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BRIAN HOOPS

By Staff | Apr 4, 2014

The National Pork Board announced last week it earmarked additional funds for research in the fight against the further spread of porcine epidemic diarrhea virus, which was first identified in the United States in April 2013.

The funds – $650,000 through supplemental funding approved by the Pork Checkoff Board in early March and $500,000 through a new agreement with

Genome Alberta – will provide new opportunities for research.

“This has become one of the most serious and devastating diseases our pig farmers have faced in decades,” said Karen Richter, a Minnesota producer and president of the National Pork Board. “While it has absolutely no impact on food safety, it has clear implications for the pork industry in terms of supplying pork to consumers.

“Our No. 1 priority is to address PEDV.”

Intended acres

U.S. farmers plan to plant a record 82.93 million acres to soybeans this spring, up 8.4 percent from 2013, while corn seedings will drop 3.5 percent to 92.06 million acres, according to a survey released Monday by Farm Futures magazine.

After planting an increasing number of fields with successive corn crops in the past few years, farmers appear ready to revert to a more traditional corn-soy crop rotation, Farm Futures said. “All key states showed increases (in soybeans), with some of the biggest shifts possible in Illinois, where farmers pushed corn-on-corn in recent years to capture profits from the ethanol boom,” the magazine said.

CORN ANALYSIS

Corn closed the week 11.75 cents higher. Last week, private exporters did not report any private sales.

Weekly export sales of corn showed a total of 55.4 million bushels. Total annual exports total of 1.589 billion bushels and are 94 percent of the current USDA export forecast.

Corn has scored a technical breakout, but has failed to extend the rally as commercial selling limited gains.

If prices pullback, look for the commercials to become buyers as they will view pullbacks in the market as buying opportunities in the next two weeks with forecasts for a cool, wet

spring across the key growing regions during the planting season.

Thus commercial entities and large speculators will want to be long ahead of the growing season.

Highs for corn are likely to be scored during the summer with weather premium added in the spring.

Informa updated its 2014 acreage estimate to 93.03 million acres, down 2.33 million from last year’s 95.4 million acres and down 300,000 acres from its last forecast.

Strategy and outlook: Producers are 100 percent sold of 2013/14 crop.

Producers are 10 percent sold of the 2014/15 crop.

They should sell 15 percent if December futures reach $5.24.

SOYBEANS ANALYSIS

Soybeans closed the week 27 cents higher from last week. Last week, private exporters did not report any private sales.

Weekly export sales of soybeans showed 0.4 mb for old crop and bringing total commitments to 1.63 bb, and are 107 percent of the USDA’s new 2013/14 export projections.

The USDA is assuming foreign buyers will eventually cancel U.S. purchases in favor of cheaper South American product.

However, we have never seen net cancelations in the second half of a marketing year. If wet growing conditions materialize this spring as forecast, corn will rally to buy acres as the market anticipate farmers will shift corn acres to soybeans.

The crop will eventually get planted, but a very wet forecast will likely limit the upside for soybeans.

Like with corn, technical breaks should be well-supported by commercial entities as they begin to position long ahead of the growing season as they wish to extend coverage in case prices rally sharply on a weather related event.

Informa pegged 2014 bean acreage at 81.2 million acres, up 4.67 million from last year’s 76.5 million acres and just slightly higher compared to its last estimate of 81.2 million acres.

Strategy and outlook: Producers are 100 percent sold of the 2013/14 crop.

Producers are 10 percent sold of 2014/15 production. Sell another 15 percent if November futures hit $12.50.

This material has been prepared by a sales or trading employee or agent of Midwest Market Solutions and is, or is in the nature of, a solicitation. This material is not a research report prepared by Midwest Market Solution’s Research Department. Brian Hoops can be reached at (605) 660-1155.

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