Yesterday’s crop progress from the USDA shows that things are still behind and grain markets are starting to pay more attention.
“Progress lies not in enhancing what is, but in advancing toward what will be.” – Kahlil Gibran (Lebanese writer)
US Crop Progress Supports Grain Markets
Grain markets this morning are slightly in the red after a mostly positive day in the green yesterday on crop progress speculation.
Canola prices are back below $530 CAD /MT this morning despite the Canadian Loonie weakening below 78 cents USD (which is thanks to the US Dollar approaching levels of resistance). Also pressuring canola prices is soy oil, which is down 8.2% for the year, including losing more than 4% alone in April.
Make sure to check out the FarmLead Insights page later today as we’ll be publishing our recap of April grain markets activity for all of the 12 crops that we cover in GrainCents: corn, soybeans, canola, flax, winter wheat, spring wheat, durum, barley, oats, peas, lentils, and chickpeas.
While canola got a bullish StatsCan report last Friday, canola prices haven’t caught on to any of the bullish indicators to help push values higher. One argument that’s being made is that canola prices are already expensive relative to other oilseeds, like soybeans.
On that note, Argentina has bought two more boatloads of US soybeans for September delivery as they deal with a smaller crop. Almost 500,000 tonnes of US soybeans have now been bought by Argentina. Conversely, out of their expected 38-40 million-tonne harvest, soybean farmers in Argentina are reported to have forward sold nearly 16 million tonnes of the crop this year, which aligns with last year’s sales.
Chicago, Kansas City Wheat Prices Improve
As Garrett mentioned in yesterday afternoon’s Grain Markets Today post, wheat prices led grain markets’ mostly green day. Specifically, SRW wheat prices in Chicago was up 3%, while HRW wheat prices in Kansas City gained a little more than 1%. The main reason for the boost was crop progress concerns as we came out of another cold weekend with the US winter wheat crop still exposed.
Later this week, on Thursday, May 3, we’ll get the final numbers from the US Wheat Quality Council’s winter wheat crop tour through Kansas. This year’s issue isn’t so much snow and cold weather, but rather the drier conditions that the crop is dealing with. The drought in the Southern Plains is no 2011, but the lack of moisture could certainly impact the germination of the crop.  Historically speaking, if the region receives some rains in May, then the crop tends to turn out pretty good.
Yesterday afternoon, the USDA crop progress report showed us that the portion of the US winter wheat crop rated good-to-excellent (G/E) gained 2 points week-over-week to close at 33%. That’s still a far cry from the 54% G/E rating we saw at this point a year ago and the five-year average of 45%.
Although they’re in the red this morning, spring wheat prices also improved yesterday by more than 1% and are still technically in the green for the week. This is mainly to do with the US spring wheat crop progress or lack thereof regarding planting. Just 10% of the US spring wheat crop has been planted as of Sunday. Sure, that’s up 7 points week-over-week, but we were at 30% planted this time a year ago. Also, the five-year average is 36% of the US spring wheat crop planted by now. There’s some work to do.
Crop Progress A Bit Slow?
On that note, the USDA’s crop progress report showed us our first real look at US soybean planting. 5% of the crop has now been seeded, up 3 points from last Sunday’s activity. This is in line with the five-year average but yesterday saw a hotter start with 9% of the US soybean crop planted before the end of April.
For corn though, it echoes spring wheat progress in the field. The USDA crop progress report showed us that just 17% of the US corn crop had been seeded. That’s almost half of the 32% of US corn acres that were planted at this time a year ago, and well behind the five-year average of 27% planted by now.
Check the variable crop progress in the major corn-producing states below, especially those in the US corn belt and major fringe-acre player Minnesota:
Overall, as I mentioned in yesterday’s Breakfast Brief how acres planted will continue to get scrutinized, we’ll also start to see more attention paid to crop progress in the coming weeks in the US, namely emergence of the crop.
In Canada, air drills are rolling in a few areas but
Plant into dust and bins will bust?
Considering where grain prices are, it’s not exactly what would be the absolute best situation, but personally speaking, I’d rather have more grain to sell than less.