruguay’s corn imports.
Corn exports are increased 0.5 million tons each for Canada and Russia, to 1.5 million and 2.3 million, respectively. Record production and tight world supplies are facilitating these countries’ exports. Corn exports for Paraguay and South Africa are each boosted 0.2 million tons this month to 1.6 million tons and 2.5 million tons, respectively, based on the pace of recent sales and shipments. However, with sharply reduced production, Moldova’s projected corn exports are cut 75,000 tons to only 25,000.
US corn export prospects for the 2012/13 October-September trade year remain unchanged this month at 31.0 million tons (1.15 billion bushels for the September- August local marketing year). The pace of sales and shipments in recent weeks has been exceptionally low. October 2012 Census export data and November corn Inspections indicate shipments for the 2 months at about half the previous year’s unspectacular rate. Moreover, at the end of November, outstanding corn sales were 6.8 million tons, down from 12.8 million a year earlier. However, with limited supplies in most competing exporters and with Brazil expected to shift port capacity to shipping soybeans in early 2013, US corn exports are forecast to accelerate in the latter half of 2012/13.
World 2012/13 Barley, Sorghum, and Rye Trade Increased Slightly
Global barley trade projected for 2012/13 is increased 0.2 million tons this month to 17.7 million. Russia’s barley exports are up 0.2 million tons to 2.2 million based on the strong pace of recent shipments. Jordan’s imports are raised slightly, reflecting recent purchases.
World 2012/13 sorghum trade is boosted 0.2 million tons this month to 6.4 million, with Argentina’s exports up 0.2 million to 2.6 million. Colombia has purchased significant shipments of sorghum from Argentina, boosting projected imports for Colombia to 0.6 million. Argentina’s sorghum exports are expected to outpace US exports for the second straight year in 2012/13, as tight US supplies limit export prospects. US sorghum sales and shipments in the early months of 2012/13 are on a pace to support the current projection of 2.5 million tons, up from 1.5 million a year earlier.
Global 2012/13 rye trade is increased 25,000 this month to 435,000 tons, reflecting the increased pace of shipments from Canada to the United States. Canada’s exports and US imports are each increased from 150,000 tons to 175,000.

Figure 7. US corn accumulative exports
Source: USDA, Foreign Agricultural Service, Export Sales Weekly Historical Data.
 December 2012

Mustang Sally Farm

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Re: Corn & Seed/Oil Commodities
« Reply #244 on: December 30, 2012, 05:11:19 AM »

Weekly Roberts Market Report
28 December 2012

US - Weak demand and technical selling pressured corn prices, writes Michael T. Roberts.

Just a word to my readers: I really appreciate all of you who contribute with comments and questions throughout the year. I hope in some small way the information I provide helps each one of you make a little better profit. If that happens I am happy. Some of you have written to tell me you have made a lot and some of you have told me you didn't. Of course no one is perfect in anticipating markets and that includes me. I just hope that in some small way I have helped to make your year more prosperous. I am taking the next two weeks to enjoy family and the holidays which recent events have made ever so much more dear to my heart. I don’t think I will ever look at my grandchildren the same and will love them with even more gusto than I have in the past. Merry Christmas and I hope you all have a safe and Happy New Year.
Best... Mike

Risk Management Term of the Week: --- Above the Market – An order to buy or sell at a price set higher than the current market price of the commodity. Examples include: a limit order to sell, a stop order to buy, or a stop-limit order to buy.
Risk Management Principle of the week: The “Above the market” strategy is one that is often used by momentum traders. For example, a stop order would be placed above the resistance level to buy.
CORN futures on the Chicago Board of Trade (CBOT) closed down on Monday. MAR’13 corn futures closed at $7.240/bu; down 6.75¢/bu. The DEC’13 contract closed at $6.220/bu; down 6.0¢/bu. Last week’s USDA WASDE report was bland with no fresh news. Weak demand and technical selling pressured prices. Futures started with early gains but gave them up quickly. A lower US dollar could not stop the loss. Exports were bearish with USDA putting corn-inspected-for-export at 15.016 mb vs. estimates for 9-14 mb. The number needed to stay on pace with USDA’s demand projection of 1.15 bb was 24.6 mb this week. Please see chart:

Funds were bullish 322,610 lots as of December 11; a decrease of 36,663 contracts from last week. Commercial traders continue to indicate a less-bullish outlook by their spreading. The market remains fairly neutral in a sideways pattern. Corn users could find some buying opportunities soon. On Monday the national average basis narrowed 2.0 ¢ /bu from last week to -8.0 ¢ /bu under CBOT March futures.
SOYBEAN futures on the Chicago Board of Trade (CBOT) closed mixed on Monday. JAN’13 futures closed at $14.962/bu; up 2.0 ¢ /bu. The MAR’13 contract closed at $14.882/bu; down 3.25 ¢ /bu. NOV’13 futures closed at $13.190/bu; up 1.5 ¢ /bu. Strong soybean milling and fundamental demand are maintaining the bullish market. Additionally, support was found from buying from both commercial and non-commercial traders leading to a solid rally in the deferreds. Exports were supportive with USDA putting soybeans-inspected-for-export at 36.990 mb vs. estimates for 40-46 mb. Exports continue bullish with 18.3 mb needed this week to meet USDA’s demand projection of 134.5 bb. Please see chart:

Cash soybeans narrowed 5.0¢/bu from last report with the latest national average soybean basis being placed at -26.0¢/bu under the Chicago January 2013 futures contract.
WHEAT futures in Chicago (CBOT) closed down on Monday. MAR’13 wheat futures finished at $8.080/bu; down 6.0¢/bu. The JULY’13 contract closed at $8.272/bu; down 5.75¢/bu. Wheat futures moved lower amid thin volume. Both commercials and non-commercials failed to show up in the wheat pit. Technically speaking the market shows signs of moving lower in the near-term. Fundamentally global wheat stocks are ample. Exports were supportive with USDA putting wheat-inspected-for-export at 16.355 mb vs. estimates for 11-16 mb. Basis levels for wheat were steady-to-firm. The Soft Red Winter wheat basis index was placed at -34.0¢/bu under CBOT March futures; 5.0¢/bu better than last report. Hard Red Winter Wheat basis index was placed at -48.0¢/bu under Kansas City March futures; 6.0¢/bu cents over last report. Hard Red Spring Wheat average basis index was placed at -53.0¢/bu under the Minneapolis March futures contract; 3.0¢/bu better than last week at this time.
DAIRY CLASS III futures on the Chicago Mercantile Exchange (CME) closed up on Monday. The DEC’12DA futures closed at $18.63/cwt, up $0.04/cwt. The MAR’13DA contract closed at $18.74/cwt; up $0.08/cwt. MAY’13DA futures closed at $18.75/cwt; up $0.02/cwt. Class III futures were supported in thin volume. Pits sources said they were more focused on long-term trends since most of the 2012 buying activity seems to over. Milk production continues to improve in areas where weather patterns are mild. Cheese futures were steady-to-firm Monday with barrels posting mild gains. Buyers and sellers remain cautious before schools let out for the holidays. Butter prices have also stabilized in lazy trading prior to the end of the year. Most all holiday orders have been filled. Product movement now is mostly replenishing wholesale supplies shipped to retail outlets. Class III futures were: 3 months out = $18.27/cwt ($0.03/cwt higher than last report); 6 months out = $18.51/cwt ($0.20/cwt higher than a week ago); 9 months out = $18.59/cwt ($0.19/cwt higher than last Monday); and 12 months out = $18.55/cwt ($0.16/cwt over last report). This week the variable cost of production for the average North Carolina conventional 200 cow dairy with a 23,000 lb average is $22.45/cwt; $0.30/cwt higher than last Monday … but with better prices. The price sensitivity table below illustrates different returns/cow relative to varying increases and decreases to both milk prices and inputs costs over total Variable Costs for the same NC farm.

