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Tuesday, April 15, 2014, 7:58 am Submitted by: Dustin Weiner
Most of the news we are reading this morning is the same type of news you can get from your local news station: it is all about Ukraine/Russia. Tensions are escalating, Ukraine has now deployed their military for anti-terrorism operations as pro-Russian militants take over police stations in Eastern Ukraine. Russia is of course playing the same card they did with the Crimean Peninsula – accusing Ukraine of not protecting Russian-speaking people. If you want to tie this into grain S&D’s, the Ukraine National Bank nearly doubled their benchmark lending rate, changing it to 14.5% from 7.5%. This is an attempt to slow inflation but their farmers are now facing a credit crunch as they try to finance their 2014 spring planting season. Corn production estimates for the Black Sea area are already being lowered.
The outside markets are mixed with Crude Oil lower at this time (DN 95 @ 103.10) along with a higher US Dollar (138.03 vs. Euro) and the US stock market is higher (UP 27).
Other than that, pretty quiet. The market is unsure as of now the condition of the HRWW crop after last night’s cold temps. If you see a rally in corn/wheat later today – news regarding those freezing temps could be why…
The markets rebounded overnight, bouncing up from Friday’s lower close. The wheat market seems to be leading the charge higher (up double digits) likely due to ongoing weather concerns in US wheat country along with escalating tensions in Russia/Ukraine. Winter wheat crop conditions were already poor (at a 12-yr low) thanks to the drought in the Southern Plains – and now with freezing temps in the forecast for tomorrow morning it looks like they could get worse.
Although some of us here in Iowa will feel that the rains over the weekend were beneficial – the market is trading this cool wet weather as something that is friendly to prices as corn planting will have to wait a little while longer. Speaking of planting, the USDA’s first planting progress report will be out this afternoon and the market is expecting the US to be just under 5% planted on corn. This number would be pretty close to normal, and it’s probably too early to get worked up over planting delays…
Corn 2 to 4 cents higher
Soybeans steady to 5c higher
The news wire is extremely quiet this morning as new fundamental news is hard to come by. As mentioned yesterday, the stories regarding China defaulting on soybean purchases are still out there and are likely the reason that soybean prices suddenly feel so heavy.
The weather looks great out there… for the next day and a half or so. After that a cooler and wetter forecast will take hold. The moisture of course will be welcomed with open arms. I also stuck a chart on the bottom of these comments reflecting increased chances of an El Nino this summer. Generally speaking, an El Nino would be good for the crops here in the U.S. Midwest (cooler, wetter summers) – it just needs to get here in time.
The overnight electronic trading session was a quiet one last night with both corn and beans hovering close to their closes yesterday. Yesterday afternoon was the first weekly planting progress report (of course, only for states like Louisiana, Mississippi, Arkansas, etc. etc. are reporting this early). The weekly crop conditions report was delayed a day and will be out this afternoon.
Tomorrow of course is the April S&D, as I mentioned yesterday the trade seems to agree that the carryouts (aka projected ending stocks) in both corn and soybeans will shrink a bit when compared to the March report – but there are still questions as to how we will get to those numbers, especially in soybeans. Exports. Imports. Domestic crush. Residual usage. All of those categories will likely be tweaked just enough to spit out a carryout somewhere between 135mb and 145mb. The current average trade guess on soybean carryout is 139mb (it was 145mb last month). The current average trade guess on corn carryout is 1.403bb (it was 1.456bb last month).
The outside markets are mixed with Crude Oil higher at this time (UP 86 @ 101.30) along with a lower US Dollar (137.92 vs. Euro) and the US stock market is slightly lower (DN 7).
Friday, April 4, 2014, 8:23 am Submitted by: Joel Pudenz
The U.S. jobs report was out this morning and it looks to be neutral. During the month of March, the U.S. added 192,000 non-farm jobs – just short of the 200,000 expectation. This leaves the reported unemployment rate at 6.7% vs. expected 6.6%. Markets are mixed this morning as the trade focuses on the monthly WASDE report due next Wednesday. Most feel ending stocks for corn and beans will dwindle from the March report (1.456 bln bu. corn, 145 mln bu. beans).
More moisture is in the forecast for the wheat belt, adding pressure to wheat futures and that may spillover into corn. Midwest forecasts look to be steady to below normal temperatures and steady to above precipitation. NOAA continues to call for a building El Nino, which means below normal tempuratures for the Central U.S. The question remains if/when the effects will take place (Early summer? Late summer?).
Opening Calls: Corn 1 to 3 cents lower CBOT
Beans 1 oto 3 cents higher CBOT
Here’s a look at where snowplows are at in Iowa. Drive safely!
Wednesday, April 2, 2014, 8:16 am Submitted by: Dustin Weiner
May soybean futures made new highs last night, falling just shy of $15.00 on the board. Corn and wheat prices didn’t fare as well with corn down around a nickel and wheat down around a dime. The soy complex rallied yesterday and last night on news that the Senate is trying to bring back the $1/gallon biodiesel tax credit. The House is of course on the other side of it – their bill aims to keep the credit as-is (expired).
Basis values were weaker at the U.S. gulf yesterday in both corn and soybeans due in part to heavy farmer selling (thanks to the futures rally) and cheaper barge freight. Also affecting bean basis is the continued talk of soybean imports from South America. Imports into this US aren’t surprising, they are in fact needed. The Eastern U.S. can and will import a good amount of soybeans (they did so last year), but if you look at the image to the right, you will see a loaded soybean vessel headed to NOLA of all places. High prices cure high prices…
Outside markets are mixed with Crude Oil lower at this time (DN 52 @ 99.22) along with a lower US Dollar (137.82 vs. Euro) and the US stock market is higher (UP 19). The much anticipated U.S. Jobs report will be released Friday.