by Steve Freed
Grains are mixed. SN is down 1 cent and near 8.35. CN is unchanged and near 3.16. WN is down 6 cents and near 5.13. KWN is down 11 cents and near 4.76. Stocks are higher. Crude is higher. US Dollar is higher.
Last night’s GFS model run was slightly cooler in the Corn Belt Saturday morning, in the northern Corn Belt Monday morning, and in the eastern Corn Belt Tuesday morning compared to the midday GFS model. There is potential of freeze damage to emerged corn in the upper Midwest this weekend and possibly some risk farther south early next week.
Farmers are planting their crops as fast as possible in order to avoid the pitfalls of late planting seen last year; the USDA says 51% of corn expected to be planted this year is already planted as of this week–well up from 21% this time last year and a 5-year average of 39%. Soybeans are 23% planted, up from 5% planted last year
U.S. Winter Wheat was rated 55% good to excellent (trade estimate was 53%) versus 54% a week ago and 64% a year ago; 31% fair (31% last week, 28% a year ago); 14% poor to very poor (15% last week, 8% a year ago).
U.S. Winter Wheat headed was 32% versus 21% last week, 26% a year ago, 38% average.
U.S. Spring Wheat planted was 29% (trade estimate was 30%) versus 14% last week, 19% a year ago, 43% average. U.S. Spring Wheat emerged was 6% versus 4% last week, 4% a year ago, 16% average.
U.S. Corn emerged was 8% versus 3% a week ago, 5% last year, and 10% average. U.S. Oats planted were 67% versus 54% a week ago, 48% last year, and 67% average.
Yesterday’s U.S. weekly export inspections had Wheat exports running 5% ahead of a year ago (5% last week) with the USDA currently forecasting a 5% increase on the year, Corn 34% behind a year ago (36% last week) with the USDA down 16% for the season and Soybeans 5% ahead of a year ago (up 6% last week) with the USDA having a 2% increase forecasted on the year
Wheat futures are lower after USDA increased weekly US winter wheat crop ratings when most were expected a slight drop. Dryness in parts of the south plains is begging to stress the HRW crop. Crops improved in KS, OK, NE, OR, OH and WA and dropped in AR and TX. Wheat futures will continue to trade US and Russia weather. There continue to be a steep discount from old crop Russia prices to new. This offer resistance to futures.
Corn futures may be in a range after USDA estimated US corn plantings ahead of what was expected and average. Trade will now be positioning in front of the USDA May 12 report. Drop in US demand talk of favorable US summer weather should offer resistance to prices.
Soybean prices may be on the defensive until China begins to buy US soybeans or there is a weather concern. Trade will be watching USDA May 12 report and see if they drop 2019.20 demand and what they forecast for US and World 2020/21 supply and demand.
On Monday, Managed funds were net buyers of 2,000 contracts of SRW Wheat; net sold 9,000 Corn; net sold 8,000 contracts of Soybeans; net sold 2,000 Soymeal, and; sold 3,000 Soyoil. We estimate Managed Money net long 12,000 contracts of SRW Wheat; net short 153,000 Corn; net long 8,000 in Soybeans; net short 7,000 lots of Soymeal, and; net short 8,000 Soyoil.
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Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.