Soybean Update 05/17/13 3:47:35 PM|
|All information provided by Advanced Trading and the ProExporter Network|
· How does SB market bridge the old-new crop gap?’ China/Unknown bean buying; chatter about slow SRW development pushing double crop bean planting into heart of the “dry” season: SN, Up 12+SX, 4-5 Higher
· Informa boosts plantings 1.2 million to 78.2, 1.1 greater than the USDA in May; trade not impressed
· Expect soybean planting at 25% on Monday, very near last year’s 5-year average of 24%
· Daily Sales: US sells 120 K SB to China for 13/14 delivery; 120 K 13/14 to Unknown, 18 K 12/13 to Unknown
· Some processors posting higher bids: spot crush margins vary from $.65 West, $.80-$.85 Central, $1.15 East
· Bean plantings expected at 27-29% on Monday, versus 42% 5-year average
· Brazil bean vessel line-up rises 4 to 185, volume is just under 410 mbu
· BA Exchange keeps crop estimate at 48.5; soybean harvest 90% complete
· September Dalian soybeans rose nearly 8 cents, settling at $21.24 ½
· US sold 138kmt of beans to unknown
· Reports are surfacing of producers switching directly to soybean planting after corn is completed—surprise jump in progress possible in Monday’s report?
· ATI Research: Old-crop soymeal export sales recovery in the latest week, new-crop an impressive 109.7mmt
· ATI Research: China import demand is by far the greater factor influencing soybean usage trends relative to initial May WASDE projection
Soy complex held on to gains today as farmers are making great progress, leading some to believe the switch in acres from corn to beans will be marginal. Informa will be out tomorrow with updated acreage estimates. Informa in March was 78.5 vs. 77.126 USDA. There was more chatter in Brazil about another potential port strike 9 out of 12 IA biodiesel plants are said to be operating, as margins are profitable. In other news, Berkshire’s Q1 portfolio showed that they no longer hold ADM stock. As of Dec 31 they held almost 6 mln shares.
· Planting delays/ideas USDA may cut June yield estimate/strong meal sales lift futures: SN, Up 15-16; SQ, Up 13-14; SX, Up 9-10
· Tepid 12/13 SB sales of 600 K (0-4 expected/need 600); 13/14 at 12.7 were below the trade range; SBM solid both old and new, 83 K/110 K. 126 K SBM exports above needed rate. Buyers cancelled 5,300 MT SBO
· Interesting stat (maybe): USDA has not dropped bean yield estimate from May to June only twice since 1990; this week’s 6% progress figure is lowest since 1984—Gov is “monitoring” the situation
· Brazil vessel line-up unchanged at 181; bean volume estimated at 401 mbu
· CNGOIC expects 7 to 7 ½ MMT of Chinese bean arrivals in June with July total around 6 million; estimates 13/14 PRC imports up 7 to 66 MMT, 3 less than the USDA
· September Dalian soybeans closed 3 cents higher at $21.14 ¾
· NOPA crush for April light at just 120.1—well below the avg. guess of 125.2mbu (range 121.0-128.8) and vs. 137.1 in March & 131.7 in April, 2012. Soyoil stocks: 2.638 bil lbs vs. avg. guess: 2.627 bil (range 2.558-2.680)
· Soybean Export Sales: Trade range is 0-4mbu for 12/13 (0.6/wk needed) and 16-20 for 13/14 delivery
Bean futures traded on both sides of unchanged and finished 2 to 5 lower. The April NOPA crush was a bearish at 120.1 mbu. The industry was expecting 125.5 mbu. Crush margins have eroded as cash beans are hard to originate at any price as the elevator is sold up and farmers are in the field. Cargill announced they will idle their Lafayette Indiana plant. We should see more of this as well as most slowing down the balance of the season until new crop stocks become available. US processor basis was steady to firmer today. The SN/SX is right around $2.00. That’s the incentive for users to wait/not stock pile, and for producers to get stocks into the nearby pipeline. Feels like these inverse will have to do more work to get more imports into US?
− USDA did keep old crop ending stocks at 125 mln bu. ATI is currently 134 mbu
− 13/14 crush estimates were raised by 35 mbu, while the exports were the offsetting factor being
dropped by 50 mbu.
− Small changes in seed/residual gave us an estimated end stock of 265 mbu
− WASDA projected 13/14 inventories to increase by 12.5 MMT given higher production estimates
− We feel the idea of a 10 MMT increase in 13/14 Chinese SB imports seems aggressive.
− USDA estimates that SAM will have 500 mbu more beans on Sept 1 vs LY.
