Slightly firmer markets to start the week with corn up 4 and soybeans up 2.

Limited news over the weekend has the markets feeling stale. With the continued concern over COVID and what implications looming shutdowns could have on the economy, traders will remain wary. Producers should not be complacent and thinking the markets are going to continue to climb or even hang where they are. If we were to see a 4-6 week shutdown this market could crumble back to the numbers seen last spring! The USDA’s report on Tuesday had a 11.5% stocks to use ratio. This could easily climb to 15% with a shutdown. $4 can still be sold for April forward and is a level I would recommend making sales.

Have a Safe Day

Garry Gard

920-348-6844

ggard@didionmilling.com

Good Morning,

Corn is down 1, beans up 3 and wheat down 3 to open the day. The corn and wheat markets have completely wiped out the gains from the USDA report on Tuesday.

The last two days we have seen the market shifting to what would happen under a Biden Presidency as his COVID19 advisor proposed a 4-6 week national shutdown to control the virus despite having a vaccine. This action would strike directly at the US’s productivity and demand for certain commodities. As experienced in the last shutdown, gasoline took a major hit in usage and still hasn’t fully recovered. Less gasoline usage also reduces the US ethanol consumption. As the USDA removed 465 mbu from the US S/D that pushed carryout below 1.8 bln with new export expectations and lower production, now the trade is presented with a governmental action that could add 250 mbu of supply back to the corn table from reduced corn for fuel ethanol production. COVID19 cases in the US has had some states (CA, IL, IA, MN) take early action to stave off rising positivity rates. Not only is the domestic situation under the threat of shutdown but how much will it bleed into import/exports where countries, who believe they have the disease under control, look to hold off from reimporting the disease.

As I have stated in the last couple weeks, producers should not be complacent and thinking the markets are going to continue to climb or even hang where they are. We have lost 20 cents in the last two days and if we were to see a 4-6 week shutdown this market could crumble back to the numbers seen last spring! The USDA’s report on Tuesday had a 11.5% stocks to use ratio. This could easily climb to 15% with a shutdown. $4 can still be sold for April forward and is a level I would recommend making sales.

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didionmilling.com

Good Morning,

Weaker markets overnight as corn, soybeans and wheat trade lower. At this time corn is down 3 while soybeans and wheat are both down 5. The last two days have resulted in corn giving back half of Tuesdays gain.

Support levels on the CBOT for CZ20 are in the $4.02 to $4.05 range which looks a long way off at this juncture but still very much attainable. It might be worth pointing out that the supply situation, both inside the United States and globally, are unlikely to change much before January when the final production report for the U.S. is released and more information is known about South American crop prospects. Trades will be left to focus on demand indicators such as the pace of exports and ethanol grind, which is a bit of a mixed bag at present. Exports remain incredibly bullish, but still only account for 18% of total demand even with the USDA’s record forecast. Ethanol grind is projected at the second lowest marketing year total since 2012-13 as margins continue to yo-yo between profitability and losses. Livestock prices are below long-term moving averages with a fair amount of anxiety hanging over the market as long as coronavirus-related restrictions remain a concern.

I am not going to predict where the market is going to be five minutes from now let alone 5 months from now, but producers are currently able to lock in some very good prices out into the summer months and should actively be marketing grain.

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didionmilling.com

Good Morning,

Corn is up 2 and soybeans are up 7 to start the day. Yesterday’s report gave the markets a good boost which producers heavily rewarded by making very good sales for nearby thru fall of 2021. With the run up in board prices over the last couple weeks and locally better than expected yields we are starting to see nearby bids pulled from end users and basis weaken a bit in the deferred months as needs get filled. I would recommend that if you are going to need to sell corn in Q1 that you make some sales to lock in a great price and assure a space to move the grain.

Yesterday the USDA estimated US 2020 corn crop near 14,507 mil bu. Total 2020/21 corn demand is estimated near 14,825. This includes exports near 2,650. Carryout is now estimated near 1,702. This suggest corn prices may need to trend slightly higher to slow demand and help increase US 2021 corn acres.  The 1,702 carryout is a 11.5% stocks to use ratio. Historically the CBOT does not trade above $4.50 unless we see the stocks to use ratio below 9%. I am not saying this couldn’t happen, but we still have a lot to work thru to get to 9% and with COVID numbers and shutdowns around the world on the rise this number could easily go the other direction. Projections for average on farm prices for 2020/21 are $4.00.

USDA estimated US 2020 soybean crop near 4,170 mil bu. Total 2020/21 US soybean demand is estimated near 4,519. This includes exports near 2,200. Bean demand and carryout of 190 million bu. were the biggest market mover in grains on Tuesday. Projections for average on farm prices for 2020/21 are $10.40.

Have a Safe Day!

Garry Gard

920-348-6844

ggard@didionmilling.com

Good Morning,

Markets are slightly higher this morning with corn up 3 and soybeans up 6. Yesterday’s announcement by pharmaceutical company Pfizer that it had a vaccine with early data showing it to be 90% effecive3 at preventing the coronavirus is giving the market hope that we may sometime in 2021 return to more normalcy.

The U.S. Corn harvest was reported at 91% complete (trade estimate 91%) versus 82% last week and 80% average.  The U.S. Soybean harvest was reported at 92% complete (trade estimate 94%) versus 87% last week and 90% average.
USDA is scheduled to release its monthly WASDE crop report at Noon EST today, including revisions to its domestic and global supply and demand balance sheets. The average trade guesses that are factored into the market include a 0.7-bushel drop in the corn yield to 177.7 bushels per acre and a 0.3-bushel decline in the soybean yield to 51.6 bpa. The greater focus of the trade will be on a) potential upward adjustments in USDA’s corn and soybean export forecasts, b) possible reductions South American corn and soybean production estimates due to early-season dryness and c) a potential increase in China’s corn import target after the USDA attaché in China recently raised his estimate of Chinese imports to 22 million metric tons.

USDA 2020/21 Corn and Soybean Production (billion bu)

USDA 2020/21 US grain and soybean ending stocks (billion bu)

Have a Safe Day!

Garry Gard