Tag Archives: soybeans

Summary

Market Recap 7-10

It has been an interesting week in the markets. For the outside equities the sky seemed the limit coming into the week. By weeks end everything outside of technology is yielding to the market bears. The NASDAQ continues to post record highs while the S&P 500 and DOW Jones slide slowly away from theirs.  In the macro picture traders are still nervous about the mounting corona virus outbreak. There is plenty of positive data, but the headlines continue to read doom and gloom. Thursday the weekly jobless claims came in at 1.31 million. That was below analyst expectations and the 14th week of continued declines, but now nearly 50 million Americans have filed for unemployment. It will be interesting to see how this report changes as states like Nebraska start to change the unemployment requirements back towards pre-covid.  Tuesday the JOLTS job report showed the US had 5.4 million job openings in May. That was up from the expected 4.9 million.

Investors are hedging their bet and putting money back into safe havens. The interesting thing is the US Dollar is not being bought like it was earlier in the year. On Wednesday the US Dollar dropped 0.45%. Precious metals and US Treasuries were then the favored safe haven. August Gold is traded near it’s contract high above $1,822/ounce. After an auction the US ten year treasury yield has also dropped to nearly 0.60%. It should be pointed out that gold became a favorite following the selloff in the European equities. Coming into the end of the week traders are now back to favoring the US Dollar with it gaining over 0.35% on Thursday. It appears the Gold hit technical points of resistance and money started to move out back into the dollar.

Up to Thursday the lower dollar helped to keep energy bulls in the hunt. Then WTI crude oil futures broke below $40/barrel. The latest stocks and production numbers though are not that great. Crude oil stocks on Wednesday grew 5.7 million barrels to 539.2 million barrels. Excluding the strategic petroleum reserve that is about 18% higher than year ago levels.

For the week ending July 3 EIA data shows ethanol production increased 1.6%, or 14,000 barrels per day (b/d), to 914,000 b/d. Production is in 12.7% below the same week in 2019. Ethanol stocks bounced higher for the first time in eleven weeks, expanding 2.3% to 20.6 million barrels and 10.4% below year-ago volumes.
The volume of gasoline supplied to the U.S. market, a measure of implied demand, grew 2.4% to 8.766 million b/d.  Gasoline demand was 10.1% lower than a year ago. While lower than a year ago, this data shows that the holiday driving was fairly strong over Independence day.

 

Grains have traded weather heavily this week. First is started off dry and no relief in sight. Mid week there was a chance, but going into Thursday morning the rain that did develop wasn’t enough to scare the weather bulls. The WASDE report on Friday held no real surprises. Expected yields were left unchanged from the June report. With the drop in acres that helped to reduce the overall harvest size. With a smaller harvest the 20/21 marketing year corn carryout came back below the 3 billion bushel mark. While that is a small sigh of relief the carryout is still expected to be well above 2 billion bushels. John Payne, Daniels Ag Marketing, in his afternoon commentary discussed how the WASDE was friendly in the short term, but brings up the long term question of how far can US production keep going. Global production continues to rise and the US dollar strength is keeping US commodities largely out of the global market place.

The latest crop progress report from NASS rated the national corn crop at 71% good to excellent. That is 2% lower than the previous report, but 14% higher than a year ago. Soybeans are the best they’ve looked in early July since 1999 at 71% good to excellent. That was unchanged week to week.

Wheat was given a boost when the French Ag ministry lowered the country’s wheat crop to 31.3 MMT. That is lower than USDA’s estimate of 33.8 MMT in June and last year’s 41.1 MMT. The US did miss out on Egypt’s latest tender for wheat. Russia was the winning bidder selling 230,000 MT for $218.80-$218.90/MT. That undercuts US wheat by about $20-$30/MT at the Gulf.

USDA flash sales started the week strong with China and Mexico buying corn and soybeans. China purchased 264,000 MT of soybeans for the 2019/2020 marketing year. China purchased 202,000 MT  for the 2020/2021 marketing year. Mexico purchased 182,880 MT of corn split between the 2020/2021 & 2021/2022 marketing year. There have been no other flash sales so far this week.

