World Wheat-Supply Estimate Raised by U.S. on Australia, Canada Crop Gains - Bloomberg

World Wheat-Supply Estimate Raised by U.S. on Australia, Canada Crop Gains - Bloomberg

World wheat inventories will be 2.4 percent larger than forecast a month ago, as output increased from Australia and Canada, the U.S. Department of Agriculture said.

Global stockpiles will total 176.72 million metric tons at the end of the marketing year on May 31, up from 172.51 million forecast last month, the USDA said today in a report. Seventeen analysts in a Bloomberg News survey estimated that inventories would drop to 171.3 million, on average.

Previous projections may have “overstated” the impact of floods in Canada and Australia, the third- and fourth-largest wheat exporters this year, said Shawn McCambridge, the senior grain analyst for Prudential Bache Commodities LLC in Chicago. The USDA said Canada may produce 23.17 million tons, up 4.4 percent from last month’s estimate, and Australia may harvest 25.5 million, up 6.3 percent.

“When we have very poor conditions, we have a tendency of overstating damage,” McCambridge said. “Then when the crop comes out of the field and we can assess and measure it, we start getting to the real number.”

Ample precipitation early in eastern Australia’s growing season spurred the country to boost its domestic production forecast to a record on Dec. 7. The impact of recent excessive rains, which delayed harvesting and cut crop quality, won’t be known until more of the harvest is completed in the south, the Australian Bureau of Agricultural & Resource Economics & Sciences said.

Eastern Australia’s “production potential was really good for most of the growing season because they were getting good rain and everything was looking great,” Mike Tannura, the president of T-Storm Weather in Chicago, said before today’s USDA report. “What’s happened now is that it hasn’t stopped raining during harvest.”

Australia’s September-to-November spring was the wettest on record, the country’s Bureau of Meteorology has said.

Wheat futures for March delivery rose 4.5 cents, or 0.6 percent, to settle at $7.885 a bushel yesterday on the Chicago Board of Trade. The most-active contract has surged 64 percent since the end of June, after drought slashed crops in Russia and dry weather in the U.S. Great Plains threatened winter crops.

U.S. Inventories

Unsold U.S. supplies at the end of May will total 858 million bushels (23.4 million tons), up 1.2 percent from a November estimate, the USDA said. Analysts expected 842.3 million bushels.

The U.S. is projected to be the largest exporter this year, followed by France, according to data from the International Grains Council and FranceAgriMer.

Wheat is the fourth-biggest U.S. crop, valued at $10.6 billion in 2009, behind corn, soybeans and hay, government data show.

To contact the reporter on this story: Whitney McFerron in Chicago atwmcferron1@bloomberg.net

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net.

Corn-Surplus Estimate in U.S. Raised 0.6% on Higher Imports, Agency Says - Bloomberg

Corn-Surplus Estimate in U.S. Raised 0.6% on Higher Imports, Agency Says - Bloomberg

U.S. stockpiles of corn before next year’s harvest will be 0.6 percent larger than estimated last month because of a gain in imports, the government said.

The surplus on Aug. 31, the end of the marketing year, will be 832 million bushels, up from 827 million forecast in November and less than 1.708 billion on hand a year earlier, the U.S. Department of Agriculture said today in a report. A rise in imports to 15 million bushels from 10 million was the only change the department made from the previous forecast. Analysts surveyed by Bloomberg News expected inventories of 806 million bushels, on average.

Even with the increase, “corn supplies are getting snug,” Jerrod Kitt, a market analyst for the Linn Group Inc. in Chicago, said before the report. “You will need near-perfect global weather next year to rebuild inventories to more comfortable levels.”

Corn futures for March delivery fell 0.25 cent to close at $5.7425 a bushel yesterday on the Chicago Board of Trade. Corn has surged 50 percent in the past year as adverse weather reduced global production.

Crop Estimate

The USDA’s crop estimate of 12.54 billion bushels is 4.4 percent smaller than 2009’s record output of 13.11 billion bushels. The government on Jan. 12 will release its final estimate of this year’s harvest and an estimate for consumption for the first three months of the marketing year that began Sept. 1.

