Weekly Market Recap April 3, 2020

Corn Emergence 2

May corn futures finished the day down 2 3/4 at $3.30 3/4, off more than 15 for the week. December corn gained 1 for the day to finish at $3.50 3/4, but that is down 13 1/2 since last Friday. 

May soybeans lost 4 1/2 today, ending at $8.54 1/4, down more than 27 this week. November beans lost 1 1/2 today, to finish the week at $8.61 1/2, off more than 15 for the week. 

The big story this week was the USDA Prospective Plantings and Quarterly Stocks that was released Tuesday. Starting with Prospective Plantings: Corn acre estimates ranged from 92.5 to 96.4 million acres. We’ve been throwing around 94 to 95 million acres for a while now as a possibility. The actual number blew everything out of the water at almost 97 million acres. That’s up 3 million from the USDA’s February outlook and almost 7 million more than last year. The record high estimate for this report was 97.291 million in 2017.

Soybean acres were a little more in line with expectations, coming in at 83.5 million with estimates ranging from 82.7 to 87.1. This is down 1.5 million from the Feb outlook but is still 7.4 million more than last year.

For quarterly stocks as of March 1st:

Corn stocks came in at 7.953 billion bushels, with estimates ranging from 7.825 to 8.492. So this was somewhat on the lower end of the estimated range and 660 million bushels lower than the same time last year, meaning that demand has been better than we thought, at least up until now.

Soybean stocks came in at 2.253 billion bushels, in line with the average estimates, ranging from 2.075 to 2.701. Comparing this to last year’s report at the same time, we are down 474 million bushels. 

Earlier today, there was an announcement of a sale made today to China of 567,000 metric tons or 22.3 million bushels. The vast majority of that, about 20 million bushels, is for shipment during the ‘20/21 crop year. That might have been what kept December corn futures positive today. 

This week’s EIA report showed the first insight into how recent reductions in gasoline demand have impacted the ethanol industry:

  • U.S. ethanol production dropped last week to 247 million gallons, from 295 million the previous week. This works out to a 17 million bushel demand reduction per week and is the lowest weekly production since Sept 2013.
  • Looking at gasoline demand, last week came in at 6.659 million barrels per day or 102 billion gallons. This is the lowest single-week demand since January 1994.

It’s been a while since we’ve talked about ASF in China, but it looks like the world’s top pork producer is starting to rebuild its herds.

  • 6 planes carrying more than 4,000 high-quality French breeding pigs have arrived in China so far this year, first of expected dozens of plane-loads.

Next week we’ll have the USDA’s April WASDE report. That will be Thursday at 11 AM. We should expect to see some changes in demand, especially for corn. 

Also, next Friday, April 10th is a CBOT holiday, so no markets that day. 

Here is some good advice overheard recently: 

In uncertain times, you need to ask yourself these 4 questions: 

  • What do I truly know? Or, what do I know to be absolutely TRUE?
  • What don’t I know? Or, what more is out there to understand better? 
  • What do I need to know? Or, what will help me do my job better?
  • How do I learn what I need to know? Or, who do I know that can help me?

These are not only good words to remember in these times, but also good words to live by. Let us know how we can help with any of your concerns about marketing grain. Just contact your local Grain Marketing Advisor. 

For more information about this week, please tune in to our weekly podcast: https://landuscooperativeexperience.podbean.com/