Tag Archives: soybeans

Summary

At the end end of the week markets are feeling risk adverse, but not completely risk off. For the equities and outside market the dim shimmer of stimulus hope continues to shine. Mid week there were strong rumors that the Treasury department and Democratic leaders in the house were close to a deal on another round of stimulus. President Trump has even came around to the idea of a big aid package, but the senate is still wanting to try and keep things tight for the balance sheet. Which they may not be wrong in thinking that way. Currently the US debt load sits around $27.1 trillion dollars. While the Federal Reserves balance sheet sits close to $7.2 trillion dollars. That leaves a big question up to the FED of if and when a stimulus package gets passed should it increase its bond buying program to create demand for the extra debt needed to fund any stimulus program created by Congress.

Back to the top of the summary again the market feels risk adverse, but not risk off. The VIX volatility index commonly called Wall Street’s fear factor has not breached 30 throughout the week. Safe haven assets have also had mixed performance, with the dollar lower and Gold almost unchanged. The yield on the 10 year treasury has also been rising to nearly 0.9%. This all shows that investors are looking for the right investment and are not comfortable taking large risks at the current time. That could be well founded given the highly debated election that is 2 weeks away.

In the grain complex end of the week may see the dam that has been holding back the bears finally give way. Thursday saw the wheat complex break down on poor export sales and moisture forecasted in several key wheat area’s of the world. While wheat was breaking soybeans overcame their technical resistance of $10.80 on the November contract. If more momentum enters the complex soybeans could look to test $11. The big IF here is will it needs wheat support to try and move higher from here. Mike Zuzolo, Global Commodity Analytics, takes this question on in his midday commentary on Thursday available at the bottom of the page. Meanwhile corn is content to continue chugging towards it’s target of $4.20 on the December contract. Corn export sales and shipments are Thursday were solid at nearly 2 MMT of sales and almost 1 MMT of physical exports. Interesting to note Japan was also the largest buyer last week of US corn.

Other important items occurring in the grain complex is the fact that harvest is rolling along at a brisk pace. On Monday the latest crop progress data showed that 60% of the US corn crop has been picked and 75% of the beans cut. The next two weeks will be critical to watch how far harvest can progress with cold and wet descending on the Northern plains and Eastern corn belt. In South America the wet season may finally be getting started. Soybean plantings are rolling right with the rains now 32% complete in Brazil. The thing to keep in mind with the delayed plantings in South America is that it will delay harvest and may keep US soybeans in the market for a few more weeks at the beginning of the year.

Other factors helping US grains at least is a friendly currency market. The US Dollar Index is testing recent lows this week. The Chinese Yuan and Russian Ruble have  been able to experience a recent run up given the weakness in the dollar.

USDA’s export sale terminal fired up on Monday announcing two flash sales. The first 345,000 MT of corn sold to unknown and the second 123,000 MT of corn sold to Mexico. Tuesday unknown destinations purchased 132,000 MT of soybeans. Wednesday the flash sale terminal was silent. Thursday the USDA was busy again with flash sales of 152,404 MT of soybeans sold to Mexico, 132,000 MT of soybeans sold to unknown, and 130,000 MT of white wheat sold to South Korea. Friday unknown destinations purchased 100,000 MT of corn.

In the livestock complex down is the word, no matter the fundamentals it seems. Cattle started the selling early in the week. Then feeder cattle attempted to come back on Wednesday. Thursday sellers established themselves once again and moved the market lower. Export sales were solid for beef up 62% week to week. China also made it’s way to the 2nd biggest buyer of US beef at 3,700 MT. Pork net sales disappointed unchanged week to week, but down 35% on the 4 week average. China was also noticeably absent in the us pork export sales.

Demand for pork is still strong though with the noon carcass cutout on Thursday reporting $100+ carcass and nearly $200 bellies. Boxed beef on the other hand remains in an almost sideways pattern.

Friday the October cattle on feed report will drop. Ahead of the report few traders are showing much concern expecting the report to be neutral.