LIVE CATTLE futures on the Chicago Mercantile Exchange (CME) closed up on Monday. DEC’12LC futures closed at $129.000/cwt; up $2.100/cwt. APR’13LC futures closed at $137.575/cwt; up $0.800/cwt. The AUG’13LC contract closed at $132.925/cwt; down $0.825/cwt. Expectations for tighter supplies in the near-term and possible snow storms in the Great Plains states were supportive. Hard, cold weather makes it difficult for cattle to put on weight as efficiently as mild weather does. Show lists are expected to shorten. Fat cattle prices were also supported by expectations processing work weeks would be shortened. Fewer slaughter days will most likely reduce supplies at the retail level in the near-term pushing up wholesale prices. Late Monday USDA put wholesale boxed beef at $194.86; up $0.17/cwt. Cash cattle were called $1-$1.50/cwt higher. According to, the average packer margin was raised $40.95/head to a negative $28.50/head based on the average buy of $123.69/cwt vs. the breakeven of $121.23/cwt. Monday afternoon USDA put the 5-area average at $124.41/cwt. Please see graph:

FEEDER CATTLE at the CME finished up on Monday. JAN’13FC futures closed at $154.250/cwt; up $1.175. APR’13FC futures closed at $157.650/cwt; up $1.300/cwt. The AUG’13FC contract closed at $162.550/cwt; up $0.600/cwt. Feeders finished higher amid weakness in corn futures. Lower corn prices translate into lower input prices for the feeder cattle buyer. For Monday 12.17.12 estimated receipts at the closely watched Oklahoma City market were put at 4,440 head vs. last week’s 5,310 head and 4,545 head this time last year. Compared to last week feeder steers were steady while feeder heifers were $1-$2/cwt higher. Steer calves were $3-$6/cwt higher; heifer calves $1-$3/cwt higher. Demand was considered good for all classes.

This table shows the maximum price a producer could pay for feeder cattle and still break even, assuming the costs and conversion/performance factors listed above. Producers should remain aware that calculations are based on averages. Courtesy DTN.
The CME feeder cattle livestock index was placed at 148.10; up 0.88. Please see chart:

LEAN HOGS on the CME finished down on Monday. The FEB’13LH contract closed at $84.750/cwt; down $0.650/cwt. APR’13LH futures closed at $89.800/cwt; down $0.600/cwt. The JUN’13LH contract closed at $99.250/cwt; down $0.600/cwt. Lean hog futures finished lower on follow-through from Friday on weak wholesale demand and uncertainty over fears that pork supplies will swell in 2013. Lower corn prices were supportive. Pit sources told me today the market is really waiting on USDA’s hogs and pigs report due out December 28. Chart signals continue to indicate a sideways market stalling on unclear demand signals. Cash hogs were stead-to-flat. Contrary to beef, slaughter schedules are not expected to shorten for the holidays with many processors extending work hours into Saturdays. Late Monday USDA put the lean pork cutout at $82.54/cwt, up $0.31/cwt. According to, the average packer margin was lowered $1.00/head to a negative $1.90/head based on the average buy of $59.66/cwt vs. the breakeven of $58.98/cwt. The latest CME Lean Hog index was estimated at 82.02; down 0.57.

This table shows the maximum price a producer could pay for feeder pigs and still break even, assuming the costs and conversion/performance factors listed above. Producers should remain aware that calculations are based on averages. Courtesy DTN.

Mustang Sally Farm

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Re: Corn & Seed/Oil Commodities
« Reply #245 on: January 02, 2013, 09:27:49 AM »

IFES 2012: The Impact of Biofuels Mandates on Grain, Oilseed
31 December 2012

US - Minimum volumes of biofuel usage were first mandated for the US in the 2005 Energy Policy Act and then revised in the Energy Independence and Security Act of 2007. The current legislation sets annual minimum volumes through 2022 in four categories of biofuels: cellulosic, biomass-based diesel, undifferentiated advanced, and renewable, writes Scott Irwin.

There is a hierarchy among these different categories based on their life-cycle contribution to reducing "green house" gas (GHG) emissions. Most people are surprised to learn that there is not an explicit mandate for corn-based ethanol. Instead, corn-based ethanol has been the cheapest alternative to date for fulfilling the renewable component of the mandates.

 As events this summer have highlighted, there is a raging debate about the impact of the RFS mandates on grain and oilseed markets. Many have argued that ethanol production and blending is motivated only by the RFS and that a lower mandate would result in less ethanol production and blending and less corn consumption in that sector.

In an effort to provide some relief to other consumption sectors due to the drought-related drop in corn production in 2012, several state governors filed a request for the US Environmental Protection Agency (EPA) to impose a partial or full waiver of the RFS for 2013. While the logic of this request seems straightforward, the structure of the demand and supply functions in the ethanol sector indicates that waiving the mandate would have at most limited impact on the amount of corn used in ethanol production in 2013.

The main reason is that the increasing amounts of ethanol supplies since 2006 have resulted in a fundamental shift in gasoline formulation. A simplified description of the change is that the refining industry has moved to using predominantly 84 octane "conventional" gasoline that is then blended with the higher octane ethanol (around 113) to produce the 87 octane gasoline that is most popular at the retail level in the US With this change, so long as the price of ethanol is below the price of wholesale gasoline there is no market incentive for gasoline blenders to reduce their use of ethanol. The EPA agreed with this logic in their recent denial of the requests to waive the mandate.

 The future outlook for continued growth in corn-based ethanol use is clouded by several factors, including the 10 per cent blend wall, slow implementation of higher blends, declining total gasoline demand, and ethanol imports from Brazil. One might be tempted to conclude that the biofuels-fueled boom in crop prices is coming to an end as corn consumption for ethanol levels out and corn production begins to catch up.

Instead, it is possible that the new era of higher crop prices could be extended well into the future as a result of the RFS for advanced biofuels that in all likelihood can only be met with a rapid expansion in biodiesel production. The new price era, then, would not be extended by rising corn demand, but by rising vegetable oil demand. Whether this scenario actually is realized depends crucially on the evolution of biofuels policy here in the US and energy policies in Brazil.

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Re: Corn & Seed/Oil Commodities
« Reply #246 on: January 15, 2013, 04:30:18 AM »

Reports» USDA WASDE» USDA WASDE - January 2013

11 January 2013
USDA WASDE - January 2013


WHEAT: Projected U.S. wheat ending stocks for 2012/13 are lowered 38 million bushels this month. Feed and residual use is projected 35 million bushels higher as December 1 stocks, reported in the January Grain Stocks, indicate higher-than-expected disappearance during September-November. Seed use is raised 2 million bushels based on the winter wheat planted area reported in Winter Wheat Seedings. Projected exports for all wheat are unchanged; however, Hard Red Winter (HRW) wheat exports are lowered 25 million bushels and Soft Red Winter (SRW) wheat exports are raised 25 million bushels based on the pace of sales and shipments to date and the increasing competitiveness of SRW wheat in world markets. All wheat imports are also unchanged, but small adjustments raise projected HRW wheat imports 5 million bushels and reduce Hard Red Spring wheat and Durum imports by a combined 5 million bushels. The projected range for the 2012/13 season-average farm price for all wheat is lowered 10 cents at the midpoint and narrowed to $7.65 to $8.15 per bushel, based on prices reported to date.

Global wheat supplies for 2012/13 are projected slightly lower based on reduced production prospects in Argentina and lower reported production in Russia. Argentina production is reduced 0.5 million tons with lower expected harvested area and yields. Heavy December rains have increased expected area losses and harvest reports also suggest lower-than-expected yields. Russia production is lowered 0.3 million tons based on the latest government reports that reduce yields slightly. Global wheat exports for 2012/13 are reduced slightly. Projected exports are lowered 0.5 million tons each for Argentina, Australia, and Canada, but raised 0.5 million tons for Russia and 0.2 million tons for Ukraine. Imports are raised 0.2 million tons for Iran. Feed and residual use for Russia is lowered 0.5 million tons as available domestic supplies tighten. World wheat ending stocks for 2012/13 are projected slightly lower with increases for Australia, Canada, and Iran mostly offset by reductions for the United States, Russia, and Ukraine.

COARSE GRAINS: U.S. 2012/13 feed grain supplies are increased slightly with higher corn production more than offsetting a reduction for sorghum. Harvested area for corn is lowered 346,000 acres, but a 1.1-bushel-per-acre increase in the estimated yield boosts production 55 million bushels. Sorghum harvested area is nearly unchanged, but a 1.3-bushel-per-acre decrease in the estimated yield lowers production 9 million bushels.

Projected corn use for 2012/13 is raised with higher expected feed and residual disappearance more than offsetting reduced prospects for exports. Feed and residual use is projected 300 million bushels higher based on September-November disappearance as indicated by December 1 stocks and on higher expected beef, pork, and poultry production. Corn exports are projected 200 million bushels lower reflecting the slow pace of sales and shipments to date and increasing pressure from larger supplies and exports for South America. Corn ending stocks are projected 44 million bushels lower at 602 million. The season-average farm price for corn is unchanged at $6.80 to $8.00 per bushel. While stiff competition has limited U.S. corn exports, higher domestic disappearance leaves the balance sheet historically tight and is expected to support continued strong and volatile prices well into summer, particularly in the domestic cash markets.

