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  • 06/07/2024 Markets Dialing In Further Improvement in Crop Outlook Prematurely
    On the Grains Grains are all weak in overnight trade with wheat leading losses in double-digits as of 6am. Yesterday's nice gains in corn and beans were fueled in part by a big slowdown in sales by Brazilian farmers. The Lula administration has provisionally enacted a new tax plan aimed at raising $29 billion in new revenue that could raise farm taxes in Brazil by roughly 20%. Sources say that has many Brazilian farmers holding onto their grain instead of selling it into the world export market until they see if Lula's tax proposals are approved by their Congress.   On the export front, yesterday's weekly sales were near the high end of the expected range for corn and beyond the high end for new crop wheat. At the current pace, USDA's corn export forecast could be raised. Soybean sales, on the other hand, came in near the low end of the expected range.  
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  • 06/06/24 Afternoon CommStock Report – Nursing Home Affordability Crisis
    I think it was Benjamin Franklin that said "Nothing is certain in life except death and taxes."  I could write and have written many reports on tax implications for farmers, but I don't know that I have written much on the topic of death.  And this isn't really about death, but rather on the potential need for long term care in a nursing home which more and more becomes less a place to rehabilitate and more and more, a place for acute care needs and a final home before we pass away.   My wife is on the board of an area senior living complex, so she occasionally brings me up to speed on costs, regulations and such that are impacting the business of providing good long term care for those in need when they are at their most vulnerable.   President Biden is proposing a plan to set minimum staffing levels for nursing homes. Under the proposal, nursing homes must provide 2.45 hours (2 hours and 27 minutes) per resident day of care from nurse aides, exceeding standards in all states. This means a nursing home would need roughly ten nurse aides per each 8-hour shift in a facility with 100 residents. Under the proposal, 68% of nursing homes would have to hire additional nurse aides to meet this requirement. "The proposal also makes clear that the numerical staffing levels are a floor—not a ceiling—for safe staffing. Under the proposal, nursing homes would have to undertake a robust assessment of their particular facility, including consulting with ...
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  • 06/06/2024 Even Market Bears Running Low on Grit after Relentless Selling?
    On the Grains Grains are mixed in overnight trade. As of 6am corn and beans are firm but wheat still on the soft side. Bullish news is still hard to come by, but after seven straight lower closes even the bears are running low on grit. The weather outlook is drier for the next seven days and that pretty much is exactly what the crop needs with many regions too wet. To put numbers on it, Monday's Crop Progress report said topsoil moisture was in "surplus" for 18% of the country vs. 5% last year and 14% of the nation's subsoil was in "surplus" vs. 3% last year.   Yet another Russian firm, SoveEcon, has cut its estimate of that country's wheat production to 80.7 million tonnes vs. USDA's current peg at 88 million and we've got other sources saying it may well be as low as 76 MMT. It still looks like India will resume wheat imports to rebuild stocks. Yet U.S. wheat prices remain overpriced internationally and harvest is upon us. Further, there are new reports that China will rebuild its stocks from domestic supplies and remain stingy on imports.   On the Grains Grains are mixed in overnight trade. As of 6am corn and beans are firm but wheat still on the soft side. Bullish news is still hard to come by, but after seven straight lower closes even the bears are running low on grit. The weather outlook is drier for the next seven days and that pretty much is exactly what ...
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  • 06/05/24 When (not if) China Stops Buying US Soybeans
    Brazil's second crop corn harvest continues to advance as the dry season is well established at this point.  It won't begin raining in Northern growing areas until sometime in September.  Mato Grosso was at 5% complete last Friday and so could be as much as 10% complete this weekend.  Corn crop conditions on our farm in Minas Gerais started out positive.  The crop was looking great through most of April, but as is often the case, the crop could have used an extended rainy season through late April and/or May.  That didn't happen.  The crop cycle shut down prematurely and yield potential will be severely impaired.  Our rainy season is a bit shorter and so this is somewhat expected.  It is worth trying some area each year, but our second crop corn area is limited to less than 20% of our soybean area.  Some producers opt for sorghum or some other small grain that has a shorter season or requires less moisture.  It might have less profit potential but also reduces your financial risk.   Brazilian farmers are now focusing on US weather to give them a potential rally.  While the US planting season has been setting rainfall records in some regions like Northern Iowa and Southern Minnesota causing all sorts of headaches, the general trade consensus seems to maintain that "rain makes grain".  While planting progress has moved in parallel with the historical average which would indicate the crop is off to a good start, we are highly skeptical of a ...
