2009 June | EHedger

Archive for June, 2009

EHedger Quick Reaction To June 30 Acreage & Stocks Report

Tuesday, June 30th, 2009

Overall, today’s numbers have a distinct bearish tinge across the board. On the quarterly stocks front, the market seemed to have anticipated a tightening in both corn and beans due to reports of consistently strong demand. However, both sets of inventories came in well above the average estimate to suggest that usage was not quite as hot as many had suggested.

On the acreage front, 87.035 planted acres of corn marks a 2 million acres increase from the March 31 numbers and a more than 1 million jump versus 2008 levels. This goes against expectations of a decline of 1-2 million acres that had been called for due to the persistently wet spring we’d seen in the Midwest. Clearly, US corn farmers persevered as prices remained attractive, and have now planted close to the highest amount of corn acres on record.

Bean acres of 77.483 million marks a 1.4 million rise since March 31 and a 1.765 million acre increase since a year ago. The higher plantings are no surprise given how high prices have been since the spring, but some market watchers may have been anticipating an even steeper acreage advance based on the wet weather that usually steers abandoned corn acres into soybeans.

Overall, the combination of higher stocks and higher acres has the potential to deflate these markets going forward, especially if the weather remains benign throughout most of the Midwest. However, corn has already lost more than 70 cents a bushel in Dec futures since the beginning of June on suspicions that acreage remained high while the weather outlooks improved. So, there’s uncertainty as to how much further the corn price will slump in the wake of this report. There’s plenty of downside room available in new crop beans, however, especially as the stocks number suggests more adequate inventories than had been projected.

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USDA Report: Recap For June Acreage, Grain Stocks

Monday, June 29th, 2009

CHICAGO (Dow Jones)–The following table is provided as a service to Dow Jones Newswires subscribers in conjunction with the U.S. Department of
Agriculture’s acreage and quarterly grain stocks reports. The reports are scheduled for release at 8:30 a.m. EDT (1230 GMT) Tuesday.
Estimates are in millions of acres for the 2009 U.S. acreage report and in billions of bushels for U.S. grain and soybean stocks as of June 1.

U.S. Acreage

USDA
USDA March 31 2008
Tuesday Average Range Plantings Seedings

Corn _______ 84.158 82.474-86.000 84.986 85.982

Soybeans _______ 78.305 75.300-79.631 76.024 75.718

Spring Wheat _______ 13.102 12.826-13.404 13.304 14.135

Durum _______ 2.403 2.300-2.500 2.445 2.731

All Wheat _______ 58.337 57.600-58.800 58.638 63.147

Cotton _______ 8.800 8.300-9.000 8.811 9.470

U.S. Grain Stocks

2009 Mar 1 2008 June 1
USDA USDA USDA
Tuesday Average Range Stocks Stocks

Corn _______ 4.190 4.064-4.321 6.958 4.028

Soybeans _______ 0.586 0.559-0.620 1.302 0.676

Wheat _______ 0.670 0.640-0.687 1.037 0.306

By Debbie Carlson; Dow Jones Newswires; 312-750-4072;
debbie.carlson@dowjones.com

(END) Dow Jones Newswires

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DJ Argentina Midterm Election Results Are Setback For Kirchners

Monday, June 29th, 2009

BUENOS AIRES (Dow Jones)–President Cristina Fernandez and her husband, former president Nestor Kirchner, were heavily debilitated by Sunday’s midterm Congressional elections according to preliminary results, which analysts said will test their willingness to negotiate with an emboldened opposition.

The ruling couple’s Front for Victory party may secure the largest share of the overall vote, but seemed set to lose in key electoral centers, including the all-important province of Buenos Aires, and were even expected to come second in their home province of Santa Cruz.

The Kirchners were also expected to lose their majorities in both the Lower House and Senate.

The results were interpreted as a strong rejection of Kirchner’s increasingly authoritarian and interventionist policies.

“The question now is, what will Kirchner do? How will Kirchner react to such a setback?” said Rosendo Fraga, a political scientist, speaking on a local television channel.

Long after the opposition parties had given their speeches on the results, representatives from the governing party had yet to make an appearance at their campaign headquarters.

The election - which the government said was free and fair - opens up a period of political uncertainty, which will be exacerbated by the long lame duck session before the new Congress takes office in December. The opposition is likely to seek some rapid changes to controversial Kirchner policies, such as restoring full legislative oversight of Congress and removing or reducing some taxes on agricultural exports.

Opposition leaders said they were willing to work with the government, within limits.

“We will be inflexible in upholding what we’ve said throughout the campaign, but we will also be constructive when we are asked to dialogue,” said Francisco de Narvaez, returning congressman for the Union Pro party.

