SunPrairie Grain Morning Comment
MINOT - Apr 25/13 - 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 up 5-8 cents, stronger with corn and soybeans, some crop concerns in the US (Mpls July last trade 8.07, KC July 7.44 ¾)
Soybeans are 8-11 cents higher, tight old crop US supplies and general buying interest pull market higher (July last trade 13.56)
Corn is up 2-4 cents, slow US planting progress seems to be catching up a little with the markets, also helps that speculative selling seems to have slowed for now (July last trade 6.20 ½)
Sunflowers are 5-10 cents higher, bean oil stronger this morning and works to keep sunflower prices elevated
Canola is up 15-20 cents, smaller than expected Canadian acreage intentions have the market climbing higher
*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.
Yesterday:
It seems that more favorable weather forecasts for many US planting areas into next week had the markets under pressure yesterday. Soybeans were the hardest hit, losing 13 cents for the day. Corn futures managed to climb back as it seems that current delays were enough to boost things just a little bit higher by the end of the session. Spring wheat saw futures finish the day unchanged but basis values climbed 10 cents, which is why cash prices were higher yesterday. Winter wheat prices were up two cents on the day after trading both sides throughout the session. Canola prices were sharply lower despite tight old crop supplies and smaller than expected planted acres. Sunflowers finished the day 35 cents/cwt higher.
Today:
Grain markets are higher this morning as it looks like buying interest has struck. It also helps that the US dollar is lower, which may be helping to spur some buying interest in the grain markets. Crude prices are off a little this morning, though, but that doesn't seem to be bothering much. The grain futures are very much in a weather market right now and that will create for some volatile futures movement as we go forward. One day forecasts will look great for planting and the next they won't. It wouldn't surprise me if we were in for a bumpy few weeks in the grain futures, waiting for things to calm down with the weather.
Statistics Canada (StatsCan) released their planting intentions yesterday, which came from data collected from farmers at the end of March. It looks like Canadian spring wheat acres could increase by as much as 14% this year and durum acres could be up by about 10%. Increased Canadian acres could weigh on wheat futures - but the market also knows that Canada is likely going to have some planting difficulties of its own this spring due to snow amounts that remain in the field. The higher acreage number will probably also add to concerns about large global supplies as it seems that the US is the only major global growing area with production areas right now. It seems that the market is going to wait until next week to make any judgments about the US hard red winter wheat crop. The crop tour starts up and will provide much more insight into the state of the US crop. North Dakota spring wheat acres are becoming a bit of a concern to the marketplace, even though much of the state still has plenty of time to get spring wheat planted. Ideas are that ND actual planted acres will fall short of intentions. Export sales for the week were below the low end of expectations that ranged from 500-800 thousand metric MT (TMT) at 306.4 TMT.
Soybeans are climbing their way higher this morning after falling off a bit so far this week. There's a lot going on in the soybean market right now and it seems that the price action of the day just depends on which headline the market decides to run with. Today it seems that tight old crop US supplies and good processor demand are enough to lift prices (with some encouragement from fund buying, of course). However, the market is not soon to forget the nearby impact that the Chinese bird flu will have on demand or the large South American crop. Export sales for the week saw cancellations for this marketing year and decent sales for the next marketing year. Overall sales were at 422.2 TMT for the week, below estimates that ranged from 500-1000 TMT.
Canola futures are higher this morning after StatsCan reported smaller than expected intended acres as reported from farmers. The market was expecting to see Canadian acres at about 20 million for canola this year, but according to growers, they're going to put only 19.133 million acres in. This is a couple million lower than last year's 21.5 million planted acres. Additionally, planting progress is looking to be behind in Canada this year as well so the market is expecting that canola acres will fall short of intentions as well. Tight old crop supplies and a smaller than expected new crop harvest will probably make for a pretty well supported canola market as we move forward, providing the soybean complex can keep its strength.
Corn futures are now starting to struggle a little for any contracts beyond the July right now. Could the market be gaining confidence that the US crop will get planted? Forecasts look good through the weekend as it looks like things could warm up in areas and hopefully allow for planting in the central and southern US corn growing areas. However, some major producing areas look to stay saturated and to keep planting from happening. Small progress is expected to be made in the US this week as far as planting goes but I think the market is really hoping for some good progress numbers to make up for it next week. Drought maps are expected to show the drought easing up in the western corn belt due to the good amounts of precip that have fallen over the past couple months. Ethanol production numbers were up from last week which is good for demand. However, export sales for the week were expected to be at 200-600 TMT and came in at 335.9 TMT. Nothing to get too excited about, indicating that demand for US corn is still a bit weak. The market could be slightly encouraged by reports of a US corn sale to China.
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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