SunPrairie Grain Morning Comment
MINOT - Apr 23/13 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 8:45 AM CDT:
Wheat is down 2-5 cents, market doesn't concern its self with crop conditions or planting, focuses on global production which looks good for now (Mpls July last trade 8.00 ¾, KC July 7.38 ¼)
Soybeans are 2-5 higher, market may be trying to recover after yesterday, some confirmation of new crop demand from China could be helping (July last trade 13.68 ½)
Corn is 2-8 cents lower, new crop struggles despite slow planting progress, demand a big concern (July last trade 6.21 ½)
Sunflowers are down 5-10 cents, falling bean oil and crude markets put pressure on cash sunflower prices
Canola futures are mixed, old crop is higher but new crop is lower
*Minot Main Scheduled Maintenance Closure*
The Minot Main location will be closed for dumping beginning April 29th through May 10th for maintenance. The office will be open during this time. Thank you and please call if you have any questions!
*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.
Today:
It looks like the grains want to trade lower for the second day in a row. It looked like there was hope for higher soybean prices just a few short minutes ago but those prices have failed to hold and July soybeans are just barely hanging onto gains. Even the USDA's slow paced planting progress report wasn't enough to boost prices for the grain markets this morning. It seems fund selling is the primary factor for these markets and are working futures lower. Outside markets are also unfavorable with the US dollar trading higher and crude down about 80 cents/barrel due to economic concerns.
Spring wheat planting progress continues to run behind with the US crop being 7% planted versus 52% last year and a five year average of 24% complete at this time. Washington and Idaho remain the only states with notable progress made on the spring wheat planting front. Planting delays in North Dakota are starting to work their way into the market as ND is the top spring wheat producing state in the US and it doesn't look like much will happen before the beginning of May. The USDA didn't change hard red winter wheat conditions much as the crop is rated 35% good to excellent and a whopping 33% poor to very poor (versus 10% p/vp at this time last year). Even with additional freezes the market is just not concerned about what's been happening to the winter wheat crop and futures are nearly a dime lower this morning. The market seems to be focusing more on good weather in the Black Sea region (early planting there) and India - making it look like we'll have some pretty good crops out of those regions this year. Egypt reportedly did not have success in buying wheat from Russia while simultaneously borrowing money to pay for it.
There is some chatter about China cancelling additional Brazilian soybean shipments due to slow loading - could this push demand to the US? Or is China cancelling out of higher priced contracts and waiting for prices to fall further? The market doesn't seem excited about potential demand news as prices are now trading lower. The impact of Bird Flu on demand seems to be mounting - but we shouldn't panic too soon as we had confirmation of a Chinese purchase of new crop US soybeans hit the markets late yesterday afternoon. Canola futures are hanging onto gains right now but that could be tough as we move forward with a lower soybean complex and falling crude prices.
US corn planting progress came in where expected but still pretty far below average. US planting was reportedly 4% complete as of Sunday evening, which is well behind last year's 26% complete and the five year average of 16% complete. However, longer term forecasts are calling for warmer, dryer weather and it seems that the trade is focusing more on that news. It's known that once planting begins, it goes quickly and progress can catch up. It seems that's the news the market is focusing on more than anything. However, corn planning in ND is looking increasingly difficult, especially in our area. North Dakota is expected to increase corn acres pretty substantially this year and if that doesn't happen we could see some support added later on to corn prices. For now, though, fund liquidation seems enough to push prices lower. Right now the market is also concerned with slow demand - but slow producer selling keeps pipeline supplies tight as well. The Mississippi and Illinois rivers remain closed for now and could be for a few more days until high water works its way through.
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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