Sep 15, 2014
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Cash Grain Insights

RSS By: Kevin McNew, AgWeb.com

Kevin McNew is President of Grain Hedge and Geograin. McNew was raised on a farm in central Oklahoma and received his bachelor’s degree from Oklahoma State University, and master’s and Ph.D. degrees in Economics from North Carolina State University. For over a decade, he was a Professor of Economics at the University of Maryland and Montana State University, focusing on commodity markets. He has received numerous academic awards for his research and outreach work, and was (and still is) widely regarded for boiling down complex economic issues into easy-to-understand concepts for applied life.

 

Grains Steady with USDA Reports on Horizon

Aug 11, 2014

ALERT: USDA report out tomorrow at 11:00 AM central time (expectations below)


Grains are trading sideways to lower this morning in Chicago. Corn is down a penny, November soybeans down a penny, and Chicago wheat off 4 cents. Bull spreading is once again a theme in the soybean market, with September trading up 5 cents.

 

The wheat market is trading a bit lower this morning after a strong short covering rally which started at the end of July after tensions mounted at the boarder of Ukraine and Russia. The building of Russian troops at the boarder had some analysts worried that a Russian intervention was looming. However, as time passes without any further escalation we start to see wheat turn back over and move toward its lows.  


The U.S Army Corps of Engineers completed temporary 200-foot wide channels in the Mississippi river yesterday allowing them to reopen the channel to commercial traffic. Emergency dredging operations were being conducted between Wabasha, Minnesota and Alma, Wisconsin after flood damage had restricted commercial passage.  

 

Weather outlook this week continues to show a drying pattern over the northwest grain belt, one area in particular that could use the precipitation. The 6-10 day forecast is showing a fair possibility of precipitation in the western grain belt and this could drive trade action later this week. Temperatures are expected to increase at mid-week, but only to the mid 80’s to low 90’s. 

 

A reminder of USDA report expectations:

This report will be released at 11:00 AM Central Time and be the first survey based yield estimate of the year. Yield figures will be the focus of the report following a July that saw ample moisture in the eastern grain belt but a return of drought conditions in Nebraska and the Dakotas. Below are trade expectations for the report and our take on the numbers. Please call our office if you have questions about speculative or hedge positions coming into the report. Our number is 877-472-4607 and we are available between 8AM and 5PM central time.

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2014/15 Corn

July Reported

August Expected

Production (MB) 

13,860

14,253  

Yield (BPA) 

165.3

170.098 

Ending Stocks (MB) 

1,801

2,005  

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2014/15 Soybeans

July Reported

August Expected

Production (MB) 

3,800

3,823

Yield (MB) 

45.2

45.583

Ending Stocks (MB) 

415

414 

 
 
 
 
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