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Weekly market review

September 19, 2019
By Adam Suntken - Columnist , Farm News

Crop condition ratings released Monday, September 9th, surprisingly showed a 3-point decline for corn at 55 percent good/excellent. Corn in the dough stage is 8 percent behind at 89 percent, corn denting is 22 percent behind at 55 percent and corn mature is 13 percent behind at 11 percent.

Soybean were unchanged again this week at 55 percent good/excellent. Soybeans setting pods now only lags by 7 percent at 92 percent.

The anticipated September WASDE report was released Thursday, September 12th. Corn yield estimated at 168.2 bushels/acre, down from the August estimate by 1.3 bushels/acre.

This month's report included in field yield surveys finding sharply lower ear weights in Illinois, Indiana, Ohio and Minnesota. Despite the drop in yield, reductions in old crop and new crop demand for exports and ethanol left corn carryout for 19/20 crop year at 2.190 billion bushels, 9 million bushels higher than August.

Soybean yield estimated at 47.9 bushels/acre, down .6 bushel/acre from August estimate. Soybean carryout for 19/20 estimated to be 640 million, down 115 million from August with no changes to new or old crop demand. One interesting comment from the field data on soybean yield was large pod weights but very low pod counts. Historically as the soybean crop matures pod weights decline and pod counts increase.

Soybeans rallied in late in the week on news that China is considering substantial purchases of U.S. products ahead of next month's trade talks set to take place in Washington. Sources claim that China has offered to purchase U.S. goods in exchange for the U.S. delaying certain tariffs.

Some believe China will need to purchase U.S. soybeans ahead of South American harvest as Brazil's supplies are tightening. The extent of potential purchases remains highly questionable, as China is notorious for making indications of purchases and not following through. Rumors of such purchases Thursday sent soybeans prices 20 cents higher before the release of the USDA report.

China announced, for the first time in history, they would allow imports of soybean meal from Argentina. Traditionally China prefers to buy raw soybeans and crush them in their own plants. This could reduce raw soybean demand depending on how much Argentina can supply. Along with this announcement, China lifted tariffs on 16 U.S. products, excluding pork and soybeans, ahead of their in-person talks scheduled for early October. This is showing a more favorable opinion of improving trade relations.

A nationwide initiative to boost pork production is being launched by China, due to the price increases cause by African swine fever. The government is taking steps to accelerate hog production, prevent and control the disease and provide upgrades for farms to help pork supplies and provide stable prices. China's pork prices have increased 46.7 percent in August compared to a year ago.

For more information, you may contact Adam Suntken at (712)-454-1061, or e-mail at asuntken@maxyieldcooperative.com. The opinions and views expressed in this commentary are solely those of Adam Suntken. Data used in writing this commentary obtained from various sources believed to be accurate. This commentary is intended for informational purposes only and is not intended for developing specific commodity trading strategies. Any and all risk involved with commodity trading should be determined before establishing a futures position. Please visit our Risk Disclosure Page for more information on commodity trading.

 
 

 

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