SunPrairie Grain Morning Comment
MINOT - Jun 9/14 - 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 down 1-6 cents, Chicago market sharply lower, KC and Mpls hard wheats are down only 1-3 cents (Mpls July last trade 7.08, KC July 7.36)
Soybeans are mixed, old crop lower, new crop up 2-4 cents, old crop demand is fading but new crop demand remains consistent (July last trade 14.54 ¾)
Corn is down 8-10 cents, crop conditions expected to be well ahead of average, making the case for high yields this year (July last trade 4.49 ¾)
Sunflowers are up 0-5 cents, bean oil is just slightly higher this morning and that has sunflowers up, if soybeans fade bean oil likely will too, though
Canola is unchanged, futures board is pretty quiet this morning, making for an uneventful day in cash canola prices
The US dollar is higher this morning and crude prices are sharply higher as well, up over a dollar per barrel at the moment. Grain futures were choppy in the overnight session and seem to be working their way lower in the day session. Good weekend weather, meaning good crop conditions and potentially strong yields has futures on the defensive. The USDA is expected to release good crop condition ratings in this afternoon's report. This Wednesday the USDA will release its monthly S&D report.
Spring wheat planting is expected to be 90-95% complete in this afternoon's report and we'll also see the first crop condition ratings of the season. Hard red winter wheat harvest is progressing in the south with low yields and quality being reported. However, as harvest moves north both yield and quality are expected to improve. The USDA is expected to make changes to production estimates in this week's S&D update, with a downward revision expected due to decreased hard red winter wheat yields. So there is some mildly favorable news to be had for the wheat markets, especially if that decrease in wheat production comes as expected. However, global supplies are still more than able to meet demand and they will continue to weigh on the market. Additionally, if the corn market continues to sag there will be little reason for wheat prices to stay firm.
Soybeans are seeing old crop prices fade as demand interest falls. Favorable crop weather and the expectation for the first ratings of the season to come in above average keep new crop prices from finding stable ground as well. However, new crop demand is pretty good and that keeps prices from falling off too much. Other than that there is little to report for soybean prices this morning. Direction may come from the corn and wheat markets but there is really little going on. Canola prices are stable and soybean oil is slightly higher, indicating it will likely be an uneventful day for the other oilseed markets as well.
Favorable weekend weather continued over the weekend, meaning that strong crop ratings are expected again in this afternoon's report. In fact, crop condition ratings are expected to be better than average. The higher condition ratings, the better the chances of high yields and the record crop (even with decreased acres) that some in the marketplace have been chattering about. Planting progress is expected to be pretty much done, with only a couple, small problem areas still lagging behind. I'm hearing that as of last Friday that China will no longer be issuing import permits for US DDGs..of which China was a pretty big customer last year. This could weigh on corn prices as well.
Today corn will lead the way lower, wheat will simply follow along for the ride and soybeans will try to resist due to tight old crop supplies, but fading demand will limit those gains.
Kayla Burkhart
Broker/Procurement
SunPrairie
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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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