ProFarmer was struck down by the flu over the weekend and has really struggled this week to put some coherent thoughts together. But healthy or not, we probably would have struggled - it seems the markets themselves are searching for direction.
Several important reports out this week might help. The first report is the USDA’s early thoughts on plantings and the second is its Quarterly Grain Stocks report (this report has gained prominence this year as it is the most accurate read we have on demand for US grain). At week’s end the US Labor Department will release its latest unemployment report. Any or all of these reports could cause wild market price swings.
Corn plantings are expected to be back by about 2m acres to around 84m acres, but the range of guesses is large (plenty of uncertainty) at between 82-89m acres. For what it’s worth, we think that a 2m acre fall will be close to the mark. The reason why markets aren’t getting excited by this…..they know that demand has fallen by at least this. The size of the uptick in corn stocks as at 31 March will be just as closely watched.
Ditto beans. The average pre-report trade guess is 79m acres vs. 76 last year with guesses ranging from 76-82m acres. If estimates come in at the high end, it could put plenty of pressure on global oilseed values. But aiding oilseeds are signs that demand is holding up - it is expected that the US will revise US beans stocks lower in its report.
If the initial response to these reports is muted, it may signal that traders are waiting for the unemployment report. If US unemployment numbers are decisive one way or another, this would give traders a reason to amplify any moves they were intending to make following the USDA reports.
If you are interested in receiving this information and more on a regular basis, please call us toll free on 1300 302 143 to organise your subscription. Click HERE to subscribe online or Click HERE for a 4-week FREE Trial