Thursday, May 2, 2013

FC Afternoon Grain Market Commentary for 5/2/2013

Afternoon Comments 5/2/2013


Thursday, May 2, 2013, 3:31 pm
Submitted by: Kyle Lehman


Markets settled mixed the afternoon with corn 15 cents higher while beans closed 1 cent lower. Old crop corn led the way higher as planting delays continue and forecasts showing little relief nearby. Logic would tell you planting delays would benefit new crop prices more than old crop but not the case. Why are planting delays benefiting old crop prices? A few weeks ago we were looking at our carryout of 757 needing to last until harvest and as harvest gets pushed back our carryout has to last that much longer. Last year tight ending stocks for corn were bailed out by an early harvest, this year that is looking far less possible as planting continues to see delays and weather forecasts calling for very tight planting windows. Once Brazil loads all the backlogged vessels waiting off their ports it is possible the Southeastern US could import cheaper corn from South America providing relief to a later harvest.
 
Soybeans struggled to remain around unchanged as corn acres are thought to be switching to soybeans. The majority of the corn acres that would be lost come from the northern corn belt but some could come from the Delta where below freezing temperatures have damaged the already emerged corn crop. Basis and futures could see some pressure as Brazil exported 7 mln MT of soybeans in the month of April which surpasses the old record by a comfortable margin. With the record crop finally hitting the market export demand for soybeans and meal out of the US should come to a halt.
 
If you are tired of waiting to plant this may be an option.

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