From: Terry Reilly
Sent: Friday, September 28, 2018 12:38:25 PM (UTC-06:00) Central Time (US & Canada)
Subject: FI Grain Market Update 09/28/18
PDF attached
USDA released their Grain Stocks as of September 1 and Small Grains Summary
USDA Links to reports
http://usda.mannlib.cornell.edu/MannUsda/viewDocumentInfo.do?documentID=1079
http://usda.mannlib.cornell.edu/MannUsda/viewDocumentInfo.do?documentID=1268
Executive Briefings
https://www.nass.usda.gov/Newsroom/Executive_Briefings/index.php
USDA report initial reaction
· Bearish CBOT grain and oilseeds commodities.
· September 1 grain stocks were all above trade expectations, and prices were quickly to respond. After wheat began to stabilize, buyers rushed to the market which turned prices around, but then wheat prices turned lower in afternoon trading. Corn and soybean futures began to pair losses shortly after the report but made new session lows after buying activity dried.
Summary
2017 soybean production is revised up 19.1 million bushels from the previous estimate. USDA noted the planted area was unchanged at 90.1 million acres, and harvested area is unchanged at 89.5 million acres. The 2017 yield, at 49.3 bushels per acre, is up 0.2 bushel from the previous estimate.
For state changes, USDA increased 2017 soybean production for IA by 5.0 million bushels, KS by 2.6, MN by 4.0, Missouri by 3.0, and ND at 3.5 million bushels.
See table after the text…
US soybean stocks as of September 1 were reported at 428 million bushels, 37 million above a Reuters trade guess (last year soybeans were reported 37 million below the trade guess), and above 302 million at the end of 2016-17. We estimate the crop-year residual at 13 million bushels versus 32 million by USDA.
USDA September 1 corn stocks came in 130 million bushels above the trade guess at 2.140 billion bushels (last year 58 below), down from 2.293 billion at the end of 2016-17. Our 2017-18 US corn for feed is estimated at 5.308 billion bushels, versus 5.450 billion for USDA.
September 1 all wheat stocks of 2.379 billion bushels were 36 million above trade expectations (trade missed last year’s number, with it 48 higher). We look for USDA to lower its 2018-19 US wheat for feed by 5 million bushels on October 11 to 125 million bushels.
2018 all-wheat production was upward revised 7 million bushels but came in 12 million bushels above trade expectations. USDA upward revised the other spring wheat crop by 9 million bushels to 623 million, 14 million above expectations. USDA also took up the durum crop by 4 million bushels from its August estimate and revised lower the winter wheat crop by 5 million bushels.
As a result, wheat prices took a hit, but rebounded, only to trade lower gain in afternoon trading. We look for a good area expansion in 2019 amid expansion in winter wheat plantings. Prices are higher than this time last year.
See attached PDF for tables/charts
FI Price Projections:
· December corn may trade in a $3.50-$3.80 range; March $3.25-$4.00
· November soybeans are seen in a $8.05-$8.85 range, March $7.85-$9.15
· December soybean meal $305-$340 range; March $295-$400
· December soybean oil 27.80-30.50; March 28.60-31.50
- December Chicago wheat $4.95-$5.25; March $5.10-$5.90.
- December KC $5.00-$5.35; March $5.00-$6.00. (remain tight with Chicago)
- December MN $5.60-$6.25 range; March $5.75-$7.00
Terry Reilly
Senior Commodity Analyst – Grain and Oilseeds
Futures International │190 S LaSalle St., Suite 410│Chicago, IL 60603
W: 312.604.1366
AIM: fi_treilly
ICE IM: treilly1
Skype: fi.treilly
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Grain_Market_Snapshot092818.pdf