The winter wheat forecast seemed to come in below most analysts’ expectations after the Wheat Council finished their three day tour of Kansas fields.
In the overnight session the grains were mostly unchanged with corn down 3/4 of a cent, soybeans down 3/4 of a cent and wheat gaining 1 1/4 cents going into the morning pause. Oil is trading 68 cents higher and the U.S. dollar is down 1/10th of a percent. South Korea purchased 63,000 metric tons of corn late yesterday.
This week in Kansas City, crop scouts met Thursday afternoon to release the final wheat yield and production forecast after three days on the tour. The wheat council’s Kansas crop forecast was 35.9 bushels per acre which is well below the 5 year average of 40.3 bushels per acre. They also pegged production at 288.5 million bushels per acre which was down from the 5 year average of 331.6 million bushels. The wheat forecast reflected an early season drought, winterkill events and observed disease throughout the three day tour.
China is expected to produce 232 million metric tons of corn for 2015/16 which is up 7.6 percent year over year. Farmers have had incentive to plant more corn as a result of Beijing’s high price stockpile policy which has kept domestic corn prices as much as 30 percent higher than global prices. As a result of the excellent crop this year Chinese corn imports are expected to fall 2 million metric tons this year, while sorghum imports are expected to grow to 8.2 million metric tons from 8 million metric tons this year.
Precipitation looks to clear up for most of next week giving the western grain belt more opportunity to get into the fields. The 6-10 day forecast shows drier than normal conditions from eastern South Dakota and Nebraska to Ohio which should continue to support strong planting progress. Precipitation reenters the forecast in the 8-14 day outlook with above average moisture blanketing most of the U.S.
Soybean export sales continue to impress during a period when sales are typically weak and pressured by South America.
In the overnight session the grains are mostly unchanged with corn down 2 3/4 cents, soybeans unchanged and wheat in Chicago up 3/4 of a cent. The U.S. dollar is up a fraction of a percent this morning and crude oil is trading 14 cents higher.
Export sales provided another strong week for corn and soybeans and yet again disappointed for wheat. Corn booked 841,000 metric tons which was above analyst expectations which ranged between 300,000-600,000. Soybeans reported strong export sales for the second week in a row by booking 338,000 metric tons which was on the high side of expectations which ranged from 0-350,000 metric tons. Soybean have booked a cumulative 49.4 million metric tons of sales which is well ahead of the roughly 44.6 million metric tons last year and the 45.8 million metric tons expected to meet current USDA expectations.
Wheat sales disappointed expectations this morning with cancellations of 148,000 metric tons. Analysts were expecting sales that ranged from -100,000 to 100,000 metric tons. New crop sales booked 446,800 metric tons which was up from the previous week but below the 4 week average.
Ethanol production on Wednesday fell 35,000 barrels per day to 887,000 barrels per day. The decline was the smallest weekly production data since the second week in November and was partly due to routine facility maintenance. Ethanol stocks declined 35,000 barrels to 20.76 million barrels this week. Despite the decline in production this week, overall ethanol production is still running 5 percent over last year.
The grains are mixed this morning as corn bounces of support found at $3.55 during yesterday’s session
In the overnight session the grains were mixed with corn up 1 1/4 cents, soybeans down a penny and wheat up 3 1/4 cents. Corn prices are moving higher after finding some support around $3.55 per bushel during yesterday’s trade session.
Yesterday, the Egyptian grain buyer GASC purchased 120,000 metric tons of wheat sourced from Russia and Romania. The Russian FOB wheat was offered at $194.22 per metric ton, the Romanian offer was $200 per metric ton and the U.S. wheat was offered at $227.50 per metric ton. Despite the sustained decline in wheat prices, U.S. wheat is still not competitive enough on the global market to trigger above average buying interest.
Yesterday marked day one for the annual Wheat Council’s survey of HRW fields. Throughout the next few days roughly 90 scouts are taking to the fields to survey the quality of the wheat crop which suffered from dryness in the early part of the growing season. The tour is scheduled to release their final yield forecast for Kansas wheat production on Thursday.
