May 15 – Crop Progress Surprises to the Upside

Good Morning!

Grain markets are mostly in the green this morning, despite a crop progress report that showed a lot of acres in America got planted last week.

“There’s a time to impress someone, and then there’s a time to make an impression on someone.” – Cameron Dallas (American actor)

graincents-trial

Crop Progress Surprises to the Upside

Grain markets are mostly in the green this morning, despite a crop progress report that showed a lot of acres in America got planted last week. However, rains that fell over the weekend and have continued into the early part of this week in the Midwest have created fresh concerns about getting the rest of the crop in!

Our Garrett Baldwin walked through why soybean prices fell yesterday in the regular Grain Markets Today column.

There’s talk from Washington that they’re trying to get the renegotiated NAFTA locked up by May 17. [1] That’s the last day that a new Congress would be sworn in before mid-term elections. I, for one, don’t think it’ll happen. The Mexican Presidential elections are happening in a couple of months, and it looks like a right-leaning politician will get voted into power. This likely means that all the negotiations that have happened over the past year could easily be undone.

I also have said from the get-go that I don’t think we’ll see Chinese tariffs on all American agricultural products, especially soybeans. We said over a month go that concerns over US soybeans were a little bit overkill and everyone needed to take a breather.

The likelihood that this won’t happen got another vote of confidence yesterday as President Trump works with Beijing to get Chinese tech company ZTE back in business. [2] Sanctions imposed on ZTE has been quite detrimental, and so Beijing has seemingly come to the table to negotiate. And agricultural commodities are certainly on the table.

US Crop Progress Impresses

Yesterday afternoon, the market got a dose of reality in seeing how quickly the American farmer can plant a crop when the conditions are ideal. Ahead of the NASS report, trade expectations for corn planted fell in a range of 55% to 60%. The USDA says that 62% of the corn crop has been put into the ground.

For soybeans, analysts had expected the crop progress report to show that 30% of the crop had been planted, so this was a bit of a surprise. The actual crop progress report showed 35% of the US soybean crop had been planted.

Analysts expected the agency to report that 52% of spring wheat planting had been completed. In fact, 58% of the US spring wheat crop is in the ground.

The quality of the US winter wheat crop continues to pick up, this week by 2 points to 36 G/E. The market was still expecting 34%. The most notable gains in crop quality were evident in Illinois, which saw a jump from 53% to 63% G-E in one week. Conversely, Missouri winter wheat G/E ratings went from 54% last week to 47%.

GrainCents Weekly Recap of Grain Markets

Weekly digests provide a deep dive into the events that shaped the markets over the last five trading days. They also offer a roadmap for navigating the markets in the week ahead. Specifically, this week we compared crop progress across North America to other years of similar issues, we reviewed weather in South America, dug deeper into the WASDE report, and updated our cash grain sales positions.

Here are the weekly digests that went out to GrainCents readers on Sunday morning:

Corn GrainCents Weekly Digest

Soybeans GrainCents Weekly Digest

Canola GrainCents Weekly Digest

Flax GrainCents Weekly Digest

Winter Wheat GrainCents Weekly Digest

Spring Wheat GrainCents Weekly Digest

Durum GrainCents Weekly Digest

Barley GrainCents Weekly Digest

Oats GrainCents Weekly Digest

Peas GrainCents Weekly Digest

Lentils GrainCents Weekly Digest

Chickpeas GrainCents Weekly Digest

To growth,

Brennan Turner

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

At 7:25 AM CST in the North American futures markets (*not cash prices*):
(all prices in dollars per bushel unless otherwise indicated)
$1 USD = $1.2837 
CAD, $1 CAD = $0.7790 USD)

Jul Corn: 2.3¢ (0.57%) to $3.988 USD or $5.119 CAD
Jul Soybeans: 2.0¢ (0.20%) to $10.233 USD or $13.136 CAD
Jul Soybean Meal (per short ton): -$0.80 (-0.21%) to $386.80 USD or $496.547 CAD
Jul Soybean Oil (cents per lbs): -0.01¢ (-0.21%) at 31.24¢ USD or 40.10¢ CAD  
Jul Oats: 0.5¢ (0.21%) to $2.398 USD or $3.078 CAD
Jul Wheat (Chicago): 1.5¢ (0.31%) to $4.928 USD or $6.326 CAD
Jul Wheat (Kansas City): 0.3¢ (0.05%) to $5.100 USD or $6.547 CAD
Jul Wheat (Minneapolis): 3.5¢ (0.58%) to $6.050 USD or $7.767 CAD
Jul Canola: $-0.30 (-0.06%) to $12.063/bu / $531.90/MT CAD or $9.397/bu / $414.339/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 FarmLead.com, 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.

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