SunPrairie Grain Morning Comment
MINOT - May 28/13 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 8:40 AM CDT:
Wheat is up 3-5 cents, ND planting concerns vs. improving winter wheat conditions (Mpls July last trade 8.09 ½, KC July 7.49)
Soybeans are up 18-20 cents, concerns about planting delays and forecasts for more wet weather have futures higher (July last trade 14.95 ¾)
Corn is 12-14 higher, planting delays help boost the new crop futures months, old crop gaining but not by as much (July last trade 6.63 ¼)
Sunflowers are up 10-15 cents, sharply higher soybean oil and crude futures work to pull sunflowers up
Canola is 20-25 cents higher, taking cue from a rising soybean complex, crude
Friday:
Profit taking in front of the long weekend was the main theme for the grain markets on Friday. US economic news also had the grain markets a bit mixed in Friday's session. Corn was pressured due to rapid US planting progress, which is expected to be nearly on pace in this afternoon's report from the USDA. However, a shift in basis had cash prices up a nickel which negated the loss in futures. Soybeans were sharply lower on Friday as we rolled our bids from the July contract to the August contract, which is currently showing a nearly 75 cent inverse. Futures also struggled with ideas that US soybean acres will increase. Canola and sunflowers were lower with the fading soybean complex. Wheat futures were lower with the row crops and unfavorable outside markets. Spring wheat finished the day down seven cents and winter wheat was off eight cents.
Today:
Corn and soybean futures are coming alive this morning and showing a really good start to the trading week. Right now the focus is on weather and forecasts are calling for rain across many of the major US growing areas. Additionally, cooler than normal temperatures look to continue for the upper Midwest. So it seems that we have again worked ourselves into a weather focused market. Outsides are mixed this morning as the US dollar is higher and crude prices are up about $1.50/barrel.
Spring wheat planting is expected to be reported at well behind average pace in the nation's top producing state of North Dakota as there were not many great planting days last week. Overall, though, spring wheat planting is estimated to be reported at 80% complete, which isn't too far behind the average pace of 88% complete. Winter wheat futures are showing gains of about a nickel right now but we could find that strength limited by ideas that the USDA could increase crop conditions in today's report due to some recent precipitation to growing areas. Harvest is approaching quickly for some areas which means that we could also see some seasonal pressure working its way into the markets. Globally, weather is looking ok. Russia remains a bit dry but beneficial rains have reportedly fallen there, as well as to dry areas of Australia. Concerns about the US crop are negated by anticipation for ample global production this year.
The soybean market is all about weather right now. Will the crop get planted? Will there be an acreage shift from unplanted corn to soybeans? The market is uncertain at this point which is part of the reason why we have seen such inconsistent trade over the past few weeks. Planting concerns remain and today the market is expecting to see the USDA report the US at 40-50% complete, the average pace for this time of year is 61% complete. Soybean oil and soybean meal are both sharply higher as well this morning. Combined with higher crude prices, we could see a pretty good day for the oilseed markets in general.
Corn futures are posting double digit gains this morning with new crop futures showing the most strength. There are ideas that North Dakota and Minnesota will lose acres due to rain causing planting delays and forcing growers to plant something else. The USDA is expected to put US planting progress at 85% complete which would put the US only 5% behind the average planting pace. The market will remain volatile as long as our main focus is weather, which is why we see a drop in futures one session and a rally in futures the next.
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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