Tag Archives: wheat

  • Nice to see some positive markets
  • Vaccine news once again supportive
  • COVID & Ethanol demand
  • Evidence that China is back to buying again
  • Rains coming to South America & the U.S.
  • Dryness worries could be pushed into spring
  • Balance act between grocery store meat hording & restrictions for food service

 

Funds look like they are the biggest mover in the trade

Could be big volumes getting out…with many factors tied in

Export sales did not pan out like many had thought
Russians are set to sell a bunch of wheat to the world
South American weather turns wet

USDA on Tuesday released its November Crop Production and World Agricultural Supply and Demand Estimates (WASDE) reports.

USDA lowered the average corn yield by 2.6 bushels per acre (bpa) in the report, down to 175.8 bpa. That dropped corn production by 215 million bushels (mb) to 14.5 billion bushels (bb). USDA lowered new-crop ending stocks to 1.7 bb, following a 325 mb increase to export forecasts.

Soybean ending stocks estimates for the 2020-21 marketing year came in at 190 mb — 100 mb lower than last month. Despite rising interest from China, the change didn’t come from exports. USDA lowered its production estimate for soybeans by 98 mb to 4.170 bb by lowering the average national yield to 50.7 bpa.

CORN

Several surprises came in the 2020-21 corn numbers as USDA lowered the average corn yield to 175.8 bpa, a 2.6-bushel decline from October, while USDA also increased export sales for corn to a potential record volume as well and dramatically cut the estimated ending stocks.

Keeping harvested acres at 82.5 million acres, that lowered 2020-21 corn production to 14.507 bb, a 215 mb decline from the October estimate. That put total supply at 16.527 bb.

On the demand side, USDA lowered total domestic use by 75 mb by lowering the feed and residual use for corn by that amount, bringing feed and residual use down to 5.7 bb, based on a smaller crop and higher expected prices. Ethanol demand remained steady at 5.05 bb.

Exports were the 2020-21 corn crop were pumped up to 2.65 bb, up 325 mb from the October estimated. If realized, that would be a record high for U.S. corn exports, USDA stated.

Total use was forecast at 14.825 bb, up 250 mb from October. That brought down ending stocks to an estimated 1.702 bb, a decline 465 mb from October.

The stocks-to-use ratio for corn came it at 11.48%, compared to 14.8% in the October report.

The average farm price for the 2020-21 corn crop was posted at $4.00 a bushel, a robust 40-cent bump from the October report.

Globally, USDA also raised the import estimates for Chinese corn imports to 13 million metric tons (mmt), up from 7 mmt estimated in the October report.

SOYBEANS

U.S. soybean growers are expected to harvested 4.17 bb this fall, 98 mb lower than what USDA estimated last month. The agency cut its yield estimate by 1.2 bpa to 50.7 bpa, below the range of pre-report expectations. The agency said lower yields were reported in major soybean growing states, including Illinois, Iowa, Indiana, Ohio and Nebraska.

The production change resulted in most of the 100-million-bushel decline in new-crop soybean ending stocks. USDA put ending stocks at 190 mb. It also made small tweaks to seed use, up 3 mb, and residual use, down 1 mb.

The national average farm gate price increased by 60 cents to $10.40 per bushel.

Globally, USDA lowered 2020-21 ending stocks to 86.52 million metric tons (mmt), which is toward the low end of pre-report expectations. USDA left Brazilian production unchanged at 133 mmt but lowered Argentine production by 1.5 mmt to 51 mmt. Chinese import demand was left unchanged at 100 mmt.

WHEAT

USDA pegged 2020-21 U.S. wheat production at 1.826 bb, unchanged from last month. Average yield was also left at 49.7 bpa, with acreage still forecast for 44.3 million acres planted. Old-crop (2019-20) wheat production was also left unchanged 1.08 bb.

The agency trimmed ending stocks to 877 mb, in line with pre-report analyst estimates. That drop came from USDA upping food use of wheat stocks by 5 mb and seed by 1 mb.

Globally, USDA pegged total wheat production for 2020-21 at 772.38 mmt, a 0.7 mmt decrease from the October report. That drop came mostly from production losses in Argentina, where drought and a local freeze dropped its forecast production down 1 mmt to the lowest in eight years, at 18 mmt.

World ending stocks were projected at 320.45 mmt, in line with pre-report analyst estimates, and down 1 mmt from October, due to increased world consumption, mainly from higher feed and residual use for China and the EU. China’s wheat imports hit 8 million tons, on track to be the largest since 1995-96.

U.S. PRODUCTION (Million Bushels) 2020-21
Nov Avg High Low Oct 2019-20
Corn 14,507 14,645 14,820 14,250 14,722 13,620
Soybeans 4,170 4,253 4,320 4,189 4,268 3,552
U.S. AVERAGE YIELD (Bushels Per Acre) 2020-21 (WASDE)
Nov Avg High Low Oct 2019-20
Corn 175.8 177.5 179.2 175.0 178.4 167.5
Soybeans 50.7 51.7 52.5 50.9 51.9 47.4
U.S. HARVESTED ACRES (Million Acres) 2020-21
Nov Avg High Low Oct 2019-20
Corn 82.5 82.5 82.7 82.3 82.5 81.3
Soybeans 82.3 82.3 82.3 82.3 82.3 74.9
U.S. ENDING STOCKS (Million Bushels) 2020-21
Nov Average High Low Oct
Corn 1,702 2,048 2,215 1,950 2,167
Soybeans 190 239 308 195 290
Wheat 877 874 902 818 883
WORLD ENDING STOCKS (million metric tons) 2020-21
Nov Avg. High Low Oct
Corn 291.4 297.8 302.2 292.0 300.5
Soybeans 86.5 87.6 89.0 86.3 88.7
Wheat 320.5 320.0 322.6 318.9 321.5

 

See the full report here:

https://www.usda.gov/oce/commodity/wasde/wasde1120.pdf

ST. LOUIS (October 30, 2020)— Commodity Classic has announced it will transition its annual conference and trade show, originally scheduled for March 4-6, 2021, in San Antonio, Texas, to an alternative digital format. The change was necessary due to restrictions related to the COVID-19 pandemic.  The new format is expected to be offered the first week in March 2021.

