Midwest Marketing Solutions
Estimated record prevented plant acres in 2019
The Farm Service Agency is estimating 2019 prevented plant acreage at a record 19.6 million acres. That compares to the previous record of just under 11 million acres in 2011.
South Dakota leads the nation with nearly 4 million acres of prevented plant. Illinois and Ohio each had about 1.5 million acres reported as prevented plant. Minnesota has nearly 1.2 million; Indiana has 943,000 acres and North Dakota has 319,000 acres in [prevented plant.
Agreement is a “game changer”
Corn farmers, cattle ranchers and several others representing U.S. agriculture painted the backdrop for the signing ceremony at the White House. The bilateral trade agreement between the U.S. and Japan will benefit farm country by lifting tariffs on $7.2 billion of U.S. agricultural products.
During the ceremony, President Donald Trump described the deal as a “game changer” for farmers and ranchers. “As a result, over 126 million Japanese consumers will have greater access to high quality American products,” said Trump. U.S. Trade Ambassador Robert Lighthizer spoke at the signing ceremony, saying the new terms amount to $55 billion worth of trade.
Corn closed the week $.07 3/4 lower. Last week, private exporters announced sale of 228,600 mts corn to Mexico.
In the weekly crop progress/conditions report; U.S. corn conditions declined 1 percent to 55 percent good/excellent versus 55 percent expected, 56 percent last week and 68 percent last year.
U.S. corn harvest advanced to 22 percent complete versus 24 percent expected, 15 percent last week, 38 percent last year and 36 percent average.
U.S. corn exports, for the week ended 10/10/19, were weak again at only 18.5 million bushels. Year ago exports this week were 39.9 million bushels. Even with the USDA’s recently lowered 2019/20 export estimate of 1.900 billion bushels, corn exports still need to average roughly 35.8 million bushels/week through the end of August to reach the USDA forecast.
Strategy and outlook
Look to sell inventory at resistance and retracement levels. Even with smaller than expected yields, stocks are large enough with the poor demand pace.
Soybeans closed the week $.00 1/2 lower. Last week, private exporters announced sales of 142,579 mts of soybeans to unknown destination.
In the weekly export inspections report, U.S. soybean exports last week continued the very steady pace of 35.1 million bushels versus year ago exports of 45.0 million bushels.
Soybean shipments will need to average roughly 33.3 million bushels/week through the end of next August in order to reach the USDA’s 1.775 billion bushel export projection, very similar to last year’s average exports from this point forward of 32.5 million bushels/week.
U.S. soybean conditions improved 1 percent to 54 percent good/excellent versus 52 percent expected, 53 percent last week and 66 percent last year.
U.S. soybean harvest advanced to 26 percent complete versus 25 percent expected, 14 percent last week, 37 percent last year and 49 percent average.
In the monthly NOPA crush report; NOPA members reported soybean crush in September of 153.6 million bushels, sharply below average market expectations of 162.2 million bushels, down notably from August crush of 168.1 million bushels and last year’s record September NOPA crush of 160.8 million. NOPA reported its members produced 1.809 billion pounds of soybean oil in September, down from 1.965 billion in August and last September’s 1.849 billion. Moreover, September NOPA bean oil production was the 2nd lowest of the last 7 months and 3rd lowest of the last 19 months.
Strategy and outlook
The COT report has turned decidedly bearish for the soybean complex with aggressive commercial selling offsetting the strong fund buying. Interesting, soybean meal is bullish with the commercial index nearly at 90 percent.
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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