FC August USDA Report Summary for 8/12/2014

MARKET COMMENTARY

August USDA Report

Tuesday, August 12, 2014, 11:08 AM
Submitted by: Dustin Weiner

The USDA report was out and for those who were expecting, or maybe hoping, for some fireworks – it is a bit disappointing (read: quiet).  Corn yields came in below the average trade guess..  At first glance you could say that with the USDA coming in with a smaller crop – corn prices should be higher, maybe even sharply higher.  It is important to note that this crop is still projected to have a record US yield on it, pushing it over 14 billion bushels…. that is a lot of corn.  If you take that and add in the thought that in years like this “big crops get bigger” you could have a hard time going long corn in here which helps explain why prices are struggling to move higher despite the lower yield projected from the USDA.

 

Soybeans.  This one looks a little bearish.  The USDA bumped the yield up a touch and carried those bushels right into a now larger-than-expected carryout for next summer – 430 million bushels.  For reference the carryout this summer is just 140 million bushels so that is a big change on the overall availability of soybeans in the market.  Generally speaking beans still look overpriced when compared to corn.  It feels like the market is still holding onto a weather premium in beans (how will August finish up?).  If we can get another few weeks down the road without cutting into potential soybean production you can make a case for beans to go test some new lows.

 

Some facts/stats from today’s report on the 14/15 crop:

·         USDA corn yield 167.4 bpa, the trade expected 170.1bpa

·         USDA corn carryout 1.808 billion bushels, the trade expected 2.005bb

·         USDA soybean yield at 45.4bpa, the trade expected 45.2bpa

·         USDA soybean carryout 460 million bushels, the trade expected 414mb

http://www.fccoop.com/markets/market-commentary/?CommentaryID=2227

 

FC Morning Grain Market Commentary for 8/12/2014

MARKET COMMENTARY

AM Comments 08/12/14

Tuesday, August 12, 2014, 8:08 AM
Submitted by: Dustin Weiner

Happy Report Day!  Our markets look like they will stay on the weaker side heading into today’s 11am USDA reports (crop production & S&D).  When the clock hits 11:00:01… all bets are off.

 

First, the numbers.  In regards to corn production the trade is looking for U.S. corn yield to come out around 170.2 bpa with a production of 14.250 billion bushels.   For the last three years the USDA numbers have come in below the average trade guess, if that happens again today maybe we see a little bounce higher?  That’s a big maybe.  On soybeans the market is expecting bean yields to be raised ever-so-slightly to 45.5bpa with a production of 3.815 billion bushels.  The track record of the “trade guesses” on this report is similar to corn – only more exaggerated:  In 12 out of the last 13 years on the August production report the USDA has come out with a smaller yield than what the trade was expecting.  With August soybean weather being up in the air, this deviation is easier to explain. 

 

At first glance when thinking about this report… A) will the trade be happy with today’s yield increases in corn and B) will the USDA be willing to raise bean production (that is already projected to be a record) with the dry weather we experienced late July / early August?

 

Opening Calls

Corn down 1 to 3 cents

Soybeans down 3 to 6 cents

http://www.fccoop.com/markets/market-commentary/?CommentaryID=2226

 

FC Morning Grain Market Commentary for 8/11/2014

MARKET COMMENTARY

AM Comments 08/11/14

Monday, August 11, 2014, 7:08 AM
Submitted by: Dustin Weiner

The markets look to start the week off awfully quiet as both corn and soybeans are trading steady/mixed so far this morning.  Initially supportive to prices are dry weather concerns in China – which helped beans, meal and corn work higher last night.  On the flip side, reduced tensions in the Black Sea has allowed wheat prices to slip lower which could eventually drag on corn. 

 

Tomorrow the August Crop Production and S&D reports will be released from the USDA.  The general idea that the US corn and soybean crops are large should keep the market from mounting any substantial rallies ahead of the report.  However, with the market on/near its lows (esp in corn) and the potential for a surprise always looming I wouldn’t be surprised to see a little profit-taking or short-covering ahead of the report.  This could give us a small bounce between now and the 11am release time tomorrow.

