7/28/16 Grain Market Update

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See the link for a Grain Market Update by Kyle McCarthy

http://www.farmcoop.com/images/E0159601/20160728_GrainMarketUpdate.pdf

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Kyle McCarthy – Grain Dept. Intern

I’d like to introduce Kyle McCarthy. Kyle has joined the  Grain Department  this summer in an internship position and will be focusing on commodity risk management.

Kyle is originally from Aurora, NE and is currently at Chadron State finishing up his master degree in business administration. He has also been involved in football and track among other activities at Chadron State.

Kyle is looking forward to the meeting  and working with as many customers of Farmer’s Coop as he can. If you get a chance stop in the Hemingford office and say Hi. He would enjoy getting to talk with you

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As of 3/25/16 Tucker Hamilton is no longer with Farmer’s Coop. He has gone back to his home area by Newcastle WY to farm and ranch. Everyone at Farmer’s Coop wishes him success in his new venture!

Tucker Talk: March 11, 2016

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Rolling Wheat

We have finally seen a rally in the wheat prices over the last week with a slight rally in corn.  Much of the rally in wheat is attributed to short covering by the managed money after the report on Friday afternoon showed them record short in both corn and wheat contracts.  Trade is also debating the implications of the early emergence of wheat.  There is still significant freeze risk in wheat producing areas and emerging wheat will need moisture in order to keep the condition high.  Weather projections show scarce rain over the next week in the southern mid-west wheat producing areas.

The European Central Bank (ECB) extended its quantitative easing on Thursday in order to try to stimulate the economy but when it came time for a press conference, the ECB Chair contradicted the ECB’s actions in his statement and caused turmoil in the currency markets.  This was corrected in the overnight trade and the European stock market is up this morning and the Euro is down relative to the U.S. dollar.  The current exchange rate is $1.00 to 0.9 Euro when only a year and a half ago it was $1.00 to $1.6 Euro.

On March 31 the USDA will release the stocks report for the first quarter of the year which is expected to be a mover and shaker in the market.  Some traders think that due to the exports being much slower this year that stocks could be higher than currently estimated, maybe even another record level.  Feed usage is expected to be higher than last year but it is uncertain how much and if that will be enough to offset the decrease in exports.  Warm weather this winter should have improved feed efficiencies. Weather risk is finally entering the corn market as heavy rains in the delta states prevent planting progress.

Tucker Talk: March 4, 2016

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White 4-Pod at FCE

The 2016 revenue protection spring price for corn is $3.86. This is the average December futures price over the month of February.  The harvest price will be the average December futures price over the month of October.

Corn exports did better than expected last week and even though total exports are behind last years, the exports last week were higher than the same week last year.  Gulf corn offers to Asia have finally drifted low enough to be within $0.05 of offers from Argentina which will leave the US open for corn bookings.

Crude oil prices rallied today to 2-month highs but traders consider it short-covering rather than a bullish change in fundamentals.

Increased weather risk has caused a $0.20 rally in wheat over the last 3 days.  Warm temperatures have caused wheat to break dormancy 4 weeks ahead of schedule in important growing areas.  Most wheat producing areas are still under statistically high probability of a hard freeze until March 31st.  Areas such as Kansas and Oklahoma will need more moisture in order to keep the wheat going but rains are having a hard time developing.  Large rallies will be limited by increased farmer selling and moving of on-farm grain stocks.

Tucker Talk: February 19, 2016

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Early Morning Sunrise in Hemingford

The state-run company of ChemChina purchased Syngenta a couple weeks ago.  ChemChina believes that this purchase will help advance the acceptance of GMOs with the populace of China. This is also a major step for China in moving towards improving their national corn yield by 25-30% through the applications of GMOs and the complimentary technologies.

The Conservation Reserve Program (CRP) is a popular choice this year with depressed prices across all commodities.  In October of 2015 there were 23.55 million acres signed up for the program with a cap of 25 million acres.  The deadline for the current sign-up period is February 26, 2016  That cap drops to 24 million acres next year and will remain there until 2018.

Recent warm temperatures across the mid-west U.S. have eliminated snow cover and caused wheat to emerge from dormancy in many ares.  Pictures out of Oklahoma and Texas show winter wheat 2-3 inches tall.  Concerns are arising over the increased risk of winter wheat freezing over the next 2 months.

Ergot was of significant importance in the 2015 wheat harvest at Farmer’s Coop locations with some wheat being rejected.  The acceptable level of tolerance for the presence of ergot bodies is 0.05% or about 10 bodies in a coffee can.  0.05% is an extremely low tolerance level and is the international standard.  There has been some confusion with Egypt over the last couple weeks.  Egypt rejected a load 2 weeks ago and it was thought that the issues were  worked out but then they rejected more loads this week.  Egyptian agricultural authorities announced that 0.05% would be accepted but offers to sell wheat to Egypt are scarce due to the confusion.  You would probably be leery too if you had a ship full of wheat rejected on delivery.  You can read more on ergot at the links below.

Why All the Fuss Over Ergot?

Ergot in Wheat: A Brief Summary

Climatologists met yesterday to forecast spring and summer weather conditions in 2016.  They concluded that given the current trend in the El Nino/La Nina pattern, there is an increased likelihood of above normal temperatures throughout the entire central region of the U.S. and an increased likelihood of below normal precipitation throughout the Great Lakes region. They predict that the current El Nino trend, which has moved from strong to neutral since January, will last through March.  If it moves quickly into a La Nina pattern we could see drought conditions across the mid-west.

Interesting News: Pope Francis, the internationally recognized head of the Catholic Church and Patriarch Kirill, the head of the Russian Orthodox church met last week.  This is the first meeting of the two leaders since the split of the catholic church in 1054 when each leader was excommunicated by the other.  This meeting has no doubt been spurred by the threat of ISIS against Christians all over the world.  The Catholic Church and the Russian Orthodox Church are planning on joining forces to combat the Muslim threat against Christendom.  Once again the Christian and Muslim worlds are in conflict but instead of the Christians invading the Muslim world (400 years of crusades) the Muslims look to be invading the Christian world (terrorism?).