SunPrairie Grain Morning Comment
MINOT - Jul 25/13 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 8:10 AM:
Wheat is mixed, spring wheat and hard red winter wheat futures are slightly higher, perhaps favorable demand news (Mpls Sept last trade 7.44 ½, KC Sept 6.98)
Soybeans are down 18-20 cents, market continues to collapse, especially old crop which is down 33 cents (Nov last trade 12.37)
Corn is down 3-5 cents, ideal weather conditions for crop pollination and falling soybeans have corn sharply lower (Sept last trade 5.03 ¼)
Sunflowers are down 20-30 cents, bean oil is sharply lower today and sunflower movement is strong so prices do not look too favorable
Canola is down 30-40 cents, futures board sell off goes right along with the soybean complex
Today:
Grain prices were mostly lower in the overnight session and it looks like the tone for the open at 8:30 will be weaker. Soybeans are leading the way lower as old crop demand seems to have disappeared overnight and futures contract selling has been strong. Old crop prices are losing more than new crop as the contract prices converge. Soybeans are dragging corn prices lower and corn is in turn putting pressure on the wheat markets. Favorable US crop weather also adds weight to the markets. Export sales for the week were not anything too spectacular but also not bearish. Outside markets are mixed with the US dollar lower and crude prices lower as well. As with the grain markets, there is little fresh news to drive things for outside markets as well. It just looks like another lower day in general for the grain markets.
Canadian spring wheat conditions came out at above 80% good to excellent this week which may add weight to spring wheat prices which have been finding some recent strength due to declining US crop conditions. The North Dakota spring wheat crop tour has been finding only slightly lower yields than last year (45.1 bpa v. 45.5 last year) and yields above the five year average of 42.6 bpa. Overall the crop is reported to look pretty good but is noted to be a few weeks behind, which is not a surprise given the wonderful planting season we had. Export sales for the week came in above estimates that ranged from 400-600 thousand metric MT(TMT) at 661.4 TMT. Export sales could be mildly supportive for prices but with falling row crops it could be tough for wheat to find reason to trade higher.
Little fresh news for soybeans today. Price action seems to have a lot to do with old crop demand which has fallen off and the convergence of old crop and new crop prices. Old crop prices are currently down another 25 cents or so and new crop is down about 18 cents. Export sales for the week came in above estimates that ranged from 300-650 TMT at 793.5 TMT. Most of the sales were for new crop and old crop sales were fairly quiet. This could be reason for additional pressure to old crop soybean prices. Soybean oil and canola prices are following suit this morning and it looks like we could see lower oilseeds in general today with the weaker soybean complex leading the way.
South Korea bought some Black Sea region corn which does not bode too well for US prices or demand. Also hurting US prices are the weather forecasts throughout the growing area. It seems that weather is ideal for pollination as temperatures have not been too high. Some spots in the eastern corn belt are talking of dry weather but at this point it is not much of a concern. With weather aiding production, prices are struggling for corn right now. In turn, that pushes US wheat prices lower as well. Somewhat favorable news for the market is that Mexican acres are thought to be lower than current USDA estimates as drought conditions prevented full intended acres from being seeded. US export sales for the week were net cancellations for old crop and overall sales were lower than estimates that ranged from 600-950 TMT at 488 TMT.
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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