SunPrairie Grain Morning Comment
MINOT - Apr 17/13 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 8:35 AM CDT:
Wheat is 2-4 cents lower, higher US dollar has prices on edge, slightly higher row crops may support (Mpls July last trade 7.99, KC July 7.45)
Soybeans are up 2-4 cents, thoughts China may be interested in buying more US soybeans, tight pipeline supplies due to slow farmer selling (July last trade 13.78)
Corn is 1-3 cents higher, new crop shows relative strength due to US planting problems, farmer selling quiet (July last trade 6.64 ¼)
Sunflowers are 0-5 cents lower, crude struggles again and wants to pull bean oil lower, but higher soybeans could limit losses
Canola is up 5-10 cents, futures look to soybeans for direction, seemingly ignoring the crude oil market
*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:
After Monday's losses we saw a bit of a "turnaround Tuesday" yesterday as grains recovered much of what had been lost. The markets this week so far have been really driven by the outside markets, a lower US dollar combined with a rebound in some of the other outside markets was enough to work grain prices higher. Crude prices still struggled though with heavy selling pushing prices down to about $86/barrel, but buying interest pushing prices back closer to unchanged. Soybeans performed pretty well yesterday, finishing the day up 16 cents/bushel. Canola, sunflowers and flax all followed suit as each market posted double digit gains. Corn prices were up 17 cents/bushel for the day as challenging US planting weather and light farmer selling supported the markets. Wheat futures took cue from rising row crops and favorable outside markets. Spring wheat finished the day 12 cents higher and hard red winter wheat found additional support from cold temperature concerns, finishing the day nine cents higher.
Today:
Grain markets are mixed so far today with wheat prices struggling and corn/soybeans slightly higher on the nearby contracts. Crude is again lower this morning, about a dollar/barrel at the moment, as concerns about slow global economic growth keep the energy markets in check this week. The US dollar is higher also which could be working to put a cap on grain prices again this morning. Trade is fairly light and with unfavorable action in the outside markets we will likely see grain prices give in to that pressure. Fundamental news for the grains remains somewhat favorable but there's nothing fresh to push prices higher as we'd like to see.
Wheat markets are uncertain about the state of the US crop given the recent frosts to the hard red winter wheat growing areas and western areas that have been impacted by drought. North Dakota seems to be catching the market's eye this week also. Cold temperatures and record snowfall have been noted by the market, which has started making some wonder what may happen with spring wheat acres. The general consensus is that spring wheat acres will likely increase if corn cannot get planted. Egypt is reportedly looking to buy wheat, but due to credit issues could have a tough time finding a seller.
Tight old crop supplies due to slow farmer selling was enough to get soybean prices excited yesterday, but prices today are sloughing off a little bit after an initially higher open. There is actually quite a bit of favorable news for the soybean market right now as there are rumors that China could buy some US soybeans to get some quick ship supply due to South American supplies moving a bit slowly at the moment. Additionally, there are ideas that the South American crop could be smaller than current USDA estimates. The big question mark for soybeans right now is planting. US acres could look to increase if corn planting delays make for less corn getting in the ground. Also, South American growers are reportedly switching from corn to soybeans as corn prices have fallen substantially in previous weeks. Canola futures are higher at the moment but it seems that soybean oil is going to struggle with falling crude oil prices today.
New crop corn futures are holding strength better than old crop due to US planting worries. It's still very early to be getting too worked up about planting delays. However, after an early year like last year it's pretty easy to do so. Precipitation looks to continue across the corn belt which will only add to planting concerns. Old crop values should be supported by slow farmer selling. Basis values have remained fairly stable for corn and that is due mostly to the slow movement, demand is ok but does not quite justify current basis levels on its own. News that Argentina has a large vessel lineup for corn, meaning they're going to be exporting quite a bit, may weigh on the market as well.
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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