Other 2012/13 feed grain changes this month include increases in projected sorghum, barley, and oats feed and residual disappearance as indicated by the December 1 stocks. Sorghum exports are projected 35 million bushels lower with feed and residual use projected up 50 million bushels. Oats exports are lowered 1 million bushels, based on the pace of sales and shipments to date. The seasonaverage sorghum farm price is raised 20 cents at the midpoint to $6.70 to $7.90 per bushel. The barley farm price is projected down 5 cents at the midpoint to $6.10 to $6.70 per bushel on lower reported prices for malting barley. The projected oats farm price range is narrowed 5 cents on each end of the range to $3.60 to $4.00 per bushel.

Global coarse grain supplies for 2012/13 are projected 2.9 million tons higher mostly reflecting the larger U.S. corn crop and increased corn production for South America. Paraguay corn production is raised 1.1 million tons on a higher projected yield, which is in line with historical yield and production revisions this month. Brazil corn production is raised 1.0 million tons on higher expected yields with favorable December rainfall across the southern growing areas. Argentina corn production is raised 0.5 million tons as lower harvested area is more than offset by higher expected yields. Heavy rains and flooding in November and December delayed planting and reduced area prospects. Since then, clearing weather, the absence of threatening heat, and abundant soil moisture have set the stage for strong year-to-year yield increases, particularly in the central growing region. Partly offsetting these increases are reductions in corn output of 0.5 million tons for Russia and 0.1 million tons each for the Philippines and Serbia. Changes for Russia and Serbia reflect the latest government estimates. The smaller expected crop in the Philippines is based on the latest assessment of typhoon damage in December.

Changes to 2012/13 global coarse grain exports, in the aggregate, are small this month, but increases in 2011/12 and 2012/13 local year corn exports for South American countries have substantial implications for U.S. corn exports during the 2012/13 September-August marketing year. Exports for Argentina are raised 0.5 million tons for 2011/12 and 1.0 million tons for 2012/13. Exports for Brazil are raised 0.5 million tons for 2011/12 and 1.5 million tons for 2012/13. With the local marketing years in both of these Southern Hemisphere countries running from March through February, increases in both years weigh against U.S. export prospects for 2012/13. Similarly, in Paraguay, where the local marketing year runs from January through December, corn exports are boosted 0.6 million tons and 0.5 million tons, respectively, for 2011/12 and 2012/13, also reducing prospects for U.S. corn exports during the current marketing year. EU-27 corn exports are also raised 0.5 million tons for 2012/13. Global corn consumption for 2012/13 is raised 5.6 million tons mostly on the increase in U.S. corn feeding this month. Consumption is raised slightly for Paraguay, but lowered slightly for Russia and Serbia. Global corn ending stocks for 2012/13 are projected 1.6 million tons lower with lower expected stocks in the United States, Brazil, and Argentina. Stocks are raised for Paraguay with the larger projected crop.

RICE: The U.S. 2012/13 rice crop is estimated at 199.5 million cwt, up 0.9 million from the previous estimate. Average yield is estimated at a record 7,449 pounds per acre, up 32 pounds per acre from last month, and an increase of 382 pounds per acre from 2011/12. Harvested area is estimated at 2.678 million acres, up 1,000 acres from the previous estimate. Long-grain rice production is estimated at 144.2 million cwt, up 4.3 million from last month, and combined medium- and short-grain production is lowered 3.4 million to 55.3 million. Rice imports for 2012/13 are unchanged from last month.

The National Agricultural Statistics Service’s (NASS) Rice Stocks reported total rough rice stocks at 147.6 million cwt as of December 1 and total milled stocks at 6.9 million (9.8 million cwt on a roughequivalent basis). Total rice stocks on a rough-equivalent basis are 157.4 million, up 1 percent from a year earlier. Long-grain stocks as of December 1 are estimated at 96.7 million (rough-equivalent basis) and combined medium- and short-grain stocks at 51.4 million.

Rice 2012/13 domestic and residual use is unchanged at 125.0 million cwt. Long-grain domestic and residual use is projected at 94.0 million, up 1.0 million from a month ago. Combined medium- and short-grain domestic use is lowered 1.0 million cwt to 31.0 million. The all rice export projection is raised 1.0 million cwt to 106.0 million, all in the long-grain class, up 4 percent from the preceding year. The pace of exports and sales of long-grain rice have been brisk based on Census data through October and U.S. Export Sales data through early January. Long-grain exports have been particularly strong to Western Hemisphere markets including Colombia, Central America, Haiti, and Venezuela. The 2012/13 rough rice export projection is unchanged at 34.0 million cwt, but up 4 percent from the prior year. Exports of milled rice are increased by 1.0 million cwt to 72.0 million, up 4.5 percent from 2011/12. All rice ending stocks for 2012/13 are projected at 30.1 million cwt, nearly unchanged from last month, but a decrease of 27 percent from a year ago. Long-grain rice ending stocks are forecast at 17.4 million cwt, up 2.3 million from last month, but a decrease of 28 percent from 2011/12. Combined medium- and short-grain rice ending stocks are projected at 10.5 million cwt, down 2.4 million from last month, and a decline of 29 percent from last year.

The 2012/13 long-grain season-average farm price range is projected at $13.70 to $14.70 per cwt, unchanged from last month, and the combined medium- and short-grain farm price range is projected at $16.00 to $17.00 per cwt, down 50 cents per cwt on each end of the range. The all rice seasonaverage farm price is forecast at $14.40 to $15.40 per cwt, down 10 cents per cwt on both ends of the range.

World 2012/13 rice total supplies are virtually unchanged as a slight increase in production is more than offset by a reduction in beginning stocks. Global beginning stocks for 2012/13 are forecast down nearly 200,000 tons due mostly to reductions for Japan and Thailand that are partially offset by increases for China, and Pakistan. Global rice production is projected at a record 465.6 million tons, up 0.2 million from last month due primarily to higher forecasts for Argentina, Brazil, and Pakistan partially offset by a decrease for Cambodia. Brazil’s 2012/13 rice crop is raised 340,000 tons to 8.16 million tons, due mostly to an increase in average yield, based on the latest government report from Brazil. Brazil’s average rice yield has been trending higher in recent years as farmers are utilizing a larger share of higher yielding varieties and fully irrigating a larger share of the crop. Global consumption for 2012/13 is forecast at a record 468.6 million tons due mostly to increases in Sub-Saharan Africa. Global 2012/13 trade is raised 1.1 million tons to 37.7 million, down 1.3 million from the record in 2011/12. Export projections are raised for Argentina, Brazil, India, the United States, and Vietnam and lowered for Pakistan. Import forecasts for 2012/13 are raised for Sub-Saharan Africa. World ending stocks for 2012/13 are projected at 102.5 million tons, nearly unchanged from last month, and a decrease of 3.0 million from the prior year. Ending stocks are lowered for India, Thailand, and Vietnam, but raised for Brazil, Nigeria, and Pakistan.

OILSEEDS: U.S. oilseed production for 2012/13 is estimated at 92.7 million tons, up 1.4 million tons from last month. Larger crops for soybeans, sunflowerseed, and peanuts are partly offset by reductions for canola and cottonseed. Soybean production is estimated at 3.015 billion bushels, up 44 million bushels based on increased yields and harvested area. The soybean yield is estimated at 39.6 bushels per acre, up 0.3 bushels from the previous estimate. Soybean crush is raised 35 million bushels to 1.605 billion bushels reflecting higher projected domestic soybean meal consumption and increased soybean meal exports. Soybean meal domestic consumption is raised in line with projected gains in meat production, especially for pork and poultry. Soybean exports are unchanged at 1.345 billion bushels. Soybean ending stocks for 2012/13 are projected at 135 million bushels, up 5 million from last month. Soybean oil balance sheet changes include increased production, exports, and ending stocks.

The projected range for the 2012/13 season-average soybean price is lowered 30 cents at the midpoint and narrowed to $13.50 to $15.00 per bushel. The soybean oil price is forecast at 49 to 53 cents per pound, unchanged from last month. The soybean meal price is projected at $430 to $460 per short ton, down 10 dollars on both ends of the range.

Global oilseed production for 2012/13 is projected at a record 465.8 million tons, up 2.8 million due to increases for soybeans, cottonseed, peanuts, and sunflowerseed. Global soybean production is projected at 269.4 million tons, up 1.7 million with gains in the United States and Brazil only partly offset by a lower projection for Argentina. The Brazil soybean crop is increased 1.5 million tons to a record 82.5 million reflecting record area and improving yield prospects. Higher projected yields are the result of favorable moisture throughout the center west and southern growing areas. The Argentina soybean crop is projected at 54 million tons, down 1 million mainly due to lower projected area resulting from excessive moisture throughout much of the central growing area. Other changes include increased cottonseed production in China and Australia, and increased sunflowerseed production in India and the United States.

