Price action: Corn futures enjoyed gains to wrap up the week and ended 3 1/4 to 5 3/4 cents higher on the day to extend weekly gains. Most contracts ended mid-range.
5-day outlook: Initial focus for the corn market this week will be on USDA's weekly planting progress update Monday. Corn planting was thought to be active the first half of the week, but then rains and cold weather pulled farmers out of the field. Potential freeze events in the Corn Belt and Plains early next week along with weather updates for week's end will also be key next week..
30-day outlook: While currently the talk of the market, traders will likely not become overly concerned with any planting delays until around mid-May. If corn planting has not reached 50% complete by May 10, talk about late planting and corn acres shifting to beans will heat up. If progress is at least half complete at that point, new-crop prices could soften.
90-day outlook: July is the key weather month for corn. All weather models monitored by the Australian Bureau of Meteorology point to El Nino developing this year and six of the seven models suggest those thresholds may be exceeded by July. This weather pattern is typically friendly for Midwest corn and soybean yields.
Hedgers: 70% sold on old-crop. 30% of expected 2014-crop is sold via forward contract for harvest delivery.
Cash-only marketers: 60% sold on old-crop. 30% of expected 2014-crop is sold via forward contract for harvest delivery.
Price action: Old-crop contracts closed 11 3/4 to 26 cents higher and near their highs for the day, with the May contract leading gains. November and later contracts finished 4 to 8 3/4 cents higher. May futures closed about 15 cents lower on the week. Funds were net buyers of 9,000 contracts (45 million bu.) today.
5-day outlook: Soybean traders will remain sensitive to any signals of a slowdown in demand from China or trade disruptions resulting from a flare up in tensions in the Ukraine. The result is the potential for plenty of surprises, resulting in volatility as the market tries to ration the few remaining bushels of old-crop soybeans.
30-day outlook: The tight old-crop situation will likely keep a floor under soybean prices while the market tries to assess the impact of weather on corn planting progress. Corn planting and spring wheat seedings are off to slow starts but if weather turns positive in early May, new-crop soybeans will draw some support from ideas planted soybean acres will not rise from previous intentions. But delays that push corn planting into the last half of May and hold up spring wheat seeding could prove a negative for new-crop soybeans as some corn and spring wheat acres may get switched to soybeans.
90-day outlook: New-crop soybeans will take the limelight as growing season weather becomes the dominant market factor. Current forecasts call for El Nino to arise, which usually means beneficial growing weather for Midwestern soybeans. A positive growing season on top of the intended surge in soybean plantings will put pressure on soybean prices into fall harvest.
Hedgers: 25% of expected 2014-crop is sold via forward contract for harvest delivery. 100% sold in the cash market on 2013-crop production.
Cash-only marketers: 25% of expected 2014-crop is sold via forward contract for harvest delivery. 90% priced on old-crop.
Price action: Wheat futures closed higher, with HRW contracts leading the price advance. HRW wheat finished mostly 11 to 16 cents higher, SRW wheat ended mostly 10 to 11 cents higher and HRS wheat closed mostly 7 to 11 cents higher. For the week, wheat futures posted gains after starting under pressure.
5-day outlook: Monday afternoon's crop condition update is expected to show further deterioration to the HRW crop, especially if forecasts for hot, dry and windy conditions in the Southern Plains materialize. Traders will get a better read on the Kansas crop next week as the Wheat Quality Council will conduct its annual HRW tour in the state. Traders will also keep a close watch on the situation between Ukraine and Russia. These two factors will determine if traders add or subtract risk premium from the market.
30-day outlook: The clock is ticking on the HRW wheat crop. Industry sources signal rains now would only stabilize crop prospects in the driest southwestern areas of the Southern Plains. The further north and east you go from those driest areas, the greater the opportunity for the crop to add new growth if late-season weather is favorable.
90-day outlook: The development of El Nino will be critical to the global 2014-15 wheat production outlook. An El Nino event is associated with drought across key production areas of Australia.
Hedgers: 75% of expected 2014-crop production is sold via cash forward contract sale for harvest delivery. 100% sold on 2013-crop.
Cash-only marketers: 60% of expected 2014-crop production is sold via forward contract sale for harvest delivery. 90% sold on old-crop.
Price action: Cotton futures finished narrowly mixed in a relatively quiet day of trade. For the week, cotton futures posted gains.
5-day outlook: Old-crop supplies are tight enough and demand is strong enough to keep traders from aggressively selling cotton. But the technical posture of the market is not overly strong. Whether traders view fundamentals or technicals as more important is likely to determine the course of price action over the next week.
30-day outlook: Cotton plantings are running slightly below year-ago and the five-year average. But the pace is not enough to stir great concern. The bigger concern is the ongoing (and intensifying) drought in Texas. Unless rains develop over key cotton production areas of the state soon, it's possible not all of the intended cotton acres will be seeded.
90-day outlook: The longer-term price outlook will continue to hinge largely on Chinese demand. Concerns about China dumping its massive cotton supplies onto the domestic Chinese market have eased for now. If those concerns heighten again, it would pressure the market.
Hedgers: 50% of expected 2014-crop production is sold via forward contract for harvest delivery. 100% sold on old-crop.
Cash-only marketers: 50% of expected 2014-crop production is sold via forward contract for harvest delivery. 90% sold on old-crop.