SunPrairie Grain Morning Comment
MINOT - Oct 2/13 - 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 up 4-6 cents, strong consumption lifts prices but quiet export demand due to high US prices could limit gains (Mpls Dec last trade 7.43, KC Dec 7.51)
Soybeans are 3-5 higher, market stabilizes after recent selloff (Nov last trade 12.72 ¼)
Corn is down 0-1 cent, market focuses on yield reports and harvest weather for pricing, has things bouncing around this morning (Dec last trade 4.39 ¼)
Sunflowers are down 5-10 cents, soybean oil is lower, demand fairly quiet for time being
Canola is up 25-30 cents, futures shoot higher with rising soybeans
Today:
The markets, especially the financial ones, are a bit cautious as the government shutdown continues. The US dollar is lower on the news as there is not yet an end in sight as the bickering has yet to end. Grain futures have little of their own fresh news to trade off of and having no input from the USDA certainly does not help things. The USDA is scheduled to release its monthly S&D report on the 11th but if the shutdown continues much longer we could see that date pushed back. Crude prices are also off this morning, down 24 cents at the moment but still hanging above $100/barrel. Corn and soybeans will focus on harvest weather and yield reports while wheat prices look to corn prices and winter wheat planting for guidance.
In the long term we can probably expect to see wheat trade go back and forth as good consumptive demand works against falling corn prices and rapid winter wheat planting progress. There are also thoughts that perhaps US prices are climbing too high for the global export marketplace as global wheat supplies are doing pretty well right now. Canada is reporting high yields and low protein from their wheat harvest, we will know more after Friday's StatsCan report. Black Sea Region seedings look to be lower this year with rains delaying the effort.
Speaking of rain - we may see some soybean harvest delays across parts of the US due to rainfall. So far harvest yields have been pretty good but some expect that yields will decrease as harvest of late planted soybeans begins. A private market analyst increased their US soybean yield estimate from last month's estimate, though, by 0.2 bushels per acre to 41.4 bpa. This would put the US crop at 3.163 billion bushels. Soybean prices do not seem to be paying attention this morning as they are rising, probably finding some buying interest after falling so heavily recently.
It's really surprising how little has changed in the sunflower market over the past two months. Sunflowers are obviously under pressure with falling soybean prices and also falling corn prices. Corn oil and sunflower oil are good substitutes for one another, so when the corn market falls sunflowers do as well. South Dakota looks to have a pretty good sunflower crop this year and yields are also expected to be high. This helps to negate some of the concern about the lack of a crop in North Dakota. Additionally, finding a birdfood bid right now is pretty dang tough as buyers are all running. That leaves us to the NuSun/oil market for demand right now.
Corn prices are bouncing around either side of unchanged right now. Prices wanted to trade lower but it seems higher wheat and soybean prices have the market supported just a little bit. So far yield reports are meeting or exceeding expectations. It looks like the US could be in for a heck of a corn crop right now. A private market analyst increased their US yield estimate from last month by 2.3 bushels per acre to 158.7 bpa which puts total production at 14.15 billion bushels. That is a lot of corn. If realized, it is hard to imagine why corn prices would trade much higher in the near term.
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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