Soybean Harvest Pace Slower Than Expected
Oct 10, 2018
Good Morning from Allendale, Inc. with the early morning commentary for October 10, 2018!
Grain Markets have their attention split between several important factors right now. Tomorrow's USDA report is receiving the most talk, while a hurricane making land fall, a slower than expected harvest pace, and more midwest rains also make the topic list.
Crop progress numbers, out yesterday due to Monday's federal holiday, reported corn harvest at 34% complete, inline with expectations. Soybeans were 32% harvested, below the estimate of 35%. Winter wheat was reported 57% planted, just above the 56% expectation.
USDA October Supply/Demand Report will be released tomorrow at 11 AM CDT. Estimates have corn ending stocks at 1.919 billion bushels, soybean ending stocks at 0.898 billion bushels, and wheat ending stocks at 0.950 billion bushels.
Australia's Bureau of Meteorology reports a 70% chance that an El Nino will form this year after warming in the Pacific Ocean. El Nino events have historically been detrimental to Australia's ag production.
E15, the higher ethanol blended gasoline, will no longer be banned during the US summer months President Trump announced at a rally last night.
Managed money funds were sellers of 7,000 corn contracts, 8,000 soybeans, 3,000 soymeal, and 3,000 soyoil in yesterday's trade. They were neutral in wheat.
Weekly export inspections for the week ending 10/04/2018 reported wheat exports of 423,270 tonnes, corn 1,351,177, and soybeans 569,776. The numbers were inline with analyst expectations.
Russian deputy prime minister, Alexei Gordeyev said the country expected to export between 30 million and 35 million tonnes of grain in 2018/19 according to a report by Interfax news. Previously he had indicated the country would export 30 million. It was also noted that Russia plans to increase its grain export capacity by 25 million tonnes to 77.7 million tonnes by 2024.
Abiove estimates the 2018/19 Brazilian soybean crop at 119.5 million tonnes. They see 2018 soybean exports at 77 million, a slight increase from their previous estimate of 76.1. 2019 exports are estimated at 71.9 million tonnes.
Hurricane Michael is expected to make landfall this morning in Florida. World Weather, Inc. notes, "Damage to cotton is expected from southwestern Georgia into northwestern Florida with flood conditions threatening a few other crops like peanuts, unharvested soybeans and a few fruits and vegetable crops. Most of the crop damage will occur from the far southwest corner of Georgia to central portions of the Florida Panhandle."
The Trump administration is pushing forward with an aggressive and public effort to condemn China for a wide series of transgressions, a strategy that risks intensifying an already high-stakes standoff with Beijing. (The Hill)
The IMF cut its global economic growth forecast for 2018 and 2019 amid the ongoing trade war between the United States and China. The now expect growth of 3.7%, down from their previous estimate of 3.9%.
PPI & Core PPI lead the list of economic reports this morning. Both reports will be released at 7:30 AM CDT. MBA Mortgage Applications Index and Wholesale Inventories are also due today.
European Union countries are on the verge of agreeing to start negotiations with the United States to allow more U.S. beef into Europe, in what could be a major move to defuse transatlantic trade tensions. (Reuters)
China has banned the import of pigs and pig products from Belgium after the latest outbreak of African swine fever. Imports from Japan were also banned according to the General Administration of Customs. On Monday, imports from Bulgaria were banned.
Bird flu has been found in the southern Hunan province in China. The finding was the H5N6 strain and lead to 1,029 birds being culled according to the Agriculture Ministry.
Dressed Beef Values were mixed with choice down 0.36 and select up 0.91. The CME Feeder Index is at 158.45. Pork cutout value was up .13.