Someone will be surprised with the USDA crop progress and condition numbers released at 3 this afternoon. Some of us will shrug it off as a best guess estimate of a moving target and will take into account the very subjective criteria used and the people making these decisions. It’s an art and not a science! Regardless, we’ll be talking and trading weather forecasts tomorrow.
The USDA issues it’s winter wheat production estimate for conditions as of June 1 tomorrow at 11:00 Chicago time as well as supply/demand projections domestically and worldwide. They’ll give us some fresh international production figures, too! As always, we preach the Gospel of going into government reports as even and open minded as possible as the USDA has been known to be surprising!
The trade might be anticipating a larger winter wheat production estimate this month as compared with the figure issued in May. The argument might be whether the bushels harvested or just ready to harvest are milling quality or feed. Cool and wet is not what’s needed right now as sprout damage occurs in a cool and wet environment. Test weights are suffering and hard red wheat is already priced to be fed as flat price is below corn in many interior locations. We’re in the gut slot of harvest in the next three weeks and end users are hoping for more hot and dry to achieve a better quality. Watching the skies everyday!
It appears that the markets may be on hold or stalling awaiting weather information. It’s the end of the beginning of the weather market with corn and bean plantings as we’ll be sensitive all Summer and early Fall as given the time constraints we’ll need perfect temperatures and timely moisture and an extended growing season to achieve trend line yields.
We still see no reason to own old crop corn or bean spreads. Wheat spreads can be very violent this year depending on harvest quality.
The information contained on this site is the opinion of the writer and obtained from sources cited within the commentary. The impact on market prices due to seasonal or market cycles and current news events may already be reflected in current market prices.
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