HIGHLIGHTS
· MARKET TREND—Higher: CK, up $.0150; SK, up $.0975; WK, up $.02; KWK, up $.0375
· MACRO—China returns from holiday; Fed minutes are out today; ADP payroll data out with 180 K new jobs estimated to have been created in March. ASIA—Higher: Nikkei, +0.27%; Shanghai, +1.48%; Hang Seng, +0.57%. EUROPE—Mostly higher: DAX, -0.29%; FTSE, +0.16%; CAC, +0.16%. Wall STREET-Futures are mostly lower: DOW, +3; S&P, -1; NAS, -3.50. EXTERNALS: Sep $ Index, +0.024 @ 100.290; April Gold, -$3.50 @ $1,252; May Crude, +$0.50 @ $51.53
· T-storm Weather: In the U.S., a powerhouse system produces a swath of heavy rain and some snow from the central Plains through the southeast two-thirds of the Corn Belt through today. Temperatures briefly turn unseasonably cold after the system passes, causing minimums to fall to around freezing in most winter wheat areas one or two times through Sat. morning. A sharp warm-up this weekend precedes the next series of storm systems that produce widespread rain across the central U.S. next week
· Corn: CK up $.0150 @ $3.6475; CN up $.0150 @ $3.7225 Funds reversed course and sold 10 K on Tuesday
· SB: up $.0975 @ $9.4750; SN up $.1025 @ $9.5875. Funds: sold 2 SB, 0 SBM, bot 1 SBO. Board Crush: $.86, +2; LY; $.58
· Wheat: WK up $.02 @ $4.29; WN up $.0225 @ $4.4225. The funds were buyers of 2 K yesterday
CORN/SORGHUM
· Consultant: Brazil corn crop est. steady at 88.0 MMT. Conditions for safrinha (double crop) corn have generally been good. Only area of concern is a relatively dry pattern in southern Brazil, but near-term forecast is wetter (see below)
· T-storm Weather: In South America, widespread rain affects southern Brazil and Paraguay over the next week, breaking dryness across the southern ~25% of safrinha (double crop) corn
· ATI Research: U.S. corn planting pace by mid-May has at times correlated with how much change in acreage is seen in USDA JuneAcreage report v. March Prospective Plantings ; e.g. more rapid pace=more acres in June (e.g. 2000, 2004)
· Ethanol margins: $0.28 per gallon—up from $0.18 last week but below $0.36 in 2016. EIA report at 9:30 AM CDT
SOYBEANS/WHEAT
· Consultant: Brazil soybean crop est. increased 1.0 MMT to 109.0 MMT and could rise further. According to AgRural, nationwide harvest is 74%. Yields keep getting bigger and bigger, especially in Rio Grande do Sul (#3 producing state)
· T-storm Weather: Excessive/extreme rain past 1-2 weeks across parts of Argentina affected 4% to 8% of soybean crop
· Chicago 2017 July wheat futures closed at $4.40 on Tue.; one year ago, Chicago 2016 July futures settled at $4.80 ¾
· T-storm Weather: Minimum temps fall to around freezing for most U.S. HRW wheat in Plains the next two mornings, & SRW wheat in Corn Belt Fri. & Sat. mornings. Plains warm sharply Sat.-Sun. but quickly turn cooler early next week
ENERGY
· Higher: CLK17, +0.50 @ $51.53; EBM, +$0.52 @ $54.69; EBM-QCLM, +.04; RBK, +$.0087; NGK, -$0.009; HOK, +$.0161
· EIA Report Estimates (API): crude oil, -0.2 (+1.8); Gasoline, -1.6 (-2.6); Distillates, -0.7 (-2.0)
· Cash ethanol markets were mostly higher on Tuesday: Chicago up ¼; New York added ½; Gulf increased 1 ¾; Dallas gained 1; Tampa firmed ½; but LA was 1 ¾ lower at $1.80 ¾ per gallon
· Ethanol RINs were higher on Tuesday: widened $.0140 on Tuesday, +$.07270/gallon, premium RBOB
LIVESTOCK/POULTRY ;
· Choice boxed beef values fell $1.74 on Tuesday to $211.69, are down $7.88 v. a week ago & the lowest since March 6
· Tuesday’s week-to-week decline of $7.88 in choice boxed beef values was the largest since Jan. 13
· USDA mandatory pork carcass eased a penny on Tuesday to $75.07, and is $1.96 lower compared to last week
· CME Lean Hog Index was $0.52 lower on Tue. at $67.07. April futures fell $1.125 and are $3.395 below the index
Sources: Bloomberg, Dow Jones, AP, DTN, T-storm Weather