With cattle futures moving into risk off mode cattle feeders focused on basis started to move cattle early in the week. Monday saw light trade develop in the South at $106, $2 lower than the prior week’s weighted averages. A few scattered deals were reported in parts of the North at $165 to $166, $2.50 to $3.50 lower than last week’s weighted average basis Nebraska. Tuesday and Wednesday saw another round of trade develop at $106 live $163-$165 dressed. Thursday and Friday the country was quiet with no bids from packers. Business appeared to conclude ealry in the week.

The Fed Cattle Exchange Auction today listed a total of 1,096 head, of which 702 actually sold, 394 head were listed as unsold, and none were listed as PO (Passed Offer). The state by state breakdown looks like this: KS 184 total head (1 lot), with all 184 head sold at $106.50; NE 394 total head (2 lots), with none sold; TX 518 total head (3 lots), with all 518 head sold at $106.25 to $106.50. The delivery date/weighted averages breakdown is as listed: 1-9 day delivery: 558 head total, of which all sold, with a weighted average price of $106.50; 1-17 day delivery 538 head total, of which 144 head sold, with a weighted average price of $106.25.

For the week ending October 10, 2020, Imported Beef Passed for Entry in the U.S. totaled 37,136, 87.18% of the previous week and 90.73% of the 4-week average.

Expected Slaughter numbers Friday

Cattle

116,000 hd today 118,000 hd wk ago 109,311 hd yr ago

Saturday

51,000 hd Sat. 57,000 hd wk ago 58,992 hd yr ago

Hogs

488,000 hd today 487,000 hd wk ago 479,720 hd yr ago

Saturday

239,000 hd today 266,000 hd wk ago 252,614 hd yr ago

Midday Carcass Value Friday

Beef

Choice up 0.11 208.97

Select up 1.02 192.10

C/S Spread  16.87

Loads  75

Pork

Carcass dn 0.11 98.73

Bellies dn 10.98 163.36

Loads 187

Grain Settlements

  • Corn dn 2 1/2 up 3
  • Soybeans dn 1/4 up 10
  • Chicago Wht up 4 3/4 – 10
  • Kansas City Wht up 7 – 9 1/2

Livestock Settlements

  • Live Cattle dn 0.60 up 0.10
  • Feeder Cattle dn 0.77  up 0.07
  • Lean Hogs dn 0.32 up 0.82
  • Class III Milk up 0.07 – 0.75

Pre-Opening Market Broker Commentary

Ed Dugan, Top Third Ag Marketing, discusses overnight grains and what the trade may see today. Grains look to open higher with rumors that China is expanding import quotas.


Jerry Stowell, Country Futures,  looks at what may impact the livestock futures today. Livestock could open either direction on Friday.


Mike Zuzolo, Global Commodity Analytics, takes a look at the midday trade. Wheat is the leader to the topside as Chicago wheat makes bullish technical moves.


John Payne, Daniel’s Ag Marketing, takes a closer look at today’s grain close.  Payne is bullish grains as demand continues strong.


Jack Fenske, York Commodities, looks at the closing market numbers. Ag commodities may have established highs until 2021.

Fall row crop harvest continues at break neck speed across the country. Corn and soybean harvest if continued uninterrupted could have most farmers done by thanksgiving. However the quick harvest pace is a double edge sword as the dry conditions making it possible are also continuing to dry up available soil moisture, and grass quality in pastures.

In a break down of the NASS crop progress report for the week of October 19 the national corn harvest is now 60% complete. Up 19% from the prior week. Meaning if that pace continues corn harvest could be at 98%-99% in two weeks. In the state break down most states are over the half way mark for corn harvest. Iowa has harvested 65% of their corn crop. A far cry from the 13% they had harvested this time last year. Kansas has harvested 76% of their corn crop and Nebraska has harvested 58% of it’s corn crop.

