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Veteran Advisor

Floor Talk, March 31, 2020 (Report Day)

At the close:

At the close, the May corn futures finished 1/2¢ lower at $3.40 3/4. July corn futures closed 1 1/2¢ lower at $3.46.

May soybean futures settled 3 3/4¢ higher at $8.86. July soybean futures ended 3¢ higher at $8.81.

May wheat futures closed 3/4¢ lower at $5.68 3/4.


May soymeal futures ended $4.00 per short ton lower at $321.50.

 May soy oil futures closed $0.09 cents higher at 28.74¢ per pound.



In the outside markets, the NYMEX crude oil market is $0.32 per barrel higher at a $21.02, the U.S. dollar is higher, and the Dow Jones Industrials are 390 points lower.

Mike

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USDA SAYS:

The U.S. farmers will plant more corn and soybeans than last year, according to the USDA.

Perhaps a bigger surprise in today's USDA's reports came in the Quarterly Grain Stocks Report as the government estimated smaller U.S. corn and soybean stocks.

At midsession, the May corn futures are 3 1/4¢ lower at $3.38. July corn futures are 4¢ lower at $3.43.

May soybean futures are 2 3/4¢ higher at $8.85 1/4. July soybean futures are 1 1/4¢ higher at $8.88 1/4.

May wheat futures are 2 1/2¢ lower at $5.67 3/4.


May soymeal futures are $2.80 per short ton lower at $322.70.

 May soy oil futures are $0.04 cents higher at 26.91¢ per pound.



In the outside markets, the NYMEX crude oil market is $0.39 per barrel higher at a $21.02, the U.S. dollar is higher, and the Dow Jones Industrials are 15 points higher.

USDA Acreage

In its report, the USDA pegged the U.S. 2020 corn acreage at 97.0 million vs. the trade's expectations of 94.32 million, about what the USDA forecasted in its February Ag Outlook Forum, and way above the USDA’s final estimate of acreage in 2019 at 89.7 million.

For soybeans, the USDA sees the U.S. 2020 acreage at 83.5 million vs. the trade's expectation of 84.8 million and the USDA’s February Ag Outlook estimate of 85.0 million and the USDA’s final estimate in 2019 at 76.1 million.

For wheat, the USDA pegged the U.S. 2020 spring wheat acres at  12.6 million, compared with the trade's expectation of 13.0 million.

Quarterly Grain Stocks

On Tuesday, the USDA released updated estimates on U.S. Quarterly Grain Stocks, as of March 1.
For corn, U.S. March 1 stocks were estimated at 7.95 billion bushels vs. the trade's expectation of 8.12 billion bushels.

For soybeans, U.S. stocks, as of March 1, were pegged at 2.25 billion bushels vs. the trade's expectations of 2.24 billion.

The U.S. wheat stocks were estimated at 1.14 billion bushels vs. the trade's expectations of 1.43 billion.

Trade Response

Sal Gilbertie, Teucrium Trading, says that today’s USDA reports are being viewed with some skepticism, which is not surprising given how fast fundamentals have changes since the report was compiled.
“Corn acres are viewed as too high, wheat acres as too low, and the corn disappearance numbers, which at first glance seem slightly supportive, can’t be relied upon at all given the current state of ethanol margins. Markets clearly expect wheat acres to increase to at least last year’s levels, and beans could surprise and take far more acres from corn than most are expecting right now,” Gilbertie says.

 

What say you?

 

Mike

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USDA REPORT AT 11:00am CT

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At 8:45am:

In early trading, the May corn futures are 1/4¢ lower at $3.41. July corn futures are 1/2¢ lower at $3.47.

May soybean futures are 3 3/4¢ lower at $8.78 1/4. July soybean futures are 3 1/4¢ higher at $8.83 1/4.

May wheat futures are 1¢ lower at $5.68 3/4.

May soymeal futures are $1.30 per short ton lower at $324.50.

May soy oil futures are $0.01 cents higher at 26.88¢ per pound.

In the outside markets, the NYMEX crude oil market is $0.93 per barrel higher at a $21.02, the U.S. dollar is higher, and the Dow Jones Industrials are 93 points lower.


On Tuesday, private exporters reported to the USDA export sales of 113,000 metric tons of corn for delivery to Japan during the 2019/2020 marketing year

The marketing year for corn began Sept. 1.

Al Kluis, Kluis Advisors, says that investors will be carefully watching the corn feed usage projection in the big USDA reports at 11 AM CT.

"We want to see if the USDA projection in the December 2019 Grain Stocks report (that first quarter feed usage had increased by 19%) is correct. The USDA may correct that error, and take feed usage lower in this month’s report. That may result in a corn stocks estimate that is larger than the trade is expecting," Kluis told customers in a daily note.

Kluis added, "With the ethanol shut downs and reduction in DDG supplies, soybean meal and corn usage are larger than expected. However, these increases in demand (and reductions in stocks) will not show up until the June 30 Grain Stocks report."

Mike

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5 Replies
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Veteran Contributor

Re: Floor Talk, March 31, 2020 (Report Day)

Farmers can't make it on these prices!!!

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Senior Advisor

RE: Any estimates yet as to how much dislocation there will be between corn & soybean consumption?

It will be a couple more weeks before we'll get enough numbers from EIA to estimate the reduction in ethanol production and corn grind for ethanol.  Does the USDA keep track of & publish weekly DDG production anywhere?  USDA soybean grind numbers usually lag far behind so does Reuter/Thompson still publish those numbers and does anyone have access to them.

  There has already been a dramatic counter-seasonal reduction in finished gasoline supplied but it'll take a couple more weeks to see just how far production falls and from that, we can estimate ethanol demand.

  It may be that while the price of corn & ethanol falls off the cliff, the actual consumption of ethanol might serve to keep corn grind going through the summer, admittedly at a lower level and keep stocks within a reasonable level.

  PS: Post report, my opinion, corn acres are going to come down, bean acres will go up.  Corn & bean acres could actually end up being about equal.

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Honored Advisor

Re: RE: Any estimates yet as to how much dislocation there will be between corn & soybean consu

We need to announce layoffs at usda.   There is no viable reason to waist the time guessing on the unknown...

Honored Advisor

Re: RE: Any estimates yet as to how much dislocation there will be between corn & soybean consu

sw.....this is an election year....hundreds are being hired across all branches of national, state, and local governments, regardless of party in charge btw....

Layoffs....hilarious.

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Honored Advisor

Re: RE: Any estimates yet as to how much dislocation there will be between corn & soybean consu

killjoy    Smiley Happy

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