SunPrairie Grain Morning Comment
MINOT - Jun 10/14 - 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:
Wheat is up 0-2 cents, some recovery after yesterday, quiet trading before USDA S&D report tomorrow morning (Mpls July last trade 7.05 ¾, KC July 7.35 ¼)
Soybeans are up 2-5 cents, USDA expected to cut old crop stocks again, keeps market supported (July last trade 14.69)
Corn is 0-2 lower, favorable weather, increased crop conditions work to push market lower, it's hard to find bullish news (July last trade 4.50 ½)
Sunflowers are down 5-10 cents, bean oil is lower with canola, despite the increase in soybean futures
Canola is down 5-10 cents, futures just slightly lower, hopefully support from soybeans and crude can push prices higher
*Delayed Price*
We are currently offering FREE DP on new spring wheat and winter wheat deliveries, with grain to be priced by August 10th, 2014. Sunflowers currently have DP of 12 cents/month until July 31, 2014. Corn and soybeans are cash only. As always, DP is dependent on space available.
Grain futures trade will likely be light today with only traders evening up their positions before tomorrow's monthly USDA S&D report. The overnight session was pretty quiet and the day session is starting out no differently. Wheat futures are slightly higher, beans are up a few cents and corn is down a couple pennies. The USDA's weekly crop progress and conditions report did not offer any news that would make grain futures want to trade higher and weather forecasts are overall not considered to be threatening to US crops. The US dollar is higher this morning and crude is up 25 cents/barrel at the moment. There's a lot to cover in regards to crop progress and ratings, so I'll get right to it!
Winter wheat harvest is 9% done which is about 3% behind the average pace. As I said yesterday, yield and quality are both expected to improve as harvest moves north. The USDA has pegged spring wheat planting at 95% complete, which is ahead of average pace. ND spring wheat planting is reportedly 93% done, compared to an 88% average pace. The crop is, overall, rated 71% good to excellent which is 9% better than the rating at this time last year. ND spring wheat is starting out with phenomenal ratings of 82% good to excellent..with the top spring wheat producing state starting out with such good ratings it will be hard to justify higher prices. In tomorrow's S&D report the USDA is expected to increase both US and global stocks, for old crop and new crop. US hard red winter wheat could see a reduction in production numbers but increases elsewhere will make up for declines in US hard red winter wheat. Brazil, Ukraine, China and the EU could all see increases in wheat stocks from the USDA tomorrow.
US barley is, according to the USDA, 97% planted compared to a five year average of 93% planted. ND barley is 92% planted, 7% ahead of the five year average pace. Crop ratings are at 64% good to excellent, which was a 3% drop for the week. The ND barley crop, though, remains with high ratings at 72% good to excellent. Needless to say, it looks like the crops in our fair state are off to a pretty dang good start...corn and soybeans are no exception either.
Speaking of soybeans, the USDA says that we have 87% of the crop in which is six percent ahead of the average pace. ND beans are ahead of planting pace as well at 84% planted (80% average pace) which is pretty good considering the large acreage increase in ND this year. Crop ratings are starting out pretty high with the US crop overall rated 74% good to excellent...ND beans have an astounding rating of 87% good to excellent. Soybeans are a little higher this morning as the market is anticipating a reduction in old crop stocks in tomorrow's USDA S&D report. Demand is still a little shaky and that will limit price increases. Also, China had another soybean auction and processors did not buy nearly as much as they had in the past weeks with about 40% of the auction getting sold. News of Brazil decreasing their crop estimate is not impacting prices much as an increase in the Argentinean crop is thought to offset the Brazilian decline.
Sunflowers are overall 52% planted which is one percent ahead of the five year average pace. ND sunflowers are only two percent behind the average pace at 59% planted.
The USDA is expected to increase old crop stocks from the May estimate and decrease new crop. So it will be interesting to see what the USDA comes up with for tomorrow. US crop ratings increased by 2% to 75% good to excellent which is not doing any favors for prices this morning. This crop rating is 12% ahead of where last year's crop rating was at this time. North Dakota corn ratings do not at all disappoint as it is rated 90% good to excellent.
Looking forward for pricing....strong crop ratings and abundant global supplies make it tough for me to believe that prices will be higher come this fall. Yes, it's very possible that some factor could come out of left field and drive prices higher, however given the facts we have now and looking at the fundamentals of the market there is really little reason for grain prices to skyrocket. This is why I have been suggesting locking in some new crop if you have not already done so and if you are comfortable doing so. I understand we are awhile from harvest and there's a lot that can happen - especially when we are at the mercy of Mother Nature but it right now it looks like the US has a pretty good crop coming its way.
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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