SunPrairie Grain Morning Comment
MINOT - Jun 3/13 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 8:50 AM CDT:
Wheat is up 5-7 cents, spring wheat increases on planting concerns, higher corn and soybean markets help but GMO concerns still weigh on demand (Mpls July last trade 8.24, KC July 7.54 ½)
Soybeans are 20-22 higher, market focuses on weather and planting delays (Aug last trade 14.58 ¾)
Corn is 3-5 higher, unfavorable US weather guides prices higher, tight old crop stocks support that market (July last trade 6.64)
Sunflowers are 5-10 cents higher, bean oil stronger this morning, as are crude prices, should help out sunflowers
Canola is 5-10 higher, futures stronger with US markets
Friday:
Weather and concerns about US planted acres dominated the grain futures markets in Friday's session. Corn prices bounced around, starting out higher, struggling and then rebounding to finish the day eight cents higher. New crop corn prices continue to stick to that high four dollar range but have a tough time breaking a cash prices of five bucks. Soybeans focus on US planting worries (and maybe had some month end position evening occurring) and finished the day with old crop prices up 11 cents. New crop cash prices hovered just below $12. Wheat prices started the day lower with the GMO leading to less demand issue being the main driver of prices. However, the strength in corn and soybean futures combined with concern for spring wheat planting had prices turn higher with both spring wheat and hard red winter wheat finishing the day up a nickel.
Today:
The grain markets are again focusing on US planting concerns and weather this morning, which is leading to higher prices. Cold and wet forecasts persist across much of the Midwest for the 6-10 day forecast. This leads to emergence and planting concerns for much of the US corn and soybean crop. The USDA is to release its weekly crop progress/conditions report this afternoon and not much is expected to have changed from last week. Outside markets are supportive as the US dollar is lower and crude prices are up about 70 cents/barrel at the moment.
The wheat markets are climbing higher with corn and soybeans this morning. Spring wheat continues to find some strength of its own due to planting concerns as it does not seem like a whole lot more is going to happen in North Dakota as far as planting goes, due to weather. Gains in the wheat markets will continue to be limited by the GMO wheat found on a farm in Oregon. The market is looking for any fresh news into the investigation as well as how buyers are reacting to the news and handling US shipments. US shipments have been tested by buyers and no GMO wheat has been found so far. However, Asian buyers are temporarily out of the market for US wheat. A good question has been posed, though. If the US is not supplying the wheat, who will? Australia has already had a strong export pace that is reportedly not sustainable. So who will benefit? The market figures buyers will have to pay up for European or Canadian supplies until the GMO issue is sorted out in the States. The US hard red winter wheat crop continues to see conditions struggle but that's typical as harvest approaches, which has even already started in some areas. Harvest pressure could keep a seasonal lull on HRW prices.
US soybean futures are staging a pretty good rally this morning as old and new crop prices are up over 20 cents/bushel. More rain events in the forecast, delaying planting further and creating concern about tight US supply, are enough to push prices higher. A lower US dollar and higher crude oil prices are also supportive. US planting progress is expected to be reported at 55-60% complete in this afternoon's report. The five year average is 75% complete. Nearby forecasts are good for planting but as I mentioned above, the 6-10 day does not look so good for much of the Midwest. Chinese soy futures are higher on US planting worries as well, which in turn lends support to the US soybean futures markets.
The USDA is expected to put US corn planting at 90% complete in this afternoon's report. It's looking more and more like we got our corn crop in. The USDA is to report is first corn crop condition ratings of the year this afternoon. The crop is expected to come in at 65% good to excellent which is about on pace with the five year average of 70%. Tight old crop stocks combined with decent new crop demand seem to be enough to keep corn prices higher this morning. The International Grains Council increased its 2013-14 global corn output estimate from last month which could weigh on things a bit.
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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