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
February 26, 2021
Good Morning,
Weaker markets to open the day with corn currently down 4 and soybeans down 6. Markets have rebounded from the overnight session that saw corn down 10 and soybeans down 20+.
Many factors added to the selloff in prices yesterday; first notice day liquidation, a model change in weather and weak exports across the whole host of commodities. Any kind of change can cause a purge of the longs. I expect more opportunities moving forward, but the volatility will continue throughout the year.
The South American weather forecast has flip flopped from yesterday’s wet weather in Southern Brazil and Argentina. This is not the first or last time that model has or will do this. Today’s forecast doesn’t matter, other than it is back to bullish. What will matter is if the rain is on for next week this Sunday night. Forecasts are for rain to get moved back a bit and will show up in the 11-15 day period instead. Temps will remain high is Southern Brazil and Argentina until there is a break down of the ridge.
Us weather looks favorable for crops. Kansas City Based World Weather Inc released the following information yesterday.
“Temperatures will be trending unusually warm across much of the U.S. Plains and into Canada’s Prairies during the first week of March. Temperature anomalies will become above to, in some areas, well above average. The warmth will reduce snowpack and raise soil temperatures bringing more wheat in the southern Plains, Delta and southeastern states out of dormancy and help lift soil temperatures enough in the southern states to support some spring planting and germination. Cooling is a possibility after the first week of March; though, there is uncertainty as to how much cooling occurs and exactly what areas will be impacted.”
Have a Safe Day!
Garry Gard
February 25, 2021
Good Morning,
Markets are down hard this morning with contract roll and much better weather in South America.
Today is the roll day for March futures, all long positions need to be move or else face delivery. The market is putting the squeeze on anyone that was holding a long position in the March futures. Anyone holding a long position at the close of trade today will be forced to deliver.
U.S. Ethanol production for the week ended Feb 19 totaled 658,000 bls per day (down 27.8% vs a week ago, down 37.6% vs a year ago); Stocks were 22.8 mil bls (down 6.2% vs a week ago, down 7.8% vs a year ago); Corn use 66.5 mil bu vs 92.0 mil last week and 95.7 mil needed to meet USDA projections. Cold weather has hampered plants the last couple weeks and slowed consumer driving. Many plants reduced production greatly due to the cold weather and natural gas issues.
***A very significant change in the weather for Southern Brazil and Argentina.***
The current forecast for Southern Brazil and Argentina has little rain, but moving out 5-7 days has a major storm coming in on a breakdown of the ridge. The Ridge is going to move North putting drier weather where Brazil needs it most. The forecast could prove to be a bust, but this is the map for now, and we have to respect significant changes in the weather. This forecast has 2 inches of rain coming when Argentina needs it most.
If you haven’t sold much new crop corn, today may be the day to do it. I am not expecting this market to continue the selloff, but we could hit some technical triggers that move this market lower. Heading into the March 31st planting intentions I would suggest being 50%+ sold on new crop corn. I expect 93-94 million corn acres on that report which could push markets lower. This is “IF” we have a favorable spring for planting. If weather is good, we could easily see 94-96 million acres.
Have a Safe Day!
Garry Gard
920-348-6844
February 23, 2021
Good Morning,
Stronger markets to open the day with corn up 6 and soybeans up 30. Soybeans are leading the way with interest in South American weather on traders minds today.
The USDA rated the Kansas winter wheat crop at 40% good to excellent down from 43% . Last year the Kansas crop was rated at 35% good to excellent. The expectations were for a larger drop this week after the bitter cold of last week.
Brazilian harvest is near 15% complete vs 31% average. Brazil’s second crop corn plantings are 15% vs 50% last year. Wet weather is going to keep the harvest pace slow, and new plantings will be late. The forecast holds the same wet weather in the North over the next 10 days with up 8 inches projected, its rain just about every other day. The forecast below has some light rain for Southern Central Brazil and trace amounts for Northern Argentina. Eastern Brazil is going to see moderate to heavy rain in the next week. The forecast is still bullish this morning following almost exactly the same pattern of the past month plus.
Have a Safe Day!
Garry Gard
920-348-6844