“This is about doing the right thing for our farmers, exhibitors, stakeholders, and the broader community in terms of health and safety—which is our top priority,” said Anthony Bush, an Ohio corn farmer and co-chair of the 2021 Commodity Classic representing the National Corn Growers Association.  “After careful deliberation among our farmer-leaders and industry partners, the COVID-19 restrictions would prevent us from delivering the type of high-quality experience Commodity Classic attendees and exhibitors have come to expect and enjoy for the past 25 years.”

According to Brad Doyle, an Arkansas soybean farmer and co-chair of the 2021 Commodity Classic representing the American Soybean Association, directed health measures due to the evolving COVID-19 pandemic such as social distancing guidelines would prevent Commodity Classic from conducting the trade show, educational sessions, and farmer networking—each of which are hallmarks of Commodity Classic.  “Farmers and agribusiness companies rate Commodity Classic highly because of its unique energy, excitement and one-on-one engagement with agribusiness companies and fellow farmers,” he said. “The health and safety restrictions required will simply not allow us to provide a productive in-person event that is in keeping with our 25 years of being the nation’s best farmer-led, farmer-focused ag experience.”

The transition of the 2021 Commodity Classic offers an attractive opportunity for farmers who have never attended Commodity Classic, Doyle added.  “Now farmers from across the nation and even around the world can get a taste of the Commodity Classic experience without ever leaving their farms,” he said.

Jerry Johnson, Ag Sector Chair of the Association of Equipment Manufacturers said, “Agribusiness companies put Commodity Classic at the top of the list when it comes to opportunities to engage with farmers from across the nation,” he said.  “However, our concern for the health and safety of our customers and our employees takes precedence, so all of us in agribusiness will work with the farmer-leaders at Commodity Classic to find innovative ways to connect in 2021.”

Commodity Classic is now redirecting its efforts to developing alternative methods of connecting farmers and agricultural stakeholders.  “We realize the total Commodity Classic experience cannot be completely replicated online. Yet a key benefit of Commodity Classic is the educational sessions and presentations from agricultural thought leaders, which are even more important in today’s challenging environment,” said Bush. “We are already exploring ways in which we can deliver high-quality content in unique ways that allow farmers to get the information they seek from the experts they trust.”

The transition to an alternative experience is already underway.  More information on the transition will be available in the coming weeks.  To keep up to date, sign up for email updates at CommodityClassic.com.  More information on the 2021 Commodity Classic will also be available on the website.

The 2022 Commodity Classic will be held in New Orleans on March 10-12, 2022.  “Like everyone else in agriculture, we are really looking forward to reconnecting with everyone face-to-face,” Doyle added.  “We urge everyone to get these dates on their calendar and plan to join us in-person in New Orleans in 2022.”

  • Cash market weakness coming out of the north
  • Are the cattle to big?
  • What is behind the strength in the soybeans
  • Will soybean prices continue to grow?
  • Why are corn prices going up?
  • Wheat continues to see dryness global
  • Sum it up its weather & China
  • Ethanol report out on Wednesday saw production tick lower
  • Not endorsing one candidate over the other how does Nov 4th play into mkts
  • Election risks
  • Could there be an influx of dairy on the cattle market with current milk prices?

 

  • Continuation of the status quo
  • Many wondering where the stock is in China
  • Will their buying keep up in the short term?
  • Harvest progress is moving along quickly
  • South America forecast is getting better
  • Black Sea region is still tough
  • Basis in the country
  • Is the down trend in the cattle going to turn around?
  • How is cash holding up?
  • COF on Friday

 

  • Wheat is the most confusing market right now
  • Light buyer support for soybeans
  • Dry weather concerns
  • Corn isn’t really expensive…yet beans have some good value
  • Cattle had some struggles in the trade, falling off the cliff today
  • Make sure you remember what kind of year this is-does that set the stage for 2021
  • Does the downtrend in cattle set the tone for cash this week?

 

Grains end mixed on Friday, but Troy Nielson with Smart Yield looks at the week’s trade. Overall corn and soybeans continue to hold record prices given the seasonality of harvest. This could give farmers a chance to sell grain into a strong market, but there is the lingering question of basis. Nielson looks at basis and the spreads to help explain what the current market is encouraging farmers to do.

Nielson also reflects on last week’s WASDE report and some of the data that may have been overlooked in the wild ride immediately following the report.

Catch the full episode here:

Grains continue to move higher being lead Thursday by wheat. Corn has almost all of it’s 2020/2021 contracts above the $4 mark. Soybeans continue to see strong soybean demand. Jeff Peterson, Heartland Farm Partners, discusses the fundamentals of what continues to drive the grain market higher. Of course with a market that doesn’t seem to want to stop has producers asking questions of what to do about selling into the cash market.

Peterson also addresses tough questions about China and the role their current strong demand is playing into this current market. Part of that discussion includes keying in on why the early week export inspections may be more important now than the weekly export sales report.

Cath the full conversation with Peterson here: