Chatham, ON - After yesterday’s losses in the market, corn is steady this morning while soybeans and wheat continue their selloff. Ontario is also experiencing its first heat alert of the summer today! Keep cool, and be happy that our corn is getting some much needed HEAT!
Corn Futures are struggling to make gains on yesterday’s demand news as late-season rains helping with grain fill is limiting the upside potential. The USDA announced Colombia purchased 120,000 MT of corn and Costa Rica has purchased 113,673 MMT of corn; all for 2014. However, with more rain in the forecast for the next 10 days, traders are focussed on the mindset that big crops get bigger.
- USDA Crop Condition report out yesterday afternoon saw the combined ‘good’ to ‘excellent’ tally up one percentage point from last week to 73% as the crop responded well to rains last week and warmer temps. As of Sunday, USDA reports 35% of the crop was dented, up from 22% last week, but behind the five-year average of 43%.
Locally, the basis for old corn has heat up coming into September as processors look for that last bit of coverage before we get into harvest ourselves.
Soybeans
Futures are continuing their selloff here this morning as traders continue to focus on the timely rains helping to boost yields in the final growing days. With little other bullish news, traders are also noting tempered demand for Chinese state-owned stocks, as the country sold only 105,282 MT out of 345,894 MT of reserves put up for auction this week.
- USDA reports 70% of the soybean crop is in "good" to "excellent" condition, a one-percentage-point decline from last week. As of Sunday, USDA reports 90% of the crop is setting pods, compared to 83% last week and 89% on average.
Locally, basis levels remain steady as we inch closer to harvest where the biggest question will be crop quality as we see what mother nature has in store for us over the next month.
Wheat
Futures are following along with corn and soybeans as spillover from neighbouring pits has wheat steady to down a couple cents here this morning. As spring harvest continues in the US, quality remains a problem as the rains are keeping progress to a minimum and vomitoxin levels could continue to increase. USDA reports 27% of the spring wheat crop has been harvested -- well behind the five-year average of 49%. However, the price on an international level is still too high to compete for foreign demand at this point.
- The proportion of US wheat rated good or excellent fell by 2 points to 66%, not a bad rating but below last year's 67%
Locally, basis levels on SRW have begun to drop off as exporters have the ownership needed to fill sales. HRW basis levels for new crop are starting to heat up as the trade is looking to buy some acres before the crop goes in the ground.
Source: weathercentral