Global oilseed trade for 2012/13 is projected at 115.3 million tons, up slightly from last month. Increased soybean exports for Brazil are offset by a comparable reduction for Argentina. Higher soybean meal exports mainly reflect increases for the United States and China. Soybean meal consumption and imports are projected higher for several countries including Indonesia, South Korea, Mexico, Russia, and Iran. Global oilseed ending stocks are projected at 66.6 million tons, down 0.3 million from last month as reduced soybean stocks in Argentina and China are only partly offset by higher stocks in Brazil and the United States.

SUGAR: Projected U.S. sugar supply for fiscal year 2012/13 is increased 152,000 short tons, raw value, from last month, due to higher beginning stocks and production. Sugar production in Louisiana is increased 150,000 tons based on processors’ estimates. Contributing factors to Louisiana’s large sugar crop include ideal planting and growing weather for sugarcane, improved varieties, and lack of significant freezes during harvest. Sugar use is unchanged.

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Re: Corn & Seed/Oil Commodities
« Reply #247 on: February 04, 2013, 11:55:21 PM »

China Says Grain Security Top Priority
04 February 2013

CHINA - Ensuring grain security and the supply of major farm products will always be a top priority in China's development of modern agriculture, Chinese authorities said on Thursday in its first policy document for 2013.

China should never slacken agricultural production, said the document, adding that works should be done to accelerate the development of modern agricultural industry and strengthen both material and technical support for agricultural development.
The first policy document, issued by the central committee of the Communist Party of China and the State Council every year, is dubbed the No.1 central document. This is the 10th consecutive year in which the document focused on rural issues.
The country will continue to stabilize and increase grain output by keeping the area of land sown to grain crops stable, improving farm production structure and raising per-unit yields, said the document.
Efforts will be made to strengthen agricultural infrastructures and increase production efficiencies, and the government should implement while further improving "the most strict rules" on farmland protection, it said.
More work should be done to improve irrigation and water conservancy projects, encourage scientific innovation in the agricultural field and enhance intellectual property protection, according to the document.
The government also aims to boost agriculture product circulation by building a modern distribution system and better agricultural retail markets.
It will also accelerate the construction of the market of farm produce futures. It will also introduce new types of farm produce futures at appropriate times.
To encourage farm production, China will continue to increase the minimum purchase price for wheat and rice and timely launch temporary purchase and storage of corn, soybeans, rape seed, cotton and sugar, it said.
Improvements are required in agricultural market supervision and early-warning systems to better regulate the domestic market, as well as the import and export of agricultural products, said the document.
China will also focus on building a better supervision system on food-safety while preventing pollution in agricultural production and livestock and poultry farming, it added.

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Re: Corn & Seed/Oil Commodities
« Reply #248 on: February 14, 2013, 03:27:15 AM »
USDA Feed Outlook

Reports» USDA Feed Outlook» USDA Feed Outlook - February 2013

13 February 2013
USDA Feed Outlook - February 2013
In trade year 2012/13 (October 2012 through September 2013) Brazil is projected to export more corn (24.5 million tons) than the United States (24.0 million). This is a dramatic change from the historical norm for the last century, when the US share of world corn trade reached over 80 percent in 1979/80 and often exceeded two-thirds. In 2012/13, the US share is forecast to fall to 24.6 percent while Brazil is forecast to increase to 25.1 percent.


Brazil Projected To Be World’s Largest Corn Exporter in 2012/13
In the first four months of the trade year (October-January), Brazil has exported 13.75 million tons of corn, more than double US shipments of 5.9 million. Brazil’s corn exports are expected to slow significantly in coming months as soybean exports limit the transportation and port capacity available to move corn exports. However, over the last 8 months of the year, corn exports need to average only 1.3 million tons per month to reach the 24.5 million annual forecast. US corn exports need to increase to an average 2.3 million tons per month to reach the projected 24.0 million. This is a relatively slow pace compared with recent years, but as of January 31, 2013, corn outstanding export sales were 5.5 million tons, down from 10.3 million a year earlier. Based on these figures, US export sales and shipments of corn are expected to increase significantly in coming months.
US corn use for 2012/13 is adjusted slightly this month to reflect diminished export prospects but higher food, seed, and industrial use. Corn ending stocks are projected higher. The projected corn price for 2012/13 is lowered $0.05 per bushel on the low end of the range and $0.35 per bushel on the high end of the range to $6.75 to $7.65 per bushel.

Feed Grain Balance Sheet Adjusted for Smaller Export Pace and Higher FSI Use
The US feed grain supply for 2012/13 remained unchanged from last month’s projection at 318.3 million metric tons. Supplies are projected 11 percent below the 2011/12 marketing year level of 358.5 million tons. Feed grain use is lowered slightly this month. At the projected 299.4 million tons, feed grain use is 9 percent below 2011/12 and the lowest since the 2004/05 marketing year. Carryout is projected at 18.9 million tons, 32 percent below 2011/12 and the lowest since 1995/96. Usage is projected to exceed supply as lower corn production more than offsets higher production for sorghum, barley, and oats.
Feed and residual use for the four feed grains plus wheat on a September-August marketing year basis is virtually unchanged this month at 126.5 million tons. Reduced sorghum feed use is offset by increased prospects for wheat feed and residual during the March-May quarter. Grain-consuming animal units (GCAUs) are projected at 91.7 million units this month, up slightly from last month due to increases in forecast beef, pork, broiler, and turkey production. Feed and residual per animal unit in 2012/13 is unchanged this month at 1.38 tons per GCAU, compared with 1.41 tons in 2011/12.
Forecast Corn Exports Lowered and Sweetener Use Bumped Up
Forecast US corn exports were lowered 50 million bushels this month based on the year-to-date pace of sales and shipments and stronger expected competition, particularly from Brazil. Corn production is forecast up this month for Brazil and Ukraine, and high US prices have enabled those countries to usurp some markets previously supplied by the United States. This month’s 2012/13 export projection of 900 million bushels is 42 percent below last season’s 1,543 million and the lowest since 1971/72.
Projected ending stocks for 2012/13 of 632 million bushels are up 30 million from last month. The projected stocks-to-use ratio at 5.6 percent is up from 5.3 percent last month and still the lowest since 1995/96.
The projected season-average corn price for 2012/13 was lowered $0.05 per bushel on the low end of the range and $0.35 per bushel on the high end of the range to $6.75 to $7.65 per bushel. The range is lowered 20 cents at the midpoint to $7.20 per bushel. Prices were lowered based on recent market trends and the volume of corn marketed to date. This compares to the previous record of $6.22 per bushel in 2011/12.
March Planting Intentions and Weather Are Keys to Price Prospects
Given the low stocks-to-use ratio projected for corn, increasing market prices are likely to ration demand for the balance of the year. The projected 5.6 percent stocks-to-use ratio translates into a 20.5-day supply of old-crop corn available for use at the beginning of the 2013/14 marketing year; however, some new-crop corn will be harvested and available for use before the September 1 start of the new marketing year.
Sorghum Feed and Residual Lowered, Ethanol Use Increased
Market developments result in modifications to all categories of sorghum domestic use this month. Sorghum feed and residual is cut 25 million bushels to 100 million in response to multiple industry reports of lower-than-expected sorghum feeding. Despite this reduction, the 2012/13 estimate is 41 percent larger than the 2011/12 feed and residual figure. Season-to-season gains may obscure the fact that sorghum feed and residual for 2012/13 is the second-lowest since 1975 with 2011/12 being the lowest at 71 million bushels. Forecast sorghum food, seed, and industrial use is increased 20 million bushels to 80 million, a reflection of revised sorghum ethanol production estimates. On net, total domestic use is lowered 5 million bushels to 180 million.
Sorghum exports for 2012/13 are increased by 5 million bushels to 70 million based on the pace of exports to date. Exports are forecast to account for approximately 28 percent of total disappearance; this is the lowest proportion since 1996/97 when exports accounted for approximately 27 percent of total disappearance. The 2012/13 import figure is raised slightly to 1.088 million bushels following the release of trade data by the US Census Bureau. Further marketing year imports of sorghum are expected to be negligible.
The reduced outlook for corn prices contributes to a $0.15-reduction in the sorghum average farm price to a midpoint of $7.15 per bushel. The projected range of prices received by farmers in 2012/13 is reduced by $0.30 on the high-end resulting in a sorghum price range of $6.70 to $7.60 per bushel.
Slight Reduction in Barley Exports
The updated barley supply-and-use balance sheet reflects a modest downward revision to the export forecast. US Census Bureau trade data indicate a slightly slower-than projected pace of shipments abroad and supports a 1-million-bushel cut in barley exports from 10 to 9 million. Total use and ending stocks are updated in accordance with this change. The low-end of the barley price range is increased by $0.05 to $6.15 per bushel, and the high-end of the range is reduced by $0.05 to $6.65 per bushel. The average farm price midpoint is unchanged at $6.40 per bushel. No changes to the oats supply and use forecasts or to the oats price forecast are made this month.
Hay Prices and Stocks per RCAU up Slightly
The January 2013 Feed Outlook reports that stocks of all US hay stored on farms totaled 76.5 million tons on December 1, 2012, down 15.6 percent from a year ago. Based on livestock data available at that time, hay stocks per roughage-consuming animal unit (RCAU) were calculated to be 1.137 tons, compared with 1.336 tons last year. Revised livestock inventory figures have since been released and the recalculated RCAU is now projected to be slightly lower at 67.27 million units. Using the updated RCAUs, hay stocks per RCAU are forecast to be 1.138 tons per RCAU in 2012/13, up very slightly from the previous estimate. With only a modest reduction in RCAUs, hay supplies are likely to remain tight in the near future.
The most recent USDA-NASS Agricultural Prices report indicates that the January 2013 preliminary all hay price is $191 per ton, down $1 from the previous month and up 11 percent relative to the January 2012 estimate of $172 per ton. The alfalfa price forecast at $217 is unchanged from December and is $24 per ton higher than January 2012. The January other hay price at $144 is $2 higher than the previous month’s estimate and is up 9 percent from the January 2012 price of $132 per ton. In the short term, tight supplies are likely to support continued high prices for each type of hay.
Year-to-year price increases across all hay categories are a consequence of significant, drought-related declines in production. However, price increases are not uniform across all States. Michigan, Minnesota, Nebraska, Wisconsin, and a handful of other States have estimated January 2012 to January 2013 per ton price increases in the range of $100 for some types of hay. Other States in the Pacific Northwest and Southwest, including Arizona, California, Idaho, Oregon, and Texas, report year-to-year price declines for select hay varieties.

