Headlines:
- ADM results miss expectations, as grain trading arm takes hit
Food and commodity giant Archer Daniels Midland Company reported weaker-than-expected profits, thanks to falling returns from its grain trading business. But ADM chief executive Juan Luciano struck a more upbeat tone for prospects over the next sixth months. “After a challenging start to the year, general market conditions began to turn at the end of the second quarter, providing us with improved opportunities, said Mr Luciano. Across the company, net profits slumped 26% in the three months to June 30. This drop was driven by sharply lower profits in its grain handling and oilseed processing business, which saw earnings drop by 57% and 47% respectively. Adjusted earnings came in at 41 cents a share, below analyst estimates of 45 cents a share. The fall in profits was driven by lower revenues, which fell 9%, to $15.63bn, below the average analyst estimate of $16.97bn. - Egypt curtails wheat buying as offer prices tick higher
Gasc, at its fourth tender of the season, slowed its buying to just one cargo after most merchants nudged higher their offer prices, on contrast to weakness on futures markets. Gasc, the grain authority for Egypt, the world’s top wheat-importing country, purchased 60,000 tonnes of Russian supplies on Tuesday from Midgulf, the first time since February that only one cargo was bought. The slowdown from the previous three events, over which Gasc purchased a total of 600,000 tonnes of wheat, came amid a rise in offer prices, excluding freight, among many of the nine merchants who tendered this time. Archer Daniels Midland, which won a 120,000-tonne wheat order at the last event, last Thursday, lifted its prices by up to $4.60 a tonne. Midgulf was alone in cutting the price of Russian wheat, by $1 a tonne from last time to $168.90 a tonne, excluding freight.
Summary:
Corn, Wheat and Soybean were under selling pressure once again but ended the day well off of the intraday lows. Producers have not yet hit the panic button on Beans. Once that happens perhaps a solid low or bottom will be insight. Midwest crops continue to enjoy favorable soil moisture leaving September Beans down one tick shy of a dime and November Beans down 8.50 cents. Corn reached new contract lows but recovered with the September contract giving up 1.25 cents and the December finishing flat. September Wheat shed 4.25 cents.
We have recently been suggesting that Corn may bottom this week and news from South America is reporting that the Brazilian Ministry of Agriculture is preparing measures to import Corn from the US. Today, Neri Geller (the secretary of Agricultural Policy) with experts from the Ministry of Agriculture, Livestock and Supply (MAPA)began to outline necessary measures for imports of genetically modified (GMO) Corn from the United States. With the proposed upcoming bumper crop, Corn producers can use all the buyers that are willing to line up.
