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Veteran Contributor

Floor Talk April 10 (Report Day)

At 11am:

 

USDA SAYS:

 

In its April Supply/Demand and WASDE Reports, the USDA pegged the U.S. 2017/18 corn ending stocks at 2.182 billion bushels, compared with the average trade estimate of 2.189 billion bushels and its March estimate of 2.127 billion.

 

The U.S. 2017/18 soybean ending stocks were estimated at 550 million bushels vs. the average trade estimate of 574 million and the USDA’s estimate last month of 555 million bushels.

 

For wheat, the USDA pegged the 2017/18 U.S. ending stocks at 1.06 billion bushels vs. the average trade estimate of 1.036 billion bushels and the USDA’s March estimate of 1.034 billion.

 

 

TRADE REACTION

 

--Sal Gilbertie | Teucrium Trading , is not surprised with today’s government data.
“Not much to say about these numbers other than the dramatic reduction in Argentine soy production, but this was widely expected,” Gilbertie says. The Argentine soy production reduction coupled with the healthy rise in soybean crushing in the U.S. did give soy markets some minor price support, but there were certainly no big surprises in today’s report.”

 

Gilbertie adds, “Projected feed reduction across both wheat and corn does seem inconsistent with current large herd and flock sizes, but this is probably a short term statistical aberration.” The focus from this point forward will be weather as planting activity increases over the course of the next several weeks, Gilbertie says.

--Mike North, President of Commodity Risk Management Group, agrees that there were very few surprises in the reports.

 

“For the second quarter in a row, feed estimates were lowered following larger stocks figures.  In total, 50 million bushels were reduced from feed numbers along with a 5 million bushel reduction to industrial use.  This combination elevates the balance sheet to 2.182 billion bushels,” North says.  

 

Offsetting this increase were the reductions in both Argentinian and Brazilian production.  These estimates now stand at 33 and 92MT respectively, a loss of 5.5 MT combined.  

 

“Despite ongoing weather concerns in the Southern Plains, lower wheat feeding adds 30 million bushels to the balance sheet,leaving stocks to use above 50% and providing a significant buffer to potential weather stress going forward,” North says.

 

Since the US produces just 6% of world wheat totals, external balance sheets are much more important, North says.  
“That said, increases in carry-in estimates added to available world supplies.

 

Perhaps the biggest shock was in soybeans, according to North.  “Analysts estimated that soybean stocks would be announced anywhere from 545 to 625 million bushels. The announcement was made at 550 million bushels, just over the lowest estimate. This was a reduction in usage of 5 million bushels - different than the presumption that stocks would grow in the wake of the larger than expected Quarterly Stocks report,” North says.

 

South American production fell in line with estimates.

 

What say you?

 

 

Mike

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At 9:45am:

If you missed it, the USDA announced fresh soybean exports Tuesday. And guess who is still buying, despite the headlines.

 

Private exporters reported to the U.S. Department of Agriculture the following activity:

 

-- Export sales of 120,000 metric tons of soybeans for delivery to Argentina during the 2018/2019 marketing year; and
-- Export sales of 132,000 metric tons of soybeans for delivery to China during the 2018/2019 marketing year; and
-- Export sales of 279,000 metric tons of soybeans for delivery to unknown destinations during the 2017/2018 marketing year.

 

The marketing year for soybeans began Sept. 1.

 

Mike

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At the close:

At the close, the May corn futures finished 1 1/4¢ lower at $3.89 1/4. July futures finished 1 1/4¢ lower at $3.97 3/4. May soybean futures closed 3¢ higher at $10.50.  July soybean futures closed 2 3/4¢ higher at $10.60. May wheat futures closed 1 1/4¢ higher at $4.92. May soy meal futures finished $5.70 per short ton lower at $383.90. January soy oil futures settled 0.33 higher at 31.85¢ per pound.  In the outside markets, the NYMEX crude oil market is $2.02 higher, the U.S. dollar is lower, and the Dow Jones Industrials are 439 points higher.

 

Mike

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At mid-session:

At mid-session, the May corn futures are 1/2¢ higher at $3.91 1/4. July futures are 1/2¢ higher at $3.99 1/2. May soybean futures are 11 1/4¢ higher at $10.58.  July soybean futures are 11 1/4¢ higher at $10.68. May wheat futures are 1 1/2¢ lower at $4.89. May soy meal futures are $0.30 per short ton lower at $389.30. January soy oil futures are 0.13 higher at 31.65¢ per pound.  In the outside markets, the NYMEX crude oil market is $1.83 higher, the U.S. dollar is lower, and the Dow Jones Industrials are 411 points higher.

At 9:00am:

In early trading, the May corn futures are 1¢ lower at $3.89. July futures are 3/4¢ lower at $3.98. May soybean futures are 2 3/4¢ higher at $10.49.  July soybean futures are 2 1/2¢ higher at $10.60. May wheat futures are 1 3/4¢ lower at $4.89. May soy meal futures are $3.60 per short ton lower at $386.00. January soy oil futures are 0.14 higher at 31.66¢ per pound.  In the outside markets, the NYMEX crude oil market is $1.30 higher, the U.S. dollar is lower, and the Dow Jones Industrials are 324 points higher.

 

Mike

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Soybeans were again higher overnight while wheat fell despite strong fundamentals. Beans were up about 3 cents, corn was little changed and wheat was down 3-5 cents overnight. Soybeans are still higher on optimism that the US and China will be able to hammer out a deal before either side imposes tariffs on tens of billions of dollars worth of the other's goods. Investors see the row between the countries as little more than posturing, though they're keeping a close eye on news of any talks. In other news, the WASDE report is due out today and while it's generally a quiet one, analysts are expecting the government to revise its soybean carryout numberExport inspections of corn jumped week-to-week and wheat was slightly higher, but the government examined far fewer soybeans for delivery to overseas buyers than it did a week earlier. Things aren't looking up for the winter wheat crop as the USDA crop progress report showed the worst ratings every for early April. It's going to be extremely dry in the southern Plains where hard-red winter is grown and freeze warnings are in effect for the eastern Midwest where soft-red winter plants are trying to grow. Get all the details in today's 3 Big Things

 

Brent Crude Oil = up 2%.

West Texas Intermediate = up 2%.

Dollar = down 0.3%

Wall Street = U.S. stock markets higher pre-bell.

World Markets = Global stocks mixed overnight.

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