The USDA estimated world production in the 2010-2011 season, which began Oct. 1, at 820.71 million metric tons, up from 818.52 million forecast in November, on increased production in the European Union, Canada and Ukraine. That compares with a record 812.4 million tons harvested last season.

China Production

China, the second-largest producer, will harvest 168 million tons, unchanged from last month, the USDA said. Its estimate for China’s imports and exports were also left unchanged, at 200,000 tons and 1 million tons, respectively.

Global consumption will reach 837.91 million tons, up from 837.31 million estimated last month and more than‘ 812.5 million last year, the USDA said. It would be the second straight year world consumption exceeds output.

World inventories before next year’s harvest will total 130 million tons, up from 129.16 million estimated in November and down from 147.19 million this year.

To contact the reporters on this story: Jeff Wilson in Chicago at jwilson29@bloomberg.net

Alan Bjerga in Washington at abjerga@bloomberg.net

To contact the editor responsible for this story: Steve Stroth at sstroth@bloomberg.net.

Corn, Soybeans Drop for Second Day as Rain May Aid Crops in South America - Bloomberg

Corn, Soybeans Drop for Second Day as Rain May Aid Crops in South America - Bloomberg

Corn and soybean futures declined for the second straight day on speculation that rain will improve soil moisture for developing crops in Brazil and Argentina, the world’s biggest exporters behind the U.S.

As much as 0.5 inch (1.3 centimeters) of rain fell in Argentina in the past 24 hours and another storm, expected on Dec. 11, will bring as much as 1 inch to the driest growing areas, Mike Tannura, the president of T-Storm Weather, said in a report. Precipitation in the next week will maintain beneficial conditions for crops in Brazil, he said.

“Improved rainfall in South America has encouraged speculative selling,” said Don Roose, the president of U.S. Commodities Inc. in West Des Moines, Iowa. “It’s all about an improving weather story.”

Corn futures for March delivery fell 6.25 cents, or 1.1 percent, to close at $5.6175 a bushel at 1:15 p.m. on the Chicago Board of Trade. Earlier, the price reached $5.7575, the highest since Nov. 15. The grain dropped 1 percent yesterday.

Soybean futures for January delivery declined 3 cents, or 0.2 percent, to $12.855 a bushel. Yesterday, the price fell 0.9 percent after reaching a three-week high of $13.0675.

On Nov. 9, corn jumped to a 26-month high of $6.175 after the U.S. Department of Agriculture said adverse weather reduced the size of the domestic crop. On Nov. 12, soybeans reached $13.485, the highest since August 2009, as Chinese demand surged for U.S. supplies.

Australian Wheat

Corn prices also fell on speculation that increasing supplies of Australian wheat for livestock feed will erode Asian demand for U.S. grain supplies, said Brian Grete, the senior market analyst at Professional Farmers of America newsletter in Cedar Falls, Iowa.

“Asian feed buyers will buy a lot of lower-quality wheat from Australia because of cheaper shipping costs and prices than U.S. corn,” Grete said. “The rain-damaged wheat crop in Australia had a negative impact on corn.”

Corn is the biggest U.S. crop, valued at $48.6 billion in 2009, followed by soybeans at $31.8 billion, government data show.

DTN/The Progressive Farmer: Agriculture Markets, News and Weather

DTN/The Progressive Farmer: Agriculture Markets, News and Weather

Wednesday 12/01/10

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US & Chinese Yields of Key Grains

Joel Karlin DTN Contributing Analyst While the trade continues to debate the likelihood of China purchasing large quantities of foreign corn this year, it appears that over the long-term this nation will eventually have to become a large importer of various grains and feed ingredients, similar to its status in the soybean market. An increasing middle class with rising incomes has translated into much of their populace changing diets to one featuring greater consumption of meat and dairy products. This necessitates increased utilization of feed grains and protein meals to feed all the cattle, hogs, and chickens. The resulting rapid increase in feed demand has completely overwhelmed their productive capabilities. This is based on limited arable land, much lower productivity in the agricultural sector than seen in many other nations, and yields that run well below those seen in the U.S. for most grain and oilseeds, with the exception of wheat. Reasons for this include less use of higher-yielding hybrids, widespread land and water pollution, and less intensive use of modern technology. This graphic plots U.S. and Chinese yields of major grains in metric tons per hectare. Over the past 15 years, U.S. corn yields have averaged 76% higher than those in China; rice, 15% greater; and soybeans, 56% larger. Only in wheat does China surpass the U.S.: Its yields are 50% greater. This is due, however, to China's emphasis on quantity over quality, as much of China’s wheat is used for feed whereas U.S. wheat is utilized more for milling purposes and traits such as protein are more important. (KA)

