COMMENTARY 5/29/15

A cold front breaks in today, ending the very wet pattern across the Plains.  Temps will turn much warmer next week, shifting the storm track to the north, creating above average rainfall to the Spring wheat in the N Plains. The Central/Southern Plains should be dry into the central Corn Belt until late next week when chances increase for showers again.  A seasonable to warm and rather wet pattern will most likely rule from June 6-12th.

St Louis river level STEADY at +23.6 and forecast to be 23.6 by 6/3.

 The Fund’s Position:                 Bushels Today     Today(In # of Contracts)       Past Record(In # of Contracts)

CORNRECORD SHORT    -847 Million            -169,379                                     -155,379

BEANRECORD SHORT    -443 Million              -88,601                                      -75,601

WHEAT – SHORT                  -419 Million              -111,373                                       -111,373

CORN          

DOWN 2    

The EPA proposal to reduce annual ethanol requirements was expected but still disappoints.  The EPA reduced the 2014 14.4 billion gallon conventional biofuel mandate to 13.25 citing market constraints and limits to the availability of non-ethanol renewable fuels. Export Sales were neutral  at 25.8 vs expectations of  22-30 and vs  only 11.3/week needed. New Crop was -300 K due to China cancelling.  Export Sales for Milo were ok at 2.9, mostly to China, with 1.9/week needed. The Bird Flu death count rises 2.26 million head to a grand total of 43.292 birds lost.  Other reports are that wild geese are falling out of the sky dead in some areas.  Monday, the Trade is expecting a one point improvement in crop ratings and planting progress should be nearly completed TX and KS, with MO expected to lag.

LAST WEEK’s Crop Progress:

US PLANTED 92% TW, 85% LW, 86% LY, and 88% AVG.  The State of IL PLANTED:  97% TW, 94% LW, 93% LY, and 93% AVG.

US EMERGED:  74% TW, 56%LW, 56% LY, and 62% AVG.  The State of IL EMERGED: 87% TW, 75%LW, 78% LY, and 75% AVG.

US CONDITION: 74% G/E       STATE OF IL CONDITION: 80 % G/E

Bloomberg Trader Bias:  Bullish 16% (26% LW), Bearish 40% (41% LW),  Neutral 44% (32% LW).

 

BEANS     

UP 8

Old crop bean sales are solid and biodiesel implications from the EPA announcement:.  We also had a Sales Announcement of 202 K MT 15/16 SB sold to Unknown.  Friday’s weekly Export Sales report was supportive at 11.8 vs 6-11 expected and  (negative) -1.9 per week needed.  Buyers were China and Europe.  The New Crop was decent at 2 mbu vs expectations of 4-11.  Meal Sales were mid-range at 124 K MT vs 75-175 expected and 62per week needed.  Bean Oil was at 9.2 which compares to 8.7 per week needed and a pre-report estimates of 0-15 K. The Rosario Port Authority manager has declared that the Parana River channel is now clear for vessels.  The Argentine harvest is up 3 points to 90.3% complete and well ahead of LY’s 74% rain-delayed pace while maintaining a 60 MMT production forecast.

Bloomberg Trader Bias:  Bullish 8% (6% LW), Bearish 80% (62% LW), Neutral 9% (22% LW). 

LAST WEEK’s Crop Progress:

US PLANTED 61% TW, 45% LW, 55% LY, and 55% AVG.  The State of IL PLANTED:  69% TW, 47% LW, 60% LY, and 57% AVG.

US EMERGED:  32% TW, 13%LW, 23% LY, and 25% AVG.  The State of IL EMERGED: 38% TW, 14%LW, 29% LY, and 29% AVG.

 

 

WHEAT          

DOWN 12

The US missed another sales opportunity.  Egypt buys 240 K wheat from Romania and Russia.  Export Sales were (negative) —1.6 vs expectations of -3 to +4 expected.  New crop was 9.3 (near the upper end) in the 4-11 mbu expectation range.  Record rains in TX likely ruining their quality, while KS rains are being viewed as increasing yields.

LAST WEEK’s Crop Progress:

Winter Wheat Headed:  77% TW, 68% LW, 68% LY, and 67% AVG.  The Stat of IL Headed:  89% TW, 70% LW, 70% LY, and 83% AVG.

Winter Wheat Ratings:  45% G/E, 45% LW, and 30% LY.  The State of IL Ratings:  59% G/E, 57% LW.

US Spring Wheat Planting progress:  96% TW, 94% LW, 70% LY, and 79% AVG.  Emergence:  80% TW, 67% LW, 40% LY, and 54% AVG.