April 14, 2021
Good Morning,
Stronger markets this morning with old corn up 12, new crop corn up 6 and soybeans up 19.
Dry weather for the Safrinha corn crop in Brazil is driving prices higher the last two trading sessions. Brazil raises two crops of corn, the first is primarily used for domestic feed and ethanol. The Safrinha crop is mostly sold for export. The shrinking of this crop will make the World export market a tighter place for corn.
The 10 day forecast is still very dry for Central and Eastern Brazil. Second crop Brazilian corn is entering the critical stage of development and the crop needs rain now. Temps will be in the 80’s-90’s, not excessively hot. Western and Southern Brazil will see a chance of close to an inch of rain in the next week. Argentina has stayed wet during the beginning of their harvest.
The Fund position for corn could be at a new record high today. The bean position is pretty small in comparison. Markets take turns on bull runs and this one is all about corn stocks and acres. South America is able to supply the World with beans, but weather has their corn supply in question. Planting pace is really going to pick up over the next week which should put some pressure on the markets shortly.
Have a Safe Day!
Garry Gard
920-348-6844
April 13, 2021
Good Morning,
Markets opened stronger this morning with corn up 14 and soybeans up 14. Concerns over Brazils weather have added strength to the markets today. Agencies in Brazil are getting concerned about the 2nd crop corn as they dropped production 3.5%.
US corn plantings are near 4 pct vs 2 last week and 3 average. Cold temps have not slowed plantings. Texas has by far made the most progress, with 57% of the state’s corn crop now planted, followed by North Carolina (16%), Tennessee (11%) and Kentucky (10%). Nine other states have measurable progress of between 1% and 8%.
The 10 day forecast for the US has very light amounts of rain for the Central growing region. Up to a quarter of an inch is projected over the next 14 days. Most of the heavy rain stays in the far South Delta where they will get up 4-5 inches. In the back end of the model you can see storms develop in Texas and head East covering Missouri and the Southern tip of Illinois. The North stays very dry in the entire 14 day model. Temps will be below normal out into April 28th.
Have a Safe Day!
Garry Gard
920-348-6844
April 9, 2021
Good Morning,
Corn is up 4 and soybeans are up 2 this morning.
Yesterday old corn saw some strength on reports of harvest delays in South America a stronger wheat market and algorithmic trading that sent May and July corn 18-20 higher at some points.
Yesterday saw the funds as buyers of 10,000 contracts of Wheat, 35,000 contracts of Corn and 4,000 Soybeans. They are estimated to be long 7,000 contracts of Wheat; net long 466,000 Corn; net long 175,000 Soybeans.
The USDA will release the World Agricultural Supply and Demand Estimates report today at 11:00 central. (estimates below) New crop supply and demand estimates will be released in the May report.
USDA 2020/21 Ending Stocks (million bu)
| USDA | Ave. Est. | Last Year | |
| Corn | 1.352 | 1.388 | 1.919 |
| Soybeans | 119 | 118 | 525 |
| Wheat | 852 | 847 | 1028 |
While things look very bullish in the corn market right now, there are some reasons for anyone long corn to be cautious. Reports from ADM that China will not be taking all the corn that they currently have purchased and will be cancelling or rolling those purchases out to next year. There are also reports from ethanol plants across the Midwest that are looking to shutdown this summer due to corn shortages in their area and extremely high basis levels. One or both of these scenarios playing out would dramatically change the carryout numbers and send the markets in a freefall.
Have a Safe Day!
Garry Gard
920-348-6844
April 8, 2021
Good Morning,
Nice spring rains and higher markets to start the day. Corn is up 8 soybeans are up 5 and wheat is up 12.
For the week ended Apr 2, ethanol production was 975,000 barrels per day (the uptick is less than expected by analysts, who had forecast production to rise by as much as 70,000 barrels per day this week); up 1% versus a week ago, up 45.1% versus a year ago. Stocks were 20.6 mil barrels (down 500,000 barrels from the previous week’s report–this drop exceeds the expectations of analysts who had forecast a drop of as much as 400,000 barrels); down 2.2% versus last week, down 23.8% versus last year.
Weekly export sales were nothing too exciting with old corn coming in at 29.8 million bushel compared to 74.4 million on the 10 week average. Soybeans were negative 3.4 million bushels due to cancelations. The 10 week average for soybeans is 12.8 million bushel.
Estimates for tomorrow’s WASDE report are for the 2021/22 corn carryout near 1.379 billion bushel, soybean carryout at 118 million bushel and wheat at 846 million bushel. This report will be released at 11am.
US weather has a good amount of rain coming to the Central Corn belt and a lot of rain for the Delta. Totals in Illinois will reach 2 inches where in the South they will get up to 5 inches. Planting delays will continue in the Delta. The Western US shows more humidity on the maps this morning than yesterday, with most of the rain down in Texas. The Dakotas looks to miss most any rain as the system sets up further to the East up into Minnesota.
While things look very bullish in the corn market right now, there are some reasons for anyone long corn to be cautious. Reports from ADM that China will not be taking all the corn that they currently have purchased and will be cancelling or rolling those purchases out to next year. There are also reports from ethanol plants across the Midwest that are looking to shutdown this summer due to corn shortages in their area and extremely high basis levels. One or both of these scenarios playing out would dramatically change the carryout numbers and send the markets in a freefall.
Have a Safe Day!
Garry Gard
920-348-6844
April 6, 2021
Good Morning
Markets are mixed this morning with old corn up 3, new corn down 3 and soybeans up 8 across the board.
NASS rated the winter wheat good/excellent at 53% this week vs 62% a year ago. U.S. Spring Wheat planted was 3% versus 3% a year ago, 2% average. U.S. Corn planted was 2% versus 2% last year, and 2% average. Much of the wheat crop is poor to very poor at 16%. Some of this wheat crop is going to get ripped up if the yield potential is not there. Spring wheat is also going to give way to some acres of corn and beans with where price ratios are headed. Wheat is an unpopular crop and acres could end up at 100 year lows.
Bloomberg’s estimates for Friday’s WASDE report put corn ending stocks at 1.379 billion bushel vs. 1.502 billion last month. Soybeans are estimated at 118 million vs. 120 million last month. Thoughts are that the USDA will revise their export numbers this month to accommodate the rapid pace we have been selling to China thru the first quarter of the year. Through March 25, the total commitments of US corn were at 2.588 billion bushels already reaching the USDA’s 2.600 billion bushels export projection. Expectations are that they could raise t 100-200 million bushel in Friday’s report. The big question that no one knows is what will China decide to ship by the end of August vs. rolling forward to next year? That decision could dramatically impact prices.
Have a Safe Day!
Garry Gard
920-348-6844