Brazil Takes Over As Top Corn Exporter in 2012/13
In trade year 2012/13 (October 2012 through September 2013), Brazil is projected to export more corn (24.5 million tons, up 2.0 million from last month’s forecast) than the United States (24.0 million, down 2.0 million this month). This is a dramatic change from the historical norm for the last century, when the US share of world corn trade reached over 80 percent in 1979/80 and often exceeded twothirds. In 2012/13, the US share is forecast to fall to 24.6 percent while Brazil’s share increases to 25.1 percent.
In the first 4 months of the trade year (October-January), Brazil has exported 13.75 million tons of corn, with shipments peaking in November at 3.9 million tons. Brazil’s corn exports are expected to slow significantly in coming months as soybean exports limit the transportation and port capacity available to move corn exports. However, over the last 8 months of the year, corn exports need to average only 1.3 million tons per month to reach the 24.5 million annual forecast.
US Census corn export data for October to December 2012 and corn export inspections for January 2013 sum to 5.9 million tons, less than half the pace of Brazil’s exports. US corn exports need to increase to an average 2.3 million tons per month to reach the projected 24.0 million. This is a relatively slow pace compared with 3.3 million tons per month for all of 2011/12, or 3.9 tons for 2010/11. As of January 31, 2013, corn outstanding export sales were 5.5 million tons, down from 10.3 million a year earlier. Based on these figures, US export sales of corn are expected to increase significantly in coming months.
US export sales of corn have been limited by prices that are higher than those of most competitors. These relatively high prices reflect tight US corn supplies due to 3 consecutive years of below-trend yields, with the current year’s crop devastated by drought. Moreover, sustained relatively high corn prices have encouraged foreign producers to grow additional corn for the international market. Brazil and Ukraine have emerged as major corn exporters, with Brazil surpassing Argentina as the largest alternative source for corn exports.
Structural Changes and Good Yields Boost Brazil’s Supply
Several short- and long-term developments have combined to enhance Brazil’s corn export competitiveness. Favorable rainfall has boosted corn yields above trend both for second-crop corn in 2011/12 and for first-crop corn in 2012/13. The global corn trade year (October-September) reflects most production, consumption, and trade in the Northern Hemisphere. The 2012/13 trade year straddles Brazil’s local marketing years for both 2011/12 (March 2012 through February 2013) and 2012/13 (March 2013 through February 2014). Brazil’s production in both years is crucial to determining export supplies.
Within each local marketing year, Brazil’s corn production is divided between firstcrop corn, mostly grown in the Southern and Eastern regions in competition with soybeans, and “safrina” (little crop) corn grown as a second crop mostly after soybeans in Mato Grosso and other parts of the Center-West. Attractive returns for soybeans have limited the growth in first-crop corn area. However, in recent years most of the expansion in Brazil’s soybean area has been in the Center-West where corn is often grown as a second crop following soybeans. This means that instead of getting less corn area due to high soybean prices, Brazil is sowing more secondcrop corn when soybeans prices are attractive and new land is cropped. This longterm structural shift became especially important in 2011/12, when the safrina corn harvest was larger than the first-crop corn for the first time. In 2011/12, the firstcrop corn in the South suffered from hot dry growing conditions, reducing yields and boosting corn prices in Brazil. Farmers in the Center-West responded by planting shorter-season soybeans and more second-crop corn after soybeans. When rains extended into the dry season, safrina yields were spectacular, exceeding firstcrop yields for the first time and boosting corn production to a record 73.0 million tons, up 25 percent from the previous record in 2007/08.
The large 2011/12 safrina corn crop was produced in a location far from the center of internal demand for corn because most of the poultry and pork production in Brazil is in the South (Parana and Santa Caterina). Furthermore, with much of the soybean crop already exported, transportation and port facilities were available to move corn into exports beginning in July 2012, just as the US drought boosted global prices.
High corn and soymeal prices combined with limited export opportunities for Brazilian broilers in 2012 to put the brakes on the expansion of poultry production in Brazil, which reportedly declined slightly. This month, corn feed use in Brazil is reduced 2.0 million tons for both 2011/12 and 2012/13. The slack domestic demand contributes to ample supplies for export.
Strong soybean prices in August through October 2012 limited corn area for firstcrop Brazilian corn in 2012/13. However, rainfall and temperatures have been favorable in most areas, and yield prospects are excellent as harvest approaches (March 2013). Also, area being planted for the safrina crop in Mato Grosso is reported up as expected. Brazil’s 2012/13 corn crop is projected up 1.5 million tons this month to 72.5 million, reflecting the above trend first-crop corn yield. This nearly matches the previous year’s record crop, but the rains that will determine the safrina corn yield are not expected to be as favorable as those of a year earlier.
The large 2012/13 corn crop in Brazil will support ample supplies of corn in the country. However, exports are expected to slow because much of the corn and soybeans are grown far from ports. Soybeans, being twice as valuable per ton, are expected to get priority for storage, transport, and port infrastructure. Brazil will be harvesting a record soybean crop and be moving record soybean exports. Severe port congestion with ship line-ups and demurrage costs are inevitable. Also regulations have changed, limiting how many hours truckers can drive, potentially causing problems getting corn and soybeans to ports. Ultimately, the size of Brazil’s 2012/13 trade-year corn exports will be constrained primarily by how much can be squeezed through ports rather than by the size of domestic corn supplies.
Ukraine has also emerged as a major corn exporter in recent years and with final harvest reports indicating increased production, Ukraine’s corn exports are forecast up 0.5 million tons this month to 13.0 million. The pace of early-season exports has been strong, with the EU as a major buyer. Trade year corn exports by Israel are increased slightly, reflecting ongoing shipments revealed in 2011/12 trade data.

