Grain Notes 2/20/2020 PM Comments 

Good afternoon. Markets slipped again today with both corn and soybeans down. March corn was down 2 to 3.7850 and December corn fell 2 1/4 to 3.8850. March soybeans fell 5 to 8.9275 and November soybeans were down 5 1/2 to 9.1750. Most of the focus today was on the USDA Ag Outlook Forum with the number coming out as expected with the USDA projecting 94 million acres of corn and 85 million acres of soybeans for 2020. No yield for either was given, but the projected farm price for corn was 3.60 which is 25 cents less than this year implying a large corn yield.  The USDA’s Ag forum numbers did not include much from the Phase 1 agreement as it’s not specific enough to generate a forecast. Weekly ethanol production was up slightly this week as ethanol stocks continue to grow. Rumors continue to suggest the Chinese have bought 5 cargoes of beans off the PNW because of the slowest to harvest in Brazil even as their offers continue to get cheaper. In outside markets the dollar index is up .18 to 99.88, oil is up 48 cents to 53.77, and the down is down 152 points. 

  • As a reminder basis contracts against the March futures will need to be priced or rolled by the end of next week. Please give us a call on what you would like to do. 
  • Basis still remains firm in the area with Sunbury having very strong levels at -2 the March. Sunbury also has a free delayed pricing program until June 30 to relieve you of any quality concerns which have been popping up frequently. 
  • Lots of numbers from the USDA in the Ag outlook forum today. As mentioned the projected acres for corn are 94 million and 85 million for beans. Complete S/D information will be given tomorrow, but projected corn prices are 25 cents lower for the 2020 crop and the same for beans at 8.80. The USDA’s Ag forum numbers did not include much from the Phase 1 agreement as it’s not specific enough to generate a forecast. The USDA did highlight that farm net incomes plus government assistance put 2019 farm revenues at their highest in 5 years.
  • Also of interest from the USDA is the Agbarometer (a measure of farm optimism) is at an 18 month high after making their low in May of 2019. The USDA also noted that that farm bankruptcies were up this year and at 7 year highs but only at the upper range of the last 20 years and a fraction of the number in the 1980s crisis.
  • Weekly ethanol production gained 7 thousand barrels per day over last week to 1040 tbpd. Apparently demand isn’t keeping pace as stocks hit a record level by 313 tb today to 24.78 mln barrels. Stocks are 3.6% larger this week than a year ago.
  • Funds today were estimated sellers of 11,000 contracts of corn and 6,000 contracts of soybeans. They are an estimated 86,101 contracts short in corn and 87,412 contracts short in soybeans.

Have a great evening.