The following commentary does not necessarily reflect the views of AgWeb or Farm Journal Media. The opinions expressed below are the author's own.
The Hueber Report is a grain marketing advisory service and brokerage firm that places the highest importance on risk management and profitable farming.
It would appear that commodity markets are trying to do a little rebalancing act here as we begin the final week of the month. A number of markets that finished strong last week are soft while those that finished on a dour note have bounced back higher. This morning, corn is up while beans are lower, wheat is a smidge higher but energies are weak. Even in the macros, there appears to be an evening up going on as equities are under minor selling and the dollar is lower after a higher close last week. Outside of the normal weekly reports there is nothing special on the calendar to be released for the Ag sector this week. There will be a two-day regularly scheduled meeting of the FOMC on Tuesday and Wednesday, which Fed watchers will be scrutinizing very closely for hidden signals in the message but I do not suspect anyone really believes there will be any kind of surprise announcement by Yellen and company from this gathering. This is the final week of April which could keep activity somewhat subdued as traders wait for the clean slate of a new month before testing the waters once again.
Interesting news out of China over the weekend as it was reported that this nation imported 575,350 MT of corn during the month of March, which was a significant boost from just 70,000 MT for January and February combined. Granted, the cumulative total is less than half of what is was a year ago and the majority of it has originated from Ukraine so the benefit to the US is residual at best but it is interesting to note that the imports appear to have picked up right along side of the rhetoric and announcements that they are taking measures to reduce domestic stocks. While there could be any number of reasons for the increase from logistical issues to the need for good corn for blending purposes but it will be interesting to see what happens in the months ahead. This could be a classic case of pay attention to what I do, not what I say.
There has also been a number of interesting stories circulating about corn imports into Brazil. As we have reported in previous articles, due to aggressive exports during the past year and questionable weather for the safrinha crop, it appeared obvious that they would need to import corn but it was generally assumed this would be coming from Argentina and Paraguay as these nations are in a tariff-free agreement for trade amongst each other. Regardless, U.S. corn is currently competitive with Argentina corn into Brazil and there have been rumors that purchases have been made. If confirmed, it will be the first time they have purchased corn from this county in over 20 years.
It would appear that we have cool and potentially wet week ahead for much of the upper Midwest which could slow down planting just a bit. Since Friday I traveled into central Iowa, back up through Wisconsin and then Northern Illinois and as expected planters were rolling pretty much everywhere. I head south towards St. Louis this week and I expect to see corn pretty well competed through that stretch. I spoke with several good sized producers in our area over the weekend and was actually a bit surprised to hear that each of the operations was either completely finished with corn or within a day of being so. Traditionally, a fast pace like that would suggest additional corn acres but I do not believe that to be the case this year, particularly in relation to the March estimates.
No comments have been posted to this Blog Post