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Re: Corn & Seed/Oil Commodities
« Reply #249 on: February 14, 2013, 03:28:50 AM »
World Corn Trade Projected Higher
Global corn trade in 2012/13 is forecast up 0.5 million tons this month to 97.5 million. EU corn imports are raised 2.0 million tons to 10.0 million, reflecting the strong pace of import licenses. The EU has been exporting wheat while using less domestically for feed and is replacing wheat in feed rations with corn. China’s corn imports are projected up 0.5 million tons to 2.5 million based on the pace of recent imports. Corn prices in China remain above internationally prices, making imports attractive for entities with access in import quotas. The pace of Jordan’s corn imports and feed use supports an increase in forecast imports for 2012/13 of 0.05 million tons to 0.45 million.
Projected corn imports are reduced this month for some countries with economic and political problems. Egypt’s corn imports are cut 1.0 million tons to 4.5 million as poultry production stumbles and port discharge and transportation is becoming problematic. Syria’s corn import forecast is cut in half by 0.7 million tons to 0.7 million as civil war disrupts commerce.
Mexico’s corn imports for 2012/13 are reduced 0.5 million tons this month to 8.5 million due to increased prospects for corn and sorghum production coupled with larger sorghum import prospects. Saudi Arabia’s corn imports are trimmed 0.2 million tons to 1.9 million as feed use is trimmed by a like amount for both 2011/12 and 2012/13.
Global Barley and Sorghum Trade Boosted
World barley trade projected for 2012/13 is increased 0.4 million tons this month to 18.3 million. Strong recent purchases boost import prospects for Saudi Arabia, up 0.5 million tons to 7.5 million; Turkey, up 0.20 million tons to 0.25 million; and Tunisia, up 0.15 million tons to 0.3 million. Ample pasture and favorable new-crop prospects are trimming Morocco’s 2012/13 barley import forecast 0.2 million tons to 0.5 million. Export prospects are increased 0.2 million tons each for Canada and the EU, increased 0.1 million for Russia, and decreased 0.1 million for Turkey.
Global sorghum trade is boosted 0.5 million tons this month to 6.2 million. US sorghum export prospects for 2012/13 are increased 0.3 million tons this month to 1.7 million (up 5 million bushels to 70 million for the September-August local marketing year). Export sales have been stronger than expected despite tight US supplies. Argentina’s sorghum exports are forecast up 0.2 million tons this month to 3.2 million. Export price quotes for high tannin Argentine sorghum are much lower than for most alternative feeds. Mexico’s sorghum import prospects are raised 0.3 million tons to 1.8 million, and Japan is increased 0.15 million tons to 1.60 million.
World Coarse Grain Production Higher This Month
Global coarse grain production is forecast 2.9 million tons higher this month at 1,124.2 million tons. Corn production is boosted 2.1 million tons to 854.4 million, barley is up 0.4 million to 130.2 million, sorghum is increased 0.2 million to 59.3 million, oats and rye are each nudged up 0.1 million, and millet and mixed grains are increased slightly. The changes for barley, oats, rye, and millet are the result of final harvest data reported for Russia, Ukraine, and Belarus. The sorghum increase results from Mexico reporting increased area, boosting production 0.4 million tons to 6.8 million. That increase is partly offset by a 0.2-million-ton reduction for Australia, to 2.2 million, caused by extreme high temperatures and some flooding in Eastern Australia.
The largest increase in corn production prospects this month is for Brazil, covered in the previous explanation of corn export projections. Mexico’s 2012/13 corn production is projected up 0.8 million tons this month to 21.5 million. Mexico’s ministry of agriculture reported summer crop area to be larger than previously estimated, more than offsetting a slight reduction in yields. India’s corn production is forecast up 0.6 million tons to 20.6 million as area planted for the Rabi crop has exceeded expectations. Ukraine’s final harvest report revealed increased corn production, up 0.4 million tons to 20.9 million. While final area harvested was reduced slightly, the late-harvested crop in northern zones had much better yields than areas to the south and east that were more stressed by heat and dryness. There is also a tiny increase this month for corn production in South Korea.
Reduced corn production is projected this month for Argentina, down 1.0 million tons to 27.0 million. Corn yield prospects have been reduced by an extended dry spell, with above normal temperatures centered in northern Buenos Aires province, extending into nearby Santa Fe and Cordoba. The dryness extended through the entire month of January and followed excessive rains during previous months. The wetness delayed plantings in some areas, resulting in variable crop development and crop conditions and complicating yield forecasts.
Corn production in Laos is revised lower for several years due to reduced area. Production prospects for 2012/13 are reduced 0.25 million tons this month to 1.15 million. Russia’s corn production is revised down slightly due to lower reported yields.
Tighter Beginning Coarse Grain Stocks Limit 2012/13 Supplies
Changes made to previous years’ supply-and-demand estimates trim 2012/13 global coarse grain beginning stocks 0.9 million tons, to 164.4 million, partly offsetting the increase in production this month. Most of the decline is for corn, down 0.8 million tons to 131.0 million. Brazil’s corn beginning stocks are cut 0.5 million tons to 9.6 million as 2011/12 local marketing year exports are increased 2.5 million, more than offsetting the 2.0-million decline in estimated feed use. Paraguay’s corn beginning stocks are cut 0.4 million tons to 0.5 million due to reduced 2011/12 estimated production. There are also small reductions in corn beginning stocks this month for Mexico, Turkey, Indonesia, and Jordan. The reductions are partly offset by increases for Moldova, up 0.2 million tons to 0.5 million based on a larger reported 2011/12 crop, and small increases for Egypt, Syria, Israel, India, Saudi Arabia, and Uruguay.
Projected 2012/13 Global Coarse Grain Use Unchanged
Forecast world 2012/13 coarse grain use is virtually unchanged this month at 1,142.3 million tons, with changes to individual countries offsetting. Increased US use is offset by a small reduction in foreign countries. Foreign corn use is projected down 1.3 million tons to 604.8 million. The largest reduction is for Brazil, down 2.0 million tons as reduced poultry production for 2012 calendar year decreases the base demand for corn expected in 2012/13. Egypt’s corn use is cut 1.0 million tons as economic and logistical problems limit corn imports and demand for poultry. Syria’s corn use is cut 0.6 million tons because of the civil war. Argentina’s corn use is trimmed 0.4 million tons due to reduced production and deteriorating economic prospects. There are smaller reductions this month for Saudi Arabia and Laos. The reductions are partly offset by increased corn use projected for the EU, up 2.0 million tons as less wheat is used for feed; China, up 0.5 million with high prices reflecting strong demand; and India (food), Moldova, Paraguay, and Jordan, each up by a small amount.

World barley use in 2012/13 is projected 0.3 million tons higher to 133.1 million. Strong recent imports by Saudi Arabia indicate a shift toward feeding more barley, up 0.4 million tons this month. Turkey’s imports are also reflected in growth in feed demand, up 0.3 million tons, with smaller increases for Ukraine, Tunisia, and Brazil. However, barley use is trimmed 0.2 million tons each for the EU and Morocco. Foreign sorghum use is up slightly this month with increases for Mexico, Japan and Taiwan partly offset by a reduction in Australia.
World Coarse Grain Ending Stocks Prospects Boosted
Global coarse grain ending stocks for 2012/13 are forecast up 2.1 million tons this month to 146.3 million, with corn accounting for the change. The largest increase is for Brazil’s corn, up 1.5 million tons to 10.9 million. Corn supplies in Brazil for 2012/13 are relatively abundant, up this month with increased production more than offsetting reduced beginning stocks caused by record local marketing year 2011/12 exports. Moreover, for 2012/13 domestic prospects are cut by more than exports are increased, supporting relatively abundant stocks prospects. India’s corn stocks are forecast up 0.4 million tons this month and Mexico is up 0.2 million, both supported by increased production. There are also small increases in projected ending stocks for Egypt, Moldova, and Saudi Arabia. Reduced ending stocks are predicted this month for Paraguay, down 0.5 million tons mostly due to reduced beginning stocks; for Argentina, down 0.1 million because of reduced production; and for Ukraine, Syria, Turkey, Indonesia, and Russia, each down by small amounts.
February 2013
Published by USDA Economic Research Service

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Re: Corn & Seed/Oil Commodities
« Reply #250 on: March 11, 2013, 10:52:11 AM »

Increased Wheat Production Seen in 2013
08 March 2013

GLOBAL - First forecasts for the 2013 wheat harvest point to production increasing to 690 million tonnes - 4.3 per cent up on 2012. This would be the second largest crop on record, according to the latest issue of FAO's quarterly "Crop Prospects and Food Situation" report.

