Evening Report (VIP) -- October 8, 2012

October 8, 2012 09:49 AM
 

TRADERS PREPARING FOR USDA REPORTS THURSDAY... USDA is closed today for Columbus Day and therefore its Crop Progress Report is delayed until tomorrow afternoon. But the most highly anticipated data of the week is coming on Thursday when USDA releases its Crop Production and Supply and Demand Reports.

Crop Production

Avg.

Range

USDA Sept.

2011

in billion bushels

Corn

10.598

9.954-11.194

10.727

12.358

Soybeans

2.770

2.600-2.903

2.634

3.056

 

According to pre-report average trade guesses, traders look for USDA to trim the size of the corn crop by around 129 million bu. from last month to 10.598 billion bu., with a yield of 122.7 bu. per acre. The average guess for the soybean crop is 2.77 billion bu. with a yield of 37.0 bu. per acre, which if realized, would be up 136 million bu. from last month's crop peg.

 

2012-13 carryover

Avg.

Range

USDA Sept.

2011-12

in billion bushels

Corn

0.645

0.454-0.815

0.733

0.988

Soybeans

0.134

0.095-0.203

0.115

0.169

Wheat

0.627

0.550-0.714

0.698

0.743

 

Traders look for USDA to lower 2012-13 corn carryover to a very tight 645 million bu., which if realized, would be down 343 million bu. from 2011-12. However, traders look for USDA to raise 2012-13 soybean carryover by around 19 million bu. from last month to 134 million bu., which would still represent a 35-million-bu. decline from last season. While traders are looking for an increase in crop size to bump up projected 2012-13 soybean carryover, total bookings are running well ahead of the needed pace, meaning any rise in crop size could be fully absorbed by a higher export projection.

Traders look for USDA to trim wheat carryover by 71 million bu. to 627 million bu., which would be down 116 million bu. from 2011-12.

 

 

BRAZIL TOO DRY, ARGENTINA TOO WET... Meteorologist Gail Martell of MartellCropProjections.com says hot and dry conditions are depleting soil moisture in Brazil. Highs of 100 degrees were seen over the weekend in Mato Grosso, where producers are waiting on a rain to continue planting soybeans. Meanwhile, she says two to four inches of rain last week in Argentina (some locally heavier) are keeping conditions too wet for corn planting. More of the same is in the forecast this week for South America, which would not be beneficial for recently crops or advancing the planting pace.

 

 

DROUGHT WORKSHOPS BEGIN OCT. 9... The first of a three-week series of drought workshops will take place in Omaha, Nebraska, tomorrow. USDA and other federal agencies will partner with local stakeholders to conduct workshops in drought-impacted regions. In a blog post Friday, USDA Secretary Tom Vilsack said, "The purpose of these workshops will be for us to listen to producers and communities regarding the intermediate and long-term challenges created by the current drought." Throughout October, additional meetings will take place in Pueblo, Colorado; Pine Bluff, Arkansas; and Archbold, Ohio.

Vilsack also used the post to point out that the expiry of the 2008 Farm Bill on Oct. 1 limited USDA's tools for providing drought assistance. He says, "Other aspects of the law will continue to expire in the coming months. This brings tremendous uncertainty for rural families -- particularly livestock producers who have lost access to disaster programs, and dairy producers who no longer have access to dairy support programs." Click here for more.

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