PM Comments 5/18/15
Monday, May 18, 2015, 5:05 PM
Submitted by: Eric Kist
We missed sending out our AM comments, so we’ll revise them and call them PM comments…better late than never.
Green numbers were found across the board for the grain markets today, as corn, beans, and wheat all trended higher. Corn traded as much as 6 cents higher during the day, before settling up 2 ½ cents at 3.68 in the nearby July futures. Beans following in a similar fashion, trading nearly 12 cents higher early in the session, before eventually working back down to settle a penny higher at 9.54 ½.
The primary factor in today’s markets is weather, which should not come as surprise to anyone. Concerns over cool, wet weather throughout the Midwest and Central Plains has led the market higher, as additional moisture will begin to cause damage to young crops, and the continuation and completion of the planting season will be delayed.
Despite these concerns, however, this year’s Spring planting progress has still moved along at an undeniably quick pace. As of yesterday, the total percent of corn planted in the US was estimated to be 85% completed, compared to 75% last week, and 75% on average. As evidenced in Iowa, widespread emergence of the planted corn crop is being seen nationally, as 56% of the total US crop has sprouted above ground, compared to 40% on average. Locally, the Iowa corn crop is estimated to be 92% planted, and 63% emerged.
Soybean planting got off to a quick start as well, and is still ahead of the average, but recent rains over the past couple weeks have put a damper on the rapid pace. Nationally, this year’s soybean crop is 45% planted, compared to 36% on average, and locally, Iowa’s soybean crop is slightly ahead of those numbers, as we are estimated to be 51% planted this week, compared to 45% on average.
As these numbers indicate, as we already know, the early Spring weather has allowed significant planting progress to be made. However, if this recent trend of cool, wet weather persists, planting will continue to be delayed, and excessive moisture will lead to crop damage and possible drown-outs.
Although obviously bad for crop progress, this poor weather does factor into the grain markets, and any futures rallies should be watched closely. Keep in mind the long-term supply & demand environment we are in, and consider capitalizing on these weather-fueled rallies if given the chance!
Have a great night!