SunPrairie Grain Morning Comment
MINOT - Aug 19/14 - 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 08.19.2014:
Wheat is -1 to +5, market continues to struggle with abundance of global supply, news that Ukraine losing some of its crop due to struggle with pro-Russian separatists (Mpls Sept last trade 6.11 ¼, KC Sept 6.22 ½)
Soybeans are 6-8 lower, market expected a drop in crop conditions but instead saw an increase, so futures are lower today (Nov last trade 10.51 ¼)
Corn is down 0-2 cents, big yields expected from the crop tour as it works its way through the Midwest (Sept last trade 3.59 ½)
Sunflowers are 0-5 cents lower, bean oil is lower with falling soybean prices, pulling sunflowers along
Canola is 5-10 cents lower, falling with the soybean complex, lower nearby crude futures prices
The Minot Main facility is back up and running. Winter wheat will continue to go to the West Facility on Valley Street for now at 5.0 or less VOM.
*Attention Barley Growers*
Rahr has approved a product to regulate insect growth in your barley. Diacon-D can be applied easily to your barley to prevent larvae from turning into live bugs, overtaking your barley in the bin. CHS SunPrairie and Dakota Agronomy Partners have Diacon-D on hand for those who are interested. Please let us know if you're interested or if you would like more information. Thank you!
There is a lack of supportive news for the grain markets this morning and with that corn and soybean prices are turning lower. Corn and soybeans are expecting to see large yields coming from the ProFarmer crop tour this week. Wheat prices have been all over the board this morning and it's tough to pin a direction for them. With lower corn and soybean prices it could be hard for wheat to justify trading higher for too much longer. The US dollar is higher and crude prices are down 61 cents/barrel on the September contract at the moment.
Large global supply and a lack of fresh tension from Russia and Ukraine have wheat prices struggling to trade higher this morning. However, news from the Ukrainian Prime Minister that up to 15% of their crop could be lost due to the fighting with pro-Russian separatists could be slightly supportive. The market seems to be shrugging off that news, though, as the crop out of Ukraine is huge this year so the loss is not having a huge impact on prices for now. Also weighing on futures is the fact that US wheat keeps getting priced out of the global marketplace by other, cheaper wheat. Spring wheat crop conditions declined by 2% to 68% good to excellent, but since the crop is being harvested in areas this isn't really a surprise.
The soybean market is seeing double digit losses this morning which seem to be due mostly to an increase in crop condition ratings when the market was expecting a decrease. US soybean crop conditions are rated 71% good to excellent which is up 1% from last week. The ProFarmer tour is finding higher pod counts than the tour did last year and yields are expected to be higher than current USDA projections. Strong Chinese imports are definitely great for the demand side of things but when you're facing a record crop it makes it hard for prices to trade higher.
Yields from the ProFarmer tour were mixed yesterday with Ohio reporting huge yield potential (182.1 bpa) and South Dakota (152.7 bpa) showing decreased yield potential from last year. However, South Dakota's crop is behind where it was at this point last year which has an impact on the tour's results. Today the tour is expected to find larger than estimated yields. Crop ratings decreased by 1% to 72% good to excellent but the market isn't really reacting to it because it's typical for crop conditions to decline as it matures.
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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