SunPrairie Grain Morning Comment
MINOT - Aug 25/14 - SNS -- Following is the morning comment from SunPrairie Grain, a division of CHS.
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Market Outlook as of 9:25 AM CDT 08.25.2014:
Wheat is down 4-6 cents, some underlying buying support but market seems to want to trade lower with row crops (Mpls Sept last trade 6.20 ¾, KC Sept 6.27 ½)
Soybeans are 5-8 lower, rains to most areas considered favorable and thought to help boost yield (Nov last trade 10.36)
Corn is down 3-5 cents, record yield estimated from ProFarmer tour, general lack of threat to US crop (Sept last trade 3.62)
Sunflowers are up 0-5 cents, bean oil is slightly higher despite drop in soybean futures, possibly support from canola prices
Canola is up 20-25 cents, futures bouncing back after several sessions of trading lower
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Grain futures markets are mixed to mostly lower this morning. The rainfall that occurred is being viewed as favorable for many corn and soybean growing areas which is part of the reason for lower prices today. Rains in ND and MT, though, were pretty excessive and those in the wheat markets are discussing crop damage. Overnight trade began two hours late last night due to technical problems but the delay is not thought to have had any impact on prices. There is not any fresh demand news out and about this morning to provide support, either.
Wheat futures are falling with the row crops this morning despite some favorable fundamental news that is around this morning. First off, Russian wheat prices have increased recently which is good news for us because their lower prices have cut our demand a bit. Additionally, there are more concerns about Ukrainian supply due to disruptions from the conflict from Russia. US spring wheat crop quality is now becoming a point for concern due to recent, heavy rainfall and cool weather during what is supposed to be a hot and dry harvest season. Follow through from Friday's strength started out early in the session but it seems that row crop weakness is enough to get wheat prices lower this morning.
The ProFarmer crop tour estimated a record yield of 45.35 bpa for the US soybean crop, but that estimate is just slightly below the current USDA estimate. There are ideas that estimates will increase as we move closer to harvest due to the recent, timely rains. There is not a whole lot to report otherwise for soybeans as the market focuses on the whole "rain makes grain" thing. Demand news is quiet this morning and the only silver lining seems to be soybean oil which is trading higher this morning, seemingly with the canola market.
The ProFarmer tour estimated US corn yield at 169.3 bpa, which is above the current USDA estimate but not by a whole lot. The market was expecting the ProFarmer tour to report higher yields and the one released, though a record if realized, seem to disappoint some. However, recent rains coupled with an overall lack of threat to the US crop could work to further boost yields and we could see those estimates increase as we move forward. China did not receive rains as needed, leaving their crop a little drier than many there would like to see.
Overall it looks to be a lower day today.
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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