Weekly Crop Commentary - 4/21/2023
Apr 21, 2023
Vice President, Grain Division
The commodity markets are trading lower on the week as we find ourselves trading cash corn twenty-five cents lower and beans down about a dime. Export sales have been disappointing for the past two weeks and current demand for cash bushels continues to be domestic. As end users buy hand-to-mouth for just-in-time inventories, board spreads continue to widen, making it difficult to find futures or basis support. Brazil is currently exporting its bumper bean crop to China and their continued discussions of reduced demand is pressuring deferred bean prices. The geo-political issues concerning Taiwan-China and ongoing conflict in Ukraine, seem to have many traders on the defensive.
The weather forecast for the balance of the month and early May has taken a bit of a turnaround. While planting progress has been good thus far, it seems as if we will see most of the 2023 crop planting in May this year. The next crop report will be released on Friday, May 12. Trade is betting on this year’s carry-over figures on both corn and beans to be increased at some points. Planting progress and weather forecast, along with China’s daily demeanor will be the focal point in the coming weeks.
Haylee Van Scoy
Director of Grain Purchasing
The weather sure has been a roller coaster this past week from 80-degree days to freezing temps at night. We’ve started to see a few planters hit the ground rolling this past week, while majority of others are focused on tillage and spraying. The market has had little bullish news to keep the early week rally going. Weak export sales yesterday surely didn’t help matters. July corn is now well below the 20-day moving average. There’s a gap back from last July around that 5.95-6.00 mark and I’m curious if we will test that again next week? Corn price action this week has seen it’s biggest 1 week decline in over 8 months. As for July beans, we passed through the 20-day and 200-day moving averages today alone and appear to have found a support line this afternoon around that 14.45 mark. Hope you all have a wonderful weekend and stay dry this evening!
Grain Merchandiser, Upper Sandusky (Region 2)
Good afternoon, everyone! Once again, we are back with another rainy Friday. It seems like every Friday over the past two months it has rained. Anyways, since last Friday, markets have been up and down but look to end the week down across the board. It feels like the market is testing the lower part of our ranges this week. New crop corn is flirting with the idea of going lower than $5.15 here in Upper Sandusky and beans are nearing the $12.50 mark. The futures markets would be 5.50 and 12.90, respectively. If they end up below those marks today, there’s no telling how low we can get.
When tractors start getting in the fields, volatility typically happens. We have shifted to the weather and progress planting reports. In a volatile market it is always a good idea to have target orders in place to be able to capture the prices you wish to have. Without target orders, you could very easily miss out on the prices you’re looking for and must settle for a lower price.
Some farmers are out in the fields working the ground, spreading fertilizer, or spraying. There are also some that have started planting (mostly beans). There are also some that have not done anything yet. Hope everyone has a great weekend!
Grain Operation Manager, Urbana (Region 3)
We are in the back half of April and the weather has been on a roller coaster. We had 80’s last Saturday and frost on Monday - love Ohio weather!
Corn and soybeans rallied back to their winter averages early in the week as we had 15.00 cash beans and 6.50 cash corn. We pulled back from those price levels with selling coming to the market and export sales not as good as expected.
We have heard little news out of the Black Sea region for the last few weeks. Ukraine is shipping but Russia wants more concessions to keep the program running. China is putting pressure on Russia to try to get a peace deal in place as it is in their best interest to take pressure off commodity prices around the world. China is the world's largest importer of commodities.
Most of us do not follow the wheat market very closely but we have cash wheat cheaper than cash corn. This has not happened since the summer of 2013. This is going to keep pressure on corn prices and basis as wheat will move into the livestock feeding sector not just to the milling sector.We will have to see how planting progress is going across the Midwest as the report comes out Monday. We have seen planters rolling here in Champaign County. As always, it is a good idea to have offers in for old or new crop as you get busy in the field and forget to make the call to sell or think you will call in the morning and then we are down.
Grain Merchandiser, Marysville (Region 4)
Good afternoon! Last week I was travelling through South Carolina (visited Charleston and Savannah, GA – beautiful, by the way!) and saw some corn a few inches tall already, so that was exciting! Monday’s USDA Crop Progress report has the US at 8% planted for corn, three points ahead of the five-year average. National soybean plantings are at 4%, also three points ahead of average.
We saw the grain market rally Monday and Tuesday, but it’s been on a steady downfall the last half of the week. The NOPA crush report on Monday aided soybeans’ rally with a large 15-month-high figure. However, extremely poor export sales for both corn and beans coupled with negative sentiments from commodity speculators has brought corn down over 30 cents from their high earlier this week and soybeans down over 50 cents since Tuesday’s high. Chinese soybean demand has weakened, with analysts from Reuters estimating they will only import 90 MMT of beans this year instead of USDA’s estimated 96 MMT.
Here at Marysville, a new grain probe has been installed. It is now in the center of the inbound driveway so that we can probe on either side of it. If a truck is under it on the left, you can pull up on the right side or vice versa. This will help speed up the process, especially once we get the CompuWeigh system in place. Speaking of which, we have been distributing a form for Marysville customers to fill out for your vehicles delivering grain. Each truck/tractor will need its own RFID tag for this system. If you receive the form, please return it to us so we can get your vehicle registered. Have a great weekend and be safe out there!