Wednesday April 13, 2011



Commodity
Period
Price  
Weekly Movement




Corn CBOT
May. 
7.55 ¼   
?
7 ¾  
cents
Soybeans CBOT
May.
13.36 ½  
?
40 
cents
Wheat CBOT
May. 
7.52 ¾    
?
29 ½   
cents
Wheat Minn.
May. 
9.04 
?
50 ½      
cents
Wheat Kansas
May. 
8.85  
?
54 ½      
cents
 
 
 

 
 
Canadian $
Jun. 
1.0374 
?
3
points
CORN
Monday afternoon’s first USDA corn planting progress update of the new growing season showed 3 percent of the U.S. crop had been planted as of Sunday, on par with a year earlier and with the five-year average pace. The record progress for early April is 4 percent, which was accomplished in 1999 and 2000. Illinois was the only major Midwestern corn state where significant planting progress took place last week, at a pace above their historical average.
 
In their previous stock update, the USDA left corn ending stocks at a low 675 million bushels. This leaves corn in a delicate position as any shift in production expectations such a delayed planting could send the futures prices higher.
 
It is interesting to note that for a brief time, May corn futures traded above May wheat in the Chicago Exchange. This inversion has not happened since 1996, which coincidently was the last time corn stocks were at these low levels.

SOYBEANS
China continues to be the focus of the soybean market. As China is the world leader in soybean imports, any sign that they may cut these imports puts pressure on global prices. Due to poor crushing margins in China and falling soymeal prices, their crushers are operating at lower capacity than in previous years.
 
The negative pressure recently felt in the soybean market has lead to speculation that this will lead to importers and investors bringing money back into the market.  The recent selloff was triggered more by risk aversion through the commodity spectrum rather than a change in the fundamental supply-and-demand balance outlook. 
 
Production from Brazil, Argentina, Paraguay, Uruguay and Bolivia will reach 132.7 million metric tons this year, 2.8 million tons more than previously forecast, according to a recent report from Oil World. There is an extremely large South American crop that is in the process of being harvested. The remaining import demand is certainly shifting to South American origin.

WHEAT
Commodity values fell sharply the first half of the week after Goldman Sachs recommended that clients take profits, as signs of “demand destruction” emerge in crude oil. Crude oil fell more than 3 percent, dragging corn, soybeans, and wheat with it.

The U.S. winter wheat crop had the lowest government rating in nine years as dry weather persists in the southern and central Great Plains. About 36 percent of the crop was good or excellent as of the 10th of April, down from 65 percent a year earlier.  It should be noted however, that the SRW is generally in much better shape that the HRW. 

The Bank of Canada kept its benchmark rate at 1 percent, where it has been since September, and reiterated that further increases would be “carefully considered.” The Canadian dollar last week reached the strongest since November 2007 on higher commodity prices, which make up 45 percent of our exports.

Current contract prices for April 13, 2011 at the close of the markets are as follows:
SWW at $250.67 per tonne ($6.82 /bu.), SRW at $252.44 per tonne ($6.87 /bu.), HRW at $270.14 per tonne ($7.35 /bu.), and HRS at $316.63 per tonne ($8.62 /bu.).

       Ontario Grain Market Commentary for April 13, 2011
       By Todd Austin, Grain Farmers of Ontario