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Good Morning farm country. Davis Michaelsen here with your morning update for Monday, April 26. From Pro Farmer’s First Thing Today, these are some of the stories we are watching this morning:
Corn futures gapped higher overnight and extended gains to new contract highs of $6.73 ½ for May futures and $5.62 for December. Futures are currently up 9 to 15 cents, with old-crop leading. Soybean futures also registered new contract highs to start the week, but futures have since pared overnight gains to 5 to 8 cents. Old-crop are once again the upside leaders. HRW wheat futures have charged 16 to 19 cents higher, hitting new contract highs, with SRW and HRS wheat futures also at new highs and up 14 to 17 cents. The U.S. dollar index and crude oil futures are under pressure.
With corn prices soaring as stocks dwindle, large Brazilian meatpackers are turning to wheat, Francisco Turra, president of ABPA’s advisory body, told Reuters. He says wheat can fully replace corn in feed for pork and poultry.
Export prices for Ukrainian wheat climbed roughly $15 per metric ton over the past week, with rising demand and spring sowing delays in Russia lifting prices, according to the consultancy APK Inform. It details that both high-quality milling wheat and feed wheat prices are climbing.
CME Group announced it will raise maintenance margins on wheat futures by $200 (10.5%) to $2,100 per contract for May 2021, with the new rates taking effect after the close of business today. Initial margin rates are 110% of maintenance margin rates.
The House is not in session but in “committee work week” while the Senate is working and has several bills in the hopper. The Fed is not expected to take action at the conclusion of its two-day policy setting meeting Wednesday, but the market will be listening for any shifts in the Fed’s transitory inflation position. New tax and spending proposals are also expected from President Joe Biden. The Supreme Court will debate the authority of the Environmental Protection Agency to exempt refiners from biofuel usage mandates.
Restaurants spent much of the past year trying to win back customers. Now, they are struggling to win back employees, reports the Wall Street Journal. Nationwide chains and independent eateries alike said they can’t hire enough workers to staff kitchens and dining rooms, just as Covid-19 restrictions relax and more consumers want to eat out again.
Senator Joe Manchin (D-W.Va.), who’s a key moderate, said last week that Biden and Congress should focus on traditional infrastructure projects such as roads and bridges, an approach broadly favored by Republicans. Manchin said he and the coalition of House moderates known as the Problem Solvers Caucus are “working in a bipartisan, bicameral way” on a path forward on infrastructure.
White House climate envoy John Kerry joined U.S. Trade Representative Katherine Tai and other Biden administration officials in noting Biden is mulling a border adjustment tax to protect U.S. producers from foreign goods or commodities produced under weaker environmental standards.
The March surge in cattle placements was not quite as big as the market anticipated, with those numbers climbing 28.3%, and the number of cattle on feed also came in a bit lighter than anticipated with marketings a bit higher than expected. If anything, Fridays Cattle on Feed report should be given a positive read.
Lean hog futures stabilized last week and ended on a strong note, with a solid showing in the latest Cold Storage Report and strong pork exports providing support.
