Grain markets are called mixed this morning after a mixed
overnight session that when ended saw corn up 4 cents, KC wheat off a couple pennies,
MPLS wheat off 2 cents, CBOT wheat off a penny, and beans up 1-2 cents. At 8:05 outside markets have the DOW mini
futures pointing towards a positive start of about 40-50 points, crude is up 50
cents, gold is down 3 bucks an ounce, and the US Dollar is near unchanged at
79.77 on the cash index.
Yesterday’s crop report progress report helped spark some
more life into the corn market in the overnight session as the progress came in
at 19% corn planted; which was below the estimate and the 5 year average. It is well ahead of last year and ahead of
2011 and it is very similar to the 2009 level which happened to be the best
yielding crop so far.
Bottom line the market is adding in premium because of
mother nature and concern of delayed plantings; personally I think moisture
longer term makes grain. I just think
that the American Farmer continues to make advancements every year and I think
it is very unlikely that we actually lose tons of corn acres in the nation. Don’t get me wrong we could see acres slide
in some areas and we could see some prevent plant acres in other areas; but the
USDA didn’t exactly use all of last year’s prevent plant acres in the March
planting intentions either. If you
remember at that time many thought our acres would increase as we went forward;
now maybe mother nature will prevent that from happening? But today are they any less???
Also when I look and see parts of Iowa in the drought
monitor and then see rain hit Iowa and the market then go up it really makes me
scratch my head. Delays in plantings
means one of two things cool or wet.
Cool is a concern and should be a concern; but longer moisture helps
make more grain. Maybe I just suffer
from backyardagains as rain in central and western South Dakota is welcomed. To me with the amount of money that has been
spent to upgrade land and equipment via bigger machines and more tile to help
control water it is hard to paint a picture where we don’t get the majority of
the corn planted.
Here is more info on crop progress report from
yesterday. It is from CHS Hedging; it
does have a very good breakdown on page 3 showing corn planting on this week
per year.
Basis does feel weaker for most of the grains as the rail
situation continues to add some volatility to the marketplace. I think higher protein spring wheat offers
might trade but basis for most of the others grains feels weaker; but that
really depends on how bids are getting structured because of the big influence
that rail freight has.
Another negative for basis is another increase in freight rates. As example all of our wheat for MWC ships on
CP cars; the CP has a rate increase effective May 1. Doesn’t seem to matter that we still have
cars ordered for well before that.
We are now offering a new crop millet program with an Act of
God clause; if you want more info please give us a call.
Birdseed sunflower market in general feels weaker as we have
shipped a lot of rail sunflowers the past couple weeks; enough that some buyers
have cancelled some orders. I still
think the sunflower situation is very tight; but we might have the flowers just
in wrong spots. Feels like South Dakota
has too many sunflowers, and ND doesn’t have enough. The big increase in freight rates going north
has a spillover effect that maybe isn’t getting the birdseed/crush spread to
where it should be?
Here is more market info from CHS Hedging Morning Highlights
Morning Highlights
By Phyllis Nystrom
- As of 6:45
AM CT: US dollar index down .031 at 79.666, crude oil up 56 cents at
$101.40, ULSD up 1 ½ cents, gasoline up a penny, natural gas unchanged,
gold down $9.60 at $1289.10, European Stoxx up .87%, Nikkei closed down
.98%, Hang Seng closed up 1.45%.
- The 1-5
day maps look slightly drier for the central Midwest, but not much
fieldwork will get done with light rains in the forecast through
Friday.The 6-10 map looks wetter for the northwestern Midwest. Southern
Plains remain dry.
- The US and
EU are imposing new sanctions on allies of Russian President
Putin.Pro-Russian rebels are holding a group of German and other OSCE
military observers for a fourth day and have seized more public buildings
in the Donetsk region.
- First
notice day for May grain futures is tomorrow, Wednesday, April 30th.Long
positions are reported after the close today and risk taking delivery.
- Effective
May 1st, the new daily trading limit in corn will be 35 cents,
$1.00 in beans, 45 cents for CBOT wheat, 50 cents for KC wheat, 3 cents in
bean oil and $30 in bean meal.Limits will be recalculated in six months.
- Corn
planting is 19% complete, on the low end of expectations and well below
the 28% average.Next week’s average pace is 42% and with the current cool,
wet forecast it doesn’t look likely that we’ll catch up this week.The crop
can be planted in hurry if necessary, last year 40% of the crop was
planted in one week!
- Major
states completion: IL 32%, IA 15%, IN 8%, MN 4%, NE 20%.
- Yesterday’s
export inspection included a corn vessel bound for China off the PNW.This
would be the first full corn cargo for China since January.
- A 60
million gallon/year ethanol plant in Virginia that was completed in 2010,
but never operated, is reportedly now grinding corn.
- Corn
deliveries are estimated at 0-200 contracts.
- Syngenta
says they do not expect any official word on approval by China of MIR162
until this summer, based on past practices. China announced that 1.124 mmt
of MIR162 corn has been rejected.
- The CK/CN
carry continues to trade from 5 – 6 ¼ cents.Overnight it was 5 ½ - 6
cents.
- May corn
has closed higher in four out of the last five sessions.If May corn closes
the month above $5.02, it will be the fourth higher monthly close in a row
and the longest run of monthly gains since October 2010.
- The US
Dept. of Ag forecasts that China will be the world’s largest corn importer
by 2021.They are expected to import 2% of their consumption needs this
year.
Oilseeds
- US soybean
planting is 3% complete versus 4% average.IL 2% done, IA 0, IN 1%, KS 1%,
NE 6%
- Crushers
are rolling bids to the July, check your markets.
- Brazilian
sources indicate 7 bean boats are headed to the US totaling 356 tmt.
- Another
new contract high in May meal on Monday.
- No bean
deliveries are expected on first notice day.
- The SK/SN
inverse widened overnight, trading from 8 – 9 ½ cents.
Wheat
- HRW
continues to gain strength from a dismal outlook for moisture over the
next 10 days.Other wheat areas of the world, including the EU, western FSU
and western Australia are experiencing good growing conditions.
- The wheat
tour should have numbers for OK, NE and CO on Wednesday and for KS on
Thursday.The tour covers from Manhattan to Colby today.
- Winter
wheat conditions fell 1% to 33% good/excellent. 18% of the crop is headed
versus 26% on average.
- Spring
wheat planting is 18% complete vs. 30% average.
- Argentina
has approved an additional 500 tmt of 13/14 wheat exports, bringing the
official exportable surplus to 1.5 mmt.
- Egypt’s
Supplies Ministry says they have bought 350 tmt of local wheat since April
15, about 40% more than over the same period last year.
- Ethiopia
is tendering for 70 tmt of optional origin milling wheat.
Grain
Merchandiser
Midwest
Cooperatives
800-658-5535
800-658-3670
605-295-3100
(cell)
605-258-2166
(fax)
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