Floor Talk September 15

[marketeye]

USDA Weekly Crop Progress Report Monday:

For corn, the USDA rated the crop as 74% good/excellent, equal to a week ago and ahead of the 63% five-year average. The report shows that 4% of the crop has been harvested, with 2% completed in Illinois and 12% in Missouri.
Overall, 82% of U.S. corn is in the dent stage, behind an 85% five-year average. Only 27% of the U.S. corn total production is rated as mature, behind a 39% five-year average.
Al Kluis, Kluis Commodities trader, says today's report is negative for prices tonight. "I expect corn to start out 1 to 2 cents lower tonight. For soybeans, today's report is likely to take prices 2 to 3 cents lower tonight."
In its weekly report, the USDA pegged the U.S. soybean crop as 72% good/excellent, equal to a week ago and significantly ahead of a 50% five-year average.
The USDA reported that 74% of the U.S. Spring Wheat harvest is complete, compared to an 86% five-year average. Meanwhile, winter wheat planting is 12% complete, vs. the 11% five-year average.

Farmers, start your engines! This week's weather looks harvest-friendly, according to Freese-Notis Weather Inc.

Mother Nature Rolls Out Harvest Welcome Mat

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At the close:

The December corn futures finished 4 1/2 cents higher at $3.43.

November soybean futures closed 4 1/2 cents higher at $9.89.

December wheat futures ended 1 3/4 cents lower at $5.00.

For Dec. soybean meal futures, the contract settled $0.90 per short ton lower at $327.00; Dec. soybean oil futures closed $0.70 higher at $33.47.

In the outside markets, the crude oil is trading $0.48 per barrel higher, the dollar is higher, and the Dow Jones Industrials are 48 points higher.

Mike

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At mid-session:

The December corn futures are trading 1 1/2 cents higher at $3.40.

November soybean futures are trading 2 3/4 cents higher at $9.88.

December wheat futures are 2 1/2 cents lower at $5.00.

For Dec. soybean meal futures, the contract traded $0.10 per short ton higher at $328.00; Dec. soybean oil futures traded $0.26 higher at $33.03.

In the outside markets, the crude oil is trading $0.22 per barrel higher, the dollar is higher, and the Dow Jones Industrials are 9 points higher.

Jack Scoville, PRICE Futures Group vice-president, says it has been kind of a strange trading day. 

"No real reason for the grains to rally today that I can see.  Damage was minimal, the NOPA crush was below expectations, and crop condition ratings expected to see slight deterioration tonight which is as much a seasonal thing as anything.  Part of this is sell the rumor and buy the fact after yesterday, and part of it seems to be related to ideas that FSA could show smaller certified acres in its reports tomorrow.  Not sure I care about the FSA coming in light, when I drove around the plantings seemed to be fencepost to fencepost, and either way even with a few less acres we got big crops out there.  I think after the price action late last week we are having a little short covering rally and that the producer and or the spec can probably sell this rally, but we will find out soon I guess," he says.

Mike

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At the open:

The December corn futures are trading 1/4 of a cent lower at $3.38.

November soybean futures are trading 1 3/4 cents lower at $9.83.

December wheat futures are 2 1/2 cents lower at $5.00.

For Dec. soybean meal futures, the contract traded $0.10 per short ton lower at $327.80; Dec. soybean oil futures traded $0.10 lower at $32.67.

In the outside markets, the crude oil dropped $0.60 per barrel lower, the dollar is higher, and the Dow Jones Industrials are 22 points lower.

Mike

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At 7:55am:

Early calls: Corn is 2-4 cents lower, soybeans 4-6 cents lower, and wheat 5-7 cents lower.

Trackers:
Overnight grain, soybean markets = Trading lower.
Brent Crude Oil = $0.52 per barrel lower.
Dollar = Higher
Wall Street = Seen lower.
World Markets = Europe stocks were mostly higher, Asia/Pacific stocks were mixed.

More in a minute,

Mike

[roarintiger1]

I think the guys that got crops frosted would not call it a "welcome mat"......

[marketeye]

Darrel Good, Agricultural Economist, University of Illinois wants folks to know that tomorrow's Farm Service Agency Planted Acreage update should not be confused with what National Agricultural Statistics Service (NASS) harvest acreage will look like. In his own words:

"The USDA’s Crop Production report to be released by the National Agricultural Statistics Service (NASS) on October 10 may contain revised estimates of planted and harvested acreage of corn and soybeans. Revisions would be based on information revealed in the October Agricultural and Objective Yield surveys as well as other administrative data. Other administrative data consist primarily of certified acreage estimates received by the Farm Service Agency (FSA). The Farm Service Agency requires that producers participating in several federal commodity programs submit an annual report regarding all cropland use on their farms. Acreage is reported in three categories: planted, prevented planted, and failed

FSA released the first report of planted acreage of corn and soybeans in 2014 based on producer reports on August 15. That report will be updated in a release on September 16 based on more complete reporting by producers. That report may provide some indication of possible revisions in planted and harvested acreage estimates in the October 10 or subsequent Crop Production reports. While the September report by FSA is not the final report of the year, the estimates of planted acreage in the September report were very close to the final estimates in each of the previous three years. For corn, the September planted acreage estimate ranged from 98.9 to 99.8 percent and averaged 99.5 percent of the final estimate. For soybeans, the September estimate ranged from 99.2 to 99.8 percent and averaged 99.6 percent of the final estimate. There is no compelling reason to expect that those relationships will deviate much from average this year. The October estimate (to be released on October 15 this year) averaged 99.9 percent of the final estimate for both corn and soybeans over the previous three years.

