Home / Markets / Markets Analysis / Corn market / Rally could meet its match-Tim Hannagan

Rally could meet its match-Tim Hannagan

Agriculture.com Staff 05/20/2011 @ 1:11pm

Thursday's weekly export sales report gave us a break from looking at the endless weather updates. Wheat exports last week were 126,000 metric tons, down 61% from the week prior. With 839 million bushels expected to be left over on June 1, the start of wheat's new marketing year, importers are buying hand-to-mouth, as needed, with a little more buying on the brakes. But, with a fresh harvest coming in June they hope for even more at value.  But, that waiting policy could change quickly to panic-buying. 

We know that our southwestern winter wheat is in the poorest quality in 20 years. Number one winter wheat producing state, Kansas ,had a sharp decline on this week's crop condition report, after rains the week prior should have improved it. This suggests the freeze that hit several weeks ago may have damage the crop, as a freeze or frost damage isn't apparent until the kernels are developed. 

Kansas now has 64% of their heads fully developed. Once thought to be our best wheat in the Eastern grain belt of Illinois and Indiana, it has now seen sharp quality declines due to excess rain with flooded fields and more rain expected. Additionally, overseas producer exporters are again in the grips of drought. 

France is experiencing dryness in areas, the worst in 50 years. Also, Germany and the Ukraine have crop problems. Canada's flooding is preventing timely planting as well. It seems know one who produces or exports wheat is off to a good start. Instead, it's a horrible start. This could trigger a sharp price rise into June, with heavy buying to secure needs. 

Corn exports saw the benefit of last week's sharp price drop with exports of 843,000 metric tons, up 94% from the week prior, with our key Asian customers in for 788,000 metric tons of the total. Beans continue to see Brazil out-sell us near-term, as our sales were a meager 166,000 metric tons. Most important,  China not purchasing any old crop year beans for the fourth consecutive week. 

Look for US exports to pick up in June, as  Brazil's exports wind down and expect China to feast on US beans at fall harvest. 

Next week is setting up for potentially some dramatic price swings as several major issues collide. One, heavy rains to start the week. Two, month-end profit-taking. Three, potential dry late may.  Traders look to go home long grains Friday and anticipate that we will see the seventh consecutive higher opening Sunday night and Monday as weather looks to bring every rains to 80% of the Midwest grain belt states Tuesday through Thursday. 

CancelPost Comment

Soda Blasting’s Light-Touch Advantage By: 02/10/2016 @ 10:42am By Tharran GainesLike any type of media blasting, soda blasting involves the process of propelling…

Save Batteries From an Early Death By: 02/09/2016 @ 2:41pm By Dave MelloSo frustrating. That click-click-click sound – or no sound at all – from an engine…

Brazil's Soybean Yields = Record-Large… By: 02/05/2016 @ 1:14pm SAO PAULO, Brazil (sfagro.com.br)--Concerns over the drought, which affected soybean plantations in…

This container should display a .swf file. If not, you may need to upgrade your Flash player.
Ageless Iron TV: Tractors at War