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Community Manager
marketeye
Posts: 3,133
Registered: ‎05-03-2010
0

Floor Talk September 5

[ Edited ]

I'm asking for your help. Could I ask you to take a few minutes (and I mean just a few) to take our marketing survey. You might have seen the url for this survey in the Successful Farming magazine, in recent months. Successful Farming and Agriculture.com teamed up with some of the leading U.S. ag economists to develop this Benchmark Marketing survey featuring questions related to how U.S. farmers are deciding to approach risk management.

Seriously, it took me longer to type this then it will for you to take the short survey. 

 


Take survey at:  Agriculture.com Benchmark Marketing Survey

 

Give it a go.Trust me, the whole thing is anonymous. We are not sending any follow-up mailings, nothing. Just asking for you all to weigh-in. Results will be published right here in Marketing Talk and in the mid-November Marketing Issue of the Successful Farming magazine.

 

Thanks a lot,

 

Mike

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At the close:

The Sep. corn futures contract closed 5 cents lower at $4.89 per bushel. Dec. corn futures contract settled 8 cents lower at $4.61. The Sep. soybean futures contract finished 25 cents higher at $14.23, new-crop Nov. soybeans ended 15 cents higher at $13.67. Dec. wheat futures settled 6 cents lower at $6.40 per bushel. The Dec. soymeal futures ended $6.70 per short ton higher at $429.40. The Dec. soyoil futures finished $0.40 lower at $43.53


In the outside markets, the NYMEX crude oil is $1.06 per barrel higher, the dollar is higher and the Dow Jones Industrials are 21 points higher.

 

Mike

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At mid-session:

The Sep. corn futures contract is trading 7 cents lower at $4.87 per bushel. Dec. corn futures contract is trading 8 cents lower at $4.61. The Sep. soybean futures contract is trading 16 cents higher at $14.13, new-crop Nov. soybeans are trading 9 cents higher at $13.61. Dec. wheat futures are trading 4 cents lower at $6.42 per bushel. The Dec. soymeal futures are trading $3.20 per short ton higher at $425.90. The Dec. soyoil futures are trading $0.14 lower at $43.79


In the outside markets, the NYMEX crude oil is $0.98 per barrel higher, the dollar is higher and the Dow Jones Industrials are 10 points higher.

 

One analyst sizes up this market like this:  "Beans, I have no idea why they are higher. They were sinking on the wetter weather.  Corn down on reports of active harvest progress in the Delta and Southeast, plus reports of good yields and production there.  Midwest corn still a month away, from what I hear.  Wheat down with corn.  My southern guys are real happy with the corn. So, I think the big production talk down there is probably true.  Not heard a damn thing about beans, no cutting yet.  No Brazil selling, or not too much, anyway.  We will hop chop chop for the next week, I bet."

 

Mike

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At the open:

The Sep. corn futures contract is trading 2 cents lower at $4.91 per bushel. Dec. corn futures contract is trading 4 cents lower at $4.65. The Sep. soybean futures contract is trading 17 cents lower at $13.80, new-crop Nov. soybeans are trading 10 cents lower at $13.42. Dec. wheat futures are trading 4 cents lower at $6.42 per bushel. The Dec. soymeal futures are trading $3.30 per short ton lower at $419.40. The Dec. soyoil futures are trading $0.18 lower at $43.75. 


In the outside markets, the NYMEX crude oil is $0.74 per barrel higher, the dollar is higher and the Dow Jones Industrials are 50 points higher.

 

Mike

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At 7:10am:
Early calls: Corn is seen 1-2 cents lower (old-crop), soybeans 9-10 cents lower (old-crop), and wheat 3-5 cents lower. Meanwhile, new-crop corn 2-4 cents lower and soybeans are seen 4-6 cents lower.

Trackers:
Overnight grain, soybean markets=Trading lower.
Crude Oil=$0.48 per barrel higher.
Dollar=Lower.
Wall Street=Seen trading sideways.

World Markets=Asia/Pacific stocks were higher, Europe stocks higher.