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  • 06/05/2024 Hope that Strong Crop Ratings Now Dialed In, But Long-term Charts Still Look Grim
    On the Grains Grains are mixed in overnight trade. As of 6am corn and wheat are soft with beans steady to firm. Given the considerably better-than-expected initial crop condition ratings for corn released Monday afternoon. The market weakness suffered since has been modest, suggesting the plentiful moisture and benign June weather forecast may be mostly "dialed in" after breaking so hard last week before the report even came out. Drought still plagues Mexico, our biggest corn customer and production prospects are uncertain for Russia, Ukraine and China as well. The technical picture for corn, on the other hand, looks pretty grim, particularly on the weekly chart. Recent action has broken the uptrend line demarking the "spring rally" from late-February lows after testing, but failing to breach the upper Bollinger band. The weekly chart shows that after barely entering the "overbought" zone on the Stochastics oscillator, that indicator has decidedly turned lower and reopened downside risk to 420 and even 400 if that can't hold. Trade focusing is on possible changes from March intentions that we might see in the acreage mix between corn and beans when the June Acreage report comes out late this month with most expecting some switch from corn to beans if we see any significant shifts at all. Soybeans remain under pressure from sluggish exports and seasonal competition from the South American crop. A mainstay is domestic demand where crush margins slipped over 40 cents last week but remain attractive with combined meal and oil value still well over $14 ...
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  • 06/04/24 Pre-Emptive Tariffs on Chinese EVs Will Not Fix EV Mandate
    Trump, when President, imposed tariffs on $300 bln of Chinese products, roughly two-thirds of Chinese imports. Biden left them in place and just recently added tariffs under section 301 of a 1974 trade law on the sectors and products listed (chart below). Biden's tariffs are more strategic than blanketed. He uses a rifle while his predecessor uses a double-barreled shotgun.   Biden tariffs are more symbolic, currently amounting to another $18 bln, based on 2023 imports, but are different from the tariffs imposed by Trump as they are pre-emptive. China currently imports just $400 mln in vehicles to the US but has the excess production capacity to export far more. China has the production capacity to produce 40 mln autos but sells just 30 mln domestically. That means that there is capacity to boost auto exports by as much as 10 mln. Tesla's Elon Musk, who should know from his experience in China, says that there is a flood of cheap government subsidized Chinese EVs coming if trade measures are not taken preemptively. Biden wants to make sure that they do not come here. Europe will likely do the same so that it is developing nations where these cheap Chinese EVs get dumped. The Inflation Act subsidized the expansion of the US EV manufacturing industry and yet EV manufacturers are nowhere near able to compete with Chinese subsidized manufacturers. They now sell EVs for half the price or less of ours so a 100% tariff just levels the drawing board. Trump says ...
