SunPrairie Grain Morning Comment
MINOT - Apr 4/13 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
[cid:image001.jpg@01CD002F.571BB930]
Market Outlook as of 8:40 AM CDT:
Wheat is down 6-12 cents, hard red winter wheat futures sharply lower, taking pressure from higher US dollar (Mpls May last trade 7.84 ¾, KC May 7.22 ¾)
Soybeans are down 7-9 cents, concerns about Chinese demand (May last trade 13.73 ½)
Corn is 3-5 cents lower, larger than expected US supplies weigh on the market (May last trade 6.38)
Sunflowers are down 5-10 cents, bean oil is falling with crude and soybeans today, making for what looks to be another lower day for the oilseeds
Canola is off 15-25 cents, futures sharply lower this morning with lower US markets
*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:
A rally sparked by short covering in the corn and wheat markets resulted in pretty decent gains in yesterday's session. Corn, though, was unable to sustain those gains as the session progressed and finished the day only a penny higher. Wheat prices did fairly well, though, as spring wheat was up fifteen cents for the day and hard red winter wheat posted gains of 19 cents. Concerns about the quality of the US hard red winter wheat crop combined with demand optimism had prices higher. Corn tried to follow along but couldn't quite hang onto prices as the day finished. Soybeans were lower all day on concerns about Chinese feed demand. China has confirmed a strain of the bird flu that has resulted in some poultry deaths which, if it continues to spread, could significantly impact Chinese feed demand. Canola and sunflowers followed the soybean complex lower.
Today:
Grain markets are lower this morning as it seems pressure from the outside markets could finally be influencing prices. The US dollar is sharply higher this morning as the Euro falls off due to weak economic data. Crude prices are falling off this morning, down about $1.25/barrel at the moment. These two factors are not supporting grain prices at all this morning and it is showing. Additionally, grain trade is fairly light this morning which is letting prices drift lower without much effort. Export sales for the week were uneventful, providing little (if any) support to prices today.
News for the wheat market seems to be pretty supportive right now but prices just do not want to trade higher after doing so yesterday. Western Europe is reportedly seeing some cold weather which could be reducing yield to some of the wheat crop. The US hard red winter wheat crop is not doing much better as conditions remain dry, generating further concern about production. One firm is expecting to see a 14 million bushel reduction in HRW production this year due to the adverse conditions. Wheat export sales for the week were pretty disappointing at 316 thousand metric MT(TMT) which was below estimates of 400-700 TMT. There are hopes that demand will pick up with the recent decline in prices but we're still waiting for any confirmation of that.
There is little fresh news for the soybean complex right now and prices just continue to want to slide lower. Right now the main focus is large South American supplies and ideas that congestion in Brazilian ports should be starting to ease up. Argentine harvest is underway but farmers are reportedly hanging onto their crop as prices are not as high as they would like them to be. Concerns about Chinese demand are at the forefront right now but it seems to me that maybe this is a bit of an overreaction to the bird flu news at this point. Export sales for the week were not great at 747.8 TMT but at least that was above expectations of 300-625 TMT.
Larger than expected US supplies continue to weigh on corn prices as the market has little else to focus on at the moment. The market will keep an eye on planting weather but at this time there is really little to be getting worked up about. Yes, it's cold and wet in many planting areas, but it's early and there is time for conditions to turnaround and in areas they are forecast to do so. South American corn crop forecasts seem to have bigger estimates every day from a different firm, so will the UDSA follow suit? Export sales for the week were in line with estimates that ranged from 175-50 TMT but still a big yawn at 387.3 TMT.
Kayla Burkhart
Broker/Procurement
SunPrairie Grain
[image003.jpg]
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
DISCLAIMER: Futures and options trading involve substantial risk. The valuation of futures and options may fluctuate, and as a result, clients may lose more then their original investment. In no event should the content of this website be construed as an express or an implied promise, guarantee or implication by or from the author(s) that you will profit or that losses can or will be limited in any manner whatsoever. Past performance is not necessarily indicative of future results. Information provided on this website is intended solely for informative purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted.
Information on this page is derived from third parties and is deemed to be reliable. STAT Communications Ltd. accepts no responsibility for errors, omissions or inaccuracies in any of the material presented on this web site. Opinions expressed on this web site are those of the respective individuals and/or institutions and do not represent the opinions of STAT Communications Ltd. or its staff or its management.
Only active subscribers can read all of this article.
If you are a subscriber, please log into the website.
If you are not a subscriber, click here to subscribe to this edition of the STAT website and to learn more about becoming a subscriber.