While most other fall crops have concluded their weekly condition rating corn is still receiving a rating. Nationwide the corn crop is rated 61% good to excellent. That is unchanged week to week. Nebraska corn fell 4% to 59% good to excellent. Kansas corn remained unchanged week to week at 59% good to excellent. Iowa gained 3% to 47% good to excellent, but Illinois cancelled those gains out dropping 3% to 65% good to excellent.

Soybean harvest is about 15% ahead of corn harvest now 75% complete across the country. Iowa (90%) and Nebraska (92%)  are just behind the state with the most soybean harvest complete. Louisiana at 93%.  Kansas is further behind these other states at 64% complete, but was able to gain 24% harvest completion week to week.

Given it’s strong cash market sorghum harvest has really kicked into gear with 63% of the nations sorghum crop in the bin. That is 12% ahead of the five year average. Nebraska has harvested 60% of it’s sorghum crop, up from 31% last week. Kansas has harvested 49% of the state’s sorghum crop, up from last week’s 30%.

Soybeans and sorghum no longer have a weekly rating from NASS.

Winter wheat seeding continues to push on and is almost done. Nationwide 77% of the winter wheat has been seeded. With states across the great plains essentially done. Kansas is 84% planted, Colorado 98%, Nebraska 72% and South Dakota at 71% planted. All of these are within a few points of their five year average.

Despite the dry most states are seeing strong emergence of the winter wheat. 51% of the national crop has emerged. 71% of the South Dakota crop has emerged. 61% of the Kansas winter wheat crop has emerged. 68% of the Colorado winter wheat crop has emerged and 72% of the Nebraska winter wheat crop has emerged.

The final pages of the report really detail how short moisture is becoming across much of the country. Pasture and range condition in Kansas fell 5% to 27% good, 0% excellent. Nebraska pasture fell 21% to just 15% good, 0% excellent.

Topsoil moisture fell 7% in both Kansas (21%) and Nebraska (20%)  adequate to surplus. Subsoil moisture than fell 8% in both Kansas and Nebraska, to 31% and 28% adequate to surplus.

You can read the full report here:

https://downloads.usda.library.cornell.edu/usda-esmis/files/8336h188j/ww72c218f/4q77gg25f/prog4320.pdf

Clay Patton has the audio recap of the report here:

Grains end mixed on Friday, but Troy Nielson with Smart Yield looks at the week’s trade. Overall corn and soybeans continue to hold record prices given the seasonality of harvest. This could give farmers a chance to sell grain into a strong market, but there is the lingering question of basis. Nielson looks at basis and the spreads to help explain what the current market is encouraging farmers to do.

Nielson also reflects on last week’s WASDE report and some of the data that may have been overlooked in the wild ride immediately following the report.

Catch the full episode here:

Grains continue to move higher being lead Thursday by wheat. Corn has almost all of it’s 2020/2021 contracts above the $4 mark. Soybeans continue to see strong soybean demand. Jeff Peterson, Heartland Farm Partners, discusses the fundamentals of what continues to drive the grain market higher. Of course with a market that doesn’t seem to want to stop has producers asking questions of what to do about selling into the cash market.

Peterson also addresses tough questions about China and the role their current strong demand is playing into this current market. Part of that discussion includes keying in on why the early week export inspections may be more important now than the weekly export sales report.

Cath the full conversation with Peterson here:

  • Fundamental news is bullish
  • Funds position on the December cattle-risk off attitude
  • Election still has a “hold” on the markets
  • Why are cash bids so low?
  • Is the stock market worried about the election?
  • Seeing a decline in the grade…does that mean we are getting current?
  • How are weights?
  • Fund liquidation vs. good fundamentals
  • Hogs…continue to have export news to China
  • Tech picture on the hogs looks good
  • Hogs vs. cattle in the trade
  • Oct hogs go off the board tomorrow
  • Farmers selling beans…did it happen to soon?
  • Grain summary is China.
  • Harvest clips along

 

As expected in the October 11 crop progress report, harvest is racing ahead with dry weather across much of the country. The dry though is hindering emergence of winter wheat and quickly depleting topsoil and subsoil moisture.

