SunPrairie Grain Morning Comment
MINOT - Jun 18/14 - 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 up 4-7 cents, some global demand around helps prices perk up (Mpls July last trade 6.90 ¼, KC July 7.15 ½)
Soybeans are up 5-17 cents, old crop sharply higher, new crop a reluctant follower (July last trade 14.14)
Corn is up 1-3 cents, lack of producer selling helps to pull prices higher, not a lot of fresh news (July last trade 4.41 ¾)
Sunflowers are 5-10 higher, following a stronger soybean market, higher crude prices help
Canola is up 5-10 cents, higher soybean complex, crude prices, drive canola futures higher
*Rail Performance Update*
Meetings and presentations with industry leaders have indicated that CP rail performance is not due to improve any time in the near future. This means that we could see slow railcar placements into and throughout harvest, giving us plenty of fresh challenges for making space for new crop grain. Rail placements did improve over the planting season and we were able to open up a lot of space. Currently, we have space available for grain and are offering free DP (as space allows on spring wheat and winter wheat) so that you are able to move your old crop grain out of the bin before harvest (without pricing it), enabling us to get it in and out of our system before harvest as well and keeping space available for new crop. The last thing we want is to be full two weeks into harvest and waiting weeks for railcars. Additionally, we will not be rushing to pile grain. As you are all well aware, grain does not have a long shelf life when it is subject to the elements in a pile. If we do not have consistent freight coming we will not pile grain that cannot get shipped in a timely manner. Long story short - if you're considering hauling grain before harvest please do so sooner rather than later so we have time to ship out old crop and are not sitting full before harvest starts. Please call with any questions. Thank you for your continued business and support!
Grains are in a little bit of a recovery mode today after futures finished the day mostly lower yesterday. We had some local basis changes yesterday that helped to negate some of what was lost in the futures markets. The US dollar is lower today and crude prices climb due to continued concerns regarding violence in Iraq. Overall weather remains pretty good for the crop but it has been noted that some areas are just too wet and we could see that slightly impact crop conditions in Monday's weekly crop report. On June 30th the USDA will release its quarterly stocks report and on June 27th Statistics Canada (StatsCan) will release its planting estimates. Expectations are for high planted acres out of Canada again this year.
Continued rains to the Southern Plains delay harvest but are expected to ease up, so we will soon have a better idea of yield and quality of this year's hard red winter wheat crop. Speaking of harvest - Ukrainian grain harvest is off to a good start and after a great growing season yields are higher than they were at this time last year. This means that Ukraine could provide some pretty strong competition for all the global demand that has been around recently. US spring wheat ratings are still pretty strong (72% good to excellent) and the ND crop is rated at an astounding 83% good to excellent. Once hard red winter wheat harvest kicks into gear it will be hard for wheat prices to justify trading sharply higher as we move forward. There are some drought issues in eastern Washington State that are dragging wheat ratings lower.
Soybean planting is wrapping up (92% done as of Sunday evening according to the USDA) and conditions are reported to be 73% good to excellent (ND beans 86% g/e - insane!). Conditions could decline in this Monday's report as rains have been heavy in areas and may be damaging the crop in spots. However, with a lack of heat stress or any overall major stresses to the crop the trend in soybeans will most likely be lower as we move through the summer months. The market seems to be transitioning its focus from tight old crop stocks to the potential for large new crop production which will keep prices from trading too much higher. New crop prices are up less than a penny at the moment while old crop are posting double digit gains. For those of you watching soybean prices and with new crop in the ground - keep an eye on what November futures are doing, not what nearby contracts are doing. They have been trading very differently these past few weeks.
Sunflowers were reported at 71% planted which is about on pace with the five year average. ND sunflower planting is a little bit behind at 79% complete (five year average is 81%) - now the question is whether or not that number will increase with recent rainfall most likely preventing the final acres from getting in.
Corn crop conditions remain very high with the US crop at 76% good to excellent and the ND crop rated 84% good to excellent. Needless to say.... ND crops are getting a phenomenal start this year! Producer selling is very slow across the corn belt and that is resulting in some basis increases. Futures prices might even be finding a little bump due to the slow cash movement of corn. However, the market will remain focused on high acres and the potential for big yields in the US this year.
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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