Corn Jumps on USDA Report
Corn for December delivery rose 4.7% to $3.50 1/2 a bushel on the Chicago Board of Trade Tuesday, with traders reacting to a lower-than-expected acreage projection for 2020.
Soybeans for November delivery rose 2.4% to $8.82 1/4 a bushel.
Wheat for September delivery rose 1.1% to $4.91 3/4 a bushel.
Grain Stockpile Report Shows Effect of Livestock Hiccup -- Market Talk
14:13 ET - The USDA's quarterly grain stockpile report shows higher-than-expected stockpiles of US grains as of June 1 -- with the USDA projecting that corn stockpiles totaled 5.2 billion bushels while soybeans totaled 1.4 billion bushels and wheat totaled 1 billion bushels. The onset of coronavirus in the US is likely the reason for the higher inventories, especially when it comes to the consumption of grain feed by livestock. "Bigger corn stocks suggest that the livestock supply disruptions resulted in lower feed usage than the trade expected, more than offsetting quality issues remaining from the 2019 harvest," says Arlan Suderman of StoneX. (firstname.lastname@example.org; @kirkmaltais)
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Will Corn Trading Stay Bearish? -- Market Talk
14:43 ET - Corn futures reacted to a lower-than-expected planted acreage figure by rising dramatically after the acreage report's release at noon--going from down 0.1% before the report's release to up 4.6% near the close of trading for the day. Even so, it remains to be seen how long corn futures will be lifted on the strength of the report. "The report was a bullish corn shocker, but we doubt that US farmers were able to enter all those acres in Prevent Plant," says AgResource. "Our longer-term view stays bearish, but less so than before the report on the decline in US corn/soybean seeding." (email@example.com; @kirkmaltais)
Corn Production Likely Down 1B Bushels in 2020 -- Market Talk
12:44 ET - Implied corn production is likely down by as much as 1B bushels based on the USDA's data released today, says Terry Reilly of Futures International. "Implied 2020 US corn production suggests its down 1 billion bushels from the June WASDE after USDA lowered the planted area by 5.0 million acres from March Intentions," says Reilly. "Some producers may have decided you can't make as much money in some of these commodities than previous years." The USDA's quarterly stockpile report showed a higher-than-expected stockpile of corn, suggesting that demand is lagging more than expected following the onset of coronavirus. The USDA previously projected 2020 corn production at nearly 16B bushels. (firstname.lastname@example.org; @kirkmaltais)
Acreage Report Far More Bullish For Grain Futures -- Market Talk
12:29 ET - The USDA's acreage report, released at noon, showed lower-than-expected acreage figures for corn and soybeans planted by US farmers. 92M acres of corn and 83.8M acres of soybeans were planted by US farmers as of June 1, the USDA says--lower than projections of 95.2M acres and 84.8M acres respectively by analysts surveyed by The Wall Street Journal. "Shockingly low corn and bean acres likely reduces some of the downside risk," says Doug Bergman of RCM Alternatives. Following the report, corn is trading 4.5% higher, and soybeans are up 2.6%. (email@example.com; @kirkmaltais)
World Bank Approves $40 Mln to Combat Somalian Locust Swarms
The World Bank has approved $40 million of urgent funding to support Somalia in fight against the spread of locusts, the global lender said late Monday.
The grant is part of the bank's $500 million Emergency Locust Response Program, which seeks to respond to the threat posed by the locust outbreak and strengthen preparatory systems in affected countries within Africa and the Middle East.
Hogs Finish Higher as New Strain of Swine Fever Develops -- Market Talk
15:51 ET - Lean hog futures on the CME finish up 1.2% to 49.025 cents per pound, partially in reaction to the emergence of a new variation of swine fever spreading in China. "While there is no immediate threat to people, China is very cautious of any virus following the Covid-19 and African Swine Fever outbreaks," says Karl Setzer of AgriVisor. "There is now speculation on what China will do with infected hogs, and if it will lead to additional Chinese pork demand." Live cattle futures, meanwhile, finished trading down 0.2% to 96.275 cents per pound on Tuesday. (firstname.lastname@example.org; @kirkmaltais)