The latest USDA export sales report for the week ending July 2nd was mixed. Wheat net sales compared relatively close to previous weeks at 326,100 MT. Exports of wheat were 410,100 MT. Mexico was the top destination. Taking in over 25% of total exports. Corn net sales were up 66% at 599,200 MT for the 19/20 marketing year. China was the top buyer at 407,200 MT. Exports of corn notched another week at over a million metric tons, but was still down 25% from the previous week. Mexico was the top destination for US corn at 358,500 MT. China dominated all segments of sorghum exports with net sales of 50,900 MT and taking delivery of 51,100 MT. Soybean net sales were up noticeably from the previous week at 952,200 MT. China was the top buyer at 461,400 MT. Soybean exports were up 20% at 467,500 MT. Mexico was the top destination at 144,200 MT. China was a distant third.

The latest USDA grain export inspections were delayed until early afternoon on Monday due to technical difficulties. Overall the report held few surprises. Corn exports fell below a million metric tons. That widens the deficit corn is running with the previous marketing year. Sorghum also fell sharply to just over 50,000 MT. Year to date though sorghum is running almost 3 million metric tons more than a year ago. Soybean exports were strong over 500,000 MT.

Export business for US grains has been decent in 2019/2020. US soybean export commitments are 254.8 million bushels. That is up 180% from a year ago.  South American grain exports though continue to grow rather than shrink. Brazil exported a record 505.1 million bushels in June vs. 314.1 million bushels last year. Argentinian and Brazilian FOB corn offers are $4-$15 cheaper per metric ton than US corn at the Gulf.

Livestock futures trended higher most of the week. Traders are cautious to take up to short of a position ahead of Friday and the latest WASDE report. That will help shed light on the latest protein demand trends. Going into the report though the load movement is starting to slow. On Wednesday midday pork was a sluggish 170 loads. Just a week ago it was nearly 400 loads. For cattle cash continues to develop firm to stronger. That could create follow through support later this week.   As for pork traders they are expecting to see a significant increase in Chinese export business. China suspended imports from two more Brazilian meat plants on Monday. The suspension comes over corona virus concerns. Reports indicate that recent mass testing in Brazil revealed more than 1,000 positive corona virus cases at meat plants in Mato Grosso do Sul. Stone X analysts point out that the Chinese government continues to limit the sources of meat that can be imported over fears that the corona virus will be carried into the country on the meat, even though literally tens of thousands of tests of such meat in recent weeks have failed to produce a single positive test result.

The latest export sales report from USDA confirmed China was a large buyer and destination of US pork. Pork net sales were 31,500 MT. That was down 20% from the previous week. Mexico was the top buyer at 9,100 MT. China was a close second at 8,100 MT. Pork exports were up 8% at at 33,500 MT. China was the top destination at 12,700 MT. Mexico was a close second at 10,300 MT.

Beef net sales were uneventful and down 23% from the previous week at 9,500 MT. Japan and South Korea were the top buyers at 2,900 MT and 2,300 MT respectively. Beef exports were up 3% at 15,100 MT. South Korea was the top destination at 4,500 MT

A very light trade in parts of the North on Thursday at generally steady money with the rest of this week’s business. The South only saw a little scattered trade here and there. A regional did light business in Nebraska, at $157, $3 higher than last week’s weighted average.  On Monday Kansas trade was marked at $93 to $95, Nebraska also reported just a handful of trade at $160. Show lists this week are higher in Kansas, somewhat higher in Texas and lower in Colorado and Nebraska.

The Fed Cattle Exchange Auction today listed a total of 1,390 head, with 659 actually sold, 731 head listed as unsold, and 0 head listed as PO (Passed Offer). The state by state breakdown looks like this: KS 1,048 total head, with 659 head sold at $95.00-$95.25, 389 head unsold; NE 123 total head, all went unsold; TX 219 total head, all went unsold. The delivery date/weighted averages breakdown is as listed: 1-9 day delivery: 643 head total, 509 head sold, with a weighted average price of $95.16; 1-17 day delivery 747 head total, 150 head sold, with a weighted average price of $95.00.

