Corn Futures Slip on Record-Low Ethanol Production
Corn for May delivery fell 0.5% to $3.30 a bushel on the Chicago Board of Trade on Wednesday on continuing weakness in ethanol fundamentals and managed money investors opting to cash in short positions in corn ahead of the WASDE report. Wheat for May delivery fell 0.2% to $5.48 1/4 a bushel. Soybeans for May delivery fell 0.1% to $8.54 1/2 a bushel.
The ethanol industry is in worse shape than most people thought, said Terry Reilly of Futures International. Production of the biofuel fell to 672,000 barrels per day, the lowest since the EIA started tracking output in 2010, while stockpiles at 27.1 million barrels reached a record high for the week ended April 3. Ethanol producers continue to struggle narrower margins and the effects of the coronavirus pandemic on demand.
Wheat Exports Expected to Stay Weak -- Market Talk
14:21 ET - US wheat exports are expected to stay minimal this week, after last week's export sales report hit a 2019/20 marketing year low. Traders tell WSJ that they expect exports to total anywhere from 200,000 to 500,000 metric tons for both the 2019/20 and 2020/21 marketing years. With coronavirus' spread worldwide wrecking the export sales market, wheat appears to have gotten the brunt of demand destruction. Meanwhile, corn sales are expected to remain high--with traders forecasting sales anywhere from 1.2M to 1.7M tons in this week's report, which accounts for sales up to April 2. (email@example.com; @kirkmaltais)
ConAgra's Sales at Retailers Continue to Surge -- Market Talk
0951 ET - Stockpiling by US consumers in the face of the coronavirus pandemic continues to drive massive gains in retail-store sales for ConAgra Brands. The maker of Chef Boyardee pastas and Healthy Choice frozen meals says retail sales of its products rose 30.6% in the week ended March 29. Sales of consumer staples in its grocery and refrigerated business surged 55.3%, ConAgra says, citing data from research firm IRI. ConAgra also reaffirms the FY20 guidance it gave last week. ConAgra slips 0.6% to $30.26. (firstname.lastname@example.org)
STORIES OF INTEREST:
Prospect of Chinese Grain Export Demand Return Weakening -- Market Talk
13:32 ET - Grains traders are starting to lose hope Chinese demand for agricultural goods will expand strongly, to close to the elevated $36B figure agreed to in the Phase One trade deal signed in January. "The spread of COVID-19 has unquestionably disrupted many a plan and forecast, and one of the questions moving forward will be, has it completely changed some patterns and habits?" says Dan Hueber of the Hueber Report. "I believe there is no doubt that a global event as we are experiencing this year will do more to change people's attitudes and behaviors than would a thousand trade wars." (email@example.com; @kirkmaltais)
CHS Say DOJ Closes Bribery Probe -- Market Talk
15:33 ET - Federal prosecutors closed a foreign bribery probe into CHS Inc., the global agricultural company says. CHS had previously disclosed that it contacted the US Justice Department and Securities and Exchange Commission to report the discovery of a small number of reimbursements made to Mexican customs officials in connection with the inspections of grain crossing the US-Mexican border by railcar. The company said it has cooperated with the DOJ's and SEC's evaluations of the company's potential liability under the US Foreign Corrupt Practices Act. A civil investigation by the SEC is ongoing, CHS says. (firstname.lastname@example.org; @dgtokar)
McDonald's Warns Of Difficult Decisions Ahead as Coronavirus Hurts Sales
McDonald's Corp. said sales for its existing base of restaurants globally fell 22% last month as the coronavirus spread and the U.S. economy and others around the world shut down.
The hamburger chain on Wednesday said same-store sales, or those at restaurants open at least 13 months, increased in January and February but then dropped sharply. In the U.S., McDonald's largest single market, March same-store sales fell 13% from a year earlier as elected officials issued guidelines requiring restaurant dining rooms to close and consumers stayed home.
Livestock Are Mixed After Yesterday's Limit-Up Close -- Market Talk
15:14 ET - CME livestock futures are mixed, with live-cattle futures finishing 2.2% higher at 86.675 cents a pound while lean-hog futures fall 2.3% to 51.45c. For cattle, that brings futures back close to where they started last week before toppling due to concerns about abundant supply available in the US market. Even with today's loss, hogs are also up for the week, rising 17% since Monday. (email@example.com; @kirkmaltais)