Home Farm Equipment Morning Market Review for September 3, 2021

Morning Market Review for September 3, 2021

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Markets underpinned by export terminal harm within the U.S. Gulf. Plus – a take a look at Farm Futures’ 2022 acreage estimates

  • Corn down 3-6 cents
  • Soybeans up 3-7 cents
  • Wheat up 1-3 cents

*Costs as of 6:50 am CDT.

Good Morning!  An enormous because of everybody who stopped by and listened to our advertising presentation at Farm Progress Present! And a particular because of these of you who stopped me to say, “hello” and ask questions concerning the markets. It was nice to see pleasant faces once more and speak markets with all of you!  

Ben Potter and I might be at Husker Harvest Days September 14-16. If you happen to missed us at FPS, come examine us out in Grand Island, Nebraska!

What number of days away are you from harvesting? Click here to take our ongoing Feedback from the Field survey on 2021 crop circumstances. Our Google Map, up to date every day, supplies all previous responses for farm readers. Try our newest Feedback from the Field analysis to see the newest farmer feedback from across the nation.

USDA forecasts eight-year excessive for web farm earnings: February 2021 forecasts had prompt rising prices, much less authorities subsidies, and doubtlessly decrease commodity costs may damage U.S. farmers’ revenue prospects this 12 months.

However new information launched by USDA’s Economic Research Service yesterday discovered that larger commodity costs due largely to tightening international shares and robust import demand from China will  propel 2021 farm incomes 19.5% larger than the identical time a 12 months in the past.

In case you missed it… Earlier this week, we introduced the outcomes of our 2022 acreage projections from our August 2021 Farm Futures producer survey to our viewers on the Farm Progress present. Farmers are optimistic about their prospects for 2022 acreage growth, as evidenced by profitable futures pricing choices in Chicago, Kansas Metropolis, and Minneapolis.

The survey, which gathered 737 producer responses through e-mail questionnaire from growers throughout the nation between July 13-August 1, discovered that farmers estimate they may plant 94.3 million acres of corn in 2022, 87.6 million acres of soybeans, and a complete of 46.7 million acres of wheat.

If realized, will probably be the third highest acreage on document for mixed corn, soybean, and wheat crops. However what’s the probability of hitting 234.8 million acres of principal row crops in 2022?

In my newest E-corn-omics column, I dig into the elements that may affect subsequent 12 months’s manufacturing. The worldwide wheat manufacturing shortfall this 12 months will seemingly have lingering results into the 2022/23 advertising 12 months, particularly as import demand stays excessive.

By my estimates (a little bit “redneck math” and “redneck economics,” for these of you who noticed my presentation at Farm Progress Present), U.S. wheat shares are more likely to proceed tightening within the U.S., particularly if export targets return to pre-2021/22 volumes.

And that’s going to be a key issue within the 2022 acreage battle that may start with winter wheat sowings within the coming weeks. My estimates counsel that soybeans and wheat would be the seemingly winners of the acreage battle as present provide and demand fundamentals at present exist. My “redneck math” finds that whereas corn provides will seemingly loosen in 2022/23, soybean and wheat shares will stay tight.

In fact, loads of time will cross between now and remaining planting subsequent spring. Demand elements will play a big function in value dedication, particularly as export markets improve competitors for obtainable grains provide within the U.S. in opposition to home processors.

However one truth stays clear – farmers are more likely to profit from this competitors within the interim, particularly if forecasted shares stay tight.

Corn

Corn costs fell $0.02-$0.07/bushel in a single day as harvest strain begins to saturate the futures market. Ongoing issues about exporting capability because of broken terminals within the U.S. Gulf continued to loom over the market in a single day, particularly on the heels of favorable export cargo volumes reported in yesterday’s Export Gross sales report from USDA.

Corn harvest is off the races in Ukraine. The nation’s agriculture ministry reported in a single day that the primary million bushels of corn had been shelled off Ukrainian corn fields. Ukraine is amongst one of many world’s largest producers and exporters of corn.

