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Corn Harvest Behind Expectations


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Good Morning! From Allendale, Inc. with the early morning commentary for October 11, 2017.

Grain markets lack conviction ahead of tomorrow's 11 AM USDA Supply and Demand report. This morning's JOLTS job openings, and crude inventory reports will get the attention of outside market traders.

US Corn Harvest was reported 22% complete by the USDA yesterday afternoon. This was below the average analyst estimate of 27%, and well below last years 35% and the 37% five-year average. Soybean harvest was reported 36% complete, below the 38% expectation, the 44% saw last year, and the 41% five-year average. Winter wheat plantings were reported 48% complete, about in line with the 49% estimate.

Conab released estimates for the coming marketing year that starts with planting in fall 2017 and sees a spring 2018 harvest. For Brazilian soybeans, they call for a 2.7% increase in plantings this fall to 35.2 million hectares. Production is pegged from 106.0 - 108.2 million tonnes. USDA is at 107.0. This past year's production ran 114.0. They are calling for a 10.1% drop in first crop corn plantings this year. They see total production this year, both first and second crop corn, from 92.2 - 93.6 million tonnes. That would be down from this year's 97.8.

Reuters average estimates for tomorrow's USDA Supply and Demand report show analysts are looking for US corn ending stocks of 2.289 billion bushels, soybeans of .447 BB, and wheat of .946 BB. Corn world ending stocks are estimated at 201.91 million tonnes, soybeans 96.48 MT, and wheat 262.80 MT.

Corn production is estimated at 14.204 billion bushels on an average yield of 170.1, and harvested acres of 83.531 million on that same Reuters survey. Soybeans production is estimated at 4.447 billion bushels on an average yield of 50.0, and harvested acres at 89.017 million.

Societe Generale de Surveillance reports October 1 - 10 palm oil exports at 460,082 tonnes. That was 16.5% over last month in the same period. Their competitor, Intertek Testing Services, reports 448,349 tonnes of exports in the same period, 18.1% over last month.

FranceAgriMer raised the 2017 corn crop estimate up from 12.75 million tonnes to now 13.0. Soft wheat production was raised minimally, from 37.8 mt last month to now 37.9.

Export Inspections for the week ending 10/05/2017 had wheat exports at 350,632 tonnes, corn 524,168, and soybeans at 1,484,650.

Managed Money Funds were estimated sellers of 3,000 corn contracts, 4,000 soybeans, 500 wheat, and 1,500 soyoil in yesterday's trade. They were neutral in soymeal.

The Trump administration took its first step to undo President Barack Obama's landmark climate change rule today, fulfilling a major campaign promise but likely triggering years of court fights. The Environmental Protection Agency said it will move to repeal Obama's Clean Power Plan, a 2015 regulation that aimed to hasten the electric power industry's shift away from coal and toward greener sources of energy. EPA now contends that the rule violated federal law and would cost consumers $33 billion in 2030. EPA will also consider writing a far less stringent replacement for the rule. (Politico)

December Lean hogs closed between the 100 and 200 day moving averages yesterday. Key support is at 60.75.

Cash beef is up 0.18 and 2.79 for the week. The dominant December live cattle futures contract just broke through the September 22 resistance point noted yesterday.

Dressed beef values were mixed with choice down .73 and select up 1.36. The CME Feeder Index is 155.17. Pork cutout value is up .17.

If you have any questions on any of our content, give us a call at 800-262-7538 or service@allendale-inc.com


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About the author


Paul Georgy serves as president/CEO of Allendale, Inc., a worldwide agricultural advisory and research firm that provides agricultural commodity price research and risk management alternatives for producers, major food companies, international corporations, foreign governments, and major news vendors.

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