July corn up 6 ¾ at $3.90
July beans up 11 ½ at $8.3325
The DOW is down
USD is weaker
Crude oil down $.10 at $62.66
Corn traders continue to closely monitor U.S. weather and delays in planting. New-crop DEC19 prices are back above $4.00 per bushel! Last Monday, the USDA estimated just 30% of the U.S. corn crop was planted. It’s hard for me to imagine, this week, there’s much more than 45% planted. Last year, as of May 20th the USDA estimated 81% of the crop was planted. In 2017, as of May 20th, the USDA estimated 82% planted. Bottom-line, we are going to be nowhere close.
Soybean bulls are pointing towards more questions and uncertainties regarding U.S. weather. For several weeks this market has been discounting weather headlines, saying there’s plenty of time on the clock and that delays in corn planting will ultimately lead down the path to more soybean acres. That logic and reasoning is now starting to be more heavily questioned and debated as weather extremes remain in play. It’s no secret that soybeans don’t often perform well in wet soil. In fact, most seasoned agronomist will tell you that soybeans planted in overly wet soil or sitting with “wet feet” for extended periods of time will turn yellow, suffer from reduced nitrogen fixation and rarely recover enough to reach full yield potential. Last week, the USDA showed just 9% of the U.S. soybean crop planted. There’s talk we will be somewhere between 25% and 30% reported this week. Last year, as of May 20th, the USDA estimated 56% of the soybeans were planted. In 2107, as of May 20th, the USDA estimated 50% of the crop was planted.
Beginning today, the U.S. is removing tariffs on steel and aluminum imported from Canada and Mexico. I’m told a new monitoring system intended to stop steel and aluminum from China and other countries from being sent to the U.S. through Canada and Mexico will be instituted.
In an apparent response to the escalating trade war, China cancels U.S. pork import orders for 3,247 metric tons. That’s the biggest cancellation in more than a year. Prior to the trade war, China and Hong Kong combined were the second largest export market for U.S. pork. This is concerning as many have been banking on China increasing its U.S. pork purchases due to African swine fever. (Source: Reuters)
On May 17 Japan formally removed the requirement that U.S. beef exported to Japan be derived form cattle less than 30 months of age. U.S. exporters can now export beef from cattle of any age to Japan for the first time since 2003. Expanded access could increase U.S. exports to Japan by up to $200 million annually. Japan is the largest overseas market for U.s. beef, accounting for 25% of all U.S. beef exports in 2018. In 2018, the U.S. exported 330,000 metric tons of beef and beef products to Japan valued at $2.1 billion.
Successfully and economically applying nitrogen at variable rates across fields or “precision ag” can be challenging due to the required detailed understanding of the variabilities affected by soil, weather and topography. Though huge strides have been made in the use of precision ag over the last decade, as well as greater understandings from science as to the runoff of nitrogen problem, we still have a ways to go to reach our goal of reducing fertilizer losses and lowering greenhouse gas emissions. Researchers from Michigan State University have discovered that almost all fields have certain areas with consistently low or high yields, meaning much of the fertilizer added to low-yielding areas will go unused and be lost to the environment. Most would agree there is not much debating that fact, the difference here is recent research is the first to quantify nitrogen losses from the low-producing areas of individual fields. From what I understand, the study shows that lost nitrogen from 10 Midwest states totals nearly $1 billion of wasted fertilizer and 6.8 million metric tons of greenhouse gas emissions annually. As far as the research is concerned, the team used satellite imagery to measure eight years’ worth of sub-yield fields on +70 million acres of farmland in the Midwest. Validating the satellite imagery, was the comparison against 10 years of high-resolution yield data collected by sensors mounted on combine harvesters from more than 1,000 farms, which provided the researchers with a more finely resolved image of the entire Midwest’s corn production. Bottom line… by assessing how much Corn Belt farmers spent on fertilizer that went unused, the authors concluded that the best outcome—both for farmers and the environment—is to avoid fully fertilizing the underperforming areas of each field and perhaps not fertilizing at all. In fact, Bruno Basso, MSU professor of ecosystems science and lead author of the study said, it may be better from an economic standpoint to leave these areas totally “un-farmed,” to plant them with conservation grasses or in the future, with perennial bioenergy crops. Regardless, Basso said that time and resources should be focused on farming the portions of the fields that are high yielding or that might be high yielding some years and low-yielding others. The team hopes improved precision ag practices along with technological advances in remote sensing will work to improve profitability on low-yield areas and work to eliminate seasonal excesses in reactive nitrogen, ultimately meaning significant savings for the producer. Once again, by having the correct data and being able to fully analyze the output, farm owners might be able to design a much different and improved plan with being forced by new government laws and regulations.(Source: Phys.org, nature.com)