SunPrairie Grain Morning Comment
MINOT - Jul 23/13 - 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 down 1-3 cents, following lower corn prices, stiff global export competition (Mpls Sept last trade 7.45 ¼, KC Sept 6.99 ¼)
Soybeans are 4-8 cents lower, perhaps some profit taking after trading higher, weather concerns minimal (Nov last trade 12.82)
Corn is down 8-11 cents, lack of a substantial weather threat continues to let prices drift lower (Sept last trade 5.31)
Sunflowers are 5-10 cents lower, with soybean oil, strong movement
Canola is off 5-20 cents, futures lower again this morning, falling soybean complex and crude prices the likely culprit
Yesterday:
Prices chopped around in the grain markets again yesterday. Corn prices were lower due to cooler temperatures being favorable for pollination. Wheat was dragged lower with corn, strong new crop yields and an overall favorable outlook for global wheat production. Spring wheat prices were down four cents and hard red winter wheat was down three cents. Soybeans did well yesterday, though, as tight old crop stocks were enough to boost new crop prices as well. Soybeans finished the day with cash prices 14 cents higher. Expectations for declining crop conditions also provided some support to the soybean market. Old crop canola prices were hammered yesterday. You'll notice that the July cash price for canola is a lot higher than the August cash price for canola - well, now the market is working to merge those two prices and instead of bringing August prices higher, July prices are going lower. That's the market's way of saying that supplies are tight now, that canola is needed now but is confident that it will have canola later.
Today:
Grain futures are lower in general this morning despite a decline in crop condition ratings released by the USDA yesterday afternoon. Outside markets are unfavorable as the US dollar is higher and crude prices are lower with some profit taking. Nearly all grain futures contracts are lower this morning. Old crop soybean meal continues to work its way higher due to supply concerns but other than that prices are drifting lower. A lack of a significant weather threat also lets grain prices drift lower. Temperatures are expected to remain cool but rain is forecast to be a bit lighter than expected.
Wheat prices seem to simply be following the corn market this morning as there is not much news that would result in prices wanting to trade much lower this morning. Spring wheat prices are not seeing the losses of the winter wheat markets - likely due in part to an absence of harvest pressure but also due to a decline in crop conditions. Ratings fell to 68% good to excellent, which is a 2% drop from last week. North Dakota spring wheat is rated 71% good to excellent. The ND spring wheat crop tour kicks off today and I'll work to put in some of the results found as the tour works its way across the state. Winter wheat harvest is nearly on pace at 75% complete with some states notably far behind and others complete.
There is little fresh news for soybeans today. Prices are bouncing all over the place but the November contract is currently five cents lower. Crop condition ratings fell 1% to 64% good to excellent but we did see a bit of an increase to the Minnesota ratings. There are thoughts that US old crop ending stocks could be even tighter than current USDA estimates which may work to keep old crop prices pretty well supported. Canola futures are dropping a bit this morning again, likely with the falling soybean complex as there is little fundamental reason for canola to want to trade higher. Harvest is approaching and Canada is expected to have a pretty good crop.
The corn market is posting double digit losses at the moment, despite a 3% decline in crop conditions (puts ratings to 63% good to excellent). The market does not seem to be concerned about the crop rating as 63% is still a pretty good number. Additionally, weather looks to be nice and cool for the pollinating crop. Corn could use some moisture in areas and there are not too many significant weather events in the nearby forecast, but Nebraska reportedly got some much needed rains. Ukraine increased its corn production estimate which could also weigh on US futures prices.
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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