Posted at 9:26AM CST 12/01/10

DTN/The Progressive Farmer: Agriculture Markets, News and Weather

Mostly Dry in Main U.S. Crop Areas Mon Dec 6, 2010 02:46 PM CST Print Email

Snow showers continued in the Great Lakes Monday afternoon. The rest of the main U.S. crop areas had dry conditions. Temperatures ranged from -1 in northern Montana to the mid 60s in far south Texas. A swath of 5- to 10-inch snow cover in the northern, central and eastern Midwest led to afternoon temperatures in the teens, compared to 20s in the rest of the Midwest. Southwestern Plains readings were generally in the 40s to low 50s. Tuesday will feature generally dry conditions except for more snow in the eastern Great Lakes. This trend continues to be unfavorable for winter wheat in the Plains, with winter kill starting to pose a threat in the event of colder temperatures.

DTN/The Progressive Farmer: Agriculture Markets, News and Weather

DTN/The Progressive Farmer: Agriculture Markets, News and Weather

USDA Weekly weather report summary DEC 02 2010

EUROPE: Seasonably colder weather settled over much of

the continent, while heavy rain across southern Europe

continued to hamper fieldwork and cause local flooding.

In general, winter crop prospects are

favorable over much of Europe, with locally abundant soil and

subsoil moisture available for late establishment and upcoming

spring growth.

WESTERN FSU: Colder weather in northern growing areas

contrasted with unseasonably warm, wet conditions in

southern Russia.

MIDDLE EAST: Unfavorably dry weather continued in Iran,

Iraq, and southeastern Turkey, raising concerns over

developing drought.

NORTHWEST AFRICA: Showers continued, maintaining

the favorable start to the 2010-11 growing season.

SOUTH ASIA: Wet weather gave way to drier conditions

for cotton harvesting in western and southern India, while

winter crops benefited from more rainfall.

EAST ASIA: Mostly dry, mild conditions continued to

promote winter crop development.

SOUTHEAST ASIA: Wet weather abated in central

Vietnam, benefiting coffee harvesting, while heavy showers

continued to slow fieldwork in the northern Philippines.

AUSTRALIA: Drier weather in the northeast allowed winter

wheat harvesting to resume, while soaking rains in the

southeast halted most fieldwork, including winter crop

harvesting.

Drier weather (generally less than 10 mm) overspread southern

Queensland and northern New South Wales, allowing winter

wheat harvesting to resume. The added sunshine also helped

slow reductions in the quality of unharvested winter crops and

aided cotton and sorghum development. Farther south,

soaking rains (10-50 mm or more) halted fieldwork throughout

the remainder of New South Wales, Victoria, and extreme

eastern South Australia. In contrast, warm, mostly dry weather

(less than 5 mm) elsewhere in South Australia and in Western

Australia favored winter grain harvesting.

SOUTH AFRICA: Beneficial rain continued across the

corn belt, favoring emerging crops and spurring summer

crop planting.

ARGENTINA: Pockets of dryness lingered over highyielding summer crop areas of central Argentina.

Pockets of dryness lingered in key agricultural areas of central

Argentina, reducing moisture for germination and

establishment of corn, soybeans, and other summer row crops.

According to Argentina’s Ministry of Agriculture, sunflower and corn planting was 90

and 78 percent complete, respectively, as of November 25. In

addition, soybeans were 52 percent planted versus 44 percent

last year. Wheat harvesting reached 18 percent completion,

compared with 23 percent last year.

BRAZIL: Much-needed rain provided moisture for

germination and establishment of soybeans in Rio Grande do

Sul.