Morning Commentary

May corn up 4 at $3.5525

May beans up 2 ¾ at $8.565

The DOW is down

USD is stronger

Crude oil down $.30 at $63.00

Good morning,

Corn price are a bit higher this morning on wild-weather reported across the U.S. this past weekend. There was snow reported in several northern production states along with additional rainfall in already soaked areas. There’s also been more talk and rumors that Argentina will soon be raising their export taxes to help offset their weak economy and escalating government debt.  As for today, the trade is looking for the USDA to show that 15% to 16% of the total U.S. crop is planted, which is behind our more traditional pace, but still not worrisome enough to shake the bearish funds out of their record short position.

Soybean bulls are desperately searching for something to grab onto and help pull the market higher. Prices were down by more -25 cents last week and are down roughly -90 cents from their early-February high. The South American harvest has advanced at a faster pace than normal, bringing about further questions and uncertainty surrounding U.S. demand. Throw on top ongoing trade negotiations between U.S. and Chinese leaders and the deep uncertainty surrounding African Swine Fever, and we have an underlying landscape the has allowed the bears to roam and rule freely, hence, the reason funds are short nearly -150k contracts.

An outbreak of E. coli from tainted ground beef has sickened 177 people in 10 states, the CDC reported Friday – 21 more people than was reported earlier this week. Since the beginning of March, 21 of the 177 people infected with the strain of Escherichia coli O103 have been hospitalized, the Centers for Disease Control and Prevention said Friday. Kentucky, Tennessee and Georgia have seen the highest number of cases, with 65, 52 and 41, respectively. K2D Foods recalled about 113,424 pounds of raw ground beef products and Grant Park Packing recalled about 53,200 pounds of ground beef for concerns it may be contaminated. (Source: USAToday)

Saudi Arabia is a large and expanding market with highly concentrated diary and poultry industries. Fifteen farms control 80% of the poultry market and nine farms control 85% of the dairy market. Imports represent an increasing portion of the feed rations for these animals. Last marketing year, Saudi Arabia ranked as the tenth largest overall buyer of U.S. corn, importing 1.49 million metric tons (58.7 million bushels) in addition to 280,000 tons (11 million bushels) of U.S. sorghum and 13,000 tons of U.S. dried distiller’s grains with solubles (DDGS). Saudi Arabia also imported 16.5 million gallons of U.S. ethanol. (Source: US Grains Council)

Agri-giant ADM said slim biofuel margins and Midwestern floods slammed the U.S. grains merchant’s profit, which tumbled 41% in the first quarter. In response, ADM says they are creating an ethanol subsidiary, which will include dry mills in Columbus, Nebraska; Cedar Rapids, Iowa; and Peoria, Illinois. This looks like the company is preparing to spin-off their ethanol business altogether… ADM says they are seeking voluntary early retirements for some of their North American employees as they try and cut capital spending by 10% in 2019. (Source: Reuters)

Record-high demand for grain during the 2019/20 marketing year will drag down world grain reserves to their lowest level in five years, said the international Grains Council on Thursday. It would be the third straight year of declines in global carryover stocks. (Source: IGC)

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