3 Big Things Today, September 24
Corn and Soybean Markets Mixed
Corn and soybean futures were mixed overnight as traders and analysts can’t seem to figure out if this year’s crop will be average or excellent.
While early yield results from the Delta and southern parts of major producing states have been disappointing, most people in the industry fully expect higher averages as the harvest moves north. The U.S. Department of Agriculture earlier this month forecast yields for both corn and soybeans to be the second-highest ever.
Despite the optimism, however, it seems yields thus far continue to be worse than expected.
A participant in agriculture.com’s Marketing Talk said he is seeing yields at 60 to 80 bushels under last year, and he's heard that some heavy-bottom ground yields are 140 to 150 bushels less than a year ago. (http://community.agriculture.com/t5/Marketing/MT-has-your-harvest-begun/td-p/608270)
Still, with only 10% of the harvest complete, U.S. farmers have a lot of corn and soybeans to harvest, so yields will likely see an overall improvement.
On Thursday, the CME Group's corn, soybean, and wheat markets trade lower.
At the open, the Dec. corn futures are trading 2 3/4 cents lower at $3.80. Nov. soybean futures are trading 5 cents lower at $8.58.
Dec. wheat futures are 2 1/2 cents lower at $5.05.
Dec. soymeal futures are trading $1.70 per short ton lower at $300.30. Dec. soyoil futures are trading $0.10 lower at $26.44.
In the outside markets, the Brent Crude oil market is $0.16 lower per barrel, the U.S. dollar is lower, and the Dow Jones Industrials are 210 points lower.
Rain May Delay Pockets of Midwest Harvest
The precipitation may continue into the weekend on reports of a wet pattern forming in the upper Midwest from the Dakotas into Minnesota. Some harvest delays are expected as the storm moves east, but in much of the region where rain has fallen, corn isn’t yet ready to be harvested. In fact, the rain may actually improve prospects for late-filling soybeans or late-planted corn.
Rain also is expected in the next few days for parts of the southern Plains, good news for growers who are hoping to plant into moist soils rather than dust in their winter wheat.
About 19% of the U.S. winter wheat crop has been planted so far, according to the Department of Agriculture. The rain could help prospects for recently sown crops.
Spring wheat farmers should see some light rain, which could prevent them from harvesting the last little bit of spring crops that are still left in the ground. With pretty much the entire crop collected, however, the rain isn’t much of a concern.
Wheat Gets a Boost From International Weather
Wheat futures, despite being lower this morning, received a needed boost this week as adverse weather in the Black Sea region and in South America threaten global production.
Dry weather that’s persisted for weeks continues to plague wheat growers in Russia and Ukraine. Soil moisture is lacking, threatening winter wheat crops that were recently planted. Industry experts already are lowering their outlook for Black Sea yields.
In Brazil, it’s more of the same – hot, dry weather likely will slow early planting in Mato Grosso, among the biggest growing regions in the country. Growers in the area are hoping for cooler temperatures in coming weeks, and possibly even a shower or two.
Still, little rain has fallen, and long-term forecasts are calling for dry weather to continue.
The misfortune of farmers in the Black Sea region and in Brazil may be U.S. growers’ gain. Exports this year have been shoddy at best – accumulated exports so far this marketing year are down 22% from last year while total commitments to purchase U.S. wheat have fallen 13%, according to the USDA. That could change, however, if global production is threatened by hot, dry weather. (http://apps.fas.usda.gov/esrquery/)
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