05-09-2013 06:41 AM - edited 05-09-2013 03:29 PM
After the close:
Highlights of the CME Group's Ask the Analysts pre-report press briefing Thursday:
--U.S. corn acreage numbers are not expected to see a big change in Friday's Report. Due to weather concerns, the USDA is expected to tweak lower the corn yield estimates 2-3 bushels per acre. Some analysts see the yield pegged at 160.2 bu./acre, others 161.6 vs. the USDA's previous 163.3.
--U.S. corn exports are expected to fall significantly, mainly due to Brazil's big corn crop.
--U.S. soybean crush number is expected to be big.
--Wheat global ending stocks could be bigger than expected. Why? Black Sea countries could see a big bump in wheat production for next year. Ending stocks could be pegged at a 10-year high.
--Though the U.S. wheat crop is limping along, a normally bullish factor, oversea production will get more attention from the market. Market could react bearish.
--Maybe not in tomorrow's report, but one analyst sees the U.S. soybean plantings at 78.0 million acres and a longterm carryout at 385 million bushels.
--Delta farmers are switching out of corn to cotton.
--On the subject of corn demand returning to the U.S., it could be a slow return, analysts say. Other countries have picked up production, they are looking and finding new trade routes, using corn for country credit. While some countries can't start an export program from scratch, they are finding ways to take marketshare. But, while there is likely to be a lower figure for corn demand next year, world consumption will pick-up. Some countries will re-build government supplies eventually, on these low prices.
Overall, there is just too much competition worldwide, much like the wheat market. There are a lot more countries producing corn. They see the need to open up new sources of supply.
One analyst doesn't see these corn developing countries maintaining export competition. Brazil's safrinha crop is exported and is grown in risky conditions. All of that second crop was produced at a loss, due to low prices. So, there is an expectation that more soybeans will be planted next year, due to lower prices. Will they grow more safrinha acres, put on more fertilizer, etc. when they can't turn a profit?
--Growing corn in Ukraine is like growing in Saskatchewan, it doesn't grow very well. These countries don't have the price infrastructure like the U.S. farmers.
I hope this helps,
At the close:
The July futures corn contract is 16 cents higher at $6.48. New-crop Dec. futures finished 9 cents higher at $5.41. The July soybean futures contract ended 18 cents higher at $14.08, new-crop Nov. soybeans finished 4 cents higher at $12.19. July wheat futures finished 17 cents higher at $7.23 per bushel. The July soymeal futures closed $5.60per short ton higher at $413.20. The July soyoil futures ended $0.40 higher at $49.22.
In the outside markets, the NYMEX crude oil is $0.40per barrel lower, the dollar is higher and the Dow Jones Industrials are 7 points lower.
The July futures corn contract is 9 cents higher at $6.41. New-crop Dec. futures is trading 5 cents higher at $5.37. The July soybean futures contract is trading 14 cents higher at $14.05, new-crop Nov. soybeans are trading 2 cents higher at $12.16. July wheat futures are trading 15 cents higher at $7.21 per bushel. The July soymeal futures are trading $2.80 per short ton higher at $410.40. The July soyoil futures are trading $0.42 higher at $49.24.
In the outside markets, the NYMEX crude oil is $1.05 per barrel lower, the dollar is higher and the Dow Jones Industrials are 4 points lower.
One analyst says that tightness in old crop soybean supplies is what is driving soybean prices higher, especially the May contract with no deliveries yet. U.S. soybean prices keep going up and South American prices keep going down. At some point, SAM beans may be imported into the US and that will finally push US prices lower. But that and perhaps only that will finally push the soybeans lower.
It might be that the expectations that planting progress will somehow "catch up" to normal in corn is a misnomer. But for now, that seems to be what the market beleives. Not sure I am convinced yet.
In the meantime, KC HRW wheat crop is going backwards very quickly - this might be the most bullish market there is right now. We are almost assured of having a below average and maybe well below average HRW wheat crop. meanwhile, the late development of winter wheat might mean less double crop soybeans - also supporting soybeans.
At the open:
The July futures corn contract opened 1 cent higher at $6.34. New-crop Dec. futures opened 1 cent higher at $5.34. The July soybean futures contract opened 13 cents higher at $14.04, new-crop Nov. soybeans opened 4 cents higher at $12.18. July wheat futures opened 1 cent lower at $7.05 per bushel. The July soymeal futures opened $3.10 per short ton higher at $410.70. The July soyoil futures opened $0.61 higher at $49.43.
In the outside markets, the NYMEX crude oil is $0.78 per barrel lower, the dollar is higher and the Dow Jones Industrials are 3 points lower.
USDA announced Thursday that China bought 110,000 mt of U.S. soybeans for 2013-14 delivery.
USDA corn export totals miss expectations, soybeans and wheat within.
Corn= 285,700 mt vs. the trade's expectations of between 400,000-800,000 metric tons
Soybeans = 585,000 mt vs. the trade's expectations of between 400,000-900,000 mt
Wheat = 465,500 mt vs. the trade's expectations of between 400,000-600,000 mt
The USDA Weekly Export Sales Report will be released at 7:30am CT. Here are some pre-report estimates:
Corn= 400,000-800,000 metric tons
Soybeans = 400,000-900,000 mt
Wheat = 400,000-600,000 mt
Soybean meal 75,000-200,000 mt
Early calls: Corn is seen 1-2 cents lower, soybeans 2-4 cents higher, and wheat 1-2 cents lower.
Overnight grain, soybean markets=Trading mostly lower.
Crude Oil=$0.36 per barrel lower.
Wall Street=Seen opening flat, ahead of the U.S. Jobs Report.
World=Asia/Pacific stocks were mixed and Europe's stocks are mixed.
FWIW: It's been raining, overnight, in Iowa.
More in a minute,
05-09-2013 06:44 AM - edited 05-09-2013 06:47 AM
Overnight, the western Corn Belt weather radar looked like a little child's coloring book. Here's a look at it for the 6:00am hour. If you could see this map in motion, it would show the rain moving eastward:
The market is still confident the farmers will get the corn planted, with lower prices expected today. Are you as confident?
05-09-2013 06:44 AM
1.7 inches last night. Yesterday was the first day we could spread manure in over a week. Now at least 5 dasy till we can go. IF there is no more rain. Hay seems to be coming out of the beating it took from the snow.
05-09-2013 06:44 AM
Mike, we've been getting small hit & miss showers here in Kansas as well. We need and encourage them however. Anyway you can hit the reverse button and send them back our direction? I'll even pay for the shipping if that helps. LOL
05-09-2013 06:54 AM
Haven't heard of any. Our hay was in such bad shape after the last 2 years heat and drought, I imagine it will take a while to get the crop healthy again. Our 3 or 4 late freezes didn't do us any favors either.
05-09-2013 06:59 AM
I've seen lots of truck loads up & down the road, but I would say about 90% of it is CRP, corn stalk and milo stubs. Not something I would call high quality. You asking about prairie hay or alfalfa? Doesn't make any difference I guess, we don't have an abundance of anything anyhow.