Expected Slaughter numbers Friday

Cattle

120,000 hd today 109,000 hd wk ago 117,059 hd yr ago

Saturday

69,000 hd Sat. 1,000 hd wk ago 64,859 hd yr ago

Hogs

468,000 hd today 204,000  hd wk ago 460,276 hd yr ago

Saturday

276,000 hd Sat. 4,000 hd wk ago 38,552 hd yr ago

 

Midday Carcass Value Friday

Beef

Choice up 1.17 204.76

Select  dn 0.91 193.92

C/S Spread 10.84

Loads 56

Pork

Carcass up 4.01 71.13

Bellies up 2.24 106.19

Loads 214

 

Grains Settlement

  • Corn dn 6 12 – 12 1/4
  • Soybeans dn 6 3/4 – 10 3/4
  • Chicago Wht up 2 – 9 1/2
  • Kansas City Wht dn3 – 4 3/4

Livestock Settlement

  • Live Cattle up 0.70 – 0.95
  • Feeder Cattle up 1.12 – 1.42
  • Lean Hogs dn 0.82 up 0.12
  • Class III Milk up 0.03 – 0.76

Pre-Opening Market Broker Commentary

Mark Gold, Top Third Ag Marketing, discusses overnight grains and what the trade may see today. China made a big buy of corn. It is WASDE report day and there is a lot of directions it could go.


Jerry Stowell, Country Futures,  looks at what may impact the livestock futures today. Fed cattle supplies are becoming more current.


Mike Zuzolo, Global Commodity Analytics, takes a look at the midday trade. The WASDE report is out, but weather is starting to occupy traders mindset again.


John Payne, Daniels Ag Marketing, looks at the grain settlements. The WASDE did not help corn from a global perspective. Payne believes American production will have to address how it plans to handle rising global production.


Jack Fenske, York Commodities, looks at the closing market numbers.

For the first full week of July corn and soybean ratings started to drop slightly across the nation.Corn silking is the first crop condition area we see that is actually behind the five year average. Winter wheat harvest is rolling along ahead of schedule in most states.  Top soil and subsoil moisture continue to be dry and dropping across the country.

NASS estimated that 71% of the corn crop was in good-to-excellent condition as of Sunday, July 5, down 2 percentage points from 73% the previous week but still well above 57% at the same time a year ago.

For corn Iowa and Minnesota set at the top of the pile with 85% good-to-excellent condition ratings. Pennsylvania stays a close second at 82% and Nebraska it towards the top at 74% good to excellent.  On the opposite end of the scale Michigan and Colorado have the highest percentage of corn rated very poor to poor, at 14% and 16%, respectively.

Up to this point in the growing year much of the crop progress has been well ahead of the five year average. Corn silking however continues to to run behind the five year average. NASS estimated that 10% of corn was silking, 6 percentage points behind the five-year average of 16%.

Soybean development, on the other hand, was near to slightly ahead of normal last week. Soybeans blooming was estimated at 31%, 7 percentage points ahead of the five-year average of 24%, while soybeans setting pods was estimated at 2%, near the five-year average of 4%.

Looking at the state by state break down Iowa is now 37% in bloom, Minnesota 43% and Nebraska 41%. All these ratings are well ahead of their respective 5 year average.

The national soybean condition rating came in the same as the corn crop: 71% good to excellent nationwide. That was unchanged from the previous week and still well ahead of 53% at the same time last year. Iowa was 84% good to excellent, along with Minnesota 83% , Wisconsin 79% and Nebraska 76% .

Meanwhile, winter wheat harvest moved ahead 15 percentage points last week to reach 56% complete as of Sunday, 1 percentage point ahead of the five-year average of 55%.

Harvest in Kansas in 80% complete, Illinois is 81% and Missouri is at 84% finished,. Nebraska winter wheat is 16% harvested, and South Dakota has not started yet.

Winter wheat condition — for the portion of the crop still in fields — was rated 51% good to excellent, down 1 percentage point from 52% from the previous week. Sixty-one percent of North Dakota’s winter wheat crop was rated good-to-excellent.

View the full report here: https://downloads.usda.library.cornell.edu/usda-esmis/files/8336h188j/c247fd92b/1g05g1123/prog2820.pdf

Clay Patton breaks down the full report here:

Commodity markets, including grains, fell in with the risk off sentiment that developed across the entire market complex Friday. Brain Splitt with Ag Marketing.Net weighed in on how rising cases of Covid-19 may impact more than the equity markets.

