AM Comments 3/31/16
Thursday, March 31, 2016, 8:03 AM
Submitted by: Eric Kist
Markets were stagnant once again overnight in anticipation of today’s USDA reports. At 11am this morning, the USDA will release its Planting Intentions and Quarterly Stocks reports, which will hopefully give the market some direction in the short-term. Yesterday’s poor performances in corn and beans can mostly be attributed to funds positioning themselves for today, as they added to their short position in corn, and took some profits by reducing small net long positions in beans. Both corn and bean acreage numbers are expected to increase for this upcoming planting season, and with a glut of both global and domestic stocks for both crops, long-term price action is expected to remain bearish.
Trade estimates for today’s acreage numbers:
Corn: 90 million acres (compared to 88 million LY)
Beans: 83.1 million acres (compared to 82.7 million LY)
Wheat: 51.7 million acres (compared to 54.6 million LY)
Overall, we don’t expect markets to react nearly as volatile as in previous years due to the current marketing environment of large carryouts for all three major crops, unless of course the USDA surprises everyone and releases both acreage and stocks numbers differing from trade estimates.
Corn: 1-2 lower
Beans: mixed/1 lower
Have a great day!