AM Comments 5/15/15
Friday, May 15, 2015, 8:05 AM
Submitted by: Eric Kist
A good day in the corn market yesterday had a spillover effect into the overnight trade, as corn climbed nearly 4 cents higher in the early-morning hours before eventually falling back to even as we head into the break. For the week, corn has added 5 cents to the nearby July futures. As for soybeans, the past couple days have been relatively quiet following Tuesday’s steep losses. Heading into today’s trade beans are nearly 2 cents higher, but are down 18 cents on the week.
Gains from yesterday and today can mostly be attributed to short-covering by managed-money funds, as they appear to be reducing large short positions before the weekend. Also playing a factor in yesterday’s trade was the release of some acreage estimates by the private firm Informa Economics. In their report, Informa estimated that planted corn acres will be nearly 88.7 million acres, and planted bean acres will be in the ballpark of 87.2 million acres. The corn acre estimate differs from the USDA’s number by nearly ½ million acres, as the USDA is projecting 89.2 million acres of corn. Soybeans, on the other hand, feature a much larger discrepancy: the Informa bean acre number is more than 2.5 million acres larger than the number used by the USDA. Depending on which estimate is closer to actual, a sizeable adjustment to projected soybean production numbers may be in line…
News overnight reports that the Russian government has abolished its wheat export tax, which they established this past winter. The trade has been expecting to hear this, but regardless, wheat is lower by a few cents this morning, and may inflict some downward pressure on the corn market.
New cases of the bird flu are seemingly being reported by the day, as 16 states have now been affected. As for Iowa, 52 separate cases have been reported to date, totaling approximately 26 million birds.
Opening calls for today’s trade:
Beans: steady/1-2 lower
Have a great day!