Friday Afternoon Comments (2/24) Corn finished the week with a slightly lower close after a quiet day of trading. CH was 1 ½ cents lower; CZ fell ¾ of a cent. Newsworthy features today included the weekly export sales report as well as the initial USDA 2017/18 balance sheet projections released this morning at the Outlook Forum. Neither held any significant bullish factors and the market continued its recent weak performance as plentiful U.S. and world supplies are keeping corn prices under pressure. The USDA’s first guess at the 2017/18 corn balance sheet showed ending stocks of 2.215 billion bu., down 105 million bu. from the current 16/17 estimate. Production is down 1.1 billion bu. in 17/18 but higher beginning stocks and 400 million bu. lower demand largely compensates for the lower production. Exports are projected to be down 325 million bu. as the USDA is expecting some business to be lost to Argentina, Brazil, and Ukraine. The weekly export sales report included old crop sales of 29.3 million bu. which was lower than trade expectations but still 10 million bu. more than needed on a weekly basis to reach the USDA’s 16/17 sales projection. An estimated 79% of Brazil’s safrinha corn crop has been planted which is about 15% more than was planted on this date a year ago.
Soybeans finished the day with slight gains. SH was 2 cents higher; SX gained 2 ½ cents. The market gleaned light support from the initial 2017/18 balance sheet projections released by the USDA this morning. The ending stocks projection of 420 million bu. matches the current USDA estimate for the 2016/17 marketing year despite the projected increase next year in planted acreage of 4.6 million acres. The USDA used trend line yield of 48.0 bu. /acre to get projected production of 4.2 billion bu. which would be 125 million bu. less than a year ago but still the second largest soybean crop ever. Demand is forecast to increase by 100 million bu. with exports claiming most of the increase on the ever increasing Chinese appetite. The weekly export sales report showed old crop sales for the week ended Feb.16th of 15.2 million bu. which was below trader expectations. Total marketing year to date sales are now 1.916 billion bu. which is just 134 million bu. below the USDA 2016/17 projection with 28 weeks of the marketing year remaining.
Comments from Mid-Co Commodities
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You can't go wrong doing the right thimg. Kevin Brown
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