Friday, May 1, 2009

Wow! There was a surge of new buying coming into corn, soybeans and wheat pushing the market to new highs in the last two minutes of today's trade.

Corn shook off the H1N1 by mid week, wet weather forecasts causing delayed planting progress (estimates from 27 to 35% vs. 55% 5-year average)and less competition from Argentina corn exports were supportive of flat prices; the May contract closed up $.28 from last Friday. Western belt planting progress expected at a strong 63%, while Eastern belt at less than 10% planted by Sunday is quite a spread west to east! The 6/10 and 8/14 forecasts seem to be unfavorable in the eastern belt for planting, but that can change quickly. Note, we saw very heavy cash grain movement today as cash corn hit several week highs and maybe we are optimistic about getting into the field next week? Lets hope that is the case.

Soybeans were up $.36 today and gained $.57 for the week and seem to keep rolling along making new highs for the year today with cash soybeans delivered to Morris closing at $11.01 today. Market attention continues to focus on tightening old crop supplies due to the continued strong export demand, especially from China, as well as the fact soybean production estimates for S. America continue to decline. Argentina’s crop is estimated by one interior source at 34.0 MMT (last USDA est. 39.0). The fact that some acres, especially in the eastern belt, may move from corn to beans is weighing on new crop to some degree, but overall beans seem to have found some bullish momentum that is hard to slow. As with corn and wheat, the swine flu story moved to the background as the week progressed.

Have a good weekend, Phil Farrell