Morning Market Insight

May 4, 2018
Abbey Kittelson
Grain Marketing Specialist

 


CORN – As of 7:45 – down 1
December corn futures settled yesterday at 4.22 ¼, which is the highest settlement price of the contract since July 20th of last year (chart below). Weather models are showing possibilities of rain in the 6-10 day forecast. Although the rain would be welcomed in dry KS, NE, MO and southern IA, the northern and eastern states are still trying to get in the field and plant the crop. Currencies in South America are putting in lows and surging local sales of commodities for their farmers. The next two weeks in Brazil are predicted to be hot and dry for the second crop corn there. Interesting to note that if the crop in Brazil only comes to 86 mmt or less, that will put pressure on the US to supply world buyers with corn in the fall.



SOYBEANS – As of 7:45 – down 11
After making tracks lower yesterday, soybeans finished the day strong, up 10c on the nearby July chart. The sudden change of direction was due to indications from a press release that trade tensions between China and the US are easing. Those ideas were disbarred overnight, and the market is back down over a dime. The market does believe that before too long, China will need to start taking US soybeans again. We are faced with 200 mbu worth of unshipped sales to soy-loving China and weaker South American currencies. Additionally, China cancelled 5 mbu of old crop beans but bought 2 mbu new crop from us.

WHEAT – As of 7:45 – KC down 7, MNPLS down 2
Both KC and Minny wheat contracts continue to stay supported from production worries in the southern plains, behind schedule planting in the northern plains, and dry weather in other parts of the world. Tour in Kansas continues mixed results and leaning more towards lower production. What we really do know is that the plants are behind schedule, and wheat that isn’t headed right now makes it hard to nail down yields. One member of the tour says that there is about 90 days left of growing, but only 60 days until harvest. The group is estimating the lowest KS production since 1989. Beneficial rains have fallen in some areas of the southern plains, but will they be enough to turn production back around?
 

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