May 14 Morning Ag Commentary

by Steve Freed,

Grains are higher.  Wet US spring weather is helping prices. SN is up 15 cents and near 8.18. CN is up 7 cents and near 3.64. WN is up 2 cents and near 4.39. US stocks should open higher. Crude is higher. US 30 year bonds are lower.

Fact US corn and soybean planting pace is well behind normal is also helping prices. Key now is will farmers who can plant corn add to intended acres given corn price could be better than soybean. US corn yield could drop 3-4 bpa from USDA May guess and farmers in the wet area could be unable to plant corn. Some feel US corn acres could drop 3-4 million from intentions. Lower yield and acres could drop US 2019 corn crop 1.0 billion bushels. Some feel CN could test the 50 day moving average near 3.71 on the late planting and potential lower crop. Farmers could increase cash sales closer to 3.80. New crop sales could increase near 4.00 CZ.

Wheat is a reluctant follower given expectation of large increase in World 2019 supplies from last year.

Talk that POTUS is holding on to tariffs against China and could add tariffs to an additional $325 billion could increase chances for a deal. US looking at $15 billion dollar aid to US farmers could also help especially soybean farmers. This still does not help China demand for US soybean or fact South America has near record soybean supply at lower prices to compete for US demand.

U.S. farmers planted 30% of the U.S. 2019 corn crop as of Sunday, the slowest pace for mid-May since 2013, the U.S. Department of Agriculture (USDA) reported. The figure lagged the five-year average of 66% as well as the average estimate in a Reuters analyst survey of 35%. Wet weather and cool conditions have slowed field work this spring across much of the U.S. Corn Belt, prompting some to speculate whether farmers might plant less corn, or switch some acres to soybeans, which can be seeded later in the season.

U.S. Soybeans planted totaled 9% (trade estimate was 15%) versus 6% a week ago, 32% last year, and 29% average.

The U.S. Winter Wheat Headed crop was rated 64% good to excellent (trade estimate was 64%) versus 64% a week ago and 36% a year ago.

The U.S. Spring Wheat crop was 45% planted (trade estimate was 35%) versus 22% a week ago, 54% a year ago, 67% average.

Yesterday’s U.S. weekly export inspections had Wheat exports running unchanged from a year ago (down 2% last week) with the USDA currently forecasting a 3% increase on the year, Corn 5% ahead (7% a week ago) with the USDA down 6% for the season and Soybeans 27% behind (27% behind last week) with the USDA having a 17% decline forecasted on the year

The U.S. Midwest weather forecast still looks favorable with only a couple of weak systems moving through the region with light amounts of precip and scattered coverage. Overall, things look dry for the region over the next 5 days. Models differ for the weekend and the middle of next week with rainfall seen favoring the western Midwest on the European model while the GFS has rainfall for the entire region.

The Southern U.S. Plains look fairly dry for the week ahead. A front will then work through the region over the weekend with another the middle of next week.

The Northern U.S. Plains look to be dry through Thursday. Rains return heading into the weekend with an additional rain event early next week. Temps will be running below average.

The U.S. Delta and the Southeast will see a drying trend during the next two weeks with only one round of organized rain expected through at least the next ten days.

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2019-05-14T12:30:24+00:00 May 14th, 2019|