SunPrairie Grain Morning Comment
MINOT - Jun 11/13 - 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 1-3 cents, following row crops as there isn't fresh news to give wheat a direction of its own (Mpls July last trade 8.13 ¼, KC July 7.28 ¼)
Soybeans are 5-8 cents higher, planting progress in line with estimates but market still worries about delays, tight old crop stocks keep prices higher as well (Nov last trade 13.21)
Corn is 1-3 higher, tight old crop stocks, trade thin and choppy in front of tomorrow's monthly USDA S&D report (July last trade 6.53 ¼)
Sunflowers are 5-10 higher, stronger soybean complex working against sharply lower crude prices influence the sunflower market today
Canola is up 15-20 cents, market coming back a little after yesterday's strong selloff
*AOG Contracts*
If you have an Act of God contract with us and are/were unable to get your crop seeded, please let us know as soon as possible. Also, just a reminder, we need a copy of your FSA 578 forms on seeded and PP acres when they're available for all AOG contracts (HO Sunflowers, Victory Canola, commodity canola, flax and NuSuns). If you have any questions please let us know. Thank you!
Yesterday:
It was not a great start to the week for the grain futures as most everything was lower for one reason or another. Corn and soybeans saw some funds rolling their positions from one futures month to another and general technical selling also added weight to prices. Corn saw old crop finish the day sixteen cents lower and new crop prices fell as well. Improving weather forecasts for the developing crop may have also had something to do with decreasing corn prices yesterday. Soybeans were off 11 cents for old and new crop cash prices as planting progress over the weekend was better than expected. Canola had a sharply lower close yesterday as the Canadian crop was seeded and soybean prices fell. Canola lost another 40 cents/cwt yesterday and flax was down 30 cents a bushel. Sunflowers lost only a nickel, though.
Today:
Grain trade is choppy, mixed and cautious in front of tomorrow's USDA report and after yesterday's losses. Row crops are again leading the way with old crop soybeans posting the strongest gains right now. Tight old crop corn and soybean supplies are enough to keep those futures months elevated. New crop contracts struggle a little as weather forecasts improve and planting/crop progress are not cause for too much concern at the moment. General economic concerns could be weighing on the outside markets as we're seeing a lower US dollar and crude prices down about $1.35/barrel at the moment.
Winter wheat prices look to trade higher this morning but gains are being limited by harvest progress. Hard red winter wheat harvest was, as of Sunday evening, 5% complete, which is 11% behind the average pace. However, progress is expected to be fairly strong this week as weather dries out and allows for combines to get going. The USDA is expected to decrease US hard red winter wheat output slightly in tomorrow's report due to the drought decreasing yield. However, global supply estimates are still more than ample to cover losses in the US crop at this point. The GMO situation will continue to weigh on prices as testing and the investigation continue. Spring wheat is posting gains better than the winter wheat markets as ND planting is still a concern. However, the USDA put overall spring wheat planting at a higher number than what the market expected. According to the USDA the US spring wheat crop was 87% planted as of Sunday evening which isn't too far off from the 96% average. However, that last bit will be hard to go in as North Dakota is lagging behind at 77% planted, compared to a five year average of 94%. Spring wheat crop condition ratings are at 62% good to excellent which is a 2% drop from last week. ND spring wheat is rated 69% good to excellent.
US barley planting is a bit behind average at 88% complete, versus the five year of 96%. North Dakota is behind at 68% planted (96% average) and MN is behind at 89% done (99% average). The US barley crop is rated 63% good to excellent which is a 3% fall from last week's rating as more of the crop fell into the "fair" rating category.
Soybean planting progress was in line with what the market was expecting and good progress is expected to be made this week. The US soybean crop is reportedly 71% planted, which is 13% behind the five year average. North Dakota stands out as lagging behind at 69% planted vs an 89% five year average. A handful of other states are also a bit behind but like I said - steady progress is expected this week. Not many supply and demand changes are expected in tomorrow's report for the soybean market. We could see a slight yield reduction due to a later planting season but that would be about it. Old crop supplies are tight and that will keep those prices elevated but new crop will struggle as planting continues.
The US sunflower crop is only 29% seeded versus a 61% average. South Dakota has reportedly been making great progress but according to the USDA is only 20% planted, compared to a 46% average. Perhaps we'll see strong numbers out of SD this week. ND sunflower seeding is pretty sad at 33% complete, well behind the 76% average. It will be interesting to see what happens to the sunflower market is North Dakota is unable to improve upon this number.
The corn market is seeing thin, choppy trade this morning as futures are mixed. Old crop futures want to stay higher with tight supplies leading the way but are having a tough time doing so. New crop prices will fight to stay higher as crop development conditions are favorable. Corn planting is 95% done which is only 3% behind the five year average. So by now the market has completely forgotten about planting delays...ND and WI are the only states that pop out as behind at 89% and 81% planted, respectively. Corn prices are now more focused on crop conditions which are unchanged from last week at 63% good to excellent. Ratings in Iowa and Minnesota are being talked about, though, as those top producing states are seeing ratings a bit below where the market would like them. However, if weather improves it will not take long for the crop to respond.
Not much happening for grain futures today as the markets await tomorrow's USDA S&D report.
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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