SunPrairie Grain Morning Comment
MINOT - Jul 1/13 - 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, surprising because of winter wheat harvest pressure, perhaps gaining strength from outside markets (Mpls Sept last trade 7.77, KC Sept 6.94 ¼)
Soybeans are up 2-5 cents, old crop sharply higher due to tight stocks, new crop not quite as strong due to crop uncertainty (Nov last trade 12.54 ½)
Corn is down 4-6 cents, probably some follow through pressure from Friday, but most likely good weather forecasts puts downward pressure on prices (Sept last trade 5.42 ¾)
Sunflowers are up 0-5 cents, bean oil is slightly higher, crude doing well, soybeans higher, could be a good day for sunflowers
Canola markets are closed today as Canada is on holiday
Check out our new and improved website! www.sunprairiegrain.com
Delayed Pricing
SunPrairie Grain will offer free DP on spring wheat and winter wheat beginning July 1st through July 31st. DP will remain at 5 cents a month for corn and soybeans and 15 cents a month for sunflowers through July 31st. As always, DP is dependent on space available.
SunPrairie Grain Dynamic Pricing Platform (DPP) Incentive
DPP is offering an exciting incentive to those who sign up for their mobile app between July 1st-7th. Everyone who signs up for the app will be automatically entered to win a GoPro Silver edition. If you were like me and had not heard of a GoPro until now - here's a link http://gopro.com. What can you do with the DPP mobile app, you ask? You can see SunPrairie Grain's cash bids for futures traded commodities, futures quotes and even place offers to sell grain all from your phone! The app also offers market commentary and news. Those who have the app have had nothing but great things to say about it so far. Simply download the DPP app from the app store to get signed up. If you have questions please do not hesitate to call.
Minot Main Scheduled Maintenance Closure
The Minot Main facility will be closed for dumping July 1st-3rd for scheduled maintenance. Offices and the Minot East and West facilities will be open during this time. Thank you for your cooperation!
Fourth of July Holiday - SunPrairie Grain will be closed July 4th and 5th for Independence Day. Markets close at noon on the 3rd and reopen the morning of the 5th. There will not be a morning grain update those days.
Friday:
It was a report day and that was all the grain futures focused on. The report was considered favorable for old crop prices and not so favorable for new crop prices. Perhaps the most surprising number was the corn acreage estimate. The market was expecting to see 95.340 million acres of corn seeded in the US...the USDA pegged us at 97.379 million which was actually higher than March intentions. Corn futures shot lower and finished the day down 25 cents. June 1 corn stocks were tighter than expected at 2.764 billion bushels (2.856 estimated and 3.145 at June 1 last year) which should help old crop but did little in Friday's session. Soybean acres were lower than expected at 77.728 million (78.024 average estimate). However, the USDA announced shortly after the release of the report that soybean acres in 14 states will be resurveyed due to the late planting season - giving uncertainty to the market. Soybean stocks were tighter than expected at 435 million bushels (441 millbu est) and last June 1 stocks of 667 million bushels. Soybeans were down 23 cents for the day. Spring wheat acres were decreased by 400k from March intentions, which was less than expected. June 1 wheat stocks were also lower than estimated (750 millbu) at 718 millbu. Wheat futures did better than corn and soybeans on Friday with Minneapolis losing eight cents (spring wheat cash prices were down only 3 cents due to a basis increase) and KC HRW futures down 12 cents for the day.
Today:
The wheat and soybean futures markets are recovering a little bit today from Friday's session. Corn futures are not quite so lucky as the market turns its attention to weather forecasts which look pretty good for the crop, which means prices tend to struggle. Outside markets are mixed, the US dollar keeps bouncing around both sides of unchanged but crude prices are doing well, over a dollar/barrel higher. There is little fresh news for grain futures this morning and it seems like prices are just trying to settle into Friday's numbers and adjust accordingly.
Wheat futures should be kept subdued a bit today by yield reports from winter wheat harvest. Yes, there are areas where the hard red winter wheat crop is not doing well (we're talking yields in the teens) but there are also other areas where yields are up in the 50s. In fact, some areas of Kansas reportedly saw increased hard red winter wheat seeding last fall and that are also experiencing higher than expected yields, resulting in the potential for a record crop. We won't know until harvest is complete but the market feels, for now, that the crop is overall going to be ok and that what is poor in one area will be made up for in others. The market is expecting HRW harvest to be reported at 35-38% complete in this afternoon's USDA report. Soft red winter wheat yields have also been coming in much higher than expected. In the newest in the GMO saga - it was discovered and reported that the GMO wheat variety was stored at a facility in Colorado until 2011 when it was ordered to be destroyed. The thought is that during the process, some must have been leaked (stolen?) which would help explain how the variety wound up in a field in Oregon.
As I mentioned above, the USDA has said that it plans to resurvey soybean acres in 14 states that experienced late planting due to wet weather. This adds some uncertainty to Friday's report numbers - will there be more acres? Tight old crop stocks are enough to keep prices supported for now, though, and soybean futures are higher today on that news. In other oilseeds the USDA decreased estimates from March intentions. US sunflower acres are down nearly 7%, canola 21% and flax 18%. Year on year the changes are more drastic with sunflowers down 18%, canola 26% and flax 35%. I guess this is not really a surprise considering the late planting season and switch to more corn and soybean acres in North Dakota where many of these oil crops are produced.
The USDA really surprised us with the corn acreage number on Friday, putting us higher than March intentions at 97.4 million. The market had priced in about a 2 million acre decrease in corn acres, so the fact that we were up from March intentions gave prices quite the shock. The USDA has said that it has no intent to resurvey corn acres also. Additionally, favorable weather forecasts mean that we could see an increase in crop conditions in this afternoon's report which further weighs on prices. Fund selling of corn futures continues as well, which adds weight to futures.
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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