Aug 22, 2014
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RSS By: Kevin Van Trump, AgWeb.com

Kevin Van Trump has over 20 years of experience in the grain and livestock industry.

Can Meal Demand & Frost Scare Support Bean Prices?

Aug 22, 2014

Soybeans bounce off the bottom, but more than likely will continue their "downhill slide."  Yes, soymeal remains in heavy demand, and until new-crop bushels are both harvested and delivered, the front month (SEP14) contract is going to remain extremely volatile. The weather forecasters are now thinking the latest tropical storm will miss the Gulf which should ultimately allow the harvest down south (through the Delta) to gain more traction. From where I sit, it's only a matter of time until there is NO old-crop soybean story for the bulls to grasp on to.  This will eventually leave more and more in the trade with nothing to focus on but new-crop production.  As of right now most seem to be on the same page, thinking that we have not only planted record acreage but could soon harvest a record yield. I still keep hearing many of my top soybean sources penciling in a 46 to 48 bushel yield estimate.  I can't stress enough, if this happens to be the case and plays itself out, new-crop soybeans have the potential to trade down to the $8.50 area. Obviously, good finishing weather will be needed to push yields past 46 bushels per acre, but what if the weather cooperates? Are we really sure we fully understand the potential of these new traits and genetics?  I'm telling you now, the past three to four years almost every producer I have spoken with (hundreds and hundreds) underestimated their soybean yields.  As far as that goes, it appears the USDA did the same thing with this past crop.  All I'm saying is with this many beans having been planted and the weather as a whole being extremely cooperative, the surprise could be a blowout type number to the up-side.  Yes, there is still the chance for some type of early freeze or other unforeseen weather event, and I'm sure someone will want to argue the case. Just remember, as each day passes our odds of getting that "one card" becomes less and less. CLICK HERE for my daily report...

Crop Tour Points to Higher Yields?

Aug 21, 2014

Results Pro Farmer Midwest Crop Tour:  Day #3 of the Tour came to an end with scouts giving us a look at Western Iowa and the final Illinois numbers. Both corn yields and soybean pod counts for Illinois and Western Iowa were better than last year and much better than their 3-year average. Today, crop scouts will dive into the remainder Iowa and Minnesota.  Then this evening participants from both the Eastern and Western leg of the tour will come together in Rochester, Minnesota to give us their final overall estimates. Remember, as I mentioned before the tour started, Day #4 (today) could bring a bit of disappointment, especially as the crop scouts work their way further north.  I try no to get caught up in the short-term day-to-day movements of the market, but as the tweets and social media roll across the screen, theres a chance we could see a bit of a short-covering rally.                           CLICK HERE for my daily report...    

Western Iowa (Wednesday) - 3 districts surveyed yesterday the rest of the state today. Corn: District 1 - 177.48 vs 175.6 bpa last year vs. 3-year avg. of 170.72;  District 4 - 180.06 vs. 170 bpa last year vs. 3-year avg. of 162.06;  District 7 - 180.90 vs. 160.12 bpa last year vs. 3-year avg. of 146.77.  Soybean pod counts by district: District 1 - 1091.34 vs. 802.98 last year vs. 3-year avg. of 962.06; District 4 1124.96 vs. 849.79 last year vs. 3-year avg. of 1045.65;  District 7 - 1166.21 vs. 1101.49 last year vs. 3-year avg. of 1091.22. 

Illinois (Wednesday) corn yield reported at 196.96 bpa vs. the 170.48 bpa estimate last year  vs. the 3-year average of 149.36 bpa. Soybeans showed a pod count in a 3’-by-3’ square of 1,299.17 vs. the 3-year average of 1,085.35 and last years estimate of just 1,115.97.

Nebraska (Tuesday) corn yield reported at 163.77 bpa vs. 154.93 bpa last year  vs. 3-year average of 146.81 bpa. Soybeans showed a pod count in a 3’-by-3’ square of 1,103.36 vs 1,138.94 last year vs. the 3-year average of 1,106.62.

Indiana (Tuesday) corn yield reported at 185.03 bpa vs. 167.36 bpa last year vs. 3-year average of 141.24 bpa. Soybeans showed a pod count in a 3’-by-3’ square of 1,220.79 vs. 1,185.14 last year vs. the 3-year average of 1,118.65. 

Ohio (Monday) corn yield estimated at 182.11 bpa vs. 171.64 bpa last year vs. the 3-year average of 146.43 bpa.  Soybean count at 1,342.24 pods in 3’-by-3’ square vs. 1,283.61 last year vs. the 3-year average of 1190.18 pods.

