SunPrairie Grain Morning Comment
MINOT - Mar 13/13 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 8:35 AM CDT:
Wheat is 0-3 lower, spring wheat struggles, market follows corn and technical selling prevails as well (Mpls May last trade 7.88 ¾, KC May 7.35 ½)
Soybeans are down 9-14 cents, technical selling and South American harvest push prices lower (May last trade 14.54 ¾)
Corn is 0-2 lower, tight old crop US supply will limit losses (May last trade 7.12 ¾)
Sunflowers are down 5-10 cents with falling soybean oil
Canola is 10-20 cents lower, long liquidation continues to push that market lower and lower, prices got too high and are now correcting
*CHS Harvest for Hunger*
We are in the midst of the annual CHS Harvest for Hunger campaign! CHS Country Operations locations are working together to raise over two million meals for hungry families. Best of all is that for every donation we collect, CHS Country Operations will also make a local contribution to help our friends and neighbors right here in our community. If you would like to make a contribution to Harvest for Hunger you can do so by selling grain or making a cash donation at your local SunPrairie Grain office by March 20th. Let's work together to make this the most successful Harvest for Hunger yet!
*Delayed Price Program*
SunPrairie Grain is offering free DP until July 31st, 2013 on spring wheat and winter wheat delivered by March 15th. All new deliveries of corn and soybeans can be put on DP for 5 cents/bushel/month. Sunflower new deliveries can also be put on delayed for 15 cents/cwt/month.
Yesterday:
Grain markets were mixed to mostly lower yesterday with corn being the only market to find any sort of strength, with futures finishing three cents higher. Corn futures continued to find strength from Friday's USDA report which kept futures supported. An increase in basis had corn cash prices up eight cents on the day. Wheat futures were lower with a slight sell off, but an increase in spring wheat basis had cash prices up two cents and hard red winter wheat was down a penny for the day. Soybeans finished off their lows of the day but nearby cash prices were still down eleven cents. Canola was off a dime and sunflowers were down 15 cents. Flax was unchanged for the day. We also posted new crop cash bids for spring wheat, hard red winter wheat, corn and soybeans yesterday.
Today:
The US dollar is higher this morning as concerns about the Eurozone debt crisis continue. Crude oil prices are also a bit higher this morning, up about 65 cents/barrel. Grain futures are mostly lower this morning with soybeans again posting double digit losses. There is really little fresh news to drive price direction and it seems the biggest influence is coming from technical selling or long liquidation. Global economic concerns and South American harvest are also keeping the markets, especially soybeans, on edge. The grain markets are already looking for more fundamental news and the stocks reports on the 28th are already being well anticipated.
With little else to go off of it seems that wheat prices are looking to corn futures for direction. Unfortunately, that direction is lower today. Spring wheat is taking the worst hit, down about four cents right now. Hard red winter wheat is unchanged at the moment and Chicago soft red winter wheat futures are down about a penny. The SRW market is finding some good support recently from chatter about increased feed usage. Increased precipitation forecasts for the US plains keep any gains in check as hard red winter wheat crop conditions have improved from recent rain events and any additional precip would only make things better. Russia is liking the looks of new crop wheat prospects and it seems that new crop wheat sales could be taking place if they haven't already. Egypt is reportedly looking for some new crop purchases and would most likely look to sourcing from Russia.
Soybeans are sharply lower this morning with technical selling, South American harvest and concerns about the state of the Chinese economy all working against tight US supplies and recent strong demand. It also seems that volume is pretty light in the trade which really lets prices drift lower quite easily. News out of China continues to be slightly unfavorable which makes the market concerned about long term demand. However, ideas that Chinese soybean acres could fall as growers switch to other commodities could work to keep their soybean demand strong.
The corn market is bouncing around both sides of unchanged today and can't quite seem to make up its mind. The bulls in the market want to look at the fact that the USDA didn't increase carryout on Friday, while others say that the drop in feed/residual usage is enough to scare demand away. There has been an increase in farmer selling with the recent bump in prices but many are continuing to hang on, hoping for higher prices. Helping out new crop prices are ideas that some acres could switch from corn to soybeans...I think some analysts just had their corn acreage estimates for this year a bit too high. Acres will still, in all likelihood, be easily over 95-96 million though. US corn exports will face some competition from India which has been selling off some of its new crop supply.
Kayla Burkhart
Broker/Procurement
SunPrairie Grain
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1600 27th St SE | Minot, ND 58701
P 701.857.9322 | F 701.839.5515 | C 701.720.4682
kayla.burkhart
To discuss this report further or for specific trade ideas please contact me
directly
Kayla Hoffman
SunPrairie Grain
Kayla.Hoffman@chsinc.com
Toll free: 800.735.4956
Local: 701.852.1429
Fax: 701.839.5515
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