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  • 06/04/2024 Initial Crop Condition Ratings Beat Expectations That Were Already High
    On the Grains Grains are generally weaker in overnight trade as of 6am. Given yesterday's hard sell-off, you'd never know the day started with weekly export inspections that came in at the upper end of expectations for corn, wheat and soybeans alike. In fact, corn inspections beat the top end of the range by a considerable margin. But traders have concluded big crop potential in the offing for this season and a big break in crude oil prices bled into grain markets as well. Crude oil sold off hard yesterday despite the weekend OPEC+ decision to extend current production cuts through September. That seems counter-intuitive, but apparently many traders thought they might have announced deeper cuts to boost global prices, so when they didn't it was deemed bearish. The potential for increased output from October forward was all that mattered. After the close we got the weekly Crop Progress report with initial crop condition ratings for corn and spring wheat, but not for soybeans. For corn, it came in at 75% good to excellent, 5 points better than expected and 21 points better than last year. It matched 2021 for the best initial ratings in six years. Only 4% was rated poor to very poor vs. 6% last year. Planting progress came in at 91%, a point shy of expectations but 2 points ahead of the 5-year average. It showed 74% emerged, 7 points shy of last year but a point ahead of the 5-year average. Among major producing states, only five (mostly in ECB) still ...
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  • 06/03/24 CommStock Radio Report Being Refreshed into the Digital CommStock Channel With New Host Marlin Bohling
    In 1985, when I conversed with the owner of the inaugural radio station that first aired the CommStock Report years ago, I asked him how long such programs last. He seemed surprised by the question saying that if refreshed they would not wear out and could last a long time. When I first recorded the CommStock Report we used 8-track tape technology which certainly dates me. Then, we sent each recorded program to each station individually, which often took me several hours each afternoon. If I coughed, for example, I had to start all over. There was such a thing as digital editing. This technology dramatically improved, changing over the years and the format of the program did too.   In January of this year CommStock Investments inaugurated another significant change, creating our own digital network called the CommStock Channel. We produce a podcast each day aired with the daily digital CommStock Report. It is also posted on YouTube and social media platforms. Marlin Bohling, coming to us from RFD TV, is the director of the CommStock Channel with Breann Hendrickson as his producer. We have had an excellent initiation of the channel with contributions from our brokers, agents, guests and staff located in 7 states. We have subscribers in twenty five states. Given that Matthew Kruse, president of CommStock Investments, has married into a Brazilian farm family and has extensive farm experience spending time in both countries, his weekly Brazilian Ag update is one of the most popular programs on the ...
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  • 06/03/2024 Why This Afternoon’s Crop Progress Report Will Be So Closely Watched
    On the Grains Soybeans are lower in overnight trade to start the week and corn is weak as well. Today's Crop Progress report is expected to show both crops in the wrap-up phase of planting and soil moisture conditions vastly improved over last year. Wheat is bucking the trend, however. Friday's Commitments of Traders report showed funds had resumed selling in corn and Chicago wheat but continued to lighten up on their net short position in KC wheat and continued to build a net long position in MGE wheat, perhaps for fundamental as well as technical reasons. The new weather outlook for June could explain. It shows benign weather for most of the corn and soybean regions. As for wheat, however, it shows June to be hotter and drier than normal over most of the spring wheat area of the country and above normal rain for the southern Plains with HRW harvest underway and the potential to do more harm than good at this point. Wheat futures struggled late last week on reports some rain was falling in Russia and that officials claimed it would still make 85 MMT, down only 3 million from USDA's current estimate. Our Ukrainian grain broker contact, scoffs however, that if even the government is conceding any drop at all this early, it must be really bad and he concurs. A private firm he respects is already down to 77 MMT and after speaking with numerous contacts his own estimate is now 75-76 at best. Today's Crop Progress Report due after ...
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  • 06/01/2024 Sunday Market Preview
    Bids and offers look to be stacking up for a slightly softer start, at least for corn and soybean futures. Wheat futures closed the weak with a bearish tone, but sellers could be kept in check by dry weather persisting in Russia. In the Headlines Corn futures sold off last week with the July contract down 18 1/2 cents. July beans dropped 43 cents for the week. July Chicago wheat futures lost 18 3/4 cents last week and KC July was lower by 12 1/2. June live cattle finished last week down $2.15 while August feeders were down $3.82. June lean hogs were higher by 7 cents. A sharp break lower for international corn values has been led by prices in Argentina, where harvest has accelerated toward its halfway mark. Corn export prices in Argentina are about 2.5 percent lower than U.S. offers out of the Gulf, but the U.S. price is about 2.5 percent cheaper than Brazilian corn prices. As prices in Argentina fell last week, there was also news circulating about the Chinese government making the necessary approvals to import corn from Argentina. Along with cheaper corn from Argentina, a downturn for soybean prices in Brazil helped weigh on futures in Chicago last week. Brazil was becoming more competitive again after a brief period when U.S. soybeans were thought to be attractive enough to generate buying from China, but no significant sales were ever confirmed. Daily export sales announcements were made again last week for corn committed to Mexico. A flash sale is ...