Analysts said markets will welcome the new constraints which the Kirchners will face in Congress. Yet the uncertainty of this period of change, coupled with the somber economic outlook, may mute some of the enthusiasm.

”I don’t think the market likes Kirchner. So a reversal for him could be good for the market,” said Federico Thomsen, a political analyst. “But you could also say it may be a little more difficult to run the country over the next two years. So in the short term it might not be so good for the market.”

Part of the Kirchners’ troubles can be traced back to a disastrous dispute last year with farmers over export taxes. An association representing farmers said that their political supporters had won a large number of votes.

Across the country, the Kirchners’ setbacks were numerous. In the province of Buenos Aires, a bastion of their support until now, the slate led by Kirchner himself was losing to the ticket of Union Pro’s De Narvaez, a wealthy businessman with little political weight until now.

De Narvaez is now widely expected to run for governor of Buenos Aires province in 2011, while his main backer, Buenos Aires City Mayor Mauricio Macri, is teed up for a presidential run even though their Union Pro party lacks a nationwide political presence.

The incumbent governor and Kirchner ally, Daniel Scioli, may have seen his presidential ambitions dented by Sunday’s results.

There are likely to be some major battles within the Peronist movement as it starts to feel its way past the Kirchners. Carlos Reutemann, a former rally car driver, was narrowly in the lead for a senate seat in Santa Fe province, and has already said a victory would position him for a run at the province.

Sunday’s results threw up other possible contenders for the presidential race. Vice President Julio Cobos is seen as a big winner after a candidate he backed scored a resounding victory in the province of Mendoza. The victory could boost Cobos’ chances, this time in a run for the top job. Cobos was a former Kirchner ally who turned his back on the couple as a result of the farm crisis in the countryside.

The presence of Cobos and Reutemann on the national political scene suggests there will likely be a period of “moderation” in politics, which would be welcome, said Fraga.

The main opposition party nationwide, the Civic Coalition, which includes Cobos’ UCR, is expected to gain a number of seats in Congress but its main presidential contender until now, Elisa Carrio, may not make it into the Lower House. She gave up her top spot on the ticket in a bid to win more votes, and the ticket’s unexpected slip into third place may not guarantee sufficient votes under a proportional representation to secure her a seat.

-By Matthew Cowley and Taos Turner, Dow Jones Newswires; +54 11 4103 6740;

matthew.cowley@dowjones.com

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US Export Sales: Commodity Highlights - Jun 25

Thursday, June 25th, 2009

Kansas City (Dow Jones)– USDA Thursday released the following export highlights in its Export Sales report for week ended: June 18.

Wheat: Net sales of 368,300 metric tons were up 37 percent from the previous week. Increases were reported for Nigeria (127,600 MT), Japan (82,700 MT), South Korea (48,100 MT), Brazil (25,000 MT), the Philippines (20,900 MT), Canada (16,600 MT), and Mexico (13,900 MT). Decreases were reported for Yemen (400 MT). Exports of 323,800 MT were primarily to Nigeria (87,100 MT), Japan (61,900 MT), Yemen (57,600 MT), Mexico (31,700 MT), South Korea (24,500 MT), and Canada (16,100 MT).

Corn: Net sales of 686,400 MT were down 11 percent from the previous week and 3 percent from the prior 4-week average. Increases reported for Japan (373,200 MT, including 125,300 MT switched from unknown destinations and decreases of 110,000 MT), Malaysia (60,000 MT), Egypt (36,200 MT), Colombia (35,700 MT), unknown destinations (29,700 MT), Taiwan (29,400 MT), and Libya (28,000 MT), were partially offset by decreases for Guatemala (9,300 MT). Optional origin sales of 6,000 MT for Colombia were cancelled. Net sales of 250,300 MT for delivery in 2009/10 were mainly for unknown destinations (76,200 MT), Saudi Arabia (60,000 MT), Mexico (33,000 MT), Taiwan (30,500 MT), and South Korea (25,900 MT). Exports of 1,038,400 MT were up 27 percent from the previous week and 34 percent from the prior 4-week average. The primary destinations were Japan (496,900 MT), Mexico (131,800 MT), Taiwan (98,200 MT), South Korea (59,800 MT), Morocco (33,500 MT), Venezuela (32,400 MT), and Peru (27,900 MT).

Barley: There were no sales reported during the week. Exports of 200 MT were for Mexico.

Sorghum: Net sales of 2,000 MT were for Japan (5,800 MT, including 5,100 MT switched from unknown destinations) and Mexico (1,200 MT). Decreases were reported for unknown destinations (5,100 MT). Exports of 14,600 MT were to Japan (13,900 MT) and Mexico (700 MT).

