Where Did 6 Million Acres Go?
Feb 21, 2014
Good Morning! Paul Georgy with early morning comments for February 21, 2014 at 4:45 am.
Grain futures are slightly lower in a narrow range ahead of the USDA’s data release. All eyes will be on the newswires around 7:00 am eastern time when USDA is expected to release their balance sheets for 2014 production. Yesterday they gave us acreage projections which were less than what trade analysts had expected. Corn expected plantings were 92 million acres and soybeans were 79.5 million acres. There seems to be 5 to 6 million acres missing in the mix. Yield will be the key number to look for this morning.
No major change in ethanol production as it is still over USDA’s expectation. There are more traders thinking that EPA may not lower the 2014 RFS. Ethanol production is still very profitable, which is a major driver with or without a mandate change.
More rumors are circulating that Chinese meal demand is waning. There is talk that the latest bout of bird flu has hit China’s largest poultry producer hard which could put them into bankruptcy.
Traders are still waiting for confirmation of some cancellations by China. Weekly sales report is out at 7:30 this morning. Trade estimates are: Soybeans 150,000 to 500,000 tonnes, Soymeal 75,000 to 200,000 tonnes, Soyoil 10,000 to 50,000 tonnes, Wheat 400,000 to 700,000 tonnes and Corn 700,000 to 1,250,000 tonnes.
The outside markets are concerned about the unrest in Ukraine where the US and EU are considering some type of sanction. Social media is reporting unrest breaking out in Venezuela.
G-20 finance ministers and central bankers will gather in Sydney this weekend. Existing home sales are expected to fall to new 1-1/2 year low when reported this morning at 9:00 am. The US Dollar, the S&P and gold are higher this morning.
PEDv cases have reached a record high of 301 last week. Pork producers are hoping for a break in the winter weather to slow down the spread of this virus. Futures traders reversed positions and set new contract highs in yesterday’s session. Pork cutout values are up 2.72.
Cattle on Feed report will be released this afternoon at 2:00 pm. Beef cutout values are mixed with choice up .47 and select down .13. Cash trade is expected to be steady to higher this week with bids at 142 and offers at 145. The CME Feeder Index is 171.02.
Markets as of 4:45 AM
- Mar Corn – 1/4
- Mar Beans -1 1/2
- Mar Wheat -1 1/4
- Apr Cattle +.30
- Apr Hogs +.70
- Mar Dlr +.10
- Mar S&P +2.75
- Apr Crude -.20
- Apr Gold +3.80
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