SunPrairie Grain Morning Comment
MINOT - Mar 5/14 - 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 3-5 lower, Ukrainian tensions ease up and grain futures relax (Mpls May last trade 6.81 ¾, KC May 7.06 ¼)
Soybeans are down 3-10 cents, new crop losses not as heavy as old crop, China cancels purchases (May last trade 14.12 ¼)
Corn is down 1-3 cents, relaxing with tensions in Ukraine easing (May last trade 4.82 ½)
Sunflowers are down 5-10 cents, bean oil struggling with soybeans, crude this morning
Canola is up 5-10 cents, despite weaker oil markets in general, canola seems to be finding its own buying momentum to push prices higher
*CHS Harvest for Hunger*
We are in the midst of our annual Harvest for Hunger fundraiser which began the first and runs through the 20th of this month. Each dollar donated is equivalent to four meals and all contributions are given to our local food banks. Various SunPrairie Grain locations will be having fundraisers in the coming weeks. In Minot, we are having a Chili Feed on the 19th at the new office from noon - 2:00 pm. The Chili Feed will be a free will offering with all proceeds going to the campaign. Please see the attachment for more information. If you have already donated we greatly appreciate your contribution and support. Every dollar donated makes a difference!
Grain futures are relaxing this morning as the market has finally calmed down a little about the situation in Ukraine. It also helps that the goings on in Ukraine have calmed down a little as well. There are thoughts that perhaps the markets reacted a little prematurely to the tension between Ukraine and Russia and that has everything scaling back a little today. The EU has offered up $15 billion in monetary aid to Ukraine. Funds have been huge buyers in the market these past few days and maybe we're seeing some profit taking or just lack of buying interest to support prices to start this morning. For what it's worth, the US dollar is just slightly higher at the moment and crude prices are down about 20 cents/barrel.
There is some chatter of global export demand around but it is hardly enough to keep the wheat markets supported after the huge rallies they have staged over the past few sessions. The markets are continuing to keep an eye on Ukraine and the potential shift of demand to US grains. As for now, though, the market has yet to see any confirmation of demand switches. Also, as I said above, many believe it was premature of the markets to think that this could happen anyway. Logistics continue to support nearby basis values but as a whole, spring wheat selling is quite heavy. Now it's just a matter of whether or not the sold grain can get freight.
The big news in the soybean market is the confirmation of cancellations of Chinese purchases of soybeans. The news is weighing heavily on soybean futures, especially old crop, as they are posting double digit losses. On the favorable side of things, though, a private market analyst decreased its estimate of the Brazilian and Argentinean soybean crops. However, the decrease in export sales combined with the general lack of fund buying interest are taking over any positive news that might be out there today and pushing prices lower. Canola futures are higher this morning despite the losses in other oil markets, perhaps finding some continued buying interest of its own.
Corn futures losses are not too heavy this morning as the easing tension in Ukraine also pushes corn futures lower this morning. The market is still waiting for an announcement from the EPA regarding the renewable fuels standard and just how much of a decrease we'll see in ethanol required in gasoline. Decreased ethanol in gas obviously means less corn for ethanol and less demand for corn...so now the market is simply waiting to see how much those reductions are so supply/demand balance sheets can be updated. I read today that China is anticipating that the approval of Syngenta's MIR-162 trait should come quickly. Until then, though, many in the marketplace (including SunPrairie Grain) want nothing to do with it. A private market analyst also decreased its estimate of the size of the Brazilian crop which could be providing some support to prices.
Kayla Burkhart
Broker/Procurement
SunPrairie Grain
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1800 13th 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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