EHedger Afternoon Grain Commentary 8-10-2011
Aug 10, 2011
Grains finished relatively unchanged ahead of tomorrow’s report. With the weakness in the stock market, I would say grains held in there fairly well. December corn finished unchanged at $6.88 ½, November beans up 1 ¾ cents at $13.01 ½, and December wheat up 15 ½ cents at $7.19 ¼.
Tomorrow’s Supply and Demand report could be a major market mover just like the previous USDA reports this year. The market has obviously been heavily focused on supply shortages and much of the lower yield expectations should be discounted in the market. I have included our own Supply and Demand estimates in the charts below. As you can see we have corn used for ethanol below the USDA’s projections and this is highly based on the average pace that the weekly numbers are putting us at. We did lower our yield estimates slightly from the July S&D report, but still above the average of the analyst estimates.
If weather turns for the worse during the second half of August we could see those yields come down more, but time will tell. At the same time, we could also see demand levels cut even from what we are estimating. It’s a moving target, but here are the numbers we are seeing:
The report will be out at 7:30 am tomorrow morning. I will have a report overview and reaction in the morning letters and EHedger hotline. If you would like to discuss the report further please call your broker.
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