− Domestic meal demand is inelastic. Crush Margins are still historically strong despite dropping
23c from last month.
− New Crop Soybean/Corn ratio still fairly neutral.
· Outside markets said to weigh on old crop; NOPA crush was a little negative; another new crop sale to China reported: SN, down 7-8; SX, Down 1-2
· NOPA Crush at 120.1, 5 mbu below the trade average; oil stocks come in 20 million lbs higher
· USDA announces 171 K MT SB sale to China for 13/14 delivery this morning
· Brazil bean vessel line: up 10 to 181, volume up 18 to 404
· People’s Daily: expects PRC 13/14 soybean imports to reach 66 MMT in 2013, up from 58.4 in 2012
· Oil World expects May SB exports from Brazil, Arg and Para may reach record 10.8 MMT, vs 10.0 LM, 9.6 LY
· Oil World notes dryness in Australia and the Ukraine putting canola crops at risk
· Malaysia leaves PO export tax unchanged at 4.5%—seeks to increase export demand & reduce inventory levels (Indonesia cut its tax from 10.5% to 9.0% earlier this month)
· September Dalian soybeans closed 5 cents lower at $21.11 ¾
Soyoil stx dn 15 mln to 2.638….average est was dn 112 mln
Crush was 120.1 mbu vs. 125.5 average estimate
Soybeans put in a very positive day in the flat price arena, closing 14 cents higher in the SK, at $14.55. SN closed 15 cents better at $13.87, while the SX closed 17¼ cents higher at $12.21¼. Despite the rain, producers have their attention elsewhere, and basis, spreads, and flat price are working together to originate soybeans. A wire story of Cargill idling Lafayette, IN plant at the end of next week due to poor crush margins. Stats Canada printed canola stocks at 3.9 mmt, down 25% from LY, and well below trade expectations. Trade talk of a vessel of Brazilian soybeans headed to the U.S. might garner attention on Monday, especially if wait times start to dwindle in Brazil and it continues to pencil to bring soybeans in. All eyes will be on weather on Sunday night/Monday, but it feels like we are less than a trade limit away from hitting $15.00 soybeans in a lot of country, which is the magic number we’ve been hearing originates soybeans.
· ATI Research: Cancellation of some old-crop sales again, this time a net 4.0mbu. In contrast, new-crop sales were exceptionally robust at 49.3mbu. 4-week new-crop sales average is 20.8/week—2nd only to last year
· ATI Research: While old-crop soybean meal export sales of 93.2 K were light, the 4-week average of old and new crop is 219 K—a RECORD high for this time year
China returned from holiday today and bought some additional new crop beans. Old crop sales saw a net cancellation of 4 mbu with decreases seen from China and unknown. Meal sales continue strong with 93kmt sold as sales are 102.2% of the USDA estimate. Domestic meal basis was mostly steady. New crop remains active from China buying, Oct traded +79SX and Nov +83SX. Barge freight will be watching the next rain event and if water levels will rise enough again to shut down any loadings.
· Cargill KC and Wichita rolled meal basis vs. SMN and net dropped basis a $1
· New crop un-phased by decent weekly sales/PRC new crop announcement, old crop supply concerns for the crushing sector remain; more bean acres weigh: SK, Up 6-7; SN, Down ¾; SX, Down 2-3
· Export Sales—More old crop SB cancellations, net decline of 4 mbu as China/Unknown opt out of 12.2 mbu. But they did buy 48.4 13/14 beans. PRC new crop total at 249, 13 below LW. Old crop SBM sales light at 93 K (100-200 expected) but good new crop at 25.3. SBO light at 1,100 MT
· USDA also announced a 290 K MT SB sale to China for 13/14 delivery
· 20% of UK winter rapeseed crop fails to get planted/fails and another 10% has questionable viability
SOYBEAN SALES—Buyers once again cancelled some old crop beans, -4.0 TW: (7.6) LW; 22.0 LY; 4-11 Expected; 0.6 Needed. YTD: 1,333 TY; 1,250 LY. O/S: 77 TY; 180 LY. 13/14 sales were exceptionally robust at 49.3 TW versus 23.1 LW and 41.7 LY with 28-20 expected. 12/13: Mexico bought 3.3; Indonesia, 3.1; Japan, 709 K; Israel, 694 K and Taiwan, 254 K. China and unknown together cancelled a total of 12.2 million. 13/14 sales of 49.3 mbu went to China (42.2) and unknown (6.2). China’s new crop book currently stands at 249 mbu, down slightly from 262 this time LY. The 4-week old crop average of 3.1/week is a new low for this time frame (going back 19 years). On the other hand, new crop buying (China) has picked up and at 20.8/week, is 2nd only to LY’s 24+ weekly April total. 5-year average is more on the order of 10 per week.
