AgriVisor Morning MarketWatch

Thursday, May 06, 2021
Even though planting is well underway across the United States we continue to hear debate over what we will see for acreage. In the March planting intentions report the USDA published acreage estimates of 91.1 million corn acres, 87.6 million soybean acres, and 44.8 million acres of wheat. These were immediately disputed with trade thinking actual plantings should be higher given futures values. Since the March numbers were released, we have heard reports from the country that would support higher plantings than indicated in the intention’s numbers, but the question now is how much, and to what crop. Some reports indicate actual plantings will be closer to 94 million acres of corn and 90 million of soybeans, but these seem high. There are also reports that indicate plantings will increase around 1 million on both corn and soybeans, and these seem more likely. While futures would support higher plantings, inputs have also increased which may deter additional acreage. We also have to be aware that old crop futures have rallied more than new crop which is distorting some outlooks. The current price ratio between new crop futures has narrowed to 2.35:1 which favors corn plantings over soybeans, but most producers feel soybeans have a better chance of appreciating, causing further uncertainty.  

* Domestic usage on track to meet USDA estimates
* Ethanol stocks unexpectedly increase
* CME to end nearly all open outcry contracts 
* Tight input supplies reported across US
* Transportation issues a leading cause
* Also hearing of low crop protection supplies
* Canada ups grain import forecast
* Overbought indicators not deterring fresh buying
* Importers waiting for market break
* China to return from holiday today

* Argentine corn harvest remains slow
* Brazil dry next two weeks
* Record Ukraine crop forecast
* Cash market seeing localized basis pushes
* Brazil may be seeding larger acres
* New crop sales highest since 2013
* US crush margins creep higher
* Brazil commitments up 6% from last year
* Global oilseed values remain high
* Soy oil stocks continue to tighten 
* Ukraine continues to raise production 
* Ukraine also raises exports 3.5 mmt
* China taking 1/3 of US exports
* Global weather turns more favorable
* Yearly exports 86% of estimates 
* March beef exports a record 300 million pounds
* March pork exports a record 728.8 million pounds
* China’s hog herd slow to rebuild
* Likely to be 2022 before replenished
* China sow herd -50% in some regions

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