Chinese language wheat harvest, remaining vacation positioning weigh on corn and wheat
- Corn blended to down 1-3 cents
- Soybeans blended to down 1-3 cents, soyoil down $0.25/lb, soymeal up $0.30/ton
- Wheat blended
*Costs as of 6:50 am CDT.
Good Morning! Markets can be closed on Monday in observance of Memorial Day. The morning e-newsletter won’t be printed on Monday however will resume its regular schedule on Tuesday. Benefit from the vacation safely, everybody! And don’t overlook the cheese for your burgers!
Editor’s Observe: Variable climate circumstances are the overarching theme of present market volatility, with farmers battling extreme dryness and wetness in numerous corners of the Heartland. Our newest Feedback from the Field evaluation chronicles the nice, dangerous, and ugly as corn and soybean planting season wrap up within the Midwest, full with farmer insights.
The Suggestions from the Discipline sequence is an open-sourced platform for U.S. growers to share and examine rising circumstances throughout the nation. Wish to see how your crops stack as much as others throughout the nation?! Click here to take our ongoing farmer survey on crop progress at any level within the 2021 grain season. Our Google Map, up to date each day, gives all previous responses for farm readers.
July 2021 futures costs inched up barely this morning however favorable rising circumstances within the U.S. despatched all different corn futures contracts $0.01-$0.03/bushel decrease. Increased wheat manufacturing in China might eat away at break-neck corn import paces from China, offering a supply of weak point to U.S. corn costs.
Money bids for corn acquired a lift from larger futures costs yesterday. However money premiums weakened at processors and ethanol crops within the Western Corn Belt although river bids held principally regular in yesterday’s buying and selling session. An Iowa merchandiser reported little new money sale exercise for the day, whereas an Ohio originator reported a number of gentle gross sales.
Latest grain and oilseed market volatility has some robust roots in climate patterns, however as Ben Potter and I focus on within the newest Midweek Markets podcast, there are different components at play. Inflation issues are impacting hedge fund exercise, provide issues loom giant, and world demand stays excessive. The mix of value push-and-pull from all of those components has elevated volatility inside the grain markets – and it could possibly be right here to remain.
The Buenos Aires Grains Exchanged elevated Argentina’s 2020/21 soybean manufacturing estimate by 18.4 million bushels to 1.60 billion bushels. The bigger crop had blended results on soybean costs, which traded decrease for previous crop contract months and principally larger for contracts representing the 2021 crop.
Money soybean costs had been principally regular yesterday, with larger soybean futures costs providing extra profitable money choices. Foundation slipped $0.10/bushel decrease to $0.10/bushel beneath July futures costs at a Cedar Rapids, Iowa soy processing facility. However foundation at crush crops elsewhere within the Midwest stays at a $0.25-$1.85/bushel premium over Chicago futures costs.
Soybean foundation additionally strengthened on the Mississippi River on the Savanna, Illinois export terminal. Regardless of sluggish farmer gross sales throughout the Heartland yesterday, an Ohio seller reported a number of gentle gross sales for growers trying to cowl urgent cash-flow obligations. Nonetheless, most farmers proceed to carry again any further soybean gross sales – if they’ve any provides remaining – in hopes for larger costs.
College of Minnesota ag economist Ed Usset likes the thought of utilizing choices in grain advertising however has met few farmers who use them successfully. “My concerns over the use of options in pricing grain center on three issues: cost, complexity, and focus,” Usset explains.
Usset dissects the downfalls of utilizing an choices technique within the newest Advance Advertising and marketing Class column. “Options can be powerful pricing tools. They are best used selectively,” Usset foreshadows. “Too many producers have learned the hard way that overuse detracts from the bottom line.”
Well timed rains helped enhance French wheat crop rankings and the greenback rose in a single day, sending gentle and onerous purple winter wheat futures $0.02-$0.04/bushel decrease this morning. Nonetheless, dry circumstances within the Northern Plains despatched Minneapolis wheat costs up $0.04-$0.06/bushel in in a single day buying and selling.
Wheat harvest is underway in China, which might restrict China’s import charges for wheat and corn within the coming weeks. China has scrambled to supply feedstocks for its recovering hog herd because it rebuilds within the aftermath of being slashed in half following the onset of African swine fever within the nation in 2018 and one other resurgence this previous winter.
Livestock and poultry feeders shifted away from soybean meal and corn components to rations earlier this 12 months as costs for each commodities soared to near-decade highs. Feeders more and more favored cheaper wheat substitutes for the feedstuffs, easing value stress on corn and soymeal costs.
One Chinese language poultry producer switched 15% of corn for wheat in hen rations early within the 12 months. China’s 2021 wheat harvest of 5.0 billion bushels is predicted to ease import stress on the nation’s livestock and poultry feeders as shopper meat demand in China continues to soar.
“Wheat prices are expected to be lower than corn, which gives it obvious advantage to substitute (corn). Feed producers have high enthusiasm to buy the new wheat,” Qi Chiming, an analyst with the China Nationwide Grain & Oils Data Heart (CNGOIC), informed Reuters.