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  • 05/31/2024 Trade Attention Will Rapidly Focus on First Crop Condition Readings and New Long-term Weather Outlooks Due Next Week.
    On the Grains Grain prices are firm in overnight trade, even though the CPC updated the Drought Monitor yesterday showing the drought footprint has dramatically declined in the Midwest with only 5% of corn area still in some degree of drought and just 3% of soybean area. Surprisingly, drought worsened some in central and western KS and the OK panhandle with 25% of HRW winter wheat still considered in some degree of drought but only 3% of spring wheat. The PNW is the only other region with significant drought conditions. Weekly EIA stats were encouraging for ethanol. Production came in higher than expected for an 8-week high and yet ethanol stocks came in lower than expected, the lowest in 23 weeks in fact. Monday's Crop Progress report due after markets close will get heavy scrutiny. Not only will it likely show planting in the final stages for corn and beans, they will resume weekly crop condition ratings and traders will zoom right in on comparisons with last year's initial ratings to get a "feel" for yield potential relative to last year. We should also see the reports commence on wheat harvest progress. Next week we'll also get an update on the June-August temperature and precipitation outlook. On the geopolitical front, it's too early to get a reading on how Trump's conviction on all 34 counts will impact the election outlook or foreign relations for Biden, but overnight stock markets were off only slightly and unlikely to react much until we see the next wave ...
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  • 05/30/2024 It Makes More Sense for China to Invade Russia than Taiwan
    PLEASE REFER TO THE HEDGE AND TRADE STRATEGY PAGE FOR UPDATES!! The 5–6-month delay in supplying Ukraine ammunition, key munitions and weapon’s systems cost Ukraine the initiative as they lacked the offensive punch to gain ground and have instead lost some. The Russians have the advantage in manpower which has caused Ukrainian soldiers to tire out. They are committed to service until the end of this war. Ukraine has initiated new recruitment but it will take time to train them and they are not the same as veterans. Ukraine has too much border to protect with available manpower getting spread thin. Ukraine forces, repositioning to join the defense in eastern Ukraine, weaken defenses elsewhere. Will Russia be able to exploit that? Ukraine had a surprisingly high low age limit for conscription of 26 years old, recently reducing it by necessity to 25. They did not want to lose the young generation to the war looking to rebuilding in the future. Russia recently reduced the minimum age for workers in manufacturing plants to 14 years old which means they do not care as much about the future, focused only on current needs. Russia has expended its manpower advantage very carelessly, suffering heavy causalities. Russians never ran out of ammunition while Ukraine was forced to severely ration use of theirs. Europe has been aggressively supporting Ukraine but there is a time lag between rebuilding their industrial military complex to produce munitions and getting production up and running to supply the Ukraine front. More Ukraine ...
