SunPrairie Grain Morning Comment
MINOT - Jul 8/13 - 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 2-7 cents, winter wheat markets higher than spring wheat which is limited by expectations for high crop condition ratings (Mpls Sept last trade 7.66 ¼, KC Sept 6.93)
Soybeans are up 5-15 cents, new crop really rallying, buying interest seems to have been spurred (Nov last trade 12.43 ¾)
Corn is 6-9 higher, speculative buying after Friday's price decline, December contract fights its way back to over the $5 mark (Sept last trade 5.32)
Sunflowers are unchanged, soybean oil relatively quiet this morning, struggling with higher soybeans and lower crude
Canola is up 10-20 cents, futures board higher this morning with soybean complex, general buying
Delayed Pricing
SunPrairie Grain will offer free DP on spring wheat and winter wheat 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.
Today:
There's a lack of fresh news to guide grain futures trade this morning so speculative buying interest after lower trade on Friday is working to pull prices higher. There's still a lot of speculation about weather forecasts going on as corn nears the key pollination phase - will it be too hot in areas? So far, weather has been pretty ideal for the developing corn and soybean crops but today that does not seem to matter much. The market will be looking forward to what the USDA will have to say in this afternoon's weekly crop progress/conditions report. Outside markets are mixed with the US dollar lower and crude prices lower as well. Crude prices rallied pretty strongly last week and are seeing some selling pressure now.
The wheat markets probably have the most news of any of the grains right now as there are several bits and pieces floating around. Perhaps the most encouraging is that South Korea lifted its ban on US wheat after testing revealed no findings of GMO wheat in recent shipments. The ban was officially lifted on Friday and hopefully this helps to spur some demand for US wheat back into some of the Asian markets that have backed off. It was another pretty strong harvest weekend for winter wheat. Poor yields in Western Kansas may be providing some price support but in general winter wheat harvest yields are better than what was expected. Informa Economics last week, though, reduced its US wheat production estimate due mostly to decreased yields out of the hard red winter wheat crop. Overall analysts are expecting large global wheat supplies this year. Winter wheat futures are staging gains of about six cents right now whereas spring wheat is struggling due to ideas that crop conditions could increase in this afternoon's report. Reports of fair to excellent Saskatchewan crop ratings could also limit spring wheat gains.
Soybeans are posting double digit gains in most contracts right now. Tight old crop supplies keep those futures months supported but the November contract is rallying about 15 cents right now despite favorable weather conditions for the developing crop. I can't really figure out a fundamental reason for soybeans to be trading higher right now so I'm thinking this is most likely being driven by speculative buying interest more than anything. Informa Economics increased its US soybean production estimate last week. Chinese monetary policy concerns could also create some demand uncertainty as we move forward.
December 2013 corn futures traded below $5 for the first time since December 2010 on Friday when prices took a bit of a nosedive. Today, though, prices have rallied back above that mark as corn futures were feeling a bit oversold and buying interest has worked its way back into pricing. So now we're in a bit of a weather versus oversold conditions war. Weather has been pretty good to the developing crop which has been putting pressure on futures prices. However, we're getting close to entering pollination stage in areas and forecasts will continue to be watched closely. Informa Economics increased its 2013 production estimate but kept yield estimates below current USDA estimates of 160.5 bpa at 160 bpa.
Not much fresh news around so the grain markets trade weather, as well as being subject to speculative interests.
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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