The low on Tuesday matched the low seen on October 1. Excessive rains continue across the corn belt. There are reports of small corn plants yellowing due to nitrogen leaching out of the soil from excessive rain in the western corn belt. Excessive moisture may be harming crops but the trade is still following the old adage of “rain makes grain.” A similar wet year in 1993 did not see trade fully appreciate the harm of too much rain until October of that year.
Trade is concerned about feed usage and corn acres in the June 30 stocks report. There is concern that feed usage estimates are too high and that corn acres will need to be reduced due to wet weather preventing planting. However, there is also concern that acreage estimates were too low to begin with. If this is the case then the acreage estimate may not change at all. If feed usage estimates are reduced and corn acreage remains the same, there will not be good news for prices as this is not good for stock levels which are already high from old crop carryin.
The well followed Informa has left their corn acreage estimate unchanged from March at 88.7 million acres which is below the USDA’s 89.2 million acre forecast in March.
Last Friday, Egypt bought 180,000 tons of wheat from Russia and Romania at values 66 cents under US prices. When compared to the highest bidder, the US was still 49 cents too expensive. Despite several reductions in estimated wheat production around the world, with Australia, Russia, and France all reducing estimates, wheat values decline. Trade believes that excessive moisture will result in more bushel. This may be true but the value of those bushel significantly declines. Trade may not realize this until later in the season. It currently looks like protein levels below 12 will be severely docked but there should be a good premium for higher protein levels.
In Nebraska, winter wheat condition rated 14 percent very poor, 20 percent poor, 31 percent fair, 33 percent good, and 2 percent excellent. See the report below for more information.