Money choices for gentle purple winter wheat had been largely unchanged throughout the Midwest yesterday. The identical held true for money winter wheat costs throughout the Southern Plains. Nonetheless, foundation did weaken $0.03/bushel to $1.57 over July 2021 Kansas Metropolis onerous purple winter wheat futures at a Texas rail facility delivery into U.S. Gulf export terminals as export data released by USDA yesterday pointed to slowing wheat export exercise.
Farmer exercise surrounding new money wheat gross sales was scarce, in response to an Oklahoma merchandiser. A lot of the crop has already been offered as costs rose earlier this 12 months and any farmers with wheat bushels remaining in storage are prone to wait to see if one other rally strikes earlier than harvest begins over the following few weeks.
Skies will largely clear up throughout the Plains at this time as rain shifts into the Jap Corn Belt and Nice Lakes area, in response to NOAA’s short-range forecasts. Over an inch of rain is predicted within the area, with extra accumulation doable because the system strikes farther east from the Mississippi River.
Regardless of extra moisture reaching the drought-plagued U.S. Excessive Plains final week, more and more dry circumstances within the Midwest, Northeast, and Southeast led the U.S. Drought Monitor to extend the nation’s space in abnormally dry to drought situation to 61.35%, up 1.7% from the earlier week.
Areas seeing the most important enhance in dryness embrace Minnesota and east central Indiana. Excessive drought circumstances in South Dakota fell over 10% to 10.38% of the state. Over 94% of South Dakota’s acreage stays in some form of dry to drought situation as of Tuesday, May 25.
Coronavirus circumstances within the U.S. rose to 33,218,607 circumstances as of this morning in response to the Johns Hopkins Coronavirus Resource Center. The dying toll elevated to 593,293 deaths as of press time. In response to the CDC, almost 50% of the overall U.S. inhabitants has acquired at the very least one vaccine. Practically 133 million Individuals (40%) are absolutely vaccinated. Virtually 1.8 billion vaccine doses have been administered worldwide.
Summer time grilling season is simply across the nook! Whole Farm Advertising and marketing’s Naomi Blohm writes that the uptick in seasonal demand comes at a time when market volatility is already excessive. “The latest pork cutout worth has surged to over $123, a value not seen since October of 2014” Blohm explains. “Domestic demand is strong. The re-opening of restaurants is supportive.”
Giant cattle inventories proceed to depress beef costs, however an Argentine beef export stoppage, drought circumstances, and the vacation weekend supply a premium on money costs amid lackluster futures costs. “Domestic demand continues to shine as restaurants re-open and summer grilling is just getting started,” Blohm observes within the newest Ag Marketing IQ column. “Packers continue to reap most of the benefit of higher values, however.”
Farm Futures Enterprise Summit will happen June 16-17 this 12 months on the Coralville Marriot in Coralville, Iowa. In a particular version of the Around Farm Progress podcast, Govt Editor Mike Wilson sits down with three of the occasion’s audio system, together with Farm Progress coverage editor Jacqui Fatka, former chief ag negotiator for the U.S. Commerce Consultant Gregg Doud, and Washburn College ag regulation professor Roger McEowen to supply a sneak peak of the Summit’s thrilling content material!
For extra data or to register, go to FarmFuturesSummit.com.
Markets await recent private consumption expenditure (PCE) information at this time that can present insights about April 2021 ranges of inflation. The Federal Reserve makes use of PCE as a key goal for measuring inflation. The April 2021 shopper value index (CPI) launched earlier this month noticed shopper costs rise a staggering 4.2% because the financial system began to revamp because the pandemic eased.
U.S. shares had been unfazed concerning the reminder of excessive inflation charges this morning, comforted by Federal Reserve assurances that the uptick is non permanent. S&P 500 futures rose 0.36% forward of the opening bell to $4,214.00.
