SunPrairie Grain Morning Comment
MINOT - Apr 3/13 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 8:25 AM CDT:
Wheat is up 4-6 cents, rains to US hard red winter wheat growing areas disappoint so far (Mpls May last trade 7.81 ½, KC May 7.20 ¼)
Soybeans are 5-8 cents lower, South American harvest and bigger than expected US supplies continue to weigh on prices (May last trade 13.88 ½)
Corn is up 1-3 cents, following stronger wheat prices, but stocks may limit gains (May last trade 6.43 ¼)
Sunflowers are unchanged, bean oil is quiet this morning but could have a tough time if crude prices continue to slide
Canola is unchanged - 10 cents lower, futures board giving back some of what it's gained recently, but not much
*Delayed Price Program*
SunPrairie Grain is offering free DP until July 31st, 2013 on spring wheat and winter wheat delivered by April 30th. 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:
The corn and soybean markets saw two sided trade yesterday but wheat was higher for the whole day. Corn prices started out higher but failed to hold those gains as selling hit the market and prices retreated with the larger than expected US stocks number weighing on things. Corn cash prices fell a nickel yesterday by the end of the day as selling pressure pushed things lower. Soybeans finished off their highs of the day but still managed a positive close of four cents higher. Trade in the soybean market was fairly light yesterday and it didn't take much for prices to trade lower. Canola prices did well yesterday despite a falling soybean oil board. Wheat prices started out stronger and stayed that way all day. Poor hard red winter wheat crop ratings were the main reason for higher prices yesterday, but spring wheat prices managed to show pretty good strength yesterday as well. Spring wheat was up 11 cents on the day and hard red winter wheat was up seven cents.
Today:
Grain prices are mixed today with corn and wheat a bit higher and soybeans struggling. Outside markets are mixed with the US dollar lower and crude prices about 35 cents/barrel lower. The dollar is lower as the Euro is on the rise and crude continues to struggle with economic concerns. Strength in the wheat market is coming from concerns about the hard red winter wheat crop and renewed optimism about demand. It seems we have mostly digested the information from the USDA reports last week but high stocks numbers will likely continue to weigh on the corn and soybean markets.
Technical buying seems to be boosting wheat futures this morning as earlier losses were a bit overdone considering recent hard red winter wheat crop condition ratings. The top producing states in the US have high poor/very poor crop ratings which will keep prices on edge. Additionally, precipitation so far to the US southern plains has been fairly disappointing with small amounts being reported. However those amounts are expected to change with good coverage forecast over the next few days. If realized we could see some concerns ease about the state of the crop, but will it be too little too late? Some favorable news for the US export market is that China is worried about some quality issues with Canadian wheat. It seems that the gluten in the wheat is not holding together well and right now it's thought to be due to the wheat varieties that are grown up north. Could this generate additional demand for US wheat exports? The market sure hopes so.
Soybean prices are having a tough time this morning, continuing yesterday's direction after coming off of yesterday's highs. South American harvest combined with larger than expected US supplies are really weighing on futures prices right now. Argentine harvest is progressing along quite quickly. However, farmer selling is reportedly fairly slow as prices are "not profitable". There are also some estimates of the Argentinean crop that are well below the USDA's current number. Things are going well in Brazil as the country now believes that the worst of the logistical problems are now behind them. Also pressuring soybeans are concerns about Chinese soymeal demand. It's funny how yesterday the market was encouraged about Chinese demand due to tight supplies but today is a whole different story. Bean oil prices are fairly quiet right now as are the canola futures. It looks to be a fairly quiet day for the oilseeds in general today.
Corn prices are about a nickel higher at the moment as the market finds strength from rising wheat futures. South Korea is again looking for corn, eager to come in and buy after the hefty decline in prices. Corn could be working its way back into US feed markets and pushing wheat (or hopefully even Argentinean corn) out with the fall in prices. New crop corn prices could find some support from forecasts for continued wet and cold weather to the US corn belt which would delay planting progress.
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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