Morning Commentary

May corn up ¼ at $3.6275

May beans up 1 ½ at $9.005

The DOW is down

USD is weaker

Crude oil up $.13 at $63.21

Good morning,

Corn traders are debating the balance sheet ahead of tomorrow’s monthly USDA supply and demand report. Bears are pointing to downward revisions coming to corn used for ethanol, exports and perhaps a more significant cut coming to feed and residual usage. In fact, following the Quarterly Stocks Report, I’ve heard some bears thinking the USDA could reduce feed and residual by -50 to -150 million bushels. As for ethanol, many inside the trade are thinking we could see -50 to -100 million bushel reduction in corn used for ethanol. There’s similar type of talk circulating regarding corn for exports, perhaps a -50 to -100 million bushels reduction in estimated demand, especially with such improved production in South America this year compared to last year.

U.S. corn being exported during the 2018/19 marketing year rates No. 2 or better on all grade factors, according to the U.S. Grain Council analysis. The corn tested had lower average stress cracks, higher average 100 kernel weight, slightly higher average kernel true density and a higher average percent of whole kernels compared to the same analysis done in 2017/18. (Source: USGC)

Soybean prices prices are fairly steady this morning ahead of tomorrow’s monthly USDA report. Bulls rallied prices last week on more bullish optimism surrounding Chinese trade negotiations. Bears however, believe the window of opportunity for U.S. exporters is closing and the South American crops have improved a bit the past few weeks. Bears also argue that U.S. demand might be a touch overrated. Presenting numbers that show the current U.S. domestic crush estimate might be a bit too optimistic. At the same time, U.S. exports might also be overly optimistic without some unforeseen heavier old-crop buying from the Chinese.

The Iowa Farm Bureau Federation said the state’s economic damage from last month’s catastrophic flooding will likely surpass $2 billion; farmers there will struggle to plant as many as 145,000 flooded acres along the Missouri River. U.S. Corps of Engineers said March runoff from the Missouri River Basin above Sioux City, IA set a record at 11 million acre feet. The previous high was 7.3 million acre feet set in 1952. (Source: DesMoines Register)

Scientists at The Roslin Institute in Edingburgh are now studying ways to identify the genes that are important in reducing infection by Influenza A virus in pigs and chickens as well as genes that limit the spread of the virus to people. Keep in mind, Influenza A viruses have infected many different animals, including ducks, chickens, pigs, whales, horses, and seals. However, certain subtypes of the infectious virus are specific to certain species, except for birds, which are hosts to all known subtypes of influenza A viruses. In case you were wondering, the circulating Influenza A subtypes in humans are H3N2 and H1N1 viruses. It’s worth mentioning, Influenza A viruses that typically infect and transmit among one animal species sometimes can cross over and cause illness in another species. For example, until 1998, only H1N1 viruses circulated widely in the U.S. pig population. However, in 1998, H3N2 viruses from humans were introduced into the pig population and caused widespread disease among pigs, and more recently, H3N8 viruses from horses have crossed over and caused outbreaks in dogs. While it is unusual for people to get influenza infections directly from animals, sporadic human infections and outbreaks caused by certain avian influenza A viruses have been reported. Keeping us relatively safe from the jump is the arm of our immune system, known as the host interferon response, which fortunately provides a significant barrier to the virus spreading from animals to people. But now the new study at the Roslin Institute, will investigate which genes are important for inhibiting replication of Influenza A virus in pigs and chickens and which genes of the host interferon response limit the spread of the virus from animals to people. I’m told the researchers will receive nearly $1 million to move the ball forward in understanding how to combat influenza strains, and using the recent developments of genome wide CRISPER libraries for livestock species, it is hoped that researchers will soon have answers to combat both the economic burden caused by outbreaks as well as avoiding any potential for pandemic human outbreaks. I should mention researchers there have already been successful using CRISPR to produce pigs that are potentially resistant to Porcine Reproductive and Respiratory Syndrome, and hope to do the same with African Swine Flu.(Source: CDC, Poultryworld, feedstuff)

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