05-08-2013 06:34 AM - edited 05-08-2013 01:49 PM
At the close:
The July futures corn contract settled 7 cents lower at $6.33. New-crop Dec. corn futures finished 7 cents lower at $5.32. The July soybean futures contract ended 8 cents higher at $13.90, new-crop Nov. soybeans settled 1 cent lower at $12.14. July wheat futures closed 3 cents lower at $7.06 per bushel. The July soymeal futures finished $4.30per short ton higher at $407.60. The July soyoil futures ended $0.32 lower at $48.82.
In the outside markets, the NYMEX crude oil is $0.88 per barrel higher, the dollar is lower and the Dow Jones Industrials are 5 points higher.
The July futures corn contract is trading 5 cents lower at $6.34. New-crop Dec. futures is trading 7 cents lower at $5.31. The July soybean futures contract is trading 8 cents higher at $13.90, new-crop Nov. soybeans are trading 4 cents lowerat $12.10. July wheat futures are trading 6 cents lower at $7.03 per bushel. The July soymeal futures are trading $1.90 per short ton higher at $405.20. The July soyoil futures are trading $0.12 higher at $49.26.
In the outside markets, the NYMEX crude oil is $0.56 per barrel higher, the dollar is lower and the Dow Jones Industrials are 15 points higher.
One analyst says, "We believe the market is forward pricing a rebound in corn planting pace. There has been a lot of fear premium built into December corn. Early May is not too late to get it planted before yields really suffer. Plus we have the first WASDE 2013 estimates coming out this Friday. Traditionally the USDA doesn't change their yield estimate very much from their February Ag Outlook which this year was at 163.6. Using a yield of 160 or more for this report means carryout will still be rather high on the estimates. My guess is the bulls don't want to carry their risk into Friday's report. Soybean support is coming from the May contract in delivery as well as from the unwinding of the corn-bean ratio ahead of the report."
The Energy Information Agency reported Wednesday that ethanol production dropped this past week. Here's a full report:
According to EIA data, ethanol production averaged 843,000 barrels per day (b/d) — or 35.41 million gallons daily. That is down 14,000 b/d from the week before. The four-week average for ethanol production stood at 846,000 b/d for an annualized rate of 12.97 billion gallons.
Stocks of ethanol stood at 16.8 million barrels. That is a 1.1% decrease from last week and the lowest in more than 18 months.
Imports of ethanol showed zero b/d, unchanged from last week, according to the Renewable Fuels Association press release.
U.S. corn is expected to get planted. So, the corn market is dropping Wednesday. And, more corn means less beans. So, the soybean market is higher. That' it, in a nutshell.
At the open:
The July futures corn contract opened 2 cents lower at $6.38. New-crop Dec. futures opened 5 cents lower at $5.34. The July soybean futures contract opened 5 cents higher at $13.87, new-crop Nov. soybeans opened 1 cents higher at $12.15. July wheat futures opened 3 cents lower at $7.06 per bushel. The July soymeal futures opened $2.90 per short ton higher at $406.20. The July soyoil futures opened $0.03 higher at $49.17.
In the outside markets, the NYMEX crude oil is $0.17 per barrel higher, the dollar is lower and the Dow Jones Industrials are 30 points lower.
--USDA announces Wednesday that China bought 115,000 tons of U.S. soybeans for 2013-14 delivery.
Jeff Coleman, the Trean Group analyst and CME Group floor trader, woke up this morning and saw the markets this way. In his own words:
"The grain markets were lightly traded overnight as corn and wheat futures both traded around unchanged and soybean futures showed some life trading up 6-7 cents on the session. July corn futures opened a penny lower, traded as much as 3 cents higher and 3 cents lower before coming back to unchanged heading into the close of the night session. July wheat futures acted in much the same fashion opening unchanged also trading up and down 3 cents on the session and coming back to unchanged this morning. July soybean futures also opened near unchanged before trading almost a dime higher and maintained decent gains trading 7 cents higher into the morning. Concerns about tight bean supplies are forcing traders to keep a nervous eye on the old crop bean markets and we always have the shipping problems in South America which some experts say is getting sorted out. If the congestion at Brazilian ports continues to ease, China could begin to import from Brazil and take US beans out of their yearly import plans.
After yesterday’s record setting performance which saw the DJIA close above 15,000 for the first time, DJ futures are little changed this morning and the S&P 500 index is off slightly trading 1.50 lower. This is a very light week of economic data releases and the first quarter earnings season is winding down so market activity is likely to remain calm for the rest of this week," he says.
--Japan seeks 320,000 tons of feed wheat, barley in a May tender.
--S. Korea buys 69,000 tons of South American corn Wednesday.
