March 10, 2021
Good Morning,
This morning corn is down 9 and soybeans are down 23. A technical meltdown developed overnight, high prices are going to have big ranges and moves. This is just going to be part of things moving forward. It will probably get even worse with the expanded position limits that go into place next Monday. The drop is blamed on wet weather for Argentina and Southern Brazil, but this could be the beginning of a lower technical trade. Volatility will rule this market all the way to the end.
Not that anyone should have expected much out of the USDA yesterday and most expected very few if any changes. The USDA delivered to the expectations and delivered a dud of a report. They made no changes to US corn, beans or wheat.
U.S. domestic ending stocks were left unchanged from February at 1,502 million bushels versus the average trade estimate of 1,460 million and the range between 1,302 and 1,561 million. No other adjustments were made to any of the supply or demand figures on the domestic balance sheet. The projected average farm price was also left unchanged at $4.30/bushel. World corn ending stocks increased 1.14 MMT from February to 287.67 MMT versus the average trade estimate of 285.3 MMT and the range of estimates between 282 and 287 MMT. Notable changes included a 650,000 MT increase in projected imports for Southeast Asia (SEA) to 18.7 MMT.
Have a Safe Day!
Garry Gard
920-348-6844
March 8, 2021
Good Morning,
Another sharply higher Sunday night trade fades into the early AM hours. Improved rain chances in Argentina and a USDA crop report coming Tuesday have held prices at bay. Look for the market is going to chop around today and tomorrow.
Tomorrow the USDA will release their monthly WASDE report. The trade est. US 2020/21 corn carryout at 1,470 mil bu vs USDA 1,502, soybean at 117 mil bu vs USDA 120, US 2020/21 wheat carryout at 839 mil bu vs USDA 826, World 304.3 mmt vs USDA 304.2. Trade est Brazil soybean crop near 133.1 vs USDA 133, Argentina near 47.4 vs USDA 48, Brazil corn crop near 108.3 vs USDA 109, Argentina near 47 vs USDA 47.5
I would guess the USDA comes out with something very close to what the trade estimates have. They will want to see what the future holds for corn and bean exports, as they have vaporized as of late. Brazil and Argentina crops are unknown, with the majority of harvest yet to develop.
Have a Safe Day!
Garry Gard
920-348-6844
March 4, 2021
Good Morning,
Stronger markets this morning after a weak overnight session. Corn is up 5 and soybeans are up 30.
The 6% drop in the Brazilian currency over the last few trading sessions plus weakening values for corn in Argentina have caused the recent setback in the markets. Traders remain fearful of increased supply from South America and less demand for US corn as Argentina corn prices have shifted below US values.
The trade was expecting weekly corn export sales of 400-800 mt, soybeans 100-500 mt. Actual sales were 115,900 mt of corn, 334,000 mt of beans. Bean sales were split between Mexico, Germany and Japan. China is obviously waiting for Brazilian beans.
The outlook for the next week remains hot and dry for Argentina, which should continue to stress crops going through the reproductive phase of development. Very heavy rains remain in place for much of Brazil, other than Rio Grande do Sul at the far southern tip of the country. However, that pattern is expected to change by mid-month. Rain chances start improving significantly for Argentina after March 12th. This should be able to recover a part of the lost production potential for Argentina’s corn and soybeans.
Have a Safe Day!
Garry Gard
920-348-6844
March 2, 2021
Good Morning,
Mixed markets this morning with corn down 1 and soybeans up 3.
China has been holding off on any purchases of beans, while they wait for Brazilian shipments. They have backed off the crush pace to bridge the gap until South American supplies arrive.
Kansas HRW good/excellent conditions fell 3% to 37%, Oklahoma fell 2% to 46% g/e, and Texas was down 2% to 28% g/e. The freeze and dry temps are leading to more deterioration of the wheat crop. This will lead to more soybean, milo, corn and other small grain acres being planted in these areas.
Ag Rural is reporting that 25% of the Brazilian harvest is complete vs 40% last year. They also raised the size of the Brazilian crop to 133 mmt vs the previous forecast of 131.7 mmt. The 10 day forecast and the 11-15 are both dry for Argentina this morning. Limited rainfall is expected over the next two weeks. Temps are also going to move into the mid 90’s to 100 degrees over this same timeframe.
Producers should be active sellers of new crop corn and soybeans ahead of the March 31st planting intentions. With crop insurance coverage price for corn at $4.58 and soybeans at $11.87 we should see a record number of acres in the report.
Have a Safe Day!
Garry Gard
920-348-6844
March 1, 2021
Good Morning,
Overnight markets had old corn down 1, new corn up 2 and soybeans up 11. Prices rallied up again strongly last night only to fizzle out in the early AM. This has been a pretty reliable pattern over the last couple months. Expect a really choppy week as we wait for two crop reports headed towards us in the next 4 weeks. Volatility is going to remain very high. Funds are estimated to be long 358,000 corn and 165,000 soybeans heading into the new month.
Brazil shipped out 2.5 mmt of beans last week putting February shipments at 4.5 mmt. Normally they would move 7 mmt or higher. March looks to get back to normal shipping 2 mmt plus a week.
Forecasts for South America are consistent with Friday’s forecasts. Limited rain for Argentina and most of Southern Brazil. Northern Brazil will see rain over the next week. The 11-15 day forecast has some rain chances for the south.
Have a Safe Day!
Garry Gard
920-348-6844