Energy markets are at risk as states like Texas pause their reopening. That translate to harm for corn demand. Splitt is quick to point out though that there is one demand factor that could be improving for corn and that is feed demand. As DDGS and other feed ration ingredients became more scarce corn filled in more gaps livestock feeders.

China is back in the market for US soybeans on Friday, but their total demand picture is still fuzzy. A weather story would definitely help bean bears, but time for the story to develop is starting to dwindle in Splitt’s opinion.

Listen to the full commentary here:

Pollinators are a vital part of agriculture and for National Pollinator week we are looking at different ways pollinators and ag producers work together.

When Hunnicutt Farms of Giltner decided to expand into organic soybeans Zach Hunnicutt said the organic guidelines led them to look at planting pollinator habitat

Hunnicutt said they had seen some research showing increased soybean yields around pollinator habitats, not dramatic, but enough to make them want to give it a try.

Listen for the rest of the story:

 

Following hot and dry conditions mixed rain showers were welcomed by farmers across the Midwest this past weekend. That helped to bring around the corn and soybean conditions from the previous week. Winter wheat harvest was able to keep pace with the 5 year average. Topsoil moisture was also able to increase in several states that were starting to become pretty dry.

Corn planting and emergence is considered complete across the country. That means that corn is now in or nearly in the silking stage. According to NASS 2% of the national corn crop is silking. That is on pace with the five year average. Kansas has 3% silking. Which is about 3% from the five year average. Nebraska has yet to see any corn enter the silking stage. Texas has the most corn silking at 55%. That is 5% ahead of the five year average.

As for the national corn condition it improved 1% week to week to 72% good to excellent. Nebraska corn improved 3% to 74% good to excellent. Kansas corn remained unchanged to 54% good to excellent. Pennsylvania continues to have one of the best corn crops at 88% good to excellent.

Soybeans have yet to complete the planting or emergence stage. That means they are still reported by NASS. Soybean planting is considered 96% complete up 3% from last week. Just 4 states have yet to hit the 90% and above planting completion. Kansas has 95% of the soybeans planted. That is 8% ahead of the 5 year average. Nebraska completed soybean planting last week.

Soybean emergence is 4% ahead of the five year average nationally at 89%. Iowa and Nebraska are both considered 96% emerged. That is 5-6% ahead of the five year average. Kansas is 15% ahead of the five year average at 86% emerged.

5% of the soybean crop nationally is considered to have entered the blooming stage. That is on pace with the five year average. Nebraska has 16% of the soybean crop blooming, up 13% from the five year average. Kansas is right at the five year average for 1%. Louisana has the most soybeans blooming at 55%.

Nationally soybeans are considered 70% good to excellent. That is down 2% from the previous week. Iowa has one of the strongest soybean crops at 84% good to excellent, up 2% from the previous week. Kansas improved 4% to 68% good to excellent. Nebraska soybeans dropped 1% to 77% good to excellent.

Winter wheat is almost completely headed at 96% nationally. That is just 1% behind the five year average. Kansas is now officially 100% headed out.  That is even with the five year average. Nebraska saw 11% of the winter wheat crop head out since last week to 96%. That is still 2% from the five year average. Montana and Michigan are the only 2 states that have not reached 90% or better headed out for winter wheat.

Winter wheat harvest continues across the country now considered 29% complete, up 14% from the previous week and 16% from a year ago. It is also 3% ahead of the five year average. Nebraska has yet to start winter wheat harvest. Kansas has harvested 25% of the winter wheat crop. That is up 16% from last week and 1% ahead of the five year average.

Nationally the winter wheat crop continues on a roller coaster of condition. Nationally the crop improved 2% to 52% good to excellent. Kansas winter wheat dropped 1% to 44% good to excellent. Nebraska increased 19%, after dropping 23% last week, to 62% good to excellent. Colorado winter wheat dropped 2% to 29% good to excellent. 37% of the crop is considered poor to very poor.

Spring wheat decreased in condition week to week at 75% good to excellent. That is down from 81% good to excellent.

Pasture and range land also benefited from the weekend rains. Nebraska pasture improved 5% to 71% good to excellent. Kansas improved 1% to 50% good to excellent. Colorado pasture is still dry with 0% in the excellent category and 26% in the good category. Colorado has the third highest very poor to poor rating at 48%. California (55% p-vp) and New Mexico (59% p-vp) are number one and two.

