Morning Commentary

May corn up 1 ¼ at $3.64

May beans up 3 at $9.0175

The DOW is up

USD is stronger

Crude oil up $.13 at $62.59

Good morning,

Corn prices continue to show little movement. Bears point to South American crop production estimates, which appear to be moving a hair higher, and will be substantially stronger than last year. The bears are also questioning growth in U.S. demand, particularly exports and ethanol. Some insiders actually believe the USDA might soon make a slight reduction to their current forecast for each. It’s not that anyone is thinking or saying U.S. demand will fall apart, rather just more difficult in growing overall demand. Remember, the USDA is forecasting +3 million more corn acres and gains in technology could easily keep pushing yields higher, hence we need continued “growth” in overall demand, that “growth” is what’s being questioned. Ethanol production here at home rebounded a bit last week, but we are still running -3% to -4% behind our production averages from last year and at the same time sitting on about +7% in additional ethanol surplus, which is record large. The trend is negative.  A failure from 365.5 maintains strong negative forces.  The market is poised to challenge long term support at 352.5.  Closing under 352.5 should lead to a test of the low 340 area.  Stable action over 371.25 is the minimum needed to improve the short term outlook. 

Soybean bears are pointing to weather headwinds as conditions in South America have improved helping to aid harvest and bump production estimates slightly higher than what many inside the trade had been previously forecasting. Here at home, weather is also weighing on prices, as many traders are thinking overly wet conditions and limited opportunity for field work could ultimately bring about more soybean acres. Technically, the market seems comfortable trading in a fairly narrow range, at least until more is known about Chinese trade negotiations and U.S. weather, with the MAY19 contract trading between $8.80 and $9.15 per bushel. The new-crop NOV19 contract seems comfortable trading nearby between $9.15 and $9.50 per bushel.

Reports from the World Organization for Animal Health state that a Cambodian ASF outbreak has originated from the backyard near the Vietnam border.

China’s ag ministry said they will require pork processors handling raw pork to test for the presence of African swine fever from May 1. The tougher procedures come as the virus continues to spread through the world’s largest pig herd. China has reported 116 outbreaks of African swine fever since the disease was first detected last August, although many believe it is much worse than officially reported.


Your browser is out-of-date!

Update your browser to view this website correctly. Update my browser now