Good morning! Corn continues to weaken this morning as it gapped 4 ¾ cents lower on the overnight open. The shockingly high planted acre estimate by the USDA estimate is still weighing heavily on the market. Soybeans were higher overnight as the reduction in acres to 76.7 million in yesterday’s report was 4.3 million acres less than the average trade guess.
Looking into the acre numbers more, planted acres at 90 million and PP acres at 11.2 would get 101.2 million acres of corn intended to be planted. Soybean planted acres were at 76.7 million, down 12.5 million acres from last year, so much of the loss in soybean acres went to corn. The jump in corn acres makes sense because of the cheap soybean prices and a jump in corn prices this spring but the 12.1 million increase in corn acres from last year, when adding in the PP acres, is not very probable. Corn PP acres might be overstated as it had a better payout than soybeans in many locations.
The yield estimate was left unchanged at 48.5 bushels per acre vs. the trade guess of 47.5. It is still early to have a strong indication of how yields are going to look as it is still early on a late planted crop. There are concerns the dryness could hinder pod fill.
Going forward, the harvested acres will be closely monitored as well as the yield estimate given the wet spring and the delayed planting for a large part of the Corn Belt. Crop conditions last night stayed flat in the good/excellent category vs. expectations of a slight drop due to the dry conditions last week.
Have a great and safe day!
U/Z 9 ¼ cent carry; Z/H 12 ¼ cent carry; Z/N 23 ¾ cent carry.
U/X 12 ¾ cent carry; X/F 13 ½ cent carry
Corn and wheat markets closed mostly lower while soybeans rose in active trade. Funds are in control of price action as many remain skeptical of yesterday’s USDA numbers. President Trump asked Japanese Prime Minister to buy a “huge amount” of U.S. farm products. Tyson plant fire to remain a weight on cattle. Warm and wet weather is forecast for the major growing areas for August 18-22.