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Weekly Crop Commentary

22-Feb-2019


Lou Baughman - Region 1 Grain Merchant

No comments available today.


Eric Godfrey - Region 2 Grain Merchant

What a week this was for prices. Stressful from where I watched the plummet but I can’t imagine what some (if not all) of you were feeling having on the line the things you do. Thankfully things are headed in the right direction and will stay there throughout the weekend . I won’t be surprised if we see some excitement next week as leaders are suppose to meet and that March 1 deadline closes in. At this point would an extension benefit the situation more than a speedy and decisive application of tariffs? Time will tell but I do believe that both sides don’t have much of a choice and have to make it work. A few days of decent gains on corn, more than we have seen the last few months, I expect things to level off and a return to familiar corn price territory, but could be surprised as there are indications that china is also buying US corn. Again, don’t forget about your on farm storage and end up with bins that need cleaning in the heat of July. Call and lets see what we can work out. Be safe and have a great weekend!


Steve Bricher - Region 3 Grain Merchant

I think the groundhog lied. We saw a large snow this week but fortunately this time of year it seems to go away much quicker. The markets on the other hand are still in Groundhog Day the movie, rinse and repeat. We are still range bound, the soybean market tried to break lower early in the week but trade talks with China going well lent some support.

We have caught up on government reports since the shutdown. The next big report will be the planting intention report at the end of March. My biggest concern today, we have not done anything to discourage soybean planting to get more corn acres. The spring crop insurance values will be done by this time next Friday. We are looking around 4.00 corn and 9.50 soybeans. That is 2.38 to 1, that does not discourage soybean planting. We have a good snow pack today over the northern plains, which if it holds could add soybean acres if we see planting delays. I am still thinking we need to get new crop soybeans sold at the 9.00ish level, or if you are going to bin, then price them for first quarter 2020 delivery. I think we can be a little patient on getting new crop corn priced, if we finally get something done with China and they take corn, corn could have a story.


Wes Bahan - Region 4 Grain Merchant

Good Afternoon. Well we have had yet another week of wild weather across the whole country. Areas in the delta region look to have some significant flooding, snow in Las Vegas, and possible flooding here over the weekend. The USDA Ag Outlook Forum gave us our first look at potential acreage for 2019. They are expecting 92 million acres of corn and 85 million acres of soybeans. They are tentatively using a 176 corn yield and 49.5 bean yield, and projecting ending stocks at 1.65 billion bushels of corn and 845 million bushels of beans. The ending stocks are both lower than this year which could offer a bit of support to the market for the short term. Brazil harvest was said to be 36% completed earlier in the week, and the weather in Argentina has been conducive for crop development. Today will be a bit of a mixed bag as we have March options expiring. As we approach spring all eyes will be on the weather to see how quickly field work can begin.


Ralph Wince - Region 5 Grain Merchandiser

Ralph’s Comments are not available today.


Melinda Ledley - Director Origination, Logistics and Risk Compliance

The grain market worked very hard today and got absolutely nowhere. It was an exceptionally quiet day compared to the last few Friday sessions. Traders are still trying to validate information being leaked from the China Trade Talks and will likely be a little nervous about establishing long positions ahead of the weekend. As planting season draws nearer, the corn and bean price ratio is getting much more attention. For many producers in the eastern half of corn belt, the futures price ratio would still favor soybean planting, however in Iowa and Illinois, where new crop bean basis is even wider than in the east, the new crop cash price ratio favors corn planting. So the wide bean basis is expected to sway bean acres to corn.


Ed Nienaber - Vice President, Grain Division

Ed shared some Key Takeaways from an outlook presentation that was part of the Southeast Grain and Feed Association Conference. The presenter was Ankush Bhandari from Gavilon Grain.
- Large Speculator is still carrying short positions
- Increase in the value of the US$ will be a headwind for exports.
- South American corn and soybean production prospects are increasing from YA
- Producers remain undersold and end-users are hand to mouth
- Livestock margins are at break even levels and ethanol has deteriorated
- Increased ethanol production needs to be channeled to exports
- TRADE POLICIES will Continue to drive PRICE, EXPORTS and ACRES
- World Trade for corn to INCREASE into 2019/20 but Soybeans need to be WATCHED
- Corn Acres are poised to increase at the expense of soybeans