Topsoil moisture was able to recharge in Kansas up 14% to 61% adequate to surplus. Nebraska remained unchanged to 62% adequate to surplus. Subsoil moisture was also able to improve in Kansas up 4% to 63% adequate to surplus. Nebraska subsoil moisture improved 1% to 75% adequate to surplus.

Find the full crop progress report here: https://downloads.usda.library.cornell.edu/usda-esmis/files/8336h188j/w9505n13w/8910kf14z/prog2620.pdf  

Clay Patton has the full report information as a podcast

 

Markets on Tuesday started with a risk on sentiment. By the close even the outside equities had faded on that sentiment. Grains ended mixed with spread action setting up between corn and wheat. Wheat is being sold on decent crop conditions, but also seasonal harvest market pressure. Shawn Hackett, Hackett Financial Advisors, joined the Fontanelle Final Bell and discussed the seasonality of the current marketing trends in the grains. Hackett is eyeing the Minneapolis spring wheat market as the signal for a turn around in the market. “Spring wheat is growing right now and very susceptible to a weather issue.” According to Hackett. During the Fontanelle Final Bell Hackett also highlights recent research his team has done about global crop insects and pests that could impact the markets later this year.

The second half of the Fonatenelle Final Bell is dedicated to livestock. Hackett starts with Class III milk futures and highlights that the recent upswing may be over done at $20. Hackett also doesn’t believe the live cattle lean hog spread can continue much higher.

Hear the full program here:

The latest crop progress report shows the hot and dry weather in the Midwest has yet to impact major crop conditions. It has though significantly dropped the top and subsoil moisture. Winter wheat harvest continues to roll on pace with it’s five year average doubling week to week.

Corn planting is considered complete by NASS across the country. Thus the crop progress report this week starts off with corn emergence, which like planting, is nearly complete. 95% of the countries corn crop has emerged – 3% ahead of the five year average. Kansas has seen 95% corn emergence – an increase of 9% from the previous week. Nebraska has 98% corn emergence – just 2% ahead of the five year average. While several states are at the 98-99% emergence rate, only one state has reached 100% emergence. That is North Carolina which only needed 2% more to emerge from last week to reach 100%.

Nationally, the corn crop did see a slight drop in condition rating going from 75% good to excellent to 71% good to excellent. Kansas corn condition fell 6% from last week to 54% good to excellent. Nebraska’s corn rating fell 12% to 71% good to excellent. Pennsylvania still runs one of the strongest corn crops in the nation at 91% good to excellent, improving 1% since last week.

The soybean planting report was still released this week, but it is quickly nearing the 100% mark. Nationally 93% of the soybean crop is planted, up 7% from last week and 5% ahead of the five year average. Nebraska inched 2% week to week to officially finish soybean planting. Kansas improved 10% week to week to 89% complete. That is 13% ahead of the five year average.

Soybean emergence continues 6% ahead of the five year average nationally at 81%. Nebraska soybean emergence is now rated at 94% – 10% ahead of the five year average. Kansas opened it’s lead on the five year average to 20% this week with 73% of the soybean crop already emerged. No state has hit the 100% emergence rating yet.

The national soybean condition is rated 72% good to excellent, equal with the rating a week ago. Nebraska soybeans dropped 4% from 82% yo 78% good to excellent. Kansas soybean rating fell 3% to 64% good to excellent. Iowa saw a large drop week to week on the soybean rating. Going from 82% good to excellent last week to 72% good to excellent this week.

Grain sorghum planting is continuing at a steady pace, up 15% from last week nationally to 79% good to excellent. Nebraska sorghum planting is 9% ahead of the five year average to 97% complete. National sorghum rating fell 7% to 48% good to excellent. Nebraska sorghum is rated 55% good to excellent.

Winter wheat is almost completely headed out. Nationally 91% of the crop is considered headed out. Nebraska is still lagging 7% from the five year average to 85%. Kansas is right on pace at 99% headed out. Montana is the furthest from being completely headed out at only 28%. That is up 23% from last week, but 19% behind the five year average.

Winter wheat harvest doubled week to week from 7% to 15% complete. Right on pace with the five year average. Kansas is 1% ahead of the five year average at 9% complete. Nebraska has yet to start winter wheat harvest. Texas is the furthest along with winter wheat harvest at 38% complete. Up 15% from last week and 16% ahead of the five year average for Texas.