Complete Farm Advertising and marketing’s Naomi Blohm can also be trying in direction of the 2022 rising cycle already. However Blohm dives into the fee aspect of the revenue equation as a substitute of the income aspect within the newest Ag Marketing IQ column.

“Higher energy prices, higher fertilizer prices, higher bills to have machinery repaired and even higher land rents are coming into play,” Blohm factors out. “Some producers are suggesting that with fertilizer prices at nine-year highs, they may opt to plant more soybeans or wheat instead of corn.”

To cut back the uncertainty with making 2022 manufacturing choices, Blohm recommends penciling out your farm’s manufacturing prices to cement your advertising methods.

“By knowing your true cost of production, it mentally and emotionally makes it easier to pull the trigger on cash sales ‘when you know you ought to,’ and helps to eliminate indecision and hesitation that is heard when producers say, ‘well, let’s just give it one more day and see if the price comes back up.’”

Soybeans

Soybean futures costs rose this morning by $0.03-$0.06/bushel on continued export optimism following one other massive every day flash sale to China, as introduced by USDA yesterday. However good points had been capped because the market continues to guage delivery harm at export terminals within the Gulf because of Hurricane Ida. New estimates counsel that damages on the Gulf services may take weeks to restore, consuming into peak soy and wheat exporting seasons.

Wheat

Wheat costs inched larger in a single day as markets proceed to commerce on tight international provides and robust export demand. The greenback weakened barely in a single day, including one other layer of value help. However delivery issues within the Gulf amid peak export season restricted the wheat advanced’s upward mobility within the in a single day buying and selling session.

Asian wheat consumers are scrambling to seek out ample milling provides amid spring wheat crop shortfalls within the Northern hemisphere. The tight provide state of affairs is already triggering an early spherical of demand rationing, based on a recent Reuters article. It means that USDA could also be inclined to regulate international wheat utilization forecasts in subsequent week’s WASDE reviews as costs stay excessive.

“Prices have gone up more than what we expected,” an proprietor of a number one wheat miller and noodle maker in quantity two wheat importer Indonesia advised Reuters. “We expect a decline of around 10% in wheat processing” in 2021 from 2020, he stated.

France’s smooth wheat harvest is coming to an in depth after a tumultuous harvest season, based on French farm company, FranceAgriMer. An estimated 99% of France’s smooth wheat crop had been harvested as of August 30, up from 96% the week prior.

The milling high quality of France’s smooth wheat crop deteriorated this summer time as extreme rains throughout harvest saturated mature kernels.

Climate

Cooler temperatures are settling into the Midwest over Labor Day weekend, based on NOAA’s short-range forecasts. It’s beginning to really feel like fall right here at my mother and father’ dairy farm in Northwestern Illinois – the corn silage choppers are because of arrive right now so this analyst could also be pressured right into a packing tractor later this afternoon!

In fact, that’s supplied we don’t see any rain showers right now. A storm system is forecasted alongside the Higher Mississippi River Valley, stretching throughout the Central Plains and sure shifting into the Northern Plains later this night.

Over an inch of precipitation is predicted in Kansas and Missouri within the subsequent 24 hours, with the aforementioned areas solely anticipated to obtain as much as three quarters of an inch.

Financials

Coronavirus circumstances within the U.S. rose to 39,552,739 circumstances as of this morning based on the Johns Hopkins Coronavirus Resource Center. The dying toll elevated to 643,702 deaths as of press time because the pandemic continues to deal devastating blows to people unvaccinated in opposition to the virus.

In keeping with the CDC, practically 75% of U.S. adults have acquired at the very least one COVID-19 vaccine as office mandates assist increase immunity charges. Almost 175 million Individuals (53%) are totally vaccinated. Over 5.3 billion vaccine doses have been administered worldwide.

Japan’s prime minister of a 12 months, Yoshihide Suga, introduced plans to step down late final night time, including one other layer of financial uncertainty to the worldwide pandemic restoration. Month-to-month jobs information might be launched right now. China can even start permitting foreign investors to take part in its futures markets, marking an extra rise in China’s financial prowess throughout the globe.

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