Grains Quiet Overnight
Jun 10, 2014
Good Morning! Paul Georgy with early morning comments for June 10, 2014 at 4:30 am CDT.
Grain futures are mixed in a quiet session ahead of the monthly USDA report tomorrow.
The next event for the grain market is the USDA report on Wednesday morning. Rich Nelson’s analysis suggests the USDA is not likely to change production. On the June report over the last 30 years they lowered production several times but never raised it.
The new yield model used by USDA for corn takes into account the mid-May planting progress and July temperature and precipitation. Only very select years have they used June weather conditions.
Weather forecasts look for cool temps and alternating showers for the balance of June.
US corn crop condition was 75% good/excellent versus 76% last week and 68% for the 5 year average. Corn emergence was 92% with a slight lag from normal in northern states.
US soybean’s first condition report put the crop at 74% good/excellent compared to an estimate of 72%. The record high start for soybean conditions was 75% in 2010. Soybean planting is 87% complete compared to average of 81%.
US winter wheat condition did not change from last week at 30% good to excellent. Spring wheat planting was up 7% to 95% vs. 93% average while the crop conditions were rated at 71% good/excellent vs. 62% last year.
Export inspections for soybeans showed another 4.5 million bushels of beans being shipped out of US ports.
Economic news — Federal Reserve Bank of St. Louis President James Bullard said Monday if the economy performs as he expects over the remainder of the year, it is likely the central bank will increase short-term rates earlier than most officials now expect.
Grain traders will be watching the US Dollar index as technical indicators are nearing a breakout to the upside. This could be another negative for Ag commodities.
This week we could see hog slaughter run just below 1.9 million head. That would be the smallest non-holiday kill since March of 2007. Packers have been quick to reduce slaughter when hog prices jump. Is this the beginning of really tight hog supplies? Pork cutout values are up .85
The final tally from Friday afternoon’s sales came in even better than initially reported. Kansas and Texas moved numbers at $145. Nebraska saw an average live price of $146. This was $2 higher than previous week. Futures are still at a considerable discount to cash. Feeder cattle continue their surge higher. According to DTN-K State formula a 700# steer bought today would lose $242 per head under current price structure. Beef values are higher with choice up 1.07 and select up .88.
Markets as of 4:30 AM CDT
- Jul Corn + 3/4
- Jul Beans +6 3/4
- Jul Wheat – 1/2
- Aug Cattle -.10
- Jul Hogs +.72
- Sep Dlr +.08
- Sep S&P -4.00
- Jul Crude +.21
- Aug Gold -.30
Chart of the Day
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