AgriVisor Morning MarketWatch

Wednesday, May 05, 2021
Significant basis pushed are being paid across much of the United States on both corn and soybeans. One reason for this is the high margins processors are receiving, especially on soybean crushing. Many plants are now reporting crush margins of $2.00 to $2.50 per bushel. This is allowing them to pay elevated bids for soybeans, with premiums of $1.00 per bushel to the futures being reported in some regions. Ethanol margins are not as strong, but manufacturers are reporting premiums for their distiller grains, which is keeping bids elevated for that industry as well. While these elevated margins are one reason for the higher basis incentives we are seeing, concerns over future availability are also a factor. There are concerns in the cash market that stocks will be nearly impossible to buy prior to the next harvest, especially from the farm. The majority of the movement that may be taking place in late summer could be from commercial elevators which tend to warrant higher bids. As a result, processors are more willing to pay a premium now rather than later on. There is also some concern on what the quality of the inventory will be later in the marketing year, giving buyers further incentive to push for coverage now. 

* Whit House pushes cover crop usage
* Forward contracting of new crop is slow
* Buyers passing on US offers 
* Inflation concerns building
* ASF continues to spread in China
* Market volatility expected to rise
* Ethanol stocks expected to decline in today’s report
* China remains on holiday until tomorrow
* Argentina exports $3 billion of goods in April
* Planting progressing rapidly

* Wheat feeds cuts lobal corn demand
* China accounts for 47% of unshipped US sales
* New crop sales -1% from last year
* More reductions to Brazil crop
* Brazil crop est range from 90 mmt to 109 mmt
* Global market correcting
* Russia to lower export tax July 1st 
* More rationing still needed
* China has 110 mbu US new crop bookings
* US loadings +64% from last year 
* EU lowers usable production to 124.8 mmt 
* EU to see high feed quality wheat
* Ukraine crop to increase 10% from last year
* Ukraine exports to approach 21 mmt
* New crop sales up 30% from last year 
* Cash cattle -$1.00 from last week
* Seasonals point to highs in cash cattle
* Cattle/Hog futures nearly equal
* Yearly beef sales up 25% from last year
* China lost 305,000 sows in 1st quarter

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