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Veteran Advisor

Floor Talk February 25 (USDA Ag Outlook)

USDA Ag Outlook Conference starts today. Watch for new projections, right here.

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Full story: U.S. Farm Exports Seen Lowest in Six Years

 

Full story: USDA Sees Lowest Corn, Soybean Prices In A Decade

 

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USDA SAYS THURSDAY ON U.S. 2016 PRODUCTION:

Corn= 90 million acres, down 1/2 million from Dec. estimate, up 2.0 million from a year ago.

Soybeans= 82.5 mill. vs. 82.0 earlier estimate

Wheat= 51.0 million, 3.6 million lower than a year ago.

 

Overall, the USDA expects total acreage of 8 major crops to go down in 2016, along with prices. 8 major crops acreage is expected to drop by 1 percent to 249.1 million acres in 2016.

 

 

What do you think about these estimates? Are they too low, too high, way off?

 

Mike

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At the close:

At the close, the May corn futures closed 4 cents lower at $3.60 1/2. May soybean futures settled 6 3/4 cents lower at $8.65 1/2. 
May wheat futures finished 2 3/4 cents higher at $4.54. May soymeal futures settled $1.90 lower per short ton at $262.70. May soyoil futures closed $0.28 lower at $30.91.  
In the outside markets, the Brent Crude oil market is $0.71 higher per barrel, the U.S. dollar is lower, and the Dow Jones Industrials are 140 higher.

 

Peter Meyer, PIRA Energy senior grain analyst, says that the markets are starving for new data.  
“Today’s acreage estimates from the USDA’s Outlook Forum were pretty much in line with expectations. So, the lack of anything new is a negative given the current market structure,” Meyer says.
The 172.5 million combined acres for corn and soy seemed reasonable, he days.
“But, it does not take into consideration the very low 51 million acres in wheat.  Somehow, a reconciliation of the wheat acreage, as it pertains to corn and soybean acreage, must be forthcoming at some point.”  
What the USDA did today with their acreage numbers was assure that the S&D’s released tomorrow will not have carry-outs above 2 billion in corn, 1 billion in wheat, and 500 million in soybeans, Meyer says.  I
“It did little more than that. The numbers also confirm in our opinion that a so-called V recovery in pricing is far-fetched,” Meyer says.

 

Mike

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At 10:30am:

Corn trades 4¢ lower, soybeans and wheat are both lower too.

 

Mike

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At mid-session:

At mid-session, the May corn futures are trading 3 1/2 cents lower at $3.61. May soybean futures are 3 cents lower at $8.69. 
May wheat futures are trading 2 cents higher at $4.53. May soymeal futures are $0.50 per short ton lower at $264.10. May soyoil futures are trading $0.27 lower at $30.92.  
In the outside markets, the Brent Crude oil market is $0.94 lower per barrel, the U.S. dollar is lower, and the Dow Jones Industrials are 60 higher.

 

Mike

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At the open:

At the open, the May corn futures are trading 1/2 of a cent higher at $3.64. May soybean futures are 2 1/2 cents higher at $8.74. 
May wheat futures are trading 4 cents higher at $4.55. May soymeal futures are unchanged at $266.20. May soyoil futures are trading $0.07 higher at $31.26.  
In the outside markets, the Brent Crude oil market is $0.30 lower per barrel, the U.S. dollar is higher, and the Dow Jones Industrials are 32 higher.

 

Mike

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At 7:45am:

International Grains Council raises world corn output for 2015/16.

Corn production= Up 10 million tonnes to 969 million tons.
If realized, world grain stocks would hit their highest marketing year-end level in 30 years.

World wheat production=  732 million tonnes, up 1 million tonnes from last month's estimate

 

What do you say about this?

 

Mike

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At 7:40am:

USDA released its weekly Export Sales Report Thursday and corn and wheat beat.

 

Wheat= 486,200 mt vs. the trade's expectations of between 200,000-350,000 metric tons.

Corn= 1.06 million metric tons vs. the trade's expectations of between 750,000-1,200,000 metric tons.

Soybeans= 328,600 mt vs. the trade's expectations of  250,000-750,000 mt.

Soybean meal= 172,600 mt vs. the trade's expectations of 100,000-250,000 metric tons.

 

Mike

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At 6:15 am:

 

Early calls:

Wheat 3-5 cents higher, soybeans 2-4 higher and corn 1-2 higher. 

 

Trackers:

Overnight wheat higher, soybeans and corn higher. 

 

Brent Crude Oil = $0.30 lower per barrel.

Dollar = Lower.

Wall Street = Stock futures seen stronger, as traders eye oil and data reports. 
World Markets = Global stocks rise.

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8 Replies
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Veteran Advisor

Re: Floor Talk February 25 (USDA Ag Outlook)

Wheat is flying off of the shelves:

Egypt's GASC, the world's biggest state buyer, is tendering for late March/April wheat. Saudi Arabia seeks 770,000 mt of wheat. Tunisia is buying 50,000 mt's and Taiwan 101,000 mt's of US wheat. And Indonesia wants 200,000 mt's of corn.
 
Good demand, after wheat hit a 5 1/2 year low this week.
 
Mike
 

 

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Senior Contributor

Re: Floor Talk February 25 (USDA Ag Outlook)

Hi Mike, is everyone else out of wheat? I thought we were the highest cost producer?

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Veteran Advisor

Re: Floor Talk February 25 (USDA Ag Outlook)

Plenty of wheat around the world. But, the grain has gotten so cheap, feeders and others are choosing it over corn. U.S. is facing a problem, though, with wheat quality. The wheat used for cookies and crackers has a fungus. The world buyers know it and that could curb demand.

 

Mike

 

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Veteran Advisor

Re: Floor Talk February 25 (USDA Ag Outlook)

Ouch! Egypt buys 300,000 tons of wheat Thursday and none of it is from the U.S.

 

GASC bought:

--60,000 tons from France

--120,000 tons from Romania

--60,000 tons from Argentina

--60,000 tons from Ukraine

 

Mike

 

 

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Senior Contributor

Re: Floor Talk February 25 (USDA Ag Outlook)

Mike, why does the radio keep saying carn acres up 2 million and you said down half million?

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Veteran Contributor

Re: Floor Talk February 25 (USDA Ag Outlook)

It is up 2 million from last year but down half a million from the last guess from the USDA.

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Senior Contributor

Re: Floor Talk February 25 (USDA Ag Outlook)

Ok, that makes more sense.

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Veteran Contributor

Re: Floor Talk February 25 (USDA Ag Outlook)

So lots of wheat just non you can eat or will pass Egypts standards if you cant eat it it is not wheat it is feed and should not be counted as carry over all this does is keep the price down

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