According to FAO, the production hike is expected mostly in Europe, driven by increased plantings in response to high prices and a recovery in yields in some countries, notably the Russian Federation.
The outlook in the United States, while less favourable because of earlier drought conditions, has improved somewhat over the last few weeks.
Meanwhile, the recently lower prices of wheat and, to some extent, maize kept the FAO Food Price Index unchanged at 210 points for the second consecutive month in February. That is 2.5 per cent, or five points, less than in February 2012.
Since November 2012 the Index has moved within a narrow 210 - 212 point range as increases in the prices of dairy products and oils/fats were largely balanced out by declines in the prices of cereals and sugar.
Too early for global cereals forecast
At this stage of the season, with the bulk of the coarse grains and paddy crops yet to be planted it is still too early for even a preliminary global cereal forecast for 2013.
But prospects for the first 2013 coarse grains crops in the southern hemisphere are generally favourable. Rice prospects are also encouraging in several countries below the equator.
The Crop Prospects and Food Situation report focuses on developments affecting the food security situation of developing countries. In its review of food insecurity hotspots, the report highlights the following countries, among others:
Syria, where an estimated 4 million people are in urgent need of food and livelihood assistance as severe civil conflict continues. In addition, the Syrian refugees are putting strain on other countries in the region. Some international food assistance is being provided.
Democratic People's Republic of Korea, where a dry spell in May-June 2012 followed by localized floods in July-August cut crop production and damaged agricultural infrastructure. Chronic food insecurity exists in the country, with 2.8 million severely vulnerable people requiring food assistance during the 2012-13.
Escalating conflict
In the Democratic Republic of the Congo escalating conflict has increased the total number of internally displaced people to an estimated 2.7 million. Agricultural activities have been hindered, especially in the eastern areas, while high food prices continue. Nationally, a total of 6.4 million people are estimated to be in a state of food and livelihood crisis.
Mali, where insecurity in the northern part of the country has disrupted food commodity flows and resulted in large population displacements. This has worsened the already precarious food situation created by drought in 2011.
Sudan, where about 3.5 million people are estimated to be in need of humanitarian assistance, mainly in conflict areas.
Regarding international food prices, FAO's Cereal Price Index averaged 245 points in February, down by just less than 1 per cent from January but still 8 per cent higher than in February 2012.
The FAO Oils/Fats Price Index averaged 206 points in February, up 0.4 per cent from January. The rise was driven by palm oil, mainly reflecting the expected seasonal production slowdown and reduction in inventories from their current high levels.
The FAO Dairy Price Index averaged 203 points in February, 2.4 per cent, or 5 points up from January, representing the most substantial increase since September 2012. The rise was principally a reflection of falling production in Oceania due to hot weather.
The FAO Meat Price Index averaged 178 points in February, the same as January. Poultry prices were slightly lower and pork marginally higher, while other types of meat remained largely unchanged. The meat index has remained substantially stable since October 2012.
The FAO Sugar Price Index averaged 259 points in February, down 3 per cent, or 8.6 points, from January. Prices declined for the fourth consecutive month, on the expectation of a relatively large world production surplus and improved export availabilities in 2012-13.

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Re: Corn & Seed/Oil Commodities
« Reply #251 on: March 30, 2013, 09:08:38 AM »

China Could Dominate Soymeal Exports to South East Asia
28 March 2013

CHINA - China has the potential to replace South America as the dominant exporter of soymeal to South East Asia, according to a report from Rabobank.

By maximising its existing crushing industry capacity – utilisation is currently below 50 percent – China could ringfence regional demand, providing a significant growth opportunity for Chinese crushing businesses. In doing so, China would fundamentally alter the battle for global soybean supply, forcing the crushing industry in the West to either find new markets or shut down.
“Demand for soymeal from the animal protein industry has increased dramatically in South East Asia in recent years, and the region has emerged as an important export destination, accounting for 20 percent of the world’s soymeal trade in 2011/12” said Rabobank analyst Pawan Kumar. “Up to now, South East Asia has had few choices of its own when it comes to sourcing soymeal to meet this growing demand and has relied on imports from South America. However, soymeal exports out of China could offer an alternative – one that could provide a saving of up to 20 percent in freight costs”.
At price levels averaged over the last two years, soymeal from China is uncompetitive by about USD 57 per tonne compared to the Americas. However, Rabobank believes that there are three scenarios that could change the ‘status quo’ and lead to a geographical dislocation in the soymeal market.
First, Chinese processors could begin to sell soymeal at a discount or breakeven prices in order to capture the South East Asia market, a strategy followed to capture Chinese market share and one which kept the crushing industry going during unprofitable periods. This would also increase the utilisation rate for Chinese crushers, which might contribute positively to earnings. Under such a scenario, exports would also potentially become competitive with respect to direct shipments of US soymeal to South East Asia.
Second, the case for China would become even stronger if the Chinese government formally allowed fiscal treatment of soymeal exports as a re-export and for VAT to be reimbursed as it is by other governments in Asia. A rough estimate suggests that this could amount to more than USD 50/tonne and provides a positive basis for Chinese exports to cater to South East soymeal demand.
Finally, Rabobank suggests that India – which supplied 1.7 million tonnes of soymeal to South East Asia in 2011 – may reach a situation where, it reduces the availability of soymeal for exports to South East Asia. This would be as a result of their growing animal protein industry and challenges in oilseed production growth.

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Re: Corn & Seed/Oil Commodities
« Reply #252 on: April 13, 2013, 09:33:08 AM »

US Grain Futures Weaken Modestly in Wake of USDA's Supply and Demand Report
10 April 2013

ANALYSIS - Grain futures markets were under modest selling pressure in the wake of the latest US Department of Agriculture monthly supply and demand report issued late Wednesday morning, writes Jim Wyckoff, grain analyst.

Overall, the USDA data was deemed by traders to be slightly bearish. Trading was choppy and volatile, however, as the grain trade continued to digest the latest government numbers.
USDA raised its estimate of US corn supplies on hand for the current marketing year, but not by as much as the market place expected. The USDA pegged US corn stocks at the end of the 2012-13 marketing year at 757 million bushels. This compares with USDA's March forecast of 632 million bushels and a pre-report consensus forecast of 824 million bushels on hand at the end of the marketing year.
The US government also projected slightly less export demand and domestic use for U.S. corn than in its March report.
On world corn carryover, USDA forecast ending stocks at 125.3 million metric tons at the end of the 2012-13 marketing year. That compares with a pre-report analysts' consensus of 120.2 million tons and the March USDA report estimating 117.48 million tons. The larger world carryover figure was a main bearish factor for corn.
Meantime, USDA increased its wheat stocks figure for the end of the 2012-13 marketing year. The new peg for wheat stocks is 731 million bushels versus 716 million bushels in last month's report. The pre-report consensus trade prediction was spot on, at 731 million bushels.
World wheat carryover for the 2012-13 marketing year is pegged by USDA at 182.3 million tons, which compares with 178.23 million tons last month and an analyst consensus forecast of 178.6 million tons. The world carryover number was deemed bearish for wheat futures.
US soybean endings stocks for the 2012-13 marketing year are forecast by USDA at 125 million bushels, which is unchanged from last month's report but down from the analysts' estimate of 137 million for this month's report.
World soybean ending stocks for the 2012-13 marketing year are forecast by USDA at 62.6 million tons versus last month's figure of 60.21 million tons. Analysts thought the USDA number would come in at 60.1 million tons.
Grain traders are quickly turning their attention back to weather patterns in the US. Cold, wet weather is presently enveloping the Corn Belt, and that is limiting the downside in corn prices due to concerns about planting delays.
Wheat futures prices are seeing selling interest mitigated by freezing temperatures that are occurring in the hard red winter wheat region of the US Plains states. This has raised concerns about frost damage to the wheat crop there.

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Re: Corn & Seed/Oil Commodities
« Reply #253 on: April 22, 2013, 06:40:17 AM »

USDA Feed Review: Bids Mixed on Weather, Lower Chinese Growth, Bird Flu
20 April 2013

GLOBAL - Compared to last week, grain and soybean bids traded mixed.

