SunPrairie Grain Morning Comment
MINOT - Apr 1/13 - 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 down 3-5 cents, pressure from Friday continues, wheat follows soybeans and old crop corn (Mpls May last trade 7.76, KC May 7.22 ½)
Soybeans are down 9-11 cents, Friday's stocks numbers keep pressure on soybean prices, new crop prices doing ok, comparatively (May last trade 13.95 ¾)
Corn is 28-30 cents lower on old crop, new crop is unchanged to higher, acreage numbers came in where expected but higher old crop stocks hammer prices (May last trade 6.66 ¾)
Sunflowers are down 15-20 cents, bean oil is off sharply with soybeans and crude oil this morning
Canola is 15-20 cents lower, following US markets lower this morning, fund selling continues
Today:
The big news Friday, and continuing into today, is the release of the USDA March 1 quarterly stocks report and planting intentions report. The release of the reports saw grain futures down immediately and never looking back. The big surprise was in corn stocks, which came in well above what the market expected. The market was expecting to see corn stocks as of March 1 reported at 5 billion bushels..the USDA pegged them at 5.4 billion. So down went corn futures. Prices were limit down (40 cents) and never looked back, finishing the day that much lower. Corn acreage numbers were in line with expectations, coming at in 97.3 million which was right where the average market estimate was. With no surprises there, acreage numbers had little influence on prices. There are hopes that the drop in corn prices may be enough to spur some demand. Hopefully we can get some quick export business done. Also, the sharp decline in old crop corn prices makes corn look good for feed usage again in comparison to wheat, which has not fallen off quite as substantially.
Soybeans also saw an unfavorable stocks number with the market estimating 935 millbu and the USDA reporting a billion bushels. Soybeans were down 49 cents on the day. Acreage numbers were a million below what was expected at 77.1, when the market was estimating 78.3 million. Flax acres were dropped pretty considerably from last year's 315k to 250k nationwide. Sunflowers also saw a pretty substantial cut to acres from 860k (total sunflower acres) to 636k. Sunflowers are a good crop for late planting in ND, and depending if this spring continues to take its time getting here we could see some last minute sunflowers get planted. Soybean prices are seeing old crop down about a dime with new crop unchanged to higher. It seems the planting number is enough to keep things supported on that end. Some indication that Chinese buying could pick up may be enough to boost prices a little.
The wheat market also saw a bit of an unfavorable stocks number on Friday but it seems that the price action is due mostly falling corn and soybean prices. Wheat stocks were estimated to come in at 1.177 billion bushels but the USDA reported them a bit higher than that at 1.23 billion bushels. Spring wheat prices were down 33 cents for the day and hard red winter wheat was off 47 cents. Acreage numbers didn't provide much in the way of market moving news. Spring wheat acres were put at 12.7 million total, just a bit higher than the average market estimate of 12.45 million. ND spring wheat acres are estimated to be slightly higher than last year at 6.2 million versus 5.75 million last year. Durum acres, though, are expected to fall by a couple hundred thousand to 1.1 million (1.34 last year). US durum acres came in well below the average market guess of 2.11 million at 1.75 million with declines noted in Arizona, California, Idaho and Montana. Considering how fast malt barley contracts filled up this year and our program being significantly smaller than last year's, it's no surprise that ND barley acres are a bit lower as maltsters cut back on what they need. ND barley acres are estimated to be at 950 thousand from last year's 1.06 million.
Today's price action is being determined by what happened Friday. Outside markets are mixed with crude prices down nearly a dollar/barrel as economic concerns drive crude prices lower. The US dollar is lower this morning but that seems to be doing little in the way of supporting grain prices today. Hopefully we'll price in this negative news soon and start looking ahead. Weather will be the big concern for the markets now that these reports are behind us.
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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