Importantly, there has been a consistent relationship between the final FSA estimate of planted acreage of corn and soybeans reported by producers and the final NASS estimate of planted acreage. The NASS estimate of planted acreage always exceeds the FSA estimate since not all producers participate in the commodity programs that require reporting of acreage. For the seven years from 2007 through 2013, the difference between the two estimates for corn ranged from 2.381million (2007) to 3.085 million acres (2012) and averaged 2.779 million acres. FSA planted acreage estimates ranged from 96.7 percent (2011) to 97.5 percent (2007) of the NASS estimates. The seven year average was 97 percent. Anticipating revisions in the NASS estimate of planted acreage based on the September FSA planted acreage estimate will be a two-step process. First, the FSA estimate should be divided by 0.995 since the September estimate in the previous three years has average 99.5 percent of the final FSA estimate. Second, that result should be divided by 0.97 since the FSA final estimate has averaged 97 percent of the NASS final estimate. Alternatively, the September FSA estimate can be divided by 0.965 (0.995 X 0.97 =0 .965). Using those past average relationships then, no change in the current NASS estimate of 91.641 million acres of planted acreage of corn would be expected if the September FSA estimate is near 88.434 million acres. The August estimate, based on incomplete reporting by producers, was 83.322 million acres.

For the seven years from 2007 through 2013, the difference between the final FSA and NASS estimates of planted acreage of soybeans ranged from 917,000 (2008) to 1.319 million acres (2012) and averaged 1.249 million acres. FSA planted acreage estimates ranged from 97.1 percent (2007) to 98.8 percent (2008) of the NASS estimates. The seven year average was 98.3 percent. The expected magnitude of the final NASS estimate of soybean planted acreage this year, then, can be derived by dividing the September FSA planted acreage estimate by 0.979 (0.996 X 0.983 = 0.979). Using average relationships for the previous three years, no change in the current NASS estimate of 84.839 million acres of planted acreage of soybeans would be expected if the September FSA estimate is near 83.057 million acres. The August estimate, based on incomplete reporting by producers, was 79.249 million acres.

While the September FSA report of planted acreage may provide some indication of the final NASS estimate, it will not provide any guidance on harvested acreage. Estimates of harvested acreage will be based on the differences between planted and harvested acreage estimates in the NASS September Crop Production report—7.802 million for corn and 781,000 for soybeans.

The forecasts of planted and harvest acreage of corn and soybeans derived from the FSA September report of planted acreage will be important in refining expectations for changes in production forecasts. There is a general expectation that the NASS October average yield forecasts will be larger than the September forecasts. Changes in acreage expectations, then, will influence the expected net change in production forecasts."

What do you think?

[OJG]

Agree, Large part of Minnesota into Iowa had frost damage beans still grass green for the most part yield damage approximately 5 to 10 bushels. I know I was looking at mine at 6:30 am to see how "frosty" they were. Many guys I talked with were in denial, seeing damage showing up now in most fields

[fbf2574789]

My opion the beans got it real good. Corn also got it.

[Shaggy98]

fbf, what territory are you from?

I've got some in-law relation in NW Iowa but I haven't talked to them to see if the first touched them or not.

[fbf2574789]

South Central MN

[aaron-neill]

Are all traders that arrogant or just  Scoville?  Good thing he can drive around and see that all the acres are planted vs. USDA data!

[marketeye]

If you missed it this morning, the USDA reported fresh exports of corn and soybeans.

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

• Export sales of 120,000 metric tons of corn to Mexico during the 2015/2016 marketing year; and
• Export sales of 118,000 metric tons of soybeans to China during the 2014/2015 marketing year.

The marketing year for corn and soybeans began Sept. 1.

[sw363535]

I I I I , I did not miss it this morning.  Sorry I was too busy to prompt you on it.

I am slacking off.

"Only 27% of the U.S. corn total production is rated as mature, behind a 39% five-year average."

Seems more behind than that.

Darrell Good,  You and I are in agreement.  It is more fun to stay in and play with statistics.

How would the corn crop compare to a 5 year average of potential probable yields, assuming a less than standard deviation caused by a wetter and cooler fall, coupled with a late planted crop.  And do expectations deviate by diet??  

I have found that a slice of pie with a scoop of ice cream before lunch can take my projections into a steady deviation by 2 pm.  Like the steady up and down--- no that's  in and out of a boring snore.

Experts on parade.

Can't wait for us to get busy in harvest and enjoy being somebody who actually produces something besides mental fog.

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Our irrigated crops are below last year in appearance alone.  Testing of irrigated crops verifies it.  We actually had to cut a few dry land acres  in wheat harvest,  and should have a very few cutable acres in milo this fall ---- a grand improvement. 

Now back to the ever enjoyable blast of expertise from the clean finger nail crowd.