Corn: The corn market has continued its rally over the early part of this week. However, the rally was cut a bit short due to a stronger U.S. dollar. This creates a bit of headwinds for corn futures. As we get further into the planting season, the size of the crop will start to be revealed in analyst reports. As of Monday, 94% of the Tennessee corn crop was planted while only about 75% of the national crop has been planted. Of those planted acres, 43% of the crop has already emerged. September corn futures were up a nickel from last week while the average local harvest basis strengthened by $0.03.
Soybeans: Soybean futures have started to trade sideways. Since the beginning of the week, soybean futures have traded in a roughly $0.03 to $0.05 range. Domestic demand for soybeans is expected to increase as margins for processors are incentivizing them to process more soybeans.
In regard to planting progress, 36% of the U.S. soybean crop has been planted with 10% of the crop has already emerged. November soybean futures have declined $0.12 since last week’s market update while the average local harvest basis improved by $0.03.
Wheat: Wheat futures are still facing an uphill battle due to the sheer amount of wheat supplies on a global scale. However, exports were better than expected for the week, which is supportive of higher wheat futures. According to the latest crop progress report, 68% of the U.S. winter wheat crop has begun to head out. This is about 12% higher than the 5 year average. The crop is looking to be a good crop overall as the USDA continues to rate 62% of the crop as being good-to-excellent. July wheat futures remained unchanged from last week’s levels while the average local harvest basis increased by $0.03.
Cotton: The U.S. cotton crop is well on its way to being planted. As of Monday, 40% of the crop had already been planted. This is in line with the 5 year average. For Tennessee, 50% of the cotton crop has been planted, which is higher than the 5 year average of 33%. December cotton futures closed at 61.40. Cotton futures continue to trade range bound and have been trading in a two cent range for the past 30 days or so. Until cotton supplies are reduced, any major price improvements will be hard pressed to occur in the cotton market. Cotton loan options, or equities, continue to be $0.10 to $0.12 for West Tennessee.
Take Home Message: Farmers continue to see grain prices trend upward, or at least stay near recent highs. Producers should evaluate their crop sales and percentages sold per acre when considering layering in additional sales at these levels.
West Tennessee Grain Elevator Bids: Grain Newsletter 5-20-2016