SOYBEAN MEAL SALES—Light at 93.2 K TW; 193 K LW; 59 LY; 100-200 Expected; (4) Needed. YTD: 8.7 MMT TY; 6.3 LY. O/S: 1.5 TY; 1.5 LY. 55.7 K sold for 13/14 delivery TW, 25.3 LW; 92.7 LY with 28-80 expected. Net sales of 93,200 MT for 2012/2013 were down 52% week to week. Increases were reported for unknown (40,900 MT), Guatemala (11,000), Canada (9,300), Israel (6,500), El Salvador (5,700), and Sri Lanka (5,600). Decreases were reported for Trinidad (4,500 MT), the Dominican Republic (700 MT), and Morocco (700 MT). Net sales of 55,700 MT for 2013/2014 were reported for unknown destinations (51,000 MT), Trinidad (4,500 MT), and Canada (200 MT). Old crop buying has been declining but toss in the new crop interest and there’s been a sharp up-turn since early April. The 4-week average (old and new) at 219 K is RECORD high for this time of year and even exceeds last spring’s S Am drought-induced meal demand push to the U.S. Implications for September/October crush?
SOYBEAN MEAL SHIPMENTS—Slipped to 117.8 K MT TW; 177 K LW; 136 LY; 66 Needed. YTD: 7.1 MMT TY; 4.8 K LY. The primary destinations were Morocco (21,300 MT), Ireland (20,000 MT), the Dominican Republic (16,900 MT), Canada (14,100 MT), Mexico (13,900 MT), Jamaica (7,000 MT), and Venezuela (6,000 MT). 4-week pace at 145 K is 10 less than the seasonal average.
SOYBEAN OIL SALES—Weak again at 1.1 K MT TW; 1,700 LW; 14,900 LY; 5-10 Expected; 8.9 Needed. YTD: 832 TY; 373 LY; O/S: 86 TY, 126 LY. Net sales of 1,100 MT for 2012/2013 resulted as increases for Mexico (1,800 MT) and Belgium (100 MT), were partially offset by decreases for Canada (800 MT).
SOYBEAN OIL SHIPMENTS: Light, 3,600 MT TW; 2,600 LW; 2.0 K LY. YTD: 746 K TY; 247 K LY. Exports of 3,600 MT were up 37 percent from the previous week, but down 75 percent from the prior 4-week average. The primary destinations were Mexico (2,600 MT), Canada (700 MT), Panama (100 MT), and Australia (100 MT).
U.S. soybean futures sold off hard on Wednesday due to negative economic data from China & fund selling. Nearby SK13 closed down 30¼ at 14.37½, the steepest daily loss since the USDA’s Stocks & Plantings Report on March 28th. New crop SX13 closed down 14¼ at 12.09¼. Funds sold an estimated 7,000 contracts of beans today, bringing the 2-day total to 13,000. SMK13 was down $12.7, or nearly 3% making it the biggest loser in the entire grain complex. Disappointing economic data out of China seemed to pressure commodity prices across the board, metals & energy futures turning negative along with grains. Since China account for roughly 60% of global soybean imports, futures came under significant pressure. China’s official manufacturing PMI dipped to 50.6 in April, vs March’s 50.9, which renewed concerns about the strength of their economy after a disappointing Q1. Rumors circulated late in the day that the U.S. booked Brazilian beans for import, with no time frame & very few details attached. The trade watching closely in an effort to figure out if the rumors carry any weight.
· Lack of positive news, Weak Chinese manufacturing index (PMI), demand concerns slam old crop: SK, Down 21 ¼; SN, Down 2 0 ½; SX, Down 12
· Declining crush on tight U.S. soybean supplies along with a pick-up in biodiesel demand should pull soybean oil stocks down significantly as the summer progresses
· Processors said to pushing as much as 20-30 cents for beans—crush margins still 90 cents, or better
· Dryness in Australia is beginning to worry canola growers; 12/13 output is approximately 22% of world total
· No Brazil vessel report
· May soybean futures trades to $14.88 ¾ on Tuesday, the highest price since February 22
· ATI Research: Record S Am soybean supply on Sept. 1; U.S. Sept-Nov exports pegged at 425mbu vs. 620 in 2012
· Some say 1-3 mil acres intended for corn will not be planted in NW Corn Belt with most of that land going to soybeans, others say still too early to tell