This food inflation shock even got the attention of Rick Santali on CNBC this morning. He said something to the effect, "so we are being told not to worry about inflation?".
These are extremely bullish numbers for food, and if the SA soybean doesn't kick in, we will have a dual food and energy crisis. We may have one anyway. The only concern (for new buyers): speculators are already long big time.
Reuters
CBOT grains and soy complex preopening calls
Monday January 12, 9:43 am ET
CHICAGO, Jan 12 (Reuters) - Chicago Board of Trade (News - Websites) grain and soy complex preopening calls at 8:35 a.m. CST (1435 GMT) on Monday.
WHEAT - 5 to 10 cents per bushel higher - Bullish reaction to USDA's January crop reports. USDA pegged 2004 U.S. winter wheat acres at 43.46 million, below the low end of analysts' estimates for 43.9 million and well below the average of analysts' estimates for 45.637 million. USDA forecast 2003/04 U.S. wheat ending stocks at 559 million, below USDA's forecast in December for 583 million and about in line with the average of analysts' estimates for 555 million. USDA also cut world wheat ending stocks for 2003/04 to 127.26 million tonnes from the forecast in December for 127.93 million. Wheat also was finding support from news on Saturday that Egypt's GASC bought 295,000 tonnes of wheat with a large portion, 175,000 tonnes, coming from the United States. Australia landed the remaining 120,000 tonnes. Friday's CFTC commitments report for wheat showed large speculators were long wheat futures by a 2-to-1 margin as of last Tuesday. Dry weather in the western U.S. Great Plains hard red winter wheat region continues to give the wheat market underlying support. But most of the lift should surface in the KCBT new-crop contracts; some U.S. grain dealers were pushing HRW bids 3 to 4 cents early Monday. The overnight e-cbot trend for wheat was 1-1/2 cents higher to 1-1/4 lower.
CORN - 7 to 10 cents per bushel higher - Boosted by USDA's January crop production reports showing last year's U.S. corn crop at only 10.114 billion bushels, below an average of analysts' estimates for 10.311 billion and below USDA's forecast in November for 10.278 billion. USDA pegged 2003/04 U.S. corn ending stocks at 981 million bushels, below the average of analysts' estimates for 1.251 billion and below USDA's forecast in December for 1.299 billion. USDA trimmed its forecast for world corn ending stocks for 2003/04 to 67.49 million tonnes, below the December forecast for 74.24 million. Also, USDA announced early Monday that U.S. exporters sold 220,000 tonnes of U.S. corn to unknown destinations. Cash corn traders at the U.S. corn to unknown destinations. Gulf late Friday said corn basis values were beginning to stabilize after falling earlier last week. Friday's CFTC report showed large speculators were long by a 4-to-1 margin in corn futures. The overnight e-cbot corn trend was 1-1/4 to 2-1/2 cents lower.
SOYBEANS - 10 to 20 cents per bushel higher - USDA trimmed its forecast for last year's U.S. soy crop to 2.418 billion bushels, below an average of analysts' estimates for 2.451 billion and below USDA's last forecast in November for 2.452 billion. However, USDA left unchanged its forecast for 2003/04 U.S. soy ending stocks at 125 million bushels. Analysts had expected USDA to make at least a slight cut in soy ending stocks. The analyst average estimate was at 111 million bushels. Stocks at 125 will still be a 27-year low. USDA pegged world oilseed ending stocks for 2003/04 at 39.77 million tonnes, below the forecast in December for 39.92 million. Friday's CFTC data showed large speculators were long soy by a 5-to-1 margin in futures and in futures and options combined there were long 74,256 contracts and short 13,189 contracts. The overnight e-cbot trend for soy was 3 to 8-1/2 cents per bushel lower and China's Dalian soy futures closed lower overnight. Deliveries on the January contract on Monday totaled 166 lots and there were signs of strong commercial stopping with the ABN AMRO customer account taking 125 lots. Registrations with the CBOT late Friday totaled 538 lots, unchanged from Thursday
SOYMEAL - $3.00 to $5.00 per ton higher - Spillover support from soybeans after the release early Monday of USDA's bullish crop numbers. Friday's CFTC report showed large speculators were long futures and options by 26,922 contracts and short 5,596 contracts. The overnight e-cbot trend for soymeal was 40 cents to $1.40 per ton lower and China's Dalian soymeal futures closed mixed overnight. Deliveries on the January contract were nil on Monday and registrations late Friday with the CBOT were unchanged at 340 lots.
SOYOIL - 0.30 to 0.50 cent per lb higher - Boosted by expected strong gains in soybeans following the release early Monday of USDA's January crop production reports. Friday's CFTC report for futures and options combined showed large speculators were long 59,968 contracts and short 4,466 contracts. The overnight e-cbot trend for soyoil was 0.22 to 0.25 cent per lb lower and the Malaysian palm oil futures closed lower overnight. Deliveries on the January contract on Monday totaled 442 lots and there were signs of strong commercial stopping with the ADM house account taking 401 lots. Registrations with the CBOT late Friday totaled 5,019 lots, up from 4,894 lots on Thursday. |