The winter wheat crop is rated 50% good to excellent down 1% from a week ago and down 14% from a year ago. Kansas winter wheat is rated 45% good to excellent. That’s an increase of 3% from last week. Nebraska is rated 43% good to excellent. A drop of 23% from last week. Colorado is holding at 31% good to excellent, but 16% is still rated very poor. Oklahoma is the only other state with double digit very poor rating at 14% very poor. Oklahoma also has 46% of the winter wheat crop rated good to excellent.

Pasture and range condition is not fairing well in the heat and wind. Kansas pasture and range fell 6% to 49% good to excellent. Nebraska pasture and range also fell 6% to 66% good to excellent.

Topsoil and subsoil moisture both saw double digit drops week to week in several states. Kansas topsoil is now considered 47% adequate to surplus. Down 15% from last week. Nebraska topsoil moisture is rated 61% adequate to surplus down 16% from last week. New Mexico has the driest top soil with a 45% very short rating. Kansas subsoil moisture is rated 59% adequate to surplus down 9% from last week. Nebraska subsoil moisture is rated 74% adequate to surplus. That is down 12% from last week. Some state are still near saturated at the subsoil level. Alabama is rated 93% adequate to surplus for subsoil moisture.

See the full crop progress report here: https://downloads.usda.library.cornell.edu/usda-esmis/files/8336h188j/pk02cx87g/rx914b27v/prog2520.pdf

Clay Patton recaps the report here:

 

An emergency motion was filed late last week, asking a federal court to bring all dicamba use in the U.S. to an immediate halt. DTN says the motion also asks that the Environmental Protection Agency be held in contempt of court for its decision to permit farmers to use their existing stocks of three dicamba herbicides.

If the judge agrees, that could once again leave farmers without the dicamba herbicide options they need to use on millions of acres of dicamba-tolerant soybeans and cotton through the summer growing season. The emergency motion was filed by the same plaintiffs who brought the lawsuit against the EPA in the Ninth Circuit Court of Appeals.

The suit demanding the court bring an end to the registrations of three dicamba herbicides succeeded on June 3rd when the judge ruled in the plaintiffs’ favor. Five days after that, the EPA issued a cancellation order, ending the registrations but allowing farmers and applicators to continue to use existing stocks until July 31st.

The plaintiffs, including the Center for Food Safety and the Center for Biological Diversity, estimated that up to 16 million pounds of dicamba could be applied in the coming weeks, which they say is a direct violation of the court’s ruling.

June 12th Update:

 

According to the Friday alert from Nebraska Extension, soybean gall midge adults have emerged from multiple sites in eastern Nebraska. The June 12th update indicates soybean gall midge adults have emerged in monitoring sites in Cuming County (1 adult detected), three sites in Saunders County (1 adult at each), two sites in northern Landcaster County (1 adult at one site, 2 adults at the other site), and in Cass County (2 adults at one site, 3 total adults at a different site). Also, the alert network website shows one soybean gall midge adult has been captured at sites in Cass and Ida counties in Iowa.

See the alert web site and latest information here: www.soybeangallmidge.org.

For soybean growers that are near the site with adult activity and that have had issues with soybean gall midge, they may consider making an application in the next week if their soybean fields have reached the V2 stage. Based on last year’s data from Nebraska Extension, soybean plants prior to the V2 stage generally lack the presence of cracks or fissures at the base of the stem. Plants without fissures are not considered to be susceptible to soybean gall midge infestation. If growers have fields at VC or V1, NE Extension Cropping Systems Specialist Justin McMechon recommends waiting until V2 to make an application if they are in a high-risk area and have adult activity occurring.

In 2019, pyrethroid insecticides applied at different timings relative to adult emergence showed a significant yield response in Nebraska when applied up to 10 days after the first adult emergence was detected. McMechon says it’s important to note that none of those treatments provided complete control of soybean gall midge. In addition, the study was conducted on a field that was planted to soybean the previous year. Since soybean gall midge is a field edge infesting pest, growers may only need to treat the first 60 to 120 feet of a field edge that is directly adjacent to a field that was injured the previous year.