May 7 – Crop Progress Watched Ahead of Important WASDE

Good Morning!

Ahead of today’s crop progress report, grain prices are all in the red this morning as bullish speculators take some profits off the table.

“We all have a tendency to avoid our weaknesses. When we do that, we never progress or get any better.” – Jocko Willink (former US Navy Seal)


Crop Progress Watched Ahead of Important WASDE

Grain prices are all in the red this morning as speculators take some profits off the table before this afternoon’s crop progress report.

For the perspective of where the US crop progress report usually is at by this week in the growing season, the five-year average is for 10% of soybeans, 43% of corn, and 51% of spring wheat planted in the US. In last Monday’s crop progress report, these numbers were at just 5%, 17%, and 10% respectively.

Grain markets are also starting their usual positioning ahead of this week’s WASDE report from the USDA. However, May’s WASDE report is one of the more important ones of the year.


The May WASDE provides the first estimates of what the coming year’s balance sheet could look like. This means that we’ll get the USDA’s first look at their production expectations for the 2018/19 crop. Over the weekend, in the weekly Sunday morning GrainCents digest, we looked at some of the expectations going into the report for all crops.

Speaking of 2018/19 production estimates, Strategie Grains dropped their forecast for this year’s EU rapeseed crop by 300,000 tonnes to 22.2 million. This makes it a full 500,000-tonne decline from the 22.8 million tonnes they were at two months ago. Check out our analysis of all things EU rapeseed as a GrainCents canola subscriber here

Outside influencers of the grain markets continue to be a geopolitical risk, namely that of Chinese and US trade relations. Last week I spoke with the press at Bloomberg about how China doesn’t historically buy soybeans from the US at this time of year but given the risk on the table of Chinese tariffs, it’s a safer bet to hold Brazilian soybeans right now.

Finally, oil prices are up above $70 USD /barrel for the first time since November 2014 and are now up 16% year-to-date! [1] Historically-speaking, the rest of the commodity complex (including grain markets) tend to do well when oil prices are on a bullish run.

Bullish Fund Positioning in Grain Markets

On Friday, we got data that showed managed money is getting a bit more bullish in the grain markets. Here’s a breakdown of some of the action:

• Corn: +63,440 to a net long of 186,317 contracts
• Soybeans: +6,953 to a net long of 177,047 contracts
• Soy Oil: -20,540 to a net short of 73,540
• Soymeal: +28,128 to record net long of 133,549
• Chicago Soft Red Winter Wheat: +26,011 to a net short of 28,702
• Kansas City Hard Red Winter Wheat: +1.467 to a net long of 39,231

A couple of things to note here. Soymeal seems to be overbought, and it’s likely that we could see some liquidation as the bulls take their profits and run. This would pressure soybean and canola prices.

For corn, the bulls grabbed the horns last week as corn prices hit their highest levels since August 2017. Factoring in today’s crop progress report, I guess that 25% of the US corn crop did not get planted last week. Also on the bullish side: some rain in the forecast that would potentially slow things down in the field but likely accelerate corn prices.




US Winter Wheat in Dire Situation?

Last week, the US Wheat Quality Council revealed its results from the annual winter wheat tour. The group expects that total Kansas wheat production would come in around 243 million bushels based on an average yield of 37 bushels per acre. This sort of yield would be down 19% from the 48 bushels seen last year in Kansas. Also, if that production number is realized, that would be the lowest total since 1989. But Kansas isn’t alone in its lower production. Scouts from other states gathered during the tour to offer their assessments. Here’s a recap of those numbers:

• Nebraska: Total winter wheat production is pegged at 43.7 million bushels, down from 46.92 million bushels last year. Average yield is pegged at 43 bushels per acre.
• Colorado: Total winter wheat production is pegged at 70 million bushels, which is down from 86.9 million last year. The state’s estimated yield is just 35 bushels per acre.
• Oklahoma: Production is pegged at 58.4 million bushels, down about 50% from a normal crop size. Roughly 4.1 million acres had been planted, but just 2.355 million of those acres are expected to make it harvest.