In Argentina, port activity returned to normal after a port workers strike vote was postponed. Argentina has been struggling with delays at export ports caused by stevedoring strike that left cargo vessels delayed.
This morning StatsCan announced that total wheat stocks in Canada on March 31st was 16.74 million metric tons down 25 percent from the previous year. Durum wheat on stock was reported at 2.32 million metric tons this year which was down from 4.01 million metric tons in 2014. Canola stocks were reported at 7.04 million metric tons down 18.9 percent from the previous year.
Corn planting jumped from 19 percent to 55 percent complete this week providing little reason to rally the grain.
In the overnight session corn and wheat traded lower by 4 cents apiece, while soybeans was able to continue showing relative strength by gaining 2 1/4 cents.
Crop progress showed that wheat crops rated good-to-excellent improved by 1 percent on Monday after two weeks of unchanged ratings. The precipitation over the last month has been beneficial for the wheat crop and the outlook favorable for continued moisture over the next two weeks.
Corn planting jumped 36 percentage points on Monday after a week of good weather. With 55 percent of the corn crop now planted, we are well ahead of the four year average of 38 percent planted. Soybeans are also ahead of pace with 13 percent planted across the 18 states that make up 92 percent of acreage. This is ahead of the four year average of 9 percent planted at this time of the year. Spring wheat is also ahead of pace with 75 percent of the crop planted, up 20 points from last week and well ahead of the 40 percent planted seen in the 4 year average.
Weather this week is expected to get warmer across the eastern half of the U.S. with precipitation in the Southern and Central Plains continuing to provide relief to the winter wheat crop. Expect to see corn and soybean planting delays this week as the western and central part of the grain belt are expected to receive above average rain fall.
Yesterday corn export inspections beat the average analysts guess by recording 1.25 million metric tons compared to expectations which ranged from 800 thousand metric tons to 1.25 million metric tons. Soybeans disappointed by only showing 100 thousand metric tons which below the range of analyst guesses. Wheat met expectations with 565 thousand metric tons inspected for export which was on par with last week’s numbers.
The grains were mixed on Monday with corn and wheat cupping over on lows printed over the last two weeks
In the overnight session the grains were mixed with corn down 2 1/4 cents, soybeans up 3 3/4 cents and wheat down 4 3/4 cents going into this morning’s pause. Crude oil is trading about 17 cents higher and the U.S. dollar is up a 10th of a percent. A Taiwanese buyer issued a tender to purchase 50,000-65,000 metric tons of corn to be sourced from the U.S., Brazil or Argentina.
The Plains wheat has received a good amount of precipitation over the last three weeks and it seems as though the trend is unlikely to change. Rains are expected to start half way through this week and continue for the next two weeks. Precipitation seems to be evident in the 16-30 day forecast as well.
The market is anticipating the crop progress report out which will show the planting progress over the last week and give us an update on the condition of the winter wheat crop. The winter wheat crop rating has held steady at 42 percent good to excellent over the last two weeks after recent precipitation stalled the crops deterioration. On average over the last four years, corn planted during this time is 42 percent complete and 11 percent complete for soybeans. Spring wheat planting is well ahead of pace, with 55 percent of planting complete last week which was well ahead of the four year average of 29 percent.
Corn and soybeans appear to be trending lower this morning, cupping over on the lows printed in early April. The grains have been pressured recently by the increase bird flu detection throughout the state of Iowa which have forced the governor to declare a state of emergency. This is the third state behind Minnesota and Wisconsin to declare a state of emergency due to the outbreak in bird flu.
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In the overnight session the grains traded higher with wheat leading the way up 4 3/4 cents, corn traded up 1 3/4 cents and soybeans up 1/4 cent. The U.S. dollar index is trading about a 1/4 percent higher this morning and crude oil is down 58 cents.
In the overnight session the grains are trading higher, with corn up 1 1/2 cents, soybeans up 1 1/4 cents and wheat up 3 cents. The U.S. dollar is lower by 1/10th of a percent and crude oil is 48 cents higher. This morning a reportable export sale was announced for 152,400 metric tons of...