Pro Farmer's First Thing Today: Chinese Grain Purchases, Housing Market is Hot and More
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Good Morning farm country. Davis Michaelsen here with your morning update for Wednesday, April 14. From Pro Farmer’s First Thing Today, these are some of the stories we are watching this morning:
Corn futures are 5 to 7 cents higher, with December corn hitting a new contract high of $5.10 ¼ overnight. Soybeans are also rallying, with futures 6 to 9 cents higher and old-crop leading gains. Winter and spring wheat futures are up 5 to 8 cents to start the day. The U.S. dollar index is just below unchanged, and crude oil futures are posting solid gains.
The market is increasingly concerned with dry conditions for Brazil’s safrinha corn crop, some of which is starting to pollinate and some of which is just germinating/emerging.
Commercial grain sources signal China will significantly accelerate shipments of U.S. corn purchases during the May-August timeframe. If so, World Board’s assumption that around 6 MMT in U.S. corn sales to China will be rolled forward.
A report from a Brazilian ethanol industry group signals that in the 2020-21 marketing year ending in March, corn-based ethanol production rose 58% from the year prior as new and retrofitted facilities came online.
Beijing warned on Tuesday it was determined to stop Taiwan from getting close to Washington with the use of military action, ahead of a visit by a former U.S. politician and officials to the island at President Joe Biden’s request. A spokesman for the Taiwan Affairs Office of the State Council said the recent deployment of the largest fleet of warplanes to Taiwan’s air defense identification zone (ADIZ) was to tell Taiwan that moving closer to the U.S. to seek independence would fail.
Vice President Kamala Harris will step into her new role addressing the causes of the swell of migrants arriving at the southern border, meeting today with outside experts on Central America's Northern Triangle countries.
The housing market is hot in the U.S. and lumber prices are even hotter. The frenzy to buy is so intense that half of the homes on the market are selling within a week, according to Redfin. There is plenty of lumber around, but there's a shortage of sawmill capacity to turn those trees into usable wood.
China notified USDA that new African swine fever (ASF) cases were detected in live hogs, making it the fourth notification since the end of January, according to a report from a U.S. ag attaché.
New Zealand announced today it will halt the export of livestock by sea after a transition period of up to two years, citing animal welfare concerns. Its main trading partners include Australia and China.
Fund long liquidation continued Tuesday in the cattle market, with feeders pressured by the renewed rally in corn futures. Nearby live cattle contracts are now trading right in line with last week’s cash action.
Lean hog futures saw a choppy day of trade on Tuesday, which was a bit disappointing considering an impressive surge in the pork cutout value mid-morning and strong movement.
