Morning Comments – Thursday August 18, 2016

Posted By :
Comments : 0

Buchheit Morning Comments from Dave Danker

Wednesday’s commodity market was higher for corn, soybeans and wheat.  Specs and commercials pushed the corn, soybean and wheat markets higher.  The Macro Markets were positive as the DOW was higher; Oil higher and the US Dollar Index trading lower.  The Dow closed at 18,574 up 22 points for the day.  Crude Oil closed at $46.90, up $0.88 per barrel.  The West Texas Intermediate Crude (WTI) September 16 to September 17 spread closed tonight at $4.72 carry to September 2017.   August Heating Oil closed at $1.4921, up $0.0308 per gallon.  The US Dollar Index closed at $94.76, down $0.24.  The 10-year US Treasury bond closed down at a 1.57% yield and the 30-year bond closed at 2.28%.  Wednesday’s CBOT closes were 2.25 to 2.75 cents per bushel higher for corn, 6 to 11 cents higher for soybeans and 1.75 to 4.25 cents higher for Chicago wheat.  Cash bids at the river have traded at $10.52 after they reached $11.47+ for November through January for soybeans and SEP corn is trading around $3.38 after hitting a top in $4.65-4.75 area for JAN delivery corn.  We are currently bidding about $0.15 to $0.20 behind those prices for the same time slots at our local elevators.  If you need help with marketing and logistics, we can help sell your crop arrange transportation to the terminals if necessary.

Friday’s USDA WASDE report was a stunner with national corn yields estimated at 175.1 bpa and a total corn crop just shy of 15.2 billion bushels.  The soybean yields estimate was a stunner as well.  The markets traded lower at first just after the report was released and then rallied to finish the day higher.  The Commercial support for meal and oil, coupled with the 4% over-night jump in Palm Oil prices in Asia produced strong gains in the soy complex and moderate gains in corn again on Monday.  The big question is, “Have we put in the fall Low”?  Some analyst feel that we have several others think that we still have another move lower coming in the next few weeks.  At the moment the answer appears to be YES, but we are seeing excellent growing conditions and the old mantra is “Big Crops Get Bigger”!

Below average temperatures and above average precipitation are forecast for most areas of the corn belt.  In my travels through Eastern Missouri and SE Iowa this week I have seen corn that had been stressed somewhat by drought, but recovered due to recent rains and soybeans that appeared to be doing great!  In visiting with a friend that had recently traveled I-55 and I-57 this week he saw much of the same in the dry areas and almost perfect crops in the majority of the areas viewed.  Locally, our corn looks great and both our full-season and double-crop soybeans appear to have excellent yield potential.  It is not often that we have a growing season with three different rains in the 5-8 inch category without having extensive flooding.  This has to be the wettest August that I can remember in my 38+ years in Southeast Missouri.  We normally do not have double-crop wheat beans that are standing in muddy fields in mid-August.  I would have to say that our entire soil profiles should be filled with water and the best soils should have enough moisture to get the soybean crop through the majority of the pod-filling phase.

USDA Crop Progress reports released Monday afternoon estimated corn Good-Excellent condition at 74% versus 74% LW, 70% LYR and 58.0% for the 5-year average.  The soybean condition ratings were 72% GE, 72% LW and 63% last year with a 5-year average of 57.6%.  Missouri Corn condition was reported as 76% GE, 75% LW, 51% LYR and 47.0% – 5yr. avg.  Missouri Soybeans were 72% GE, 70% LW, 30% LYR and 41.8% – 5-year average.  This report was bearish.  Missouri corn condition is rated 25% better than last year and Missouri soybeans are 42% better than one year ago.  We are still very much in a weather market!  The current weather has been crop friendly and is pressuring prices.

Check out our Daily Grain Bids (updated every 10 minutes during the trading session) by clicking on:  www.buchheitagri.com/biehle-grain-bids/   or   www.buchheitagri.com/morehouse-grain-bids/  or feel free to call us at 800-622-7937 (ask for Katlyn, Eric, Chad or Dave) or call 573-667-9921 or 573-768-0489 and ask for Shon.

Long Accumulation by the Specs and Commercials pushed the soybean and meal markets higher today as Specs bought 8,000 contracts of corn to finish the day at 132,000 contracts short. They bought 5,000 contracts of soybeans to close at 106,000 contracts long and they bought 3,000 contracts of wheat to close at 111,000 contracts short.  Specs sold 0 contracts of SBM and are long 49,000 contracts of Soybean Meal.

CIF bids for corn have softened and soybeans have stabilized in the Gulf, wheat CIF is stronger with August wheat at (38 bid-45 offer), OND wheat (60 bid-no offer).  October soybeans were quoted (90 bid-92 ask).  August corn was quoted (56 bid-60 ask), Sep was quoted (64-66); October corn was (66 bid-69 asked) and JFM corn was (59 bid-69ask).

Barge freight has firmed.  Freight firmed 60-70% in the last three weeks with the nearby   August at 250-325.  Harvest barges traded today at 350-525 for SEP, 500-515 for OCT and NOV at 325-450.

Cattle futures were weaker and Lean Hogs were higher on Wednesday.  August Feeder Cattle lost $0.40 and closed at $146.73.  August Live Cattle closed at $114.75 and December cattle closed at $113.60.  Lean Hogs traded $1.15 to $1.43 higher.  October Lean Hogs closed at $61.00 and December Hogs closed at $56.75.  The Pork Cutout gained $0.40 and closed at $74.36.  Sale Barn auctions of fat cattle ranged between $119 and $120, but packers were still trying to bid $117-118 in the South and $185-187 in the beef in the North.  Feedlots are asking for $120-122 and $190-192 in the beef.  Choice Boxed Beef was up $0.09; closing at $201.75 and Select was down $0.46, closing at $193.13.  Calls are for cattle to be steady to $1 higher on Thursday and hogs to be steady to $1 lower.

Fescue prices were quite strong during the 2016 Harvest.  We paid prices to range from $0.48 to $0.50 per pound.  A good fescue fertility program involves the addition of 40 lbs. of nitrogen per acre in late August, followed by an application of nitrogen, phosphorus and potassium in the spring.  You can spray 2,4-D and Dicamba for weeds in either the spring or fall.  If you have a very heavy infestation of weeds, you might consider doing both.

Please mark your calendar for our annual “Tech Park Field Day”! Wednesday, August 24, 2016 12:00 pm to 2:00 pm and 5:00 pm to 7:00 pm at the I-55 Tech Park. Join us for population studies, herbicide trials, the latest seed varieties, triad pant hormone trials, and much more! You will get the chance to visit and learn from top agronomy experts, seed, fertilizer, and chemical vendors, and implement dealers. Food and drinks will also be provided! RSVP by Friday August 12th by calling 573-547-4569, emailing agri@buchheits.com, or at http://www.buchheitagri.com/tech-park-field-day-registration/

We have updated our test plot results on our website, you can check out our 2015 corn yields and some 2014 soybean and corn yields at:  http://www.buchheitagri.com/tech-park-data

Be sure to check out our website at:  www.buchheitagri.com  and see the marketing information available.  If you scroll down on the front page you will find our market info page supported by AgriCharts.  If you examine the left hand side of that page you will discover the options that allow you to create price graphs or charts and also to check on historical spread information.

We are providing a DP program for those producers wanting to wait for a better day in the markets.  We can help develop a marketing plan and a floor price program.  Call Katlyn, Chad, Eric or Dave at 800-622-7937, Shon at 573-667-9921 or 768-0489.