SunPrairie Grain Morning Comment
MINOT - Mar 14/13 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 8:30 AM CDT:
Wheat is -1-+2, futures are mixed with spring wheat lagging, export sales should support prices but a stronger US dollar could limit gains (Mpls May last trade 7.96, KC May 7.40)
Soybeans are 3-5 lower, concerns about Chinese demand for old crop US soybeans as South American harvest ramps up (May last trade 14.43 ½)
Corn is 0-1 lower, futures saw choppy trade in the overnight session, looks to continue that way today despite the strongest export sales we have seen in some time (May last trade 7.09 ¾)
Sunflowers are 5-10 lower, bean oil off with soybeans again today, dragging sunflower prices along
Canola is down 10-15 cents, strong selling in that futures market continues
*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:
A lack of fresh news and a fairly technical trading day was enough to let prices drift mostly lower yesterday. Wheat was the exception to that with last minute buying at the close that pushed prices up a few cents. Spring wheat finished up four cents and hard red winter wheat was up two cents for the day. Malt barley prices dropped off a bit as the market has plenty of supply to keep maltsters covered for the time being. Soybeans were sharply lower yesterday, down 21 cents by the close, as selling pressure hard hit the market. Soybeans are worried about how the South American crop will impact demand for US old crop supply and futures are taking a hard hit. Canola and sunflowers were down in sympathy with the soybean market as canola was down 20 cents/cwt and sunflowers were a dime lower. Corn was lower with the soybean market and profit taking, finishing the day down four cents. A higher US dollar yesterday did not provide any support to the grain markets either.
Today:
Grain markets are looking a lot better this morning than they were at this time yesterday. Soybeans are down a couple of cents, corn is fluttering around unchanged and it looks like wheat prices are going to stay a few cents to the good side today. The US dollar is higher again this morning and could continue to limit gains in the grain markets today. Crude prices are about a dime/barrel higher. Export sales for the week were pretty good for corn and wheat but not so great for soybeans. Trade looks to be fairly light and quiet today and I don't think we'll see too much price action one way or the other.
Wheat is optimistic about demand today and that seems to be enough to keep prices a little bit higher this morning, despite the higher US dollar and lower soybean trade. Export sales for the week saw some pretty aggressive estimates - 500-800 thousand metric MTand they came in at 1,087 TMT. Most of the sales were for old crop as well and this should be pretty favorable for prices. Feed demand for soft red winter wheat remains strong as well which keeps the Chicago wheat futures well supported, in turn helping out the spring wheat and hard red winter wheat futures.
After today's export sales report it seems that the soybean market is somewhat justified in its concerns about decreasing Chinese demand. Sales for the week were estimated to come in at 700-1100 TMT and were reported at 783.7 TMT. Most sales were for old crop soybeans but are obviously substantially lower than what the market was hoping for. It seems that many buyers in the market are focusing on Brazilian and Argentinean supplies as harvest continues and they become more abundant. Some of today's pressure could also be follow through from yesterday's price action as futures were sharply lower. Also weighing on things are ideas that some private market analysts could increase their US soybean acres as some growers may switch intended corn acres to soybeans.
The corn market saw a choppy overnight session and that looks to continue into the day session as well. Nearby corn futures are, at the moment, unchanged after trading lower for at least the past hour or so. New crop futures are up a penny, seemingly hoping for that reduction to US acreage estimates. Export sales for the week were much better than we have seen recently at 653.3 TMT, exceeding estimates of 200-500 TMT. The sales were fairly evenly mixed between old crop and new crop. Some unfavorable news is a report of India selling corn to China. The sale is reportedly a "trial shipment", but if the corn meets China's quality standards it would not surprise me if we saw more business take place between the two countries. Remember that the US market would really like to see increased corn sales to China and this has been the source of several rallies in the past, so it is somewhat disheartening to see more competition in the global corn export market.
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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