Row crops have essentially hit the final stages of maturity with corn maturity reaching a national rating of 94%, 7% ahead of the five year average. Soybean dropping leaves is now rated 93% nationwide, 3% ahead of the five year average.

As for harvest national corn harvest jumped from 25% complete last week to 41% complete this week. That is 9% ahead of the five year average. In the state by state break down Nebraska has harvested 34% of the state’s corn and Kansas has harvested 63% of the states corn. Both jumped 10+% week to week and are well ahead of the five year average. Big I-states are quickly approaching the halfway mark on corn harvest with Illinois at 45%, Indiana 34%, and Iowa 42% corn harvested. Soybean harvest nationwide is 61% complete, 19% ahead of the five year average and up 23% from last week. Nebraska has harvested 82% of the state’s soybean crop. That more than doubles the five year average of 39% and almost quadruples year ago harvest levels which were just 24%. Kansas soybean harvest is 40% complete. That perfectly doubles the five year average. Big I-states soybean harvest continues to roll on with Illinois 56%, Indiana 52% and Iowa 78% complete. Finally sorghum harvest is keeping just ahead of the five year harvest with 49% of the national harvest complete. Nebraska has harvested 31% of the states sorghum. That is 8% ahead of the five year average.

Crop conditions deteriorated on the national scale this week with key states seeing a decent drop. Nationally corn is rated 61% good to excellent, down 1% from last week. Nebraska corn increased 2% week to week to 63% good to excellent. Kansas corn is unchanged week to week at 54% good to excellent. Iowa corn dropped 1% to 44% good to excellent. Illinois corn though saw an 8% drop to 68% good to excellent. The national soybean condition dropped 1% as well to 63% good to excellent. Nebraska soybeans were unchanged week to week at 63% good to excellent. Kansas soybeans increased 3% to 56% good to excellent. Iowa soybeans were unchanged week to week at 49% good to excellent. Illinois soybeans fell 9% to 66% good to excellent. Nationally sorghum dropped 1% to 50% good to excellent. Nebraska sorghum improved 8% to 68% good to excellent.

Winter wheat planting could possibly be finished in the next two weeks with the current pace being  set. Nationally 68% of the winter wheat crop is planted, 7% ahead of the five year average and up 16% from last week. In the state by state break down Colorado has the most winter wheat planted at 94%. Followed by Nebraska at 89%. South Dakota at 88% and Kansas was further away at 74% planted.

Dry conditions are slowing Nebraska winter wheat emergence, but nationwide 41% of the crop has emerged. That is 6% ahead of the five year average. Kansas has 50% of the winter wheat crop emerged, up 18% from the five year average. Nebraska has 60% of the winter wheat crop emerged, down 8% from the five year average.

Pasture and range conditions continue to drop week to week. Nebraska range dropped 2% to 36% good to excellent. Kansas pasture dropped 6% yo 32% good to excellent. Wyoming has some of the poorest range in the Midwest with only 1% being rated good and 0% excellent. Wyoming has 70% of the pasture and range rated poor to very poor.

Topsoil moisture in Kansas has taken large drops the last couple of weeks. Dropping 10% to 28% adequate to surplus this week. That is 23% drop in the last two weeks. Nebraska topsoil dropped 6% this week to 27% adequate to surplus. Dropping 13% over the last two weeks. Subsoil moisture in Kansas dropped 8% to 39% adequate to surplus. Nebraska subsoil dropped 4% to 34% adequate to surplus.

You can view the full report here:

https://downloads.usda.library.cornell.edu/usda-esmis/files/8336h188j/hd76sq359/pg15c454g/prog4220.pdf

Sir Isaac Newton may have best explained Monday’s market action when he created his theory of gravity, “What goes up must come down.” After a strong week of rallies capped off a friendly USDA report, follow through support was no where to be found in the soybean complex.