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  • 05/30/2024 Traders Settling in to “Rain Makes Grain” Mode with Weekly Crop Condition Ratings About to Commence Next Week
    On the Grains Grain markets are weak in overnight trade. Widespread rains are expected to return over much of the Plains and Western Corn Belt through the weekend. But with planting progress now ahead of the 5-year averages, concern about "delayed planting" has vanished and the trade seems to be settling back into the "rain makes grain" mode of thinking. Next week we'll start getting the weekly crop condition ratings for row crops with usual comparisons to the year before for guidance on yield potential. These are primarily the result of little more than "windshield" surveys based on visual observations and its anybody's guess whether widespread reports of poor stands or plant health issues due to excessive wetness will be factored in, or ignored on the premise that all that moisture insures it will take a serious and prolonged dry spell midsummer to pose any threat. Even wheat is lower this morning despite more indications that India is going to suspend import tariffs and resume imports this summer to replenish reserves it has drawn down to curb domestic prices and popular unrest. Concern about declining production estimates for Russia and Ukraine could only muster so much when faced with seasonal harvest pressure about to commence as harvest moves north from Texas where yield results have been beating expectations. Weekly export sales are due at 7:30 and that often sets the tone of early trade but our usual sources for the range of expectations didn't have them this morning. On the Hogs: It looked early on like ...
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  • 05/29/24 41% of Brazil’s Safrinha Crop Planted in High Risk Period
    Brazil's second crop corn harvest slowly advances while weather forecast finally shows a much-needed drying pattern in RGDS. Harvest in Mato Grosso, Mato Grosso do Sul, Goiás and Parana only register at around 2% overall. Progress will begin to pick up quickly in the month of June. Three different private groups came out with their Brazil corn crop estimates last week ranging between 114.3 MMT on the low end, followed by 117.1 MMT and 121 MMT on the high end. All three came in above CONAB (111.1 MMT) but below USDA (122 MT). CONAB may be forced to increase their estimate due to favorable weather in Mato Grosso, but we still see the USDA estimate as too high. The USDA has yet to take into consideration the flood damage in RGDS as well as the earlier end to the rainy season.   As much as 41% of the safrinha corn was planted in a period we deem as high risk. We define high risk as being anything planted after February 20th. That is not to say that the corn cannot still perform well if planted past that date, but the rainy season becomes increasingly unreliable beyond that point, and farmers should no longer expect trendline yields. April rainfall averages collapse, while rainfall in May is generally considered insignificant. But Mother Nature is unpredictable and so a heavy shower in May is not unheard of either. But everything we have seen this year would indicate the rainy season ended in early to mid-April ...
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  • 05/29/2024 Planting Progress Pulls Ahead of 5-year Average despite Rainy Weekend
    On the Grains Grains are steady-to-weak in overnight trading as of 6am. After the close, we got the planting progress report and corn came in at 83%, just as expected. That's 6 points behind last year but actually a point better than the 5-year average. It showed 58% emerged, right at the 5-year average but 8 points lower than last year at this point. Among major producing states, only seven (mostly in ECB) still have more than 20% left to plant. Only Iowa is still noticeably short of normal at 88% vs. the 5-year average of 92% planted by now. Soybean planting came in at 68% complete, two points better than expected, and 5 points ahead of average. It shows 39% has already emerged, 3 points ahead of average but 11 points behind last year. Among the major producing states, as in corn, Iowa is the only state noticeably short of the normal pace for soybeans planted. At 73% it's 4 points shy of the 5-year average of 77% by now. It's important to note that even though now at or ahead of normal planting progress, history shows yield potential begins to drop for any portion of corn planted after May 22 and this year that will be over 25%.  Further, USDA is now gathering data for actual planted acreage for the June Acreage Report. Trade chatter will inevitably switch to how acreage may have shifted from March intentions with most thinking if there were any switching, it will be corn plans that ...
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  • 05/28/24 Once in a Lifetime 2024 Planting Stories Here
    Cropping conditions were starting to feel similar to 1993 here. That year my neighbor across the road planted corn extremely early in April before conditions were fit. It made no sense to me why he would plant that early mudding the crop in. I got my fertilizer and chemical on to plant corn and then it rained and rained and I ended up participating in the 0-92 program that year where we destroyed the crop for a payment. The neighbor's corn made 150 bpa which was the best in the county. Mine was about half of half of that. By it staying wet he avoided sidewall compaction and crusting. Some corn got planted here in April this year. At the time conditions were good. However, it has rained and rained since resulting in ponding, uneven emergence and N loss that will take the top end off of the yield. I am still not ready to give up on an APH yield from the early planted corn yet but unrelenting rain may change that. There were a couple days planters got into the field again here in mid-May. This time they mudded through. It will need to stay wet for this corn to emerge as it should.   Moisture laden air is starting out from the gulf moving north crossing flooded East TX, AR and MO to the central corn belt where a pattern of fronts entering the US from the Pacific Northwest dip into the country triggering storm after storm in regular ...