South Dakota (Monday) corn yield reported at 152.71 bpa vs. 161.75 bpa last year vs. 3-year average of 125.70. Soybeans count at 1057.8 in a 3’-by-3’ square vs. 1,016.68 last year vs. the 3-year average is at 902.76.  CLICK HERE for my daily report...

 

Is the Corn Market Ready for a Breakout?

Aug 20, 2014

Corn market remains on hold as traders wait for a better look and more confirmation in regard to the US crop.  Keep in mind, new-crop DEC14 corn has essentially traded sideways for the past month between $3.60 and $3.80 per bushel. From a "technical" perspective you have to imagine a close below the $3.58 bring about more bearish interest and prompts some of the longer-term bulls to throw in the towel.  While a close back above the $3.81 level will bring some new bullish interest and additional short covering. As congested as the market has been as of late, I'm starting to think a breakout in either direction may be enough to push the market for an extended period of time. In other words a close below $3.58 could prompt the market to quickly tumble another $0.50 cents.  From a risk-management perspective this is what we are trying to avoid. On the "demand" side of the equation things still remain strong, in fact corn is now the cheapest it's been in relation to ethanol since 2007. Bottom-line, demand is not the issue right now, the trade is clearly focused on supply, specifically total US production. I'm afraid if the trade can somehow confirm a US corn yield north of 172 (like many analyst are projecting) prices may eventually test the $3.00 level. As producers we have to make certain we are prepared for such a move.                       CLICK  HERE for my daily report....             

China Seeing More Rain: We have all seen the recent headlines regarding one the worst droughts in years for parts of the Northern China Plain's.  The latest forecasts are now calling for 2.0 to 2.5 inches of rain by next week for key areas of Jilin and Liaoning.  Bottom-line, I'm still not seeing a major reason to worry about Chinese production.  They might end their run of 11 straight years with NEW record corn production, but I'm thinking it will still be extremely large. Keep in mind, cash corn in their country is still trading north of $9.50 per bushel.

Latest Thoughts on Pro Farmer Midwest Crop Tour!

Aug 19, 2014

UPDATED Thoughts on 2014 Pro Farmer Midwest Crop Tour: Crop scouts took to the field today. The Eastern leg got started in Ohio, moving towards Indiana, while the Western leg of the tour started in South Dakota and worked its way into Nebraska. As expected, the first day brought along many variables... some fields were much drier than many had thought they would be, especially out east. In addition some fields were nitrogen deprived due to heavy amounts of June moisture. I heard out west some scouts found their way into fields that had seen some fairly significant storm damage, hail, high winds, etc... There is also a bit more talk than normal about various disease issues in the fields. I'm assuming this is due to the moisture levels and cooler than normal temps. As expected though, most early reports brought attention to a few dry pockets, a crop that appears to be behind pace and a soybean crop that needs good finishing weather out into Sept.  Bottom-line, OH yields were better than last year for both corn and soybeans, while SD yields were almost -6% lower for corn, but about +4% higher in soybeans.  Details from the first day of data are below. I suspecttomorrow and Wed scouts will find some massive yielding fields...hold on to your hat! CLICK HERE for my daily report...   

 

  • Ohio corn yield estimated at 182.11 bpa vs. 171.64 bpa last year vs. the 3-year average of 146.43 bpa.  Soybean count at 1,342.24 pods in 3x3 square vs. 1,283.61 last year vs. the 3-year average of 1190.18 pods.   
  • South Dakota corn yield reported at 152.71 bpa vs. 161.75 bpa last year vs. 3-year average of 125.70. Soybeans count at 1057.8 in a 3’x3’ square vs. 1,016.68 last year vs. the 3-year average is at 902.76. 

Bean Prices Higher on Weather Uncertainty...

Aug 18, 2014

Soybean production obviously remains a major "wild-card" for many inside the trade, especially since we are only at mid-August. We all know the weather could still play a major part in final production numbers. My question is  how much longer will the trade buy into this rhetoric? You have to believe as each day and week passes, with unbelievable temps and adequate rainfall, the US crop is getting bigger NOT smaller.  The trade also has to soon start paying more attention and becoming more concerned about longer-term price risk associated with increasing acreage both in South America and here at home next year.  We are already digesting news and data that indicate Brazil is going to plant an additional 5-6% in soybeans. Meaning yet another new record planted soybean crop in Brazil.  Keep in mind they start planting in just a few short weeks.               CLICK HERE for my daily report....

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