October 9, 2023
Good morning,
Markets are weaker to start the day with corn down 2 and soybeans down 6.
The violence in Israel that erupted this weekend is prompting a move into safe-haven assets as investors closely watch events in the Middle East to gauge the geopolitical risk to markets. Gunmen from the Palestinian group Hamas entered Israel in an attack on Saturday. Western countries, led by the United States, denounced the attack, and pledged support for Israel. Crude oil is up over $3 per barrel from Fridays close.
The USDA crop production report will be out on Thursday which will give the latest production and carryout estimates. The average corn yield estimate is down minimally from last month at 173.5 bpa compared to 173.8 previously. Soybean estimates are also lower at 49.9 compared to 50.1. Ending stocks for corn are still projected north of 2 billion bushels at 2.138 billion bushels which will make any rallies in corn difficult.
Locally we are in the early stages of corn harvest and yields appear to be much better than expected. I would advise producers to make additional basis sales for any corn you are not able to store this fall and deliver the bushels early as space and lines could be an issue across the corn belt. Basis levels are still fairly tight and will allow you to capture any rallies that may occur in the CBOT over the next couple of months.
Have a Safe Day!
Garry Gard
920-348-6844
October 3, 2023
Good morning,
Corn is down 1 and soybeans are down 11 to start the day.
Private analyst StoneX released their October estimates for corn and soybean production based on producer surveys. They estimated U.S. corn yields at 175.5 bushels per acre this month, up half a bushel from Sept, with production implied at 15.202 billion bushels, 68 mbu above the USDA Sept. Soybean yields rose from 50.1 to 50.4 bpa this month, with output at 4.175 bln bu, around 30 mbu above the USDA Sept.
China is on national holiday, where many travel and not very many go to work. This extends for the rest of the week. The absence of buying is noted in soybeans as traders are home this week. You can tell the overnight markets are weak as Asian buying is not there.
Early yield reports on both corn and soybeans are coming in much better than expected across the US as producers ramped up harvest this past week. Will this trend continue or is this a sign of early planted equals better yield is TBD.
Monday night’s crop progress showed that 23% of the US corn crop has been harvested compared to 15% last week and 21% on average.
Have a Safe Day!
Garry Gard
920-348-6844
September 28,2023
Good morning,
Corn is unchanged and soybeans are down 9 to start the day.
A small group of Republicans in the House of Representatives have set the government on a course towards its fourth partial shutdown in a decade. At least nine members of Speaker Kevin McCarthy’s narrow 221-212 majority are refusing to back any stopgap measure to keep the government funded. The funds are reluctant buyers with this expected shutdown and a crop report being released tomorrow.
The Stocks report on Friday is a big one for corn and wheat and not so much for soybeans. Corn stocks have come in with lost and found stocks of 150 to 500 million over the years. Early harvest, overstated yields, understated yields, and high or low feed demand all come into play on this report. The variance in ending stocks estimates ranges from 1.320 to 1.500 billion bushel. A number close to the 1.500 will have us testing the previous lows around $4.70 while a number closer to 1.320 could push things back towards the $5.00 level on the CBOT.
Have a Safe Day!
Garry Gard
920-348-6844
September 18, 2023
Good morning,
Markets are weaker to start the week with corn down 6 and soybeans down 17.
Follow through selling from last week’s bearish report along with favorable harvest weather have the market on it heals today. Weather looks to offer a wide-open week for harvest to keep rolling or get rolling in several areas of the US with no storms in the eastern corn belt until the weekend.
Early yield reports out of IA, IL, OH, IN have varied, but overall are above producer expectations and in line if not above APH’s. Lower moisture and good test weights have been reported in almost every area of the country where harvest has begun. Despite concerns it appears that the hot and dry conditions this summer helped add starch to the kernel.
It appears that it is time to throw in the towel for producers sitting on old crop corn as end users appear to be covered and early harvest is weakening basis across the country. September corn is currently trading at a 40-cent premium to October corn and that premium is slipping away quickly.
Traders will be looking to this afternoon’s crop progress report to see how much of the crop is in the dent stage and how much harvest progress has been made.
Have a Safe Day.
Garry Gard
920-348-6844
September 14, 2023
Good morning,
Corn is down 1 and soybeans are up 1 to start the day.
The current soy/corn ratio is 2.81. The markets are dealing with a situation where we have too much corn (especially in the US), and too few beans. The global marketplace in the Southern Hemisphere will likely work to correct that imbalance this upcoming planting season. Overall, though, world-ending carryout’s are just fine on both commodities – we have the largest ending stocks ever on soybeans worldwide and the second largest ever on corn. Prices will continue to struggle without a change in demand or a weather issue in S. America.
Mississippi river levels are a major concern and have barge freight at or near record highs. This will continue to dominate the headlines over the next couple months as harvest progresses in the north with limited outlets for grain to head south. Producers needing to move grain at harvest should be locking in cash prices or at least basis ASAP.
Have a Safe Day!
Garry Gard
920-348-6844