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  • 05/28/2024 Wheat the Overnight Leader Again on Falling Black Sea Prospects
    FIRST '25 CROP WHEAT RECCO DAY 3:Past advice has you sold out of '23 wheat and 35% hedged on '24 production. Last Thursday we advised hedging the first 15% of expected 2025 production in July '25 contracts at your appropriate exchange. They've rallied further since, so the advice stands. On the Grains Markets are mixed in overnight trade. As of 6 am, beans are weak but corn is up slightly and wheat is up double-digits. Wheat is stronger on continued deterioration in the Black Sea region impacting both Russian and Ukrainian crop estimates. USDA has Russia at 88 MMT but widely followed Russian firm IKAR just lowered its estimate again to 81.5 MMT and our Ukrainian broker contact thinks it's more likely under 80. USDA has Ukraine at 21 MMT but our Ukrainian broker contact says its 18.5-19.5 at best. There were interludes of dry days last week but the weekend itself showed widespread rain over much of the Mississippi Valley and eastward, ranging widely from half an inch to 1"+ and certainly enough to limit progress. We'll get the holiday-delayed Crop Progress report after the close today. Since last week's report showed surprising progress the week before, some think that will be the case again. I'm not so sure. Last week Missouri was one of the leaders at 75% planted but the St. Louis region and eastward into Illinois got vicious thunderstorms Sunday. My wife took a picture of me in a field of 20" corn wilting badly on June 4 of last year about ...
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  • 05/27/2024 Monday Market Preview
    We remember and honor those who sacrificed their lives in service of our country on this Memorial Day. The market is closed for the holiday before grain futures will open again tonight at 7 pm central for the Tuesday session. Grains look to start with a slightly weaker tone in reflection of a drier forecast for most of the week. More severe weather broke out over the weekend, but there were breaks in the rains for many areas where planting needed to catch up. It will get too late for some as more final planting dates roll around this week. In the Headlines Corn futures finished firmer last week with the July contract up 12 1/4 cents. July beans gained 20 cents for the week. July Chicago wheat futures rallied 46 cents last week and KC July was higher by 59 1/2. June live cattle finished last week up $2.65 while May feeders were up $3.41. June lean hogs were lower by $2.22. The House Agriculture Committee advanced a new farm bill worth $1.5 trillion last week. Republican members were joined in support by Democrats from North Carolina, Georgia, and Illinois. There is doubt that the bill would survive a vote to pass the House, let alone the Senate, but many observers are optimistic in seeing it as a solid starting point. As usual, critics of the proposal say that it is too heavy on increased subsidies for farmers and too light on supporting the food programs. The current farm bill has extensions ...
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  • 05/24/24 War and Conflict Remain Sources of Heightened Market Volatility
    It is being reported that Russian President Vladimir Putin is suggesting that a ceasefire could be reached in Ukraine if an agreement would allow Russia to keep the territories currently controlled by Russian forces, which are estimated to span nearly 18 percent of Ukraine. Most observers believe that the demand is an impossible ask and that there will be no push toward actual negotiations. The news may be viewed by some as a sign that Putin's desire to continue the war is softening; however, others recognize that the unrealistic claim for victory is probably a ploy to excuse further advancement of Russia's land grab. Also in the news this week was Russia's removal of border markers that were in place outside of Estonia, which was another step up of recent threats by Russia to expand its borders into the Baltic states while also provoking Finland.   Even with the latest escalations of the war in Ukraine, including talk about Russia resuming the targeting of grain assets in the Black Sea, Ukraine just had its biggest month for grain exports since the invasion occurred more than two years ago. After Russia's suspension of the trade deal with Ukraine in July 2023, Ukraine's own efforts to construct a safe shipping corridor allowed 78 percent of the exports in April to pass through the Black Sea. A potential catalyst for change in the situation is if expanding drought in the region tempts Russia to put more effort into stealing Ukraine's grain so that Russian export ...