As the size of the crop is certainly under scrutiny, the quality of the crop becomes a question mark as well. Currently, the USDA has pegged the good-to-excellent rating of the US winter wheat crop at 33% G/E. Going into today’s USDA crop progress report (through Week 18), the average G/E rating for this time of year is 64%.

In the coming weeks and months, we expect that wheat buyers are going to be to secure quality supplies. If you’re looking to sell your wheat, it’s very important that you do your grain testing today and know every single specification possible. Even if last year’s wheat has been tested already, I will guarantee you that a buyer will want an updated spec sheet from within the past month.

I encourage you to use our to get do your grain testing proactively. In my opinion, grain marketing is about being ahead of the curve. I can’t tell you how many tens of thousands of tonnes of grain that have been successfully negotiated on the FarmLead Marketplace just because the quality of the grain was assessed recently and by an independent lab. On, you can find independent testing facilities across the United States and Canada.

While it’s maybe just the start of the growing for you, you can also get proactive about your grain marketing and retest the grain still in the bin or register on GrainCents for your specific crops. Much like the crop must progress, so should you grain marketing mindset.

To growth,

Brennan Turner

President | CEO
TF: 1-855-332-7653
@FarmLead or @GrainCents on Twitter


At 7:00 AM CST in the North American futures markets (*not cash prices*):
(all prices in dollars per bushel unless otherwise indicated)
$1 USD = $1.2891 
CAD, $1 CAD = $0.7758 USD)

Jul Corn: -2.0¢ (-0.49%) to $4.043 USD or $5.211 CAD
Jul Soybeans: -7.5¢ (-0.72%) to $10.293 USD or $13.268 CAD
Jul Soybean Meal (per short ton): -$4.90 (-1.24%) to $398.80 USD or $501.18 CAD
Jul Soybean Oil (cents per lbs): 0.01¢ (0.00%) at 30.89¢ USD or 39.89¢ CAD  
Jul Oats: 0.8¢ (0.34%) to $2.358 USD or $3.039 CAD
Jul Wheat (Chicago): -8.8¢ (-1.66%) to $5.175 USD or $6.671 CAD
Jul Wheat (Kansas City): -9.3¢ (-1.66%) to $5.496 USD or $7.045 CAD
Jul Wheat (Minneapolis): -6.3¢ (-1.00%) to $6.168 USD or $7.950 CAD
Jul Canola: $0.40 (0.08%) to $11.964/bu / $527.50/MT CAD or $9.281/bu / $409.213/MT USD

COMMODITY TRADING INVOLVES RISK AND MAY NOT BE SUITABLE FOR ALL RECIPIENTS OF THIS POST. Neither the information presented, nor any opinions expressed, constitutes a solicitation for the purchase or sale of any commodities. The thoughts expressed in this email and basic data from which they are derived are believed to be reliable, but cannot be guaranteed due to uncertainty about future events and complexities surrounding commodity markets. Those acting on the information are responsible for their own actions.

About the Author
Brennan Turner

Brennan Turner is the CEO of, North America’s Grain Marketplace. He holds a degree in economics from Yale University and spent time on Wall Street in commodity trade and analysis before starting FarmLead. In 2017, Brennan was named to Fast Company’s List of Most Creative People in Business and, in 2018, a Henry Crown Fellow. He is originally from Foam Lake, Saskatchewan where his family started farming the land nearly 100 years ago (and still do to this day!). Brennan's unique grain markets analysis can be found in everything from small-town print newspapers to large media outlets such as Bloomberg and Reuters.

Most Recent Posts
June 5 – Volatility in U.S. Dollar, Loonie Mixing up Trade Flows
June 05, 2020 Brennan Turner
Grain markets this morning are almost all green as U.S. grain prices are seeing the benefit from a weaker U.S. Dollar, but that’s also pushing other currencies higher, including the Canadian Loonie and Brazilian Real.
October 4: Corn Prices Edge Higher With October WASDE in Focus
October 04, 2018 Garrett Baldwin
Corn prices ticked higher Thursday as traders and analysts began to speculate on next week’s release of the October WASDE report.
Pea Prices in 2020 Diverge as Farmers Look Up and Abroad
January 14, 2020 Brennan Turner
Pea prices are starting 2020 out on a bit of a divergent path, at least within the complex, as yellow pea prices drag lower while green pea prices soar.