Rice: Net sales of 78,000 MT were up noticeably from the previous week and 52 percent from the prior 4-week average. Increases were reported for Japan (39,000 MT), Mexico (16,500 MT), Nigeria (8,300 MT), Haiti (5,200 MT), Jamaica (3,500 MT), and Saudi Arabia (1,400 MT). Exports of 83,200 MT were up noticeably from the previous week and 50 percent from the prior 4-week average. The primary destinations were Japan (39,300 MT), Mexico (21,000 MT), Costa Rica (4,700 MT), Saudi Arabia (4,600 MT), and Jordan (3,400 MT).

Soybeans: Net sales of 28,000 MT were down 81 percent from the previous week and 62 percent from the prior 4-week average. Increases were reported for Syria (40,000 MT), China (37,100 MT, including 110,000 MT switched from unknown destinations and decreases of 79,000 MT), Japan (29,300 MT, including 28,000 switched from unknown destinations), and Mexico (21,300 MT). Decreases were reported for unknown destinations (129,000 MT) and Guatemala (5,000 MT). Net sales of 215,400 MT for 2009/10 delivery were primarily for Mexico (67,400 MT), China (58,000 MT), unknown destinations (55,000 MT), and Canada (25,000 MT). Exports of 378,300 MT were up 8 percent from the previous week, but unchanged from the prior 4-week average. The primary destinations were China (167,000 MT), Japan (76,400 MT), Mexico (47,000 MT), Taiwan (34,100 MT), and Syria (30,200 MT).

Soybean Cake and Meal: Net sales of 79,600 MT were down 15 percent from the previous week and 36 percent from the prior 4-week average. Increases reported for the Philippines (25,000 MT), Spain (16,500 MT, including 15,800 switched from unknown destinations), the United Arab Emirates (14,500 MT, including 16,000 MT switched from Egypt and decreases of 1,500 MT), Morocco (13,200 MT, including 13,000 MT switched from unknown destinations), Mexico (10,900 MT), and Canada (10,500 MT). Decreases were reported for unknown destinations (28,800 MT) and Egypt (16,000 MT). Net sales of 228,800 MT for delivery in 2009/10 were mainly for unknown destinations (223,000 MT). Exports of 161,900 MT were down 41 percent from the previous week and 9 percent from the prior 4-week average. The primary destinations were Venezuela (37,000 MT), Mexico (30,200 MT), Canada (20,400 MT), Spain (16,500 MT), the United Arab Emirates (14,500 MT), and Morocco (13,200 MT).

Soybean Oil: Net sales of 6,900 MT were mainly for Taiwan (6,000 MT), Nicaragua (700 MT), and Canada (600 MT). Decreases were reported for Mexico (700 MT). Net sales of 1,300 MT for 2009/10 delivery were for Mexico. Decreases were reported for Mexico (700 MT). Exports of 5,600 MT were down 80 percent from the previous week and 69 percent from the prior 4-week average. The primary destinations were Mexico (2,300 MT), Nicaragua (1,300 MT), and Canada (900 MT).

Cotton: Net Upland sales of 157,500 running bales were up 4 percent from the previous week and 22 percent from the prior 4-week average. Increases were reported for Turkey (63,000 RB, including 6,600 RB switched from China), China (20,000 RB), Thailand (11,100 RB), Vietnam (9,400 RB), Indonesia (8,400 RB), Taiwan (6,000 RB), South Korea (5,800 RB), Japan (5,400 RB), Peru (4,800 RB), and Singapore (4,600 RB). Net sales of 98,200 RB for delivery in 2009/10 were mainly for Mexico (36,600 RB), Turkey (23,600 RB), Vietnam (14,100 RB), and Taiwan (4,400 RB). Exports of 276,800 RB were up 6 percent from the previous week, but down 12 percent from the prior 4-week average. The primary destinations were Pakistan (48,600 RB), Turkey (44,000 RB), Mexico (33,100 RB), China (30,700 RB), Indonesia (18,300 RB), and Vietnam (17,200 RB).

Net American Pima sales of 5,700 RB were up 96 percent from the previous week, but down 23 percent from the prior 4-week average. Increases were mainly for China (2,200 RB), India (2,200 RB), Italy (500 RB), and Japan (300 RB). Net sales of 1,400 RB for delivery in 2009/10 were for Mexico (800 RB), India (400 RB), and Honduras (200 RB). Exports of 8,100 RB were mainly to China (4,500 RB), Pakistan (1,500 RB), and Germany (1,100 RB).

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