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  • 05/24/24 Markets Firm on Reduced Global Crop Estimates for ’24 from IGC
    FIRST '25 CROP WHEAT RECCO DAY 2:Past advice has you sold out of '23 wheat and 35% hedged on '24 production. Yesterday we advised hedging the first 15% of expected 2025 production in July '25 contracts at your appropriate exchange. They've rallied 140-170 per bu. from March lows and that needed to be rewarded. (For track record we're using fill prices for Chicago and KC at 743; MGE at 769.)   On the Grains This is Memorial Day weekend so there won't be any markets on Monday. A hearty salute to all veterans and families of veterans who made the ultimate sacrifice in service to our country for generations past.   In overnight trade thus far prices are mostly firm. With anticipated cuts in corn production in Argentina and sub-Saharan Africa and smaller wheat crops expected in Russia, Ukraine and the United States, the International Grains Council (IGC) revised its monthly projection for total grains output lower by 10 million tonnes for the 2024-25 marketing year. Here's the breakout by crop: Global wheat production is lowered to 795 MMT, still 7.3 MMT higher than last year but 3.2 MMT lower than USDA's forecast at 798.2. A slight decline in corn to 1.22 billion tonnes puts IGC right in line with USDA's initial forecast. With large outturns expected in the United States, Brazil and Argentina, global soybean production is seen increasing by 6% to a record 414 million tonnes in 2024-25, but that's 8.3 MMT lower than USDA's initial forecast at 422.3 MMT.   On the export front, ...
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  • 05/23/24 No Longer as Tightly Shoulder to Shoulder
    The promise by President Biden of standing “shoulder to shoulder” with Israel proved to be one of the casualties of the Israel/Hamas war. It succumbed to the success of the Hamas/Palestinian public propaganda strategy. Gaza was a Palestinian state that was controlled by Hamas. Hamas is a terrorist organization dedicated to the destruction and elimination of Israel, transparently described by Hamas as capturing the territory “from the river to the sea” as its objective. Gaza was transformed by Hamas into an underground military complex, completed as a protected missile launch pad capable of reigning missiles down on Israel defended by its ‘iron dome’. Late last year Hamas launched a military offensive against Israel. On October 7th, 2023 highly trained Hamas assault troops successfully executed a surprise attack on Israeli settlements outside Gaza raping, pillaging and killing over 1200 Israeli citizens while taking many others hostage in their retreat to their underground fortress in Gaza. Understanding why Israel is so devastated, in US population equivalency that would be the same as 42000 murders/deaths. Hamas correctly anticipated that Israel would have no choice but to invade Gaza and were well prepared for the anticipated assault to make it as bloody as possible. Urban warfare limits the scope of offensive alternatives giving defenders the advantage.   Israel responded just as Hamas anticipated vowing to eliminate Hamas. To do so they would destroy Gaza and incapacitate the underground tunnel system in which Hamas thrived. To do that they would pay little heed to the destruction of ...
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  • 05/23/2024 Sentiment Shifting from Planting Delay Fears to “Rain Makes Grain”?
    On the Grains: Grains are mixed so far in overnight trade, with corn and beans steady-to-firm and wheat a little weaker as of 6am. Widespread heavy rains are now sweeping much of the Plains and parts of the Midwest that will again delay planting in many areas. However, after last week's planting progress was surprisingly robust despite what was thought to be a generally "wet week" the week before, we're entering the stage where the old mantra that "rain makes grain" is heard just as often in trade chatter.   Wheat harvest has already begun in Texas and a crop tour just completed by the Illinois Wheat Association made mockery of USDA's recent suggestion that SRW yields might dip from last year's record 87 to 83 bpa this year. The tour average came in at a whopping 104 bpa.
