PM Comments 3/10/15
Tuesday, March 10, 2015, 3:03 PM
Submitted by: Eric Kist
The monthly USDA S&D report day has come and passed, and barely made a hiccup in the day’s trade. Market analysts predicted that there wouldn’t be any major fireworks with this month’s report, and it certainly lived up to its billing. The corn carryout number came in right at the average trade of 1.777 billion bushels, down from 1.827 bbu last month. This 50 million bushel reduction is the result of the USDA making adjustments to export demand, feed usage, and export demand numbers. The corn grind for ethanol number was adjusted downward by 50 million bushels to reflect a conservative demand number. Corn feeding was increased 50 million bushels, and the corn export number was increased by 50 million bushels as well, reflecting strong demand numbers. All in all, the net carryout was reduced by a meager 50 million bushels, and the corn market responded by dropping ¾ of a cent for the day.
The soybean picture painted by the S&D report was also bland, as the USDA left all soybean, soybean meal, and soybean oil numbers unchanged, leaving the resulting soybean carryout number at 385 million bushels. Furthermore, the USDA did not make any adjustments to its estimates for the Brazil and Argentina soybean production numbers. After digesting the report, the May futures contract dropped nearly 9 cents, as the market had been anticipating that the soybean carryout number would decline modestly.
The outside markets were fairly volatile today, as the US $ index made another strong move upward, crude oil futures were lower, trading in the $48-$49 range, and the equities market was lower as well, as the DJIA dropped lower by more than $300.
Going forward, the grain markets will begin to watch the extended weather forecasts, and will debate on acreage intentions for Spring planting.
Have a good night!