 

Opening Calls

Corn steady to 2c higher

Soybeans steady to 2c lower

 

Have a great day!

http://www.fccoop.com/markets/market-commentary/?CommentaryID=2224

FC Safety Tip of the week: Hydraulic Equipment Safety

Hydraulic Equipment Safety

Farm equipment operators must be extremely careful when working around hydraulic equipment. Hydraulic pressure is often strong enough to knock a person out if a leak or explosion occurs.

Follow these guidelines when working with hydraulic equipment:

• Inspect hydraulic equipment regularly for leaks. Report and fix any leaks immediately.
• Ensure that all couplings are properly installed and in good working condition.
• Ensure that all lines and fittings are in good condition. Repair or replace any equipment that is not in good condition.
• Lock transport wheels and support jacks on implements in place before disconnecting hydraulic cylinders. This action will prevent sudden shocks to the machine or personal injury.
• Keep couplings and hoses in good repair so that the hydraulic system can safely sustain maximum pressure.

http://www.fss.txstate.edu/ehsrm/safetymanual/agsafe/farmequip.html

FC Morning Grain Market Commentary for 8/6/2014

MARKET COMMENTARY

AM Comments 8/6/2014

Wednesday, August 6, 2014, 8:08 AM
Submitted by: Joel Pudenz

Nice rain is falling throughout Western Iowa and will move east as the day progress, bringing moisture to regions that haven’t seen much for a few weeks. Corn and soybean futures traded mixed overnight with corn finding some early spillover support from wheat; there are some renewed rumors of a Russian invasion into Ukraine. Next Tuesday, the USDA will release updated crop production numbers. Average trade guesses are 170.2 bpa corn yield (14.250 bln bushels produced) and 45.2 bpa soybean yield (3.815 bln bushels produced). The corn estimate is a lot higher from last month while soybeans are just a touch higher.

 

Have a good day!

http://www.fccoop.com/markets/market-commentary/?CommentaryID=2219

 

FC Morning Grain Market Commentary for 8/5/2014

MARKET COMMENTARY

AM Comments 08/05/14

Tuesday, August 5, 2014, 8:08 AM
Submitted by: Dustin Weiner

The markets are under pressure this morning after rains slipped further east than expected (into northern Illinois and southern Wisconsin) and crop ratings (in soybeans in particular) were better than expected last night.  What also has the market leaning bearish are the production estimates being released from different private companies.  Yesterday we had FCStone come out with a 172.4 bpa yield for the US, which pencils out to a 14.455 billion bushel crop (fyi that is big).  Informa will be out today with their numbers – if they also show a big crop, corn and beans could slip lower once again.

 

Opening Calls

Corn 3 to 4 cents lower

Soybeans 15 to 20 cents lower

 

Have a great day!

http://www.fccoop.com/markets/market-commentary/?CommentaryID=2218

 

FC Morning Grain Market Commentary for 8/4/2014

MARKET COMMENTARY

AM Comments 08/04/14

Monday, August 4, 2014, 7:08 AM
Submitted by: Dustin Weiner

The weather models are bouncing around a bit this morning, but most of them are still calling for slight chances for rain early this week and better chances later this week.  There are spots in the belt that look like they may not get as much as we thought Friday which had the grain markets moving higher last night.  The extended forecast remain cool, the precip potential is projected to be normal in the western corn belt while the eastern corn belt is projected to receive above normal precip. 

 

This afternoon’s crop ratings are projected to drop a bit for both corn and beans – the story being that the dry weather has knocked a few points off the good-to-excellent ratings.  This could also be why the market has found some buyers overnight. 

 

Many in the trade are calling the action we saw overnight nothing more than a short-covering rally.  If we are in a ‘rallies are meant to be sold’ type of market then this little upward swing in prices should be rewarded with a few sales from the producer, especially the producer who has a record or near-record crop brewing out in the field…

 

Opening Calls

Corn 2 to 3 cents higher

Soybeans 11 to 14 cents higher

http://www.fccoop.com/markets/market-commentary/?CommentaryID=2216