 


More in a minute,

 

Mike

Frequent Contributor
CitiFarmer
Posts: 62
Registered: ‎06-27-2012

Re: Southern U.S. Corn Production

Mike, I did a review of the southeastern U.S. production potential combined with record corn yields by 2 to 8 bushel in the states of AL - record by 5 but 145,000 less acres due to prevented planting, AR-by 2, GA-by 4, KY-by 6, LA-by 4, MS - by 5 but 225,000 less acres due to prevented planting, NC-by 8, SC-by 6, TN-by 7 but with 65,000 acres of prevented planting, and VA-by 4.

 

Adding these changes to the yields used by USDA in the August crop report, only raised total U.S. production by 25 to 50 million bushel.  The prevented planting changes came out of the Farm Service Agency August 15th report and I made no upward adjustment to the corn acres from unreported acres - there may have been a small amount of this but more likely the later acres went to soybeans.

 

This emphasizes the importance of keeping our eye on the key issue which is the heart of the corn belt that has surely lost a great deal of production potential during the month of August in states such as IA, IL, MN, NE along with MO and possibly IN.

 

See what your trader says about this non-scientific review.

 

Thanks

If I knew for sure, I would not be working for a living.
Community Manager
marketeye
Posts: 3,133
Registered: ‎05-03-2010
0

Re: Southern U.S. Corn Production

CitiFarmer,

 

Here you go. Here is the floor trader's response to your thoughts:

 

"The bulls will most likely have to wait until the Oct report, when certified acres will be reconciled and we can see if we lost additional corn acres. The USDA is carrying harvested acres down around 1.5 million below normal. And there are some out there who believe we are down 1-2 million acres on corn and will fear the Oct report.
 
Meanwhile, we hear of good early yields on corn. So, we will see.I have down 1 million acres on my working balance sheet and can take yields down 2 bushels and still can’t get futures much above $5.00. Why? There is too much corn acreage in Brazil from last winter. Both FSU and Brazil grain continues to undercut US exports by 20-30$ a ton. We assume they will cut back 2nd crop corn in lieu of more beans and wheat next year. So, that should help right the ship,eventually. And, we will begin watching Southern hemisphere weather after its official start date on planting is after Sept 15th. However, flat ethanol demand a rationed feed use that are all nagging factors that limit price ideas.
I think the trade is around 152-154 and did not like the FC stone numbers at 156+…sub 150 and you can take corn back to $5.65…," he says.

 

Mike

Frequent Contributor
CitiFarmer
Posts: 62
Registered: ‎06-27-2012
0

Re: Floor Talk September 5

Thank you for the updated information.  The yields being reported, are they from southern IN and southern areas of IL?  These acres are out of the drought area on the August 24th map and should be some of the better ones from IL.

 

Just food for thought. If 60% of the U.S. corn producing area suffered a 3 # drop in Test Weight (say from 58 normal down to 55) that equates to a 1.8% drop in U.S. production from just that. If tip back is 2% greater than normal due to the accelerated maturity brought on by the hot weather in August in that same area, we could see a total of a 3% drop in production vs. last month. That would equate to 415 million bushel which may be offset by say a 50 million bushel increase in the southern areas.  This could drop the U.S. production to the 13.400 billion bushel area.

 

As far as planting acres lost, the Farm Service Agency showed 3.4 million of prevented planting and an adjustment from last year's August FSA figure to the January 2013 report shows we added just over 4.0 million acres to the August 15, 2012 figure which would move this up to just 93 million total acres planted. Because this year was wet and it was difficult for some producers to get the crop planted in time, I am looking for a planted acres figure closer to 94 to 95 million acres or 2.4 to 3.4 million less acres than the 97.4 USDA is currently using.

 

Brazil and the Ukraine are strong competitors in the corn market but we must not forget that the USDA report shows a reduction of 1.250 billion bushel in ending world wheat and corn stocks the last marketing year - even with their increased production.

 

Corn export demand here in the U.S. is currently held in check by the Old Crop price but may soon get much more competitive as the NC is harvested and nations look to rebuild some stocks.

 

Time will tell but thanks for the information and the service you provide.  By the way, how are the twins?  I have twin granddaughters so I know your life is exciting.

 

Take care.

 

 

If I knew for sure, I would not be working for a living.