PJ Conradt, Tredas, joins the Fontanelle Final Bell to discuss the technical and fundamental factors that pushed the markets lower. Conradt though is excited to see for the first time in years farmers are getting an opportunity to market their grains into healthy cash market with strong basis.

Catch the full conversation here:

Grains have rallied for the first two week’s of October and most analyst estimates ahead of the October WASDE report on Friday look to support that bullish momentum.

Pre-report estimates from analyst show the average yield for corn to drop from 178.5 bu/ac to 177.6 bu/ac. Shrinking the total harvest from 14.9 billion bu to 14.801 billion bu. That is a sizeable increase from the 2019 harvest of 13.617  billion bu. Analyst also expect the average soybean yield to drop from 51.9 bu/ac to 51.7 bu/ac. That small drop decreases the overall soybean harvest size from 4.313 billion bu to 4.292 billion bu. Just like corn this harvest is substantially higher than last year’s soybean harvest of 3.552 billion bu.

US Corn & Soybean Production 2020 Millions of Bushels October Average Range USDA September USDA 2019
Corn 14,801 14,638-14,963 14,900 13,617
avg. yield 177.6 175.4-179.2 178.5 167.4
Harvested Acres 83 82.7-83.5 84 81
Soybeans 4,292 4,249-4,358 4,313 3,552
avg yield 51.7 51.2-52.5 51.9 47.4
Harvested Acres 82.9 82.5-83 83 75
US 20-21 Stock Pile Millions of Bushels October Average Range USDA September
Corn 2,130 1,882-2,333 2,503
Soybeans 360 285-436 460
Wheat 889 835-915 925
US 20-21 Stock Pile Millions of Bushels October Average Range USDA September
Corn 2,439 2,152-2,697 2,756
Soybeans 461 379-576 610
Wheat 926 900-948 925
World Stockpiles 20-21 Million Metric Tons October Average Range USDA September
Corn 299.7 295.5-305 306.8
Soybeans 90.9 88.1-93.1 93.6
Wheat 316.9 310.9-319 319.4

MANHATTAN, Kan. — Crop scientists at three federal labs – including one near Manhattan – have released results of a two-year evaluation of 56 commercially-available cover crop varieties to help farmers pick the best ones for their business.

K-State Research and Extension soil management specialist Deann Presley calls the publication – Evaluation of Cool Season Crops in the North Central Region – an “excellent piece of research” conducted by scientists employed by the U.S. Department of Agriculture and the Natural Resources Conservation Service.

“There is a lot of effort that farmers put in to selecting their cash crop hybrids (such as wheat, corn and soybeans),” Presley said. “But as far as cover crops go, we just don’t have that same level of information.

“The scientists at the (NRCS) plant material center have put in the work to do real evaluations of multiple types of cover crops to give them ratings for various properties.”

The publication is available online, and was one of the topics addressed in a recent issue of the K-State Agronomy eUpdate.

Presley notes the publication covers such important topics as how quickly a given fall cover crop will establish, its ability to survive the winter, maturity date, and insect and disease ratings.

“It’s all important information to have,” she said, “but in particular, I think winter survival is a pretty important one. The big question is how quickly can you get it seeded and how well does that establish.”

Among the varieties evaluated so far, “each has its pros and cons,” Presley said.

“Kansas growing conditions are varied; there is not one or two cover crops that are suitable for the entire state,” she said. “In addition to information in this publication, it’s important to work with local seed dealers, coops and other agricultural retailers to fine-tune cover crop selections to determine which one’s have been doing well in your local area.”

Presley has specialized in growing cover crops for 13 years and said this is the first time she has known in which a publication is available that provides key characteristics of a wide variety of fall crops.

“The questions never stop and we just keep exploring different ways and new things to research,” she said.

To keep up on this and many other crop-related topics, interested persons are urged to subscribe to the free Agronomy eUpdate, which is available weekly from Kansas State University.