SunPrairie Grain Morning Comment
MINOT - Jul 15/13 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 8:35 AM CDT:
Wheat is down 8-10 cents, winter wheat harvest pressure and good spring wheat crop conditions drag futures lower (Mpls Sept last trade 7.61 ¼, KC Sept 6.99)
Soybeans are 1-3 cents higher, choppy trading session for beans today as tight old crop work against favorable new crop weather (Nov last trade 12.58)
Corn is down 6-8 cents, favorable weather forecasts let corn continue its selloff from last week (Sept last trade 5.40 ½)
Sunflowers are down 5-10 cents, with lower soybean oil, crude prices
Canola is 20-30 cents lower, canola futures continue to fall as the market tries to find its bottom
Friday:
A higher US dollar combined with favorable US crop weather forecasts were enough to push grain futures lower on Friday afternoon. Fund selling also worked to push corn prices lower on Friday afternoon and the corn market saw double digit losses of 15 cents/bushel by the end of the session. Soybeans were the leader lower due mostly to favorable weather forecasts, despite the fact that the critical growing period for US soybeans is still a few weeks away. Soybeans were off 33 cents for the day and worked to pull other oilseeds along. Sunflowers and flax were down a dime and canola was off 30 cents as well. Wheat futures tried to trade higher on what was considered favorable USDA data. However, the decline in the corn and soybean markets was too much for wheat (especially when combined with a rising US dollar) and futures eventually gave up their gains. Spring wheat finished the day down a penny and hard red winter wheat futures were unchanged.
Today:
Grain futures are mostly lower this morning as Friday's negative price action continues. There is little fresh news for the grain markets which is probably part of the problem. The grain markets have nothing to focus on but the weather and outside markets...all of which are unfavorable for prices at this point. The US dollar sold off sharply in the middle of last week but has worked to recover some of those losses Friday and today. Crude prices are about 50 cents/barrel lower at the moment.
The wheat markets could be seeing some continued harvest pressure from the winter wheat markets. It was reportedly a good weekend for soft red winter wheat harvest progress which is contributing to some of the downward movement in that market, which is likely adding weight to the other wheat markets. Spring wheat is lower with the winter wheats, higher US dollar and also good crop conditions. Despite good news that US export demand for the 2013-14 crop year looks to pick up, prices are struggling. It seems that buyers are waiting for a price decline before they step in and make some purchases. Also not helping out the US market are falling Russian wheat prices as harvest progresses. There is some chatter about Ukraine producing a record crop this year also - the Black Sea Region will be a major competitor in the global wheat marketplace this year.
Soybean trade is really choppy this morning. In the last 20 minutes prices have gone from lower, to higher, to lower again, to higher again which seems to be the pattern adopted from the overnight session as well. It seems that the market is pretty focused on crop weather forecasts which are mostly favorable. US new crop production also looks pretty good which keeps a lid on prices. There are some hopes for strong Chinese demand as we move forward and that, as usual, will provide good underlying support to prices. US crush numbers were lower than we would have liked to see last week but that could be contributed to tight old crop supplies as well, though. Canola and soybean oil prices are lower with the wishy washy soybean market this morning and it looks like it could be a generally lower day for the oilseeds today.
Corn futures are continuing Friday's selloff and are about a nickel lower this morning. Weather is not a concern to the crop at this point and forecasts as some of the crop enters its pollination stage seem to be good for now. The market is expecting to see an improvement to crop condition ratings in this afternoon's weekly USDA report which could be adding to the lower tone that we're seeing today. Reports of a new crop sale to China released Friday are doing little to boost prices, either.
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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