SunPrairie Grain Morning Comment
MINOT - Mar 22/13 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 8:40 AM CDT:
Wheat is down 1-5 cents, following price action in the corn and soybean markets, some unfavorable global demand news is around this morning (Mpls May last trade 8.01 ¾, KC May 7.58)
Soybeans are down 6-8 cents, profit taking and ideas that US acres will go up as some corn acres switch over (May last trade 14.43)
Corn is down 3-7 cents, is the Argentine crop bigger than current USDA estimates? (May last trade 7.26 ¾)
Sunflowers are down 0-5 cents, bean oil holding its own despite falling soybean futures this morning, sunflowers follow suit
Canola is down 5-10 cents, futures slightly lower after yesterday's big rally
*CHS Harvest for Hunger*
This year's Harvest for Hunger campaign has come to a close. As of Wednesday 1.9 million meals had been raised by CHS elevators across the country to help feed hungry families, meaning our goal of 2 million meals is likely to have been reached. Final numbers will be known next week. Thank you to all of those who contributed to make this year's Harvest for Hunger a success! Because of your generous donations, SunPrairie Grain was able to raise over $9,000 which will be distributed in the coming weeks to our local food banks.
*Delayed Price Program*
SunPrairie Grain is offering free DP until July 31st, 2013 on spring wheat and winter wheat delivered by March 31st. 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. DP availability is subject to space limitations at any given location.
Yesterday:
Sorry there was not a grain update, a few things popped up unexpectedly which prevented me from being able to get it completed in a timely manner. Markets were fairly uneventful yesterday morning, though, and soybeans picked up steam as the day progressed. Soybeans finished the day 30 cents higher as rumors of Chinese cancellations turned out to be just that. Canola and sunflower prices were higher with the climbing soybean prices. Corn traded both sides with disappointing export sales weighing on things but rising soybean prices eventually helping prices higher. Wheat markets did not do so well, seemingly pulling back after trading higher a couple days in a row. Spring wheat finished the day down seven cents and hard red winter wheat was down a nickel for the day. Chances for rains to hard red winter wheat growing areas were the main reason for lower wheat prices yesterday.
Today:
Informa Economics, a private market analyst, is to release its acreage estimates this morning at 10:30. The market is anticipating what Informa might say, the corn and soybean markets are expecting to see big acreage numbers. The US dollar is lower this morning despite continued concerns about the European economy. First off, the stable German economy had some concerning economic news released. Additionally, the situation in Cyprus continues to look pretty ugly. European stock markets have had a tough week due to these factors and the downside looks to continue for now. Right now US grain futures are pretty much lower across the board but that could change later this morning after Informa numbers are released.
The wheat market seems to have entered a weather market as one day unfavorable weather forecasts push prices lower and the next the market is not so concerned. Today it looks like wheat prices are just taking cue from falling corn and soybean prices. The market could be having some issues with news that India is selling some milling wheat and South Korea cancelled a tender for feed wheat, citing high prices. Additionally, news that Ukraine is expected to have a much bigger hard red winter wheat harvest this year than last year may also be weighing on things. A falling US dollar, though, could help to limit losses. Basis values look to be topping out as wheat selling has most definitely picked up this week. If movement continues to pick up, we'll see values relax.
News that Brazilian workers have, for now, canceled their port strike could be slightly negative for the soybean market. However, loadings will continue to remain slow as ports are very well congested. News that China did not cancel shipments earlier this week was probably the main reason why soybean prices spiked yesterday. Today, though, prices are crumbling as profit taking hits the market. Also, there are reports that China will sell off some of its domestic soybean reserves in an effort to help decrease domestic prices. The market is expecting to see soybean acres in the high 70 million to lower 80 million range. Estimates will likely be higher than baseline numbers as it's thought that producers are switching from corn to soybeans.
Increasing soybean acres are good for the corn market, as long as those acres come from corn. The corn market is very much expecting to see acreage estimates fall from earlier projections. However, earlier projections were about 99 million acres...so corn acres will in all likelihood be at or near record numbers, but just not quite as high as previously thought. I'm fully expecting to see acres at well over 95 million in the coming estimates, but we'll see. News that Argentina has approved additional corn exports could also be weighing on things a bit. Also there are some that feel that the Argentine crop is bigger than what the USDA is currently estimating, which could also weigh on futures.
Have a great weekend - let's hope weather forecasts are wrong and that things start warming up around here!
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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