Fccoop

MARKET COMMENTARY

PM Comments 6/29/15

Monday, June 29, 2015, 5:06 PM
Submitted by: Eric Kist


Stocks and acres, crop conditions, extended forecasts, and short-covering.  A lot of excitement has played into the grain markets the past couple weeks as we head into tomorrow’s USDA Quarterly Stocks and Acres Report.  Over the past 14 days corn has traded a 48 cent range, while the soybean trade has spanned 99 cents from low to high during the same time period.  Wet weather and short-covering by managed-money funds have been the primary catalysts, as the completion of soybean planting has been delayed in Kansas and Missouri, and the Eastern Corn Belt has been flooded with rains, causing some crop deterioration, while also providing a spark for funds to liquidate portions of their enormous short positions, which has fueled our recent rallies. 

 

As of this afternoon’s weekly crop conditions report, the U.S. corn crop is rated as 68% good/excellent, compared to 71% last week, and 75% last year.  Illinois and Michigan both dropped 8% in the G/E category from last week, while Indiana dropped 10% G/E, and Ohio dropped 19% during the same time.  Iowa remained unchanged from last week at 83% G/E.  As for beans, the total soybean crop is 94% planted, and is rated as 63% G/E nationally, compared to 65% last week and 72% last year.  In this category, Iowa dropped from 80% G/E last week to 78% this week, as major rain events throughout the state have taken a toll on the soybean crop. 

 

As we head into tomorrow’s trade, all eyes will be set on the USDA’s Stocks and Acres Report, due out at 11 AM.  Market estimates are listed below:

 

GRAIN STOCKS

Average Trade Guess

USDA Actual

June 1, 2015

March 1, 2015

June 1, 2014

Corn

4.56 billion bu.

7.745 billion bu.

3.852 billion bu.

Beans

680 million bu.

1.33 billion bu.

405 million bu.

ACRES

Average Trade Guess

USDA Actual

June 1, 2015

March 1, 2015

June 1, 2014

Corn

89.1 million ac.

89.2 million ac.

90.6 million ac.

Beans

85.3 million ac.

84.6 million ac.

83.7 million ac.

 

 

It goes without saying, but any major deviations from these estimates can and will lead to significant volatility in the markets, one way or the other!

 

 

Have a good night!

 

@fccoopgrain

 

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