|Morning Ag Commodity Costs – 5/28/2021|
|Contract||Items||Excessive||Low||Final||Internet Change||% Change|
|JUL ’21 CORN||$ / BSH||6.7275||6.645||6.6525||0.0075||0.11%|
|SEP ’21 CORN||$ / BSH||5.89||5.81||5.825||-0.03||-0.51%|
|DEC ’21 CORN||$ / BSH||5.5775||5.505||5.525||-0.025||-0.45%|
|MAR ’22 CORN||$ / BSH||5.64||5.5725||5.5975||-0.0175||-0.31%|
|MAY ’22 CORN||$ / BSH||5.6625||5.6025||5.6125||-0.0275||-0.49%|
|JUL ’22 CORN||$ / BSH||5.65||5.5925||5.6||-0.03||-0.53%|
|SEP ’22 CORN||$ / BSH||5.105||5.085||5.085||-0.025||-0.49%|
|JUL ’21 SOYBEANS||$ / BSH||15.5575||15.3425||15.3475||-0.0225||-0.15%|
|AUG ’21 SOYBEANS||$ / BSH||15.055||14.855||14.855||-0.0175||-0.12%|
|SEP ’21 SOYBEANS||$ / BSH||14.2675||14.11||14.11||-0.005||-0.04%|
|NOV ’21 SOYBEANS||$ / BSH||13.925||13.7475||13.76||-0.0225||-0.16%|
|JAN ’22 SOYBEANS||$ / BSH||13.9125||13.75||13.8025||0.02||0.15%|
|MAR ’22 SOYBEANS||$ / BSH||13.6775||13.5325||13.55||0.0075||0.06%|
|MAY ’22 SOYBEANS||$ / BSH||13.62||13.465||13.505||0.015||0.11%|
|JUL ’22 SOYBEANS||$ / BSH||13.61||13.4925||13.4925||-0.005||-0.04%|
|AUG ’22 SOYBEANS||$ / BSH||13.3775||#N/A||13.3125||0||0.00%|
|JUL ’21 SOYBEAN OIL||$ / LB||67.39||66.48||66.59||-0.22||-0.33%|
|AUG ’21 SOYBEAN OIL||$ / LB||63.87||62.95||63.29||0.06||0.09%|
|JUL ’21 SOY MEAL||$ / TON||393.6||390.3||390.4||0.1||0.03%|
|AUG ’21 SOY MEAL||$ / TON||395.2||391.9||392.1||0.3||0.08%|
|SEP ’21 SOY MEAL||$ / TON||395||391.7||392||0.3||0.08%|
|OCT ’21 SOY MEAL||$ / TON||392.8||389.8||390||0||0.00%|
|DEC ’21 SOY MEAL||$ / TON||395||391.4||391.5||-0.2||-0.05%|
|JUL ’21 Chicago SRW||$ / BSH||6.7975||6.6975||6.725||-0.0375||-0.55%|
|SEP ’21 Chicago SRW||$ / BSH||6.83||6.735||6.7625||-0.0325||-0.48%|
|DEC ’21 Chicago SRW||$ / BSH||6.8875||6.805||6.8325||-0.03||-0.44%|
|MAR ’22 Chicago SRW||$ / BSH||6.9275||6.87||6.905||-0.025||-0.36%|
|MAY ’22 Chicago SRW||$ / BSH||6.935||6.9||6.9125||-0.0125||-0.18%|
|JUL ’21 Kansas Metropolis HRW||$ / BSH||6.295||6.1975||6.23||-0.0325||-0.52%|
|SEP ’21 Kansas Metropolis HRW||$ / BSH||6.37||6.2725||6.315||-0.0225||-0.36%|
|DEC ’21 Kansas Metropolis HRW||$ / BSH||6.4725||6.3875||6.43||-0.0225||-0.35%|
|MAR ’22 Kansas Metropolis HRW||$ / BSH||6.5625||6.4975||6.56||0.0075||0.11%|
|MAY ’22 Kansas Metropolis HRW||$ / BSH||6.6025||6.5825||6.6||-0.025||-0.38%|
|JUL ’21 MLPS Spring Wheat||$ / BSH||7.24||7.135||7.2275||0.055||0.77%|
|SEP ’21 MLPS Spring Wheat||$ / BSH||7.3||7.1975||7.2925||0.055||0.76%|
|DEC ’21 MLPS Spring Wheat||$ / BSH||7.34||7.28||7.3225||0.0375||0.51%|
|MAR ’22 MLPS Spring Wheat||$ / BSH||7.39||7.3625||7.39||0.06||0.82%|
|MAY ’22 MLPS Spring Wheat||$ / BSH||7.415||#N/A||7.36||0||0.00%|
|JUN ’21 ICE Greenback Index||$||90.25||89.98||90.23||0.271||0.30%|
|JU ’21 Gentle Crude||$ / BBL||67.45||66.74||67.22||0.37||0.55%|
|AU ’21 Gentle Crude||$ / BBL||67.18||66.51||67.01||0.41||0.62%|
|JUN ’21 ULS Diesel||$ /U GAL||2.0675||2.0585||2.0675||0.0111||0.54%|
|JUL ’21 ULS Diesel||$ /U GAL||2.067||2.0527||2.0649||0.0097||0.47%|
|JUN ’21 Gasoline||$ /U GAL||2.167||2.1497||2.1625||0.0107||0.50%|
|JUL ’21 Gasoline||$ /U GAL||2.1726||2.153||2.1689||0.0137||0.64%|
|AUG ’21 Feeder Cattle||$ / CWT||0||#N/A||152.85||0||0.00%|
|SEP ’21 Feeder Cattle||$ / CWT||0||#N/A||154.825||0||0.00%|
|JU ’21 Reside Cattle||$ / CWT||0||#N/A||116.35||0||0.00%|
|AU ’21 Reside Cattle||$ / CWT||0||#N/A||119.425||0||0.00%|
|JUN ’21 Reside Hogs||$ / CWT||0||#N/A||115.725||0||0.00%|
|JUL ’21 Reside Hogs||$ / CWT||0||#N/A||116.7||0||0.00%|
|MAY ’21 Class III Milk||$ / CWT||18.96||#N/A||18.97||0||0.00%|
|JUN ’21 Class III Milk||$ / CWT||17.65||17.63||17.63||-0.02||-0.11%|
|JUL ’21 Class III Milk||$ / CWT||18.3||18.26||18.3||-0.04||-0.22%|