SunPrairie Grain Morning Comment
MINOT - May 31/13 - 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 3-5 cents lower, GMO and demand concerns continue to lead to lower prices (Mpls July last trade 8.11 ¼, KC July 7.43 ¼)
Soybeans are up 6-8 cents, wet weather worries boost futures prices (August last trade 14.35 ¼)
Corn is unchanged, futures pretty quiet, market looks like it wants to trade lower but planting delays provide support (July last trade 6.55 ¾)
Sunflowers are 0-5 higher, bean oil slightly higher with soybean market
Canola is 5-10 lower, selling pressure after yesterday's rally is furthered by falling crude prices
Yesterday:
It was a fairly quiet, choppy and weak day in the grain markets yesterday. Fresh news was scattered and profit taking seemed to hit the corn and soybean markets. Wheat prices were pressured lower by GMO wheat found on a farm in Oregon as that generated concerns about demand as buyers do not want GMO wheat. Spring wheat prices held steady, though, as it wasn't dark northern spring wheat on that guy's farm and planting delays are becoming quite the concern. The Chicago white wheat market is what led the winter wheat markets lower and hard red winter wheat finished the day a penny lower. Corn was pressured by profit taking after recent gains and general confusion about the number of acres lost due to this planting season. Old crop prices finished the day 11 cents lower. Soybeans were lower as well, down about three cents on old crop with new crop contracts supported by reports of a new crop sale. Canola rallied sharply yesterday afternoon, pushing prices up 35 cents/cwt.
Today:
Grain futures are mixed today with corn and soybeans recovering from yesterday's losses and the wheat markets still struggling with the GMO/demand uncertainty. The markets could pay attention to an abundance of economic news that is around today but right now the US dollar is higher and crude prices are about a dollar/barrel lower - so those markets will not be providing any strength to grain prices today. Export sales for the week were ok for corn and wheat and fairly uneventful for soybeans. It looks like we're going to end the week pretty quietly. Weather continues to be a major factor but I think we're in a bit of a "wait and see what Monday's forecasts bring" mode.
Who says one farm can't have an impact on wheat prices? Wheat prices are lower again this morning and the market is citing the GMO findings in Oregon. It sounds like the GMO wheat found on the farm in Oregon is an isolated incident - but buyers are waiting on the sidelines until more information becomes available and basis values are struggling as a result. For now, Japan and South Korea are the only two countries that have stepped to the sidelines and delayed plans to buy wheat because of what was found. Even though it was a field of white wheat, all markets are struggling right now as it makes buyers question all US wheat. Export sales for last week were estimated to come in at 300-700 thousand metric MT(TMT) and were above that at 764.2 TMT. The market should be encouraged by this news but I think prices are focused more on future demand than anything at the moment.
Wet weather concerns are resulting in a technical bounce for the soybean market today. Prices are showing double digit gains and no signs of looking back right now. It's all about whether or not the crop can get planted as planting delays continue across many growing areas. Export sales for the week showed net cancellations for old crop and 648.6 TMT overall which is right in line with estimates of 300-800 TMT. Canola futures are being sold off a bit this morning after yesterday's rally. However, it could be hard for the market to continue its downward trend with the soybean complex performing so well today.
Planting delays work to boost corn prices as well. The market is really wondering just how many acres will get lost. The Western Corn Belt has gone from being concerned about drought just two months ago to dealing with 10-15 inches of rain in the month of May. This has made planting pretty dang difficult across many of the western corn growing areas of the US. However, the Eastern Corn Belt has seen a pretty good planting season and many states are wrapping up on planting and now focusing on emergence. Taiwan passed on buying some US corn, saying prices are too high. I think many buyers in the corn market want to see what the US gets planted as they're convinced that large production will happen and prices will weaken. Export sales for the week were pretty good at 875.3 TMT, above estimates that ranged from 500-800 TMT. Export sales may be providing some support to prices this morning as well.
Have a great weekend!
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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