Will USDA Adjust Bean Yields To Show Real Damage?
Sep 05, 2013
Good Morning! Paul Georgy with early morning comments for September 5, 2013 at 5:00 am. Grain futures are lower on profit-taking and technical selling.
Weather is still an important factor to the soybean markets. The models have added .10 to .25 inch of rain to parts of the central cornbelt but left the high temps. It would seem that more stress for the soybean crop is likely.
More trade estimates for next week’s USDA crop production report were released yesterday and we will get a few more today. Allendale’s Yield survey put the corn yield at 153.4 and the soybean yield at 39 bushels per acre. FC Stone released their estimate yesterday afternoon putting corn at 156.4 and soybeans at 41.2 bushels per acre. Reuters surveyed 20 analysts which had an average guess of 153.9 and 41.9. The USDA will be using the 5 year average pod weight in calculating their yield estimate. Traders don’t think it will reflect the true losses in the field.
Corn harvest is moving North to central IN and IL and northeast MO. Yield reports we are getting are in the mid 200’s and have producers pleasantly surprised. They are able to take advantage of the premiums being paid for immediate delivery at the elevators and processors.
Corn and soybean basis were mostly steady however a few processors and crushers dropped basis by $.15. There are reports of some processors willing to take high moisture, new crop corn instead of requiring 15% moisture.
Weekly export sales data will be released on Friday morning due to the holiday on Monday. DDG sales in July were 912,000 tons of which China bought 51%.
Labor disputes in the Pacific Northwest are heating up as grain inspectors are being turned away from loading facilities. A spokesman says it is not affecting grain shipments so far.
Reduced hog slaughter, firm cutout values and fund buying have supported hog futures in recent sessions. The hog index and futures prices have come together. Managed Money has a record long position in Lean Hog Futures. Historical data suggests mid-September is a time where retailers have completed purchase for "Pork Month" featuring. Pork cutout values were up .38 on Wednesday.
Beef cutout values were higher, choice up .46 and select up .21. The cash trade is still at a stand-off. Trade is concerned that feedlots are offering and moving cattle ahead of Tyson’s Zilmax use deadline. The CME Feeder Index is 156.01 unchanged.
Markets as of 5:00 AM
- Dec Corn -2 1/2
- Nov Beans -9
- Sep Wheat -2
- Oct Cattle -.32
- Oct Hogs +.77
- Sep Dlr +.07
- Sep S&P -2.00
- Oct Crude +.64
- Oct Gold +2.60
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