SunPrairie Grain Morning Comment
MINOT - Aug 18/14 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 8:45 AM CDT 08.18.2014:
Wheat is down 5-8 cents, decrease in Russian and Ukrainian tensions takes risk premium out of wheat markets (Mpls Sept last trade 6.07, KC Sept 6.15 ¼)
Soybeans are 0-2 higher, weekend rains limit gains in market, crop conditions still expected to decline in this afternoon's report (Nov last trade 10.53 ¼)
Corn is up 2-4 cents, with prices on the rise over the past few sessions, so is producer selling, adding weight to the market (Sept last trade 3.69 ¼)
Sunflowers are unchanged, soybean oil is fairly quiet with uneventful movement in soybean futures, meaning sunflowers likely won't see much change today
Canola is unchanged, futures slightly lower but not enough for there to be a major impact on prices at the moment
*Attention Barley Growers*
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Wheat futures are sharply lower this morning while corn and soybean futures are just slightly higher. The ProFarmer crop tour begins this week and is expected to find larger than projected yields for corn and soybeans, so the market will be watching for news from that. Tensions between Russia and Ukraine helped prices jump higher Friday (especially for the wheat markets) and those tensions eased over the weekend, creating less concern regarding wheat export interruption from that region.
Vomitoxin is the big chatter right now coming from North Dakota crops. Currently we are not accepting winter wheat without a submitted sample and grade. At this point we are not taking winter wheat above 5.0 VOM but we hope we will be able to work with some high VOM after harvest. Early barley VOM samples that we have run have all come back at 2.0 or less and spring wheat VOM samples have ranged from 3-4 so far. We have not seen many samples so this is by no means an accurate representation - but I want to keep you posted. The VOM problem is statewide.
Wheat futures are facing some pretty negative information this morning and that is just giving prices all the reason to trade lower. An increase in European production forecasts has prices on edge. However, only about 60% of the EU crop is expected to make milling quality. Profit taking this morning, though, is being spurred by the lack of fresh tension out of Russia and Ukraine. The market seems to be thinking that Friday's gains of a nickel-dime (depending on the wheat market) were too much. Harvest pressure could contribute to losses as well. Quality concerns from the US crop, though, could keep prices supported as we move forward.
Soybean prices are higher this morning and I'm not quite sure why. There were pretty heavy weekend rains across some areas, but others did not receive much rain. Soybeans needed the moisture but the 5+ inches that some areas received is a little much. More rains are in the forecast and overall this is viewed as pretty favorable for the crop as it was needed. Crop conditions are still expected to decline, though, as some spots missed the precipitation. Ratings, though, will remain at historically high numbers.
The December corn contract has been on the rise since about the end of July and with that uptick in prices has come an increase in producer selling, which then limits gains in the futures markets. The ProFarmer tour is expected to find higher yields than what the USDA is currently estimating which could keep a lid on gains. A decline in crop conditions is expected this afternoon, which is typical as the crop reaches maturity. There is not much other news for corn futures this morning and so prices may drift quietly higher.
Kayla Burkhart
Broker/Procurement
CHS SunPrairie
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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