Good Morning! Paul Georgy with the early morning commentary for April 30, 2015 at 5:15 am.
Grain markets are higher on support from the weaker US Dollar and stronger crude oil values. The Dollar has tested and held the lows made after last month’s FOMC meeting. Crude oil has broken out of recent consolidation which should provide support to grains.
Update - Midday Commodity Weather Update:
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Ethanol production fell from 930,000 barrels per day to 921,000 barrels last week. Production was 3% over same period last year. Year to date pace is 5.2% above a year ago. In order for us to meet USDA’s 5.200 billion bushel corn for ethanol estimate we would have to run 5.8% below last year from now through the end of August. Ethanol stocks remain large at 21% over last year.
The following are estimates for this mornings export sales report gathered by Reuters: Wheat 0-100,000 (14/15); 100,000-300,000 (15/16); Corn 500,000-700,000 (14/15); 50,000-200,000 (15/16); Soybeans 50,000-250,000 (14/15); 200,000-400,000 (15/16); Soymeal 100,000-200,000 (14/15); 0-50,000 (15/16); Soyoil 0-20,000 (14/15); 0 (15/16).
China’s direct subsidy program for soybean producers has analysts thinking it could cause a reduction in production this year by 15 to 20%. The subsidy is a trial government program in some of the key producing provinces. Which is intended to replace the controversial stockpiling program.
Scattered soybean sales by farmers caused a slippage in basis at some country elevators and the gulf.
Russian Deputy Prime Minister Dvorkovich asked the agriculture minister to submit a proposal and remove the tax on wheat exports by mid-May.
Argentina's main grains port of Rosario was paralyzed by an open-ended wage strike by boat captains needed to help dock incoming cargo ships, the country's port management chamber said. We must remember this is the time of the year where workers strike to get cost of living increases. Trade is not too worried about the immediate problems.
Funds were net buyers across the board yesterday. It is estimated they bought a net 7,000 soybean contracts, 5,000 wheat, 4,000 corn, 3,000 soymeal and 1,000 in soyoil contracts
The Fed's policy statement after the FOMC meeting, puts it on track to begin a meeting-by-meeting approach toward deciding when to pull the trigger on its first rate hike since June 2006. The central bank, however, acknowledged soft patches across the economy, making it more likely that it will not be ready to hike rates until at least September.
Confirming months of data that suggested a slowdown, the government said Wednesday that the American economy barely grew in the first quarter of 2015. At 0.2 percent, the pace of growth was the slowest in a year, when a winter wipeout in the first quarter of 2014 prompted the economy to contract at a 2.1 percent rate.
China's domestic meat consumption increase has slowed, affected by economic slowdown and anti-corruption government edicts.
The april cattle contract goes off the board today at noon. Currently the June contract is at a $10.00 per cwt discount.
Dressed beef values were mixed with choice up .83 and select down 1.92. The CME Feeder Index is 215.79. Pork cutout values are up .32.
Markets as of 5:15 AM CDT
- May Corn 1 1/2
- May Beans 4 1/2
- May Wheat 3 3/4
- May Soymeal -.00
- Jun Dlr -.25
- Jun S&P -6.50
- Jun Crude .40
- Jun Gold -7.80
Technical Chart of the Day
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