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BRIAN HOOPS

By Staff | Oct 27, 2017

There’s been another landmark shift in the seed and chemical business. BASF has agreed to purchase Bayer’s LibertyLink-branded seed and the Liberty herbicide business.

The deal is valued at 7 billion. This sale is contingent upon Bayer’s acquisition of Monsanto being approved.

The BASF purchase of this Bayer seed and chemical business will likely appease regulators. The Bayer-Monsanto sale is expected to close in early 2018.

Corn analysis

Corn closed the week $.08 1/2 lower. Last week, private exporters reported sales of 271,000 mts of corn to an unknown destination, 115,000 mts of corn to Mexico and 120,000 mts of corn to Spain.

Weekly export sales of corn showed a total of 50.0 mb (1,269,900 mt) with 49.4 mb (1,254,900 mt) for the 2017-2018 marketing year. This put total marketing year sales at 587.7 mb, 34 percent less than the previous marketing year. In the weekly crop progress report, NASS reported US corn crop conditions at 65 percent good/excellent versus 64 percent expected, up 1 percent from 64 percent last week versus 74 percent last year.

US corn harvest is now 28 percent complete versus 31 percent expected, up from 22 percent last week and behind the average of 47 percent.

In the weekly EIA report, US ethanol plants produced 299.6 million gallons versus 284 million during the previous week and 301 million gallons a year ago. Year to date ethanol production is at 12.3 billion gallons, 104 percent of a year ago. Informa economics lowered their forecast for US 2018 corn plantings to 90.460 million acres, down from their estimate of 91.880 million acres a month ago.

Strategy and outlook

Producers should only make sales that address cash flow need during harvest and store balance of production, but not in commercial storage facilities.

Soybean analysis

Soybeans closed the week $.21 1/4 lower. Last week, private exporters reported sales of 582,000 mts of soybeansto China and 227,300 mts of soybeans to an unknown destination.

Weekly export sales of soybeans showed a total of 46.9 mb (1,275,200 mt), with all for the 2017-2018 marketing year. This put total marketing year sales at 965.9 mb, 7 percent less than the previous marketing year.

US soybean crop conditions are 61 percent good/excellent versus 61 percent expected unchanged from last week and behind the 74 percent rating last year. US soybean harvest advanced to 49% complete vs 49% expected, up from 36 percent last week and well behind the 60 percent average. The monthly NOPA crush numbers were slightly disappointing at only 136.4 mb, less than the trade estimates of 138.1 mb and lower than the 142.4 mb crushed in August. It was above last year’s crush of 130.2 mb however. Oil stocks were 1.302 mb, below average estimates of 1.322 mb and down from last month (1.417 mb) and last year (1.376 mb). Informa economics raised their forecast for US 2018 soybean plantings to 90.347 million acres, up from their estimate of 89.057 million acres a month ago.

Strategy and outlook

Producers should have made sales that address cash flow need during harvest. Do not store soybeans in commercial storage.

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. The risk of loss in trading futures and/or options is substantial and each investor and/or trader must consider whether this is a suitable investment. Past performance, whether actual or indicated by simulated historical tests of strategies, is not indicative of future results. Trading advice is based on information taken from trades and statistical services and other sources that Midwest Market Solutions believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such.

Brian Hoops can be reached at (605) 660-1155.

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