08-01-2012 06:25 AM - edited 08-01-2012 04:08 PM
Southern combines roll
You are looking at what sent the markets lower Wednesday. Corn harvest activity in Arkansas spooked the markets.
At the close:
The Sep. contract finished 4 1/4 cents lower at $8.02, while the Dec. futures corn contract finished 3 1/4 cents lower at $8.02. The August soybean contract settled 40 cents lower $16.81, Nov. futures finished 12 cents lower at $16.29. Aug. soyoil futures settled $0.65 lower at $51.90. The Aug. soymeal futures finished $7.70 lower at $537.00.
In the outside markets, the NYMEX crude oil is $0.36 per barrel higher, the dollar is higher and the Dow Jones Industrials are 15 points lower.
Corn and Soybean Yield Reports:
Because it is apparently moving the markets, I checked with sources in Arkansas about corn/soybean harvesting.
Gus Wilson, University of Arkansas Extension Agent in Chicot, County, says the area has great yield potential.
"Dryland corn, harvested this week, is yielding between 140-175 bu./acre. Irrigated corn yields are coming in between 165-260," Wilson says.
And even some southeast Arkansas soybean fields have been harvested. A dryland field, cut this week, yielded 35 bu./acre. "That is not bad for dryland beans around here," Wilson says.
He goes onto say that corn harvesting is occurring as far north as Jefferson County, Arkansas. Also, although the Mississippi River is still navigatable, it is critically low. He said the levels are being closely watched. Going forward, the irrigated group-4 soybeans will be harvested in the next 10 days.
The Dec. contract is trading 17 3/4 cents lower at $7.87 3/4, while the Sep. futures corn contract is trading 18 1/2 cents lower at $7.88. The August soybean contract is trading 53 cents lower $16.68, Nov. futures are 32 1/4 cents lower at $16.08 3/4. Aug. soyoil futures trade $0.67 lower at $51.88. The Aug. soymeal futures are trading $18.40lower at $526.30.
In the outside markets, the NYMEX crude oil is $0.70 per barrel higher, the dollar is lower and the Dow Jones Industrials are 43 points higher.
It looks like the markets have cut deep losses, but remain entrenched in lower trading Wednesday.
The markets are really reacting negatively to early harvest activity. One analyst says, "Some harvest being reported in the South today and that is probably part of it. By South I mean southern Delta. No idea of yields but it is going on. One of my farmers told me basis in Minn is weakening and has been all week, so buyers are leaving for now, and that is not good for bull markets. But this is wild here today and I have nothing specific for the magnitude except that when people decide to go through the door that door gets very small. I am hoping some buy side shows up somewhere here soon, but I have not seen a lot so far," he says.
Markets fall hard. Aug. soybeans have fallen 60 cents and Sep. corn is down 19 cents.
At the open:
The Dec. contract opened 1 cent lower at $8.01, while the Sep. futures corn contract opened 1 cent lower at $8.01. The August soybean contract is trading 21 cents lower $16.99, Nov. futures are 13 cents lower at $16.27. Aug. soyoil futures trade $0.14 lower at $52.41. The Aug. soymeal futures opened $4.80 lower at $539.90.
In the outside markets, the NYMEX crude oil is $0.24 per barrel lower, the dollar is lower and the Dow Jones Industrials are 19 points higher.
Good News: The trustee in charge of distributing lost funds to MF Global customers says all U.S. customers will be paid in full, according to a Wall Street Journal article Wednesday. About $1.6 billion is still owed. The trustee is saying he feels confident that all will get their money, but no guarantee of when was given. So, I guess the message is to stay hopeful.
FWIW: I just had a conversation with a central Iowa farmer. He says the blooms, on his soybean plants, are brown. The crop consultant tells him, due to the weather, those plants with brown blooms will most likely not grow into anything. To make matters worse, he says his plants have pods, but a lot of them don't have any beans in them. My point here, perhaps you should scout your field closely, if you haven't already. Fields that look like they are ok may have a worse story developing in them than you realize. This farmer has moved on from the disappointment of not having a crop. He's now ticked off that he STILL has to run a combine through the field, incurring even further costs.
Where does the madness stop, this year?
--Japan seeks 320,000 mt of feed wheat, barley.
--Saudia Arabia tenders to buy 275,000 mt of Hard wheat.
--Taiwan buys U.S. soybeans in containers. It's cheaper buying them in that way.
--A story out of Brazil indicates that that country's soybean stocks are expected to drop to 500,000 tons later this year, compared to its normal levels of 2.5-3.0 million tons. Also, the story indicates that all farm silos are empty of old-crop soybeans and half the expected output for 2012-2013 is sold already. It quotes one analyst that is saying this U.S. drought has secured two more years of good prices.
Early calls: Corn 10-12 cents lower, soybeans 18-20 cents lower, and wheat 16-18 cents lower.
Overnight grain, soybean markets=Trading lower.
Crude Oil=$0.30 per barrel lower.
Wall Street=Seen opening higher, ahead of the Fed Reserve announcement of an additional econmic stimulation package.
More in a minute,
08-01-2012 07:13 AM
It looks like southeast Nebraska, northeast Kansas is getting a shower this morning, according to the Freese-Notis Weather Inc.'s radar:
Folks will take whatever they can get, at this point in the growing season. This is certainly going to be a weather year that many people will remember. I know there is a chance of it happening, but do you really think this weather pattern sticks around through the fall?
08-01-2012 07:20 AM
Just to note that there have been soys going out of Ontario to Japan and Europe in containers for many years.
May be only IP but lots of beans go that way.
Thanks for your daily input Mike.
Wisdom is knowing not to put it in a fruit salad.
08-01-2012 07:24 AM
good rain right here but not wide spread.. SC Nebraska... way too late for the corn but may and I say that cautiously may help the beans ... big areas of burnt beans on the dryland ... will have to see if they set pods or not...don't think .5 to 1.00 will help that much tho.
08-01-2012 07:54 AM
A wetter GFS weather model for the 10-day outlook for the Midwest came out, overnight. Plus, a larger than expected Russian wheat crop estimate weighed on the overnight. Russia wheat seen at 50.0 mmt vs. the USDA's 49.0 mmt and the trade's 42-46.0 mmt estimate. It's what I can gather, anyway.
08-01-2012 10:08 AM
Four area farmers started chopping corn for silage this past weekend in this area. Local TV news interviewed one of these farmers and he said very little corn in the chopped corn. Another TV news the same evening interviewed a large dairy in this area and they started chopping on 3100 acres this past weekend....said they have never chopped corn silage in July, normally not even August....! The ten day forecast here has 90s the next three days, and then a couple of days in the 80s, and then 90s as far as the next ten days. One day of rain mixed in, but not looking like any widespread rain here. Soybeans had the rows filled in several weeks ago, but with all the heat soybeans are shrinking and can see between rows once again.
08-01-2012 10:54 AM - edited 08-01-2012 10:56 AM
Thanks for the info Mike.
I never look at soil temps this time of year. I pulled this up: http://extension.agron.iastate.edu/NPKnowledge/soi
Anyone know what is normal soil temps for July and effect on yield? Does make it hard to cool off when you are sitting on hot brick.
Also, if we were putting in a top on old crop here, would this be the first time that a big bull move like was made without a limit up day?