The grains opened the week with moderate to sharp losses due to lower than expected GDP growth rate in China, and concerns of bird flu cases which can limit feed demand. However, the grains rebounded the next day as outside markets found some support with the stock market bouncing back along with precious metals and a lower dollar.
The slow start in corn planting with USDA reporting 2 percent of the corn planted which is 5 percent less than the five year average off 7 percent. Old crop soybeans remain tight lending a boost. Wheat saw additional support from cold weather in the southern plains.
Rain fell across the western corn-belt and throughout the Midwest adding to planting delays but beneficial for overall conditions. To the north, snow fell in the Dakota’s and in Minnesota adding to flood worries once the snow pact melts. NOPA crush came in at 137.08 million bushels, slightly below estimates of 137.5 and up from 136.3 a month ago.
Corn exports were bearish totaling 417,200 tonnes with 400,300 tonnes for 2012-2013. Soybean export sales were bullish totaling 566,800 tonnes with 339,400 tonnes for 2012-2013. Wheat had weekly export sales totaling 1,674,700 tonnes with 552,100 tonnes for 2012-2013.
Wheat was 7 cents lower to 48 cents higher. Yellow Corn was 2-14 cents lower. Sorghum was 10-12 cents lower. Soybeans were 4 cents lower to 33 cents higher.
 •Kansas City US No 1 Hard Red Winter, ordinary protein rail bid was 3 cents lower to 5 cents higher from 8.08 3/4-8.50 3/4 per bushel.
 •Kansas City US No 2 Soft Red winter rail bid was not quoted.
 •St. Louis truck US No 2 Soft Red Winter terminal bid was 17 cents higher at 7.28 per bushel.
 •Minneapolis and Duluth US No 1 Dark Northern Spring, 14.0 to 14.5 percent protein rail, was 28 1/4 to 48 1/4 cents higher at 9.27 3/4 per bushel.
 •Portland US Soft White wheat rail was 7 1/4 to 7 3/4 cents lower from 7.85-7.87 3/4 per bushel.
 •Kansas City US No 2 rail White Corn was 4 to 11 cents higher from 6.88-7.04 per bushel.
 •Kansas City US No 2 truck Yellow Corn was 14 cents lower from 6.80-6.85 per bushel.
 •Omaha US No 2 truck Yellow Corn was 2 to 6 cents lower from 6.76-6.78 per bushel.
 •Chicago US No 2 Yellow Corn was 6 3/4 to 7 3/4 cents lower from 6.39 1/2-6.64 1/2 per bushel.
 •Toledo US No 2 rail Yellow corn was 6 3/4 to 8 3/4 cents lower from 6.54 1/2-6.57 1/2 per bushel.
 •Minneapolis US No 2 Yellow corn rail was 13 3/4 cents lower at 6.31 1/2 per bushel.
 •US 2 or Better oats, rail bid to arrive at Minneapolis 20 day was 14 3/4 cents higher at 4.18 1/2-4.23 1/2 per bushel.
 •US No 3 or better rail malting Barley, 70 percent or better plump out of Minneapolis was 50 cents higher at 6.75 per bushel.
 •Portland US 2 Barley, unit trains and Barges-export was not available.
 •US No 2 yellow truck, Kansas City was 11 cents lower at 11.34 per cwt.
 •Texas High Plains US No 2 yellow sorghum (prices paid or bid to the farmer, fob elevator) was 10 to 12 cents lower from 11.47-11.51 per cwt.
 •Minneapolis Yellow truck soybeans were 33 1/2 cents higher at 14.36 1/2 per bushel.
 •Illinois Processors US No 1 Yellow truck soybeans were 4 cents lower to 18 cents higher from 14.50-14.85 per bushel.
 •Kansas City US No 2 Yellow truck soybeans were 14 cents higher at 14.73 per bushel.
 •Central Illinois 48 percent Soybean meal, processor rail bid was 18.00 to 20.00 higher from 425.00-436.00 per ton.
 •Central Illinois Crude Soybean oil processor bid was 11 to 31 points lower from 48.91-50.46 cents per pound.

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Re: Corn & Seed/Oil Commodities
« Reply #254 on: May 05, 2013, 11:00:32 AM »

Cuba's Food, Sugar Production Below Expectations Despite Reforms
01 May 2013

ANALYSIS - Obtaining food remains a cause for daily concern in Cuban homes because of insufficient domestic food production despite agricultural reforms and plans of President Raúl Castro’s government to spend a record US$1.9 billion this year for purchases on the international market, where prices have increased dramatically.

Daniel Vázquez, with NotiCen, a publication of the Latin America Data Base at the University of New Mexico, writes that Cuba imports 80% of the food it consumes, including grains, rice, milk powder, soybeans, and meat. Meanwhile authorities are promoting the use of idle lands and the sale of farm equipment and offering better prices for agricultural products. Last year, the country spent US$1.6 billion on those imports, of which 42% was devoted to animal feed.
Castro spearheaded reforms in agriculture and in the sugar sector, allowing for greater participation by the private sector. In addition to relocating surplus state labor forces, restructuring in the last three years has cut more than a half-million jobs. However, production has not rebounded to the magnitude expected by the population.
For 2013, Cuba's Ministerio de Economía y Planificación (MEP) projects that the agricultural sector will grow by 4.5%, while the sugar industry will increase by 21.7%.
Uncertainty on the Tables
Since late 2012, residents in Havana and other cities have complained about the lack of meat products, evident in the disconnected coolers in the markets and the long lines of customers when supplies arrive. The unstable food supply shows the similarity between Cuba's current domestic situation and that of its closest political ally, Venezuela.
"The ration book is insufficient and food has to be 'invented' in other ways," says Josefina, a mother of a Havana family, referring to the monthly allocations from the government, which now provides a few mouthfuls for a week.
The book includes 10 eggs a month, a few ounces of chicken and coffee, daily bread, rice, black beans, salt, sugar and oil.
Prices in the farmers' markets of private vendors are accessible to people who receive remittances from abroad or have higher incomes. Their clients are usually Cubans with ties to tourism, foreigners, diplomats, or Cuban Americans from Florida. In contrast, at the state-run farmers' markets, the supply is often poor, unstable, and of low quality.
In both markets, people complain that the vendors swindle their customers using dishonest scales.
"Food prices are constantly increasing," complains Isidora Sánchez, who purchases half the food consumed by her family on the black market, which takes two-thirds of the household income consisting of two salaries of US$20 a month, the average figure for the state sector.
Cheese, eggs, butter, yogurt, ham, and fish are true delicacies in Havana and are sold by street vendors while dodging the police. Beef and lobster are banned products, and their sale is severely punished by the authorities. The population presumes that many of these products are stolen from farms, factories, state warehouses, and hotels.
From 1998 to 2012, the domestic situation of Cubans with relatives abroad was eased thanks to food shipments sent from outside without paying customs duties. During this period, authorities allowed the entry of food without paying tariffs to alleviate the aftermath of three hurricanes in 2008 that caused losses estimated at US$10 billion dollars. However, the tariffs were reimposed in June, giving rise to expressions of popular discontent.
Cubans have moved beyond the times of dramatic food shortages in the 1990s when the disappearance of the Soviet Union deprived the island of credit, petroleum, food, and considerable subsidies. Paradoxically, these hardships turned out to be positive for the health of the Cuban public because of the reduction of cardiovascular disease and diabetes, according to a study published this month in the British Medical Journal showing comparisons of health indicators collected from the Cuban population over three decades.
The publication indicated that, during that time of severe crisis, considered to be the worst faced by the island in its history, caloric intake decreased from 3,000 calories to 2,200 per person, resulting in an average weight loss of 5.5 kg per person between 1991 and 1995. The diffusion of this research was bitterly received by Cubans on and outside the island because it ignores the lingering consequences of poor nutrition, such as neuropathy.
Sugar Harvest without Good Prospects
The set of reforms implemented by Castro are not showing food indicators for the harvest. The current milling season will end in May, but so far results suggest that it will be difficult to achieve an output superior to that of the 2011 2012 harvest, because of organizational problems, lack of demand, and insufficient supply of cane for the mills, indicates Granma, the official newspaper. The Cuban sugar industry reached its most critical moment in 2009-2010 when production declined to 1.1 million tons, the worst in 105 years.
Since then, production has been modest, with an increase of 7% and 16% in the subsequent two harvests. The goal this year is to reach 1.7 million tons of raw sugar following the 1.4 million tons harvested in 2012.
Of the country's more than 150 sugar mills in operation until early this century, a total of 50 are now participating in the harvest under the direction of the Grupo Empresarial de la Agroindustria Azucarera (AZCUBA), an institution that replaced the former ministry of sugar, whose disappearance in 2011 was considered a definite sign of this historical sector's loss of importance on the island.
Most Cuban sugar mills were built before Fidel Castro came to power, and, in the decade between 1970 and 1980, eight new plants were constructed. From having been the island's main export in the 19th century and part of the 20th century, sugar now accounts for about 5% of the foreign currency earned by the nation. Cuba allocated 600,700 tons of sugar for local consumption and sells 400,000 tons to China.
Raúl Castro has expanded the search for foreign investments to support the sugar industry, which was closed to foreign participation for half a century. The aim is to undertake a modernization to incorporate new technologies and increase exports.
Miraculous Moringa
For decades, Fidel Castro's government tested many new ideas for large-scale agriculture, which were subsequently considered arbitrary, unsuitable for the climate, and not beneficial for farmers. However, a new initiative was launched in 2012 for growing Moringa oleifera as a miraculous alternative for human and animal consumption.
Castro has been photographed with the plants and says that they are part of his diet. Originally from India, Moringa is praised by Castro because it contains all the amino acids and dozens of medicinal properties. The planting of the shrub has already begun in several provinces and its use in developing a new energy drink was announced.
The emergence of the tree in the fields of Cuba has been taken by some as a desperate governmental hope to strengthen the diet of the population, but for others it is just another eccentric episode by the former president.


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