May 06, 2015 | Grain Hedge Insights | Cody Bills | Views: 268

Is Corn Ready for a Rebound?

The grains are mixed this morning as corn bounces of support found at $3.55 during yesterday’s session

Is Corn Ready for a Rebound?

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. 

May 05, 2015 | Grain Hedge Insights | Cody Bills | Views: 209

Grain Trends Update

As grains continue to trend lower, Cody looks at what it will take for them to break through.

May 05, 2015 | Grain Hedge Insights | Cody Bills | Views: 160

Corn Planting Leaps Forward This Week

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. 

May 04, 2015 | Grain Hedge Insights | Cody Bills | Views: 251

Crop Progress Update

Cody focuses on the planting progress for corn and soybeans as well as the winter wheat conditions report.

Crop Progress Update
May 04, 2015 | Grain Hedge Insights | Cody Bills | Views: 148

Market Awaits Crop Progress

The grains were mixed on Monday with corn and wheat cupping over on lows printed over the last two weeks

Market Awaits Crop Progress

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. 

May 01, 2015 | Grain Hedge Insights | Cody Bills | Views: 209
May 01, 2015 | Grain Hedge Insights | Cody Bills | Views: 199

Weekly Cash Comments

Cash Commentary for week ending 01 May

Corn continued to find selling pressure in the futures market this week giving up 8 cents a bushel, while soybeans were unchanged for the week. For cash markets, corn basis posted a modest 1-cent advance on average across the US while soybeans were unchanged on the week.

 

In corn, basis levels were up 3 or more cents a bushel along the Ohio River area and points to the south as barge rates gave up 4 cents a bushel this week on average. At the Gulf, export bids posted a 2 cent advance as two consecutive weeks of +800,000 MT of new sales for old-crop delivery keep basis levels for river terminals relatively firm. For ethanol plants, they showed no significant departure from the norm posting only a 1-cent advance on the week. Ethanol production for the week was down 9,000 barrels per day to 921,000 barrels per day. Plants in the Western Cornbelt bid up basis by around 2 to 5 cents a bushel.

 

For soybeans, river terminals were the biggest gainers of the week posting a 3-cent increase thanks to a 5-cent advance at the Gulf export market. Weekly export sales were up sharply on old-crop, with a 433,400 MT total for the week. For crushing plants there was little movement this week overall, but a few plants in the Southeast showed strong advances of 10 cents or more.  

May 01, 2015 | Grain Hedge Insights | Cody Bills | Views: 203

Grains Mixed Headed into Friday

The grains were mixed going into Friday's trade session with more strikes at Argentina ports stalling export activity.

In the overnight session the grains are mostly steady with corn down 1/4 of a penny, soybeans off a half penny and wheat up 1 1/4 cents. The U.S. dollar is up a fraction of a percent and crude oil has fallen 18 cents.

 

Yesterday, the Buenos Aires grain exchange reported an increase in their soybean production forecast to 60 million metric tons from 58.5 million metric tons in their previous forecast. The exchange also increased expectations for the corn crop to 25 million metric tons from 23 million metric tons.  Argentina ports have been mostly at a standstill as the docking and loading services have been shut down due to a labor strike over the last two days. The strike has affected 25 ports from the city of Rosario to Timbues.

 

More bird flu was detected yesterday in an Iowa-based farm affecting only 19,000 birds this time. However, this is the first detection of the bird flu in a broiler breeding farm which typically holds tight bio security.

 

Weather next week should bring some showers early on with minimal impact on planting progress. The plains region should see ample precipitation in the 11-15 day forecast with a wet outlook in the 16-30 day outlook as well. Wheat should continue to be pressured as the weather models provide relief to the plains region.  

April 30, 2015 | Grain Hedge Insights | Cody Bills | Views: 209
April 30, 2015 | Grain Hedge Insights | Cody Bills | Views: 140

Surprising Export Sales

This morning export sales surprised analyst expectations with wheat seeing significant old crop cancellations and soybeans booking over 400,000 metric tons of old crop sales.

In the overnight session the grains moved higher with corn up 1 1/2 cents, soybeans up 6 1/2 cents and wheat up 3 1/4 cents going into this morning’s pause in trade. The dollar index was trading lower most of the night, but has found some buying support underneath the 100 day moving average and is now trading near the open of last night. Crude oil is up 41 cents this morning.

This morning’s export sales report held some surprises particularly for wheat which showed net cancellations for old crop sales. Wheat sales recorded a marketing year low for old crop when it showed 449,200 metric tons of old crop cancellations. New crop wheat sales only totaled to 852,900 metric tons supported by some old crop sales being switched over onto the new crop books. Corn export sales were down 4 percent week over week, booking 832,500 metric tons for old crop delivery. Soybean sales were very strong this week with 433,400 metric tons booked which is a sharp increase from the 102,100 metric tons booked last week. With South America on the downhill side of harvest, it is unexpected to see such a large week of U.S. soybean sales.

Ethanol production fell 9,000 barrels per day last week to 921,000 barrels per day. Ethanol stocks slipped 545,000 barrels to 20.8 million barrels this week as well. Ethanol production has been steadily declining since this year’s production highs in November. Typically, we would expect to see a seasonal increase in production between March and May as we head into driving season, but we have yet to observe a relative increase in ethanol production during this time period. Ethanol production is running 5.2 percent ahead of last year’s pace which is well ahead of the USDA expectations of an increase in production by 1.3 percent. 

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