SunPrairie Grain Morning Comment
MINOT - Apr 26/13 - 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 5-8 cents lower, lacking follow through strength from yesterday's weather-led rally (Mpls July last trade 8.03, KC July 7.53)
Soybeans are down 2-4 cents, nearby Chinese demand concerns take the forefront after yesterday's cancellation confirmation (July last trade 13.68 ¼)
Corn is 5-7 cents lower, following wheat and soybeans lower as there is little fresh news to give reason reason for futures to trade higher right now (July last trade 6.19)
Sunflowers are down 10-15 cents, bean oil off with soybean and crude this morning
Canola is down 10-20 cents, futures relaxing with lower US markets
*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:
The grain markets put in a pretty decent day yesterday, led by the hard red winter wheat market as it seems that the market finally decided to take notice of the freeze damage that has occurred over the past couple of weeks. Hard red winter wheat closed the day 21 cents higher and prices surged back above $7/bushel. Spring wheat followed along but couldn't hold strong gains the whole session and prices closed off their highs but with old crop still seven cents/bushel higher. We bought a pretty good chunk of spring wheat yesterday as cash prices started flirting with the eight dollar mark, but we're pretty far from that today. Soybeans staged a pretty good rally yesterday as they saw decent new crop demand from China. Soybeans were up 27 cents on the day and pulled sunflowers and canola along for the ride as well. Corn followed the higher wheat and soybean markets as there was little fresh news fundamentally to pull corn higher on its own. A sale of US corn to China was announced but didn't seem to have a huge impact on prices. Corn finished the day six cents stronger. Outside markets were favorable as some good economic news was released, which may have also helped out our grain futures a bit.
Today:
Well it looks like we are completely lacking any sort of follow through strength to yesterday's rally. Grain futures are weaker pretty much straight across the board this morning and I'm guessing we're going to stay that way all day. Yesterday was all about the damage past weather has had on the crop combined with what seemed like some technical buying interest. Today the markets are again focused on the better weather forecasts ahead and ideas that the US crop will make it in the ground, but just a little late. Outside markets are mixed with the US dollar trading lower and crude prices down about 50 cents/barrel.
Hard red winter wheat futures led the rally yesterday and today they're posting the biggest losses. So maybe yesterday the frost damage looked really bad and today it doesn't? Or, more likely, maybe yesterday's gains were just a tad overdone and the market is correcting a little. The market is going to be anxiously awaiting next week's crop conditions and HRW wheat tour so we can get some more insight as to how extensive the damage has really been. Globally things are not looking too good for wheat prices. The International Grains Council (IGC) decreased their global wheat production estimate from prior estimates, but the number still remains above last year's production. Additionally, it sounds like Russia may have underestimated its crop size and we could see a change to supply and export numbers in the coming weeks/months. It seems that eight dollars is the new mark for spring wheat selling. We were within a dime or so yesterday and selling picked up a little - I think that if wheat should reach that mark we will see things really pick up around here. However, planting season is just around the corner and it's tough to move last year's crop while planting this year's. I think the market is expecting to see lots of grain movement come June/July. With a good planting season that could definitely be the case.
There is little fresh news to guide soybean direction right now and futures seem a little confused. It almost looks like old crop contracts want to turn higher this morning. Basis values for old crop have been well supported by strong processor demand combined with slow farmer selling. Uncertainty about demand out of China will continue to be the biggest news for this market. Yesterday's export sales saw net old crop cancellations but pretty decent new crop purchases. Bean oil, crude and canola futures are all struggling this morning which makes it seem like we could be in for a lower day for our oilseeds in general today.
The corn market is hoping to see planting progress at 10% complete as of Sunday evening in Monday afternoon's planting progress report. I think the average for that day is about 30% complete, so that puts us a bit behind normal. It seems for now, though, the market has factored in late planting. The market is expecting to see good progress made next week across the US and if that happens I think we'll probably stop worrying so much about being behind. The IGC increased 2013-14 global corn production by about 10%. This isn't really a surprise considering all the reports and chatter about corn acres increasing globally.
It looks to be a pretty quiet finish to the week as grains drift a little bit lower. Have a good weekend and let's keep our fingers crossed that this weather can continue!
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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