Morning Commentary

May corn up 1 at $3.61

May beans unchanged at $8.9875

The DOW is up

USD is weaker

Crude oil up $.31 at $64.29

Good morning,

Corn traders appear little phased by the latest round of bearish USDA data. As many inside the trade had been expecting, the USDA delivered downward revisions across the board for corn demand. Feed and residual was lowered -75 million bushels to 5.300 billion; Corn used to produce ethanol was lowered -50 million bushels to 5.500 billion; Exports were reduced -75 million bushels to 2.300 billion, reflecting current outstanding sales and expectations of increased competition from Brazil, Argentina, and Ukraine. In total, U.S. ending stocks were pushed higher by +200 million bushels to 2.035 billion. Global stocks also became more burdensome with global corn production raised +5.3 million tons to 1.377.2 billion. The trend is negative.  Closing under 351.25 should lead to a test of the low 340 area.  Stable action over 373.25 is needed to improve the short term outlook.  Algorithms likely have sell stops below 352.5. 

Soybean price appear as if they want to remain range-bound. The USDA opted to leave U.S. exports and domestic crush “unchanged”. Interestingly seed usage was raised from 96 to 98 million. Imports were slightly reduced from 20 million down to 17 million. In the end, U.S. ending stocks were lowered slightly from 900 million down to 895 million, which is still considered extremely burdensome. Global production is raised +2.0 million tons to 595.0 million mainly on higher soybean production for Brazil and rapeseed production for India. Production for Brazil is increased +0.5 million tons to 117.0 million, reflecting favorable weather in Rio Grande do Sul where the crop is in pod-filling and maturation stages. The trend is negative.  Closing under 890.75 opens the door for a drop to 877.75.  Stable action over 910.75 is needed to improve the short term outlook. 

China may be exploring ending the anti-dumping investigation into US DDGS imports after the ministry of commerce responded to a request from the US Grains Council to review the current situation, market sources have told Agricensus Tuesday. President and CEO of the US Grains Council, Tom Sleight, confirmed that the council had raised the question of the review with the Chinese government. (Source: Agricensus)

The USDA is offering loans to upgrade rural electric systems in order to reduce energy costs and improve quality of life for people who live and work in rural America. The funding includes nearly $7.1 million for smart grid technologies that improve system operations and monitor grid security. The financing will improve electric infrastructure in Iowa, Minnesota, Missouri, New Mexico, South Dakota and Texas, building or improving 2,635 miles of power lines.


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