--Agroconsult, a Brazilian analyst firm, estimated Tuesday that Brazil's 2013/14 soybean plantings would expand over 4%, to 29.1 million hectares (71.9 mln acres). If a yield, similar to this season’s 2.957 tonnes per hectare (44 bpa), is realized that would result in a potential production of 86 MMT, compared to 81.9 MMT this season..
Early calls: Corn is seen 1-2cents higher to 1-2 cents lower, soybeans 7-9 cents higher, and wheat 1-2 cents higher.
Overnight grain, soybean markets=Trading higher.
Crude Oil=$0.04 per barrel lower.
Wall Street=Seen opening higher, as the stock market sets new records. Plus, China reported a trade surplus for April, boosting confidence in its economy.
World=Asia/Pacific stocks were higher and Europe's stocks are higher.
More in a minute,
05-08-2013 06:44 AM - edited 05-08-2013 07:51 AM
Interesting Read: Brazil's 'safrinha' corn crop becomes 'safrona'. Here's an update from Brazil's corn crops, one already harvested and one to be harvested in about a month.
Photos by Jonathan Campos/Gazeta do Povo
WrittenBy Giovani Ferreira
Gazeta do Povo Agribusiness Manager
Brazilian farmers placed their bets high and are about to retire from field activities after yet another record winter corn production of 40.58 million tonnes. This estimate is from the Brazil Corn Expedition, a project conceived by Agronegócio Gazeta do Povo, INTL FCStone consultancy and the Mato Grosso Institute of Agricultural Economics (Imea) who toured the five major producing states of the grain's second crop in recent weeks. The grain's harvest, which should begin next month, exceeds for the second year in a row the volume produced in the summer, making the term 'safrinha' (or the "little crop" in Portuguese) a thing of the past. In the field, the winter harvest has earned a more appropriate nickname – ‘safrona’, meaning the "big crop".
During a 7,000 km trip through Mato Grosso, Paraná, Mato Grosso do Sul, Goiás and São Paulo technicians and journalists confirmed optimistic expectations for production. And it's no surprise. Following gains from last winter, farmers put into practice a recipe for high productivity. Soils were well fertilized and most used high-tech seeds. To top it off, the climate was almost as perfect as in 2012.
The few areas needing rain to reach yields equal to or higher than last year, found salvation. In Paraná - the second largest domestic producer of the crop - it rained last weekend in much of the dry areas. "I still have not confirmed with my father, but I think the rain was around 15 mm. It came at a good time. Now, we hope that the colder days won't cause us any damage", said agronomy student Pedro Versari, who works with his father David on a property of 600 hectares planted with winter corn. They believe they will be able to achieve the same average productivity as last year, equivalent to more than 82 bags per hectare.
On the other hand, the projected crop is a red flag for Brazil, which must confront the challenge of increasing its exports in a year of stable domestic consumption, the recovery of the largest global producers and suppliers (United States), and weak advanced sales. Sales of the winter grain continue at a pace 50% below the same time last year, the Corn Expedition found.
Altogether, Brazil will dump 76.88 million tonnes of corn into the market, considering summer (36.3 million/t) and winter production. With domestic demand at 52 million tonnes, the country is expected to end the year with more than 16 million tonnes in stock, the largest in history. To make matters worse, the delay in soybean shipments since the beginning of the year will also likely influence the market for the cereal. "Corn will only likely begin to be shipped out of the country in August and September, which is very worrisome, because it will be at the same time that the United States is to begin its harvest," said Otávio Celidonio, superintendent of Imea.
The future scenario has already started coming true. According to a survey conducted by the consulting firm FCStone, "from February to January [the National Supply Company's crop year] exports in the 2012/13 crop accumulated 4.5 million tonnes, representing 30% of the 15 million estimated for the entire cycle." Last week, the performance of corn futures prices was marked by fears over delays in planting, which served as a factor of support, according to a weekly report from the consultancy.
The document emphasizes that the cold and wet weather in the United States' Corn Belt throughout the week complicated planting and reinforced expectations of greater potential to transfer area from corn to soybeans if the delay persists. 80% of the crop is expected to be planted after May 15, demonstrating the record delay, the report shows.
05-08-2013 07:32 AM
One more day of sun and we can be back in the field, oh wait the rain will be here by then! At least the drought is over for now.
Thanks for the story Marketeye
05-08-2013 07:44 AM
Nah. When corn gets back under $4 that will put a cabash to it.
Wow look at that red soil. What type soil is that?
Would look pretty cool running red equipment with that red soil as a background.
05-08-2013 07:55 AM - edited 05-08-2013 08:03 AM
Yeah, thanks. You'll see the information trickle out of some analyst's wires today. But, the full story and photos are sent to us for you guys and gals in Marketing Talk. By the way, we will have more photos and infographics on Brazil's corn production coming later today, on the site. I'll pass along the link to the full story.