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  • 05/22/24 Brazil’s Corn Harvest Begins With Prices Below Cost of Production
    Second crop corn harvest has begun in select areas of Mato Grosso. Early yield reports are mostly favorable with yields reaching 130 to 145 bpa. This is to be expected. Early planted fields never lacked moisture. These higher yields will be needed to offset later planted fields. They are only in the initial stages yet of the harvest season which will last until early August. While initial yields are positive, they are partially offset by reports of quality issues from too much moisture. Meanwhile, lack of rainfall will negatively impact later planted fields. Farmers may be surprised by how much the rainy season did not extend through the month of April.   The main concern for safrinha corn growers is that the cost of production is around the $3.35/bushel area…and yet the current spot price for corn in Central Mato Grosso has been trading closer to $3.00/bu. It is not expected to improve much as harvest advances. This is why corn ethanol plants have located in these areas. It allows them to source the cheapest corn in the world.   The problem areas this year are located in parts of Goiás, Mato Grosso do Sul and Parana. One region of Southwest Goiás is targeting yield losses of 35%. The state of Parana has likely faced the most damage with initial yields coming in around 55 bpa compared to an APH of 95 bpa. The best areas are coming in at 70 bpa. In addition to poor yields and poor prices, quality issues are also ...
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  • 05/21/24 NOT A Great Start!
    70% of the US 2024 corn crop was counted as planted last week. A small amount of progress was made here before the rain came today. Heavy rains and another system coming later in the week would appear to sustain protracted planting delays on the rest. My crop insurance company partner got half of his corn in in the recent couple day window. He said that 20-30% of what he planted he should not have been…in mud. He also said his planter had more mud on it then he had ever seen before but he did not plug. A subscriber e-mailed, “One more thing I saw many farmers running hard yesterday, and when they pulled out of the field WOW there was mud on the roads… Mud and great corn don't go together...So yes bad farming practices were in place.”   Rain totals could reach 2 inches here today. Planting may not resume here until the end of May. Farmers put crop in under conditions that they would not have, were it earlier on the calendar. The family is still planting corn and we will hire someone to plant my soybeans. They had put my corn in in April and then sat idle for over two weeks. Farmers are thinking about earlier varieties but will stick with the ones they have through May.   It is not just late planting that frustrates farmers. Ask them about the condition of emerging corn and they sound outright depressed. Corn should come up evenly and it has ...
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  • 05/22/2024 Grains Back on the Rebound as Rains Bog Planting and Demand Outlook Improves
    On the Grains Grain prices are rebounding from yesterday's losses in overnight trade with wheat once again leading with double-digit gains as of 6 am. While Russia's Ag Ministry talks gamely of record exports, yet another private Russian firm (IKAR) says drought and freeze damage portend a crop of 83.5l MMT, down 8 million from last year and 4.5 million below USDA's initial estimate of 88. Ukraine's crop was hurt as well and export prices are rising for both countries. As for corn and beans, severe storms (including several bad tornadoes in Iowa) have halted planting from eastern NE and SD across Minnesota, Iowa and Wisconsin again. Further we're seeing corn sales to top-customer Mexico remaining strong as drought conditions still plague that country into a 3rd straight year. There were large flash corn sales reported to both Mexico and Spain yesterday and '23 crop sales to Mexico as of May 9 are already at 778 million bu., up 43% from the year before. The demand side for beans may be firming up, too. The crush margin for central Illinois is back up to $2.73 per bu. as of yesterday. We're also learning the ferocious flooding in southern Brazil that has likely cost at least 10% of their crop has also badly slowed transportation, crushing activity and export loadings of what they did manage to harvest. On the export front, soybean sales so far lag badly with a dearth of Chinese business. There are reports they may have begun purchasing U.S. beans for summer delivery ...
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