July 30, 2012
Producer Marketing Manager
Corn: As of 7:30 Up 22
Disappointing rains over the weekend combined with the forecast for above normal temps to return this week has pushed the Dec contract to new highs over $8.00 overnight. Informa Economics released their Row Crop Production Update on Friday and estimated the US corn yield at 134.0 bu/a – they used 153.5 in a July 6th report and USDA had 146.0 bu/a in their July 11th S&D. Consensus is for continued crop rating declines in this afternoon’s USDA Crop Conditions report. Technical indicators are bullish.
Soybeans: As of 7:30 Up 40
The soybean complex is also significantly higher overnight pushing up $0.40 and trading near $16.45 on the November contract. This is still about $0.45 off the highs made last Monday. Oct meal is up $17/ton, just over $500 and bean oil is trading around 52.5 cents/lb. Informa reduced their national soybean yield estimate from 40 to 38.5 bu/a. This along with another slight increase in harvested acreage resulted in a production estimate of 2.89 billion bushels. This is 160 million bushels below the last USDA estimate.
Wheat: As of 7:30 Mpls up 13, KC up 16
The market chatter out of the Black Sea region is that a drought reduced crop there is dropping production near levels seen in 2010/11 when we seen the export ban put in place. This focused global demand squarely on the US that year……will it happen again? Stay tuned...... 2012 Spring wheat crop tour sponsored by the Wheat Quality Council finished up last week and pegged North Dakota yields at 44.9 mbu (vs 41.5 mbu on last year’s tour) – seemed like the further this tour got into the crop, the better the yields. With the earlier than normal crop, a lot was known about the crop already as far a yield and quality.
What to watch for: Crop Conditions out this pm, USDA Supply/Demand report released August 10th.