THE LAND — AUGUST 21/AUGUST 28, 2020
www.thelandonline.com — “Where Farm and Family Meet”
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Weather, exports continue to drive soybean market NYSTROM, from pg. 18 commitments at 480.4 million bushels compared to just 184.3 million on the books last year. New crop sales are the highest for this date since 2013. Weekly ethanol production was up 8,000 barrels per day to 926,000 bpd. Ethanol stocks were 520,000 barrels higher at 20.3 million barrels. Margins improved a penny to 9 cents per gallon. Gasoline demand remains 10 percent behind last year. China continues to sell state reserve corn in weekly auctions. They intend to auction corn every week through September. So far this year they have sold 51.9 million metric tons from reserves. Steady demand from China may be expected into the fourth quarter. Outlook: Traders continue to decipher what Iowa’s crop losses will likely be considering favorable conditions in other parts of the corn belt will make up some of the shortfall. No matter how you slice and dice it, we do have a big crop headed toward us. Are the harvest lows already in? It’s a toss-up, but can you risk it if you have catch sales to make before you hit the field? For the week, September corn was 2.5 cents higher at $3.27, December corn showed a 2.5 cent gain to close at $3.40.5, with December 2021 corn up 2 cents at $3.74 per bushel. SOYBEANS — November soybeans gapped higher Aug. 17 on dry conditions centered in west central Iowa. On the next day, we broke an eight-day streak of daily export sales announcements, but still posted double-digit gains. The anticipated trade discussion between the United States and China scheduled for Aug. 15 were postponed, but the trade took it as “no news is good news.”
Scheduling conflicts were cited as the reason for the postponement; but in later comments, President Trump said he wasn’t ready to talk to China. Virtual talks are expected to take place before the end of the month to discuss Phase 1 trade progress. The July National Oilseed Processor’s Association crush also lent support at a record for the month at 172.8 million bushels. Daily soybean sales announcements resumed which moved soybean prices sideways. There have been only three business days this month when we didn’t have a soybean export sale announcement. The one day this week when we were sans an export announcement, soybean prices pushed lower to test their 200-day moving average support. Heading into the weekend, China purchased 15.75 million bushels of new crop soybeans and another 14.5 million bushels were sold to an unknown destination. For the week, daily releases totaled 22.75 million bushels to China and 19.3 million bushels to unknown. This didn’t faze traders and the market remained in the lower half of the week’s trading range, but above the 200-day moving average support level at $9.01 per bushel. There is a downside gap in November soybean futures from $8.99.5 to $9.01.25 per bushel. The Midwest Crop Tour found mostly-as-expected pod counts across the tour which were higher than last year’s tour numbers. Pods in a 3x3 square, by state and vs. last year’s tour figure: Minnesota 1,086 vs. 965.3; Iowa 1,146.3 vs. 1,106.9; and Illinois at 1,247.4 vs. 997.7 last year. If we get the advertised rain, we’ll have a huge crop ready for market soon. Soybean conditions for the week ended Aug. 16 fell 2 percent to 72 percent good/ excellent. Iowa’s rating fell 8 percent, Illinois down 2
percent, and Minnesota unchanged. Ninety percent of the U.S. soybeans were blooming vs. 94 percent average with 84 percent setting pods vs. 79 percent average. Like corn, the tour soybean yield has been running below the U.S. final yield. Weekly export sales for old crop showed net cancellations of 500,000 bushels. This is not surprising as we approach the end of the marketing year and sales get rolled forward or cancelled. Old crop commitments stand at 1.745 billion bushels compared to the USDA outlook for 1.65 billion bushels. New crop sales were as expected at 94.5 million bushels after a string of daily announcements. We have nearly four times new crop sales on the books vs. last year. New crop sales are the highest for this date since 2015. U.S. soybeans are the cheapest origin through January/February, but then South American supplies should whisk away our demand. Outlook: There is a gap in November soybeans from $9.01.25 down to $8.99.5 per bushel. For the week, November soybeans were 6 cents higher at $9.04.75 and November 2021 soybeans were 8.5 cents better at $9.15 per bushel. Weather and on-going export announcements will determine where we go from here, but recent buying hasn’t done much to engage buyers. If the rain develops as advertised, prices should come under pressure. Nystrom’s Notes: Contract changes for the week as of the close on Aug. 21: Chicago September wheat rallied 27.25 cents to close at $5.27.25, Kansas City jumped 20.5 cents to $4.45.75, and Minneapolis wheat was 17.5 cents better at $5.15 per bushel. v
Seed costs will come down as more seed is grown FIELD DAY, from pg. 13
There are about 24,000 to 27,000 hemp seeds in a pound. Seeding rates are 25 to 45 pounds per acre said Kubista, so figure seed costs of $125 to $135 per acre at this stage. His ambitions are seed at $3 to $3.50 per pound as U.S. seed production ramps up. His take on hemp’s future? “The demand is on the fiber side,” Kubista said. “I have a couple growers in northern Minnesota already into production contracts with clothing firms North Face and Patagonia. My goal is to provide seed to the Seehusens and help with connections to end users of their processed hemp products.” Kubista said he has shirts, sweatshirts, even shorts made from hemp fabrics. His wife recently purchased shoes made of 100 percent hemp. “My hemp shirts are comfortable and durability is a plus.” “I have supplied at least 14 universities with hemp seed for their expanding research trials. University trials, I think, will be an important information source. Yes, I’ll have some shareable data with you
shortly,” summed up Kubista. Another observer at Prairie Producers first field day was Erik Petersen, President of F&M Bank. “Some banks and farmers are a bit nervous and understandably so,” stated Petersen. “At our bank we take a long-term view. We’re keenly aware of marketing cycles. Today you are hearing about Minnesota being in the top five in farm bankruptcy numbers. This huge crop coming on will temper this crunch somewhat — plus timely marketing helps too.” “People know the Seehusens. They’re long-time fixtures in our community — starting with their Erik Petersen dad who launched his own agribusiness venture very likely before his sons were born. Paul was a teacher here at Olivia when I was in high school. They’re a great family. I respect the ambition, the optimism and their hard work. “Anytime you put creative minds at work in creat-
ing new markets for our farm production it just opens new avenues — not just for our area farmers, but for communities in general. So how will I relate to farmers intending to grow this new crop next year? Lots of numbers being generated already this first year with the Seehusens and their first-year growers. Plus we know our State Department of Agriculture and Harold Stanislawski with Ag Utilization Research Institute are gathering incredible amounts of information also. I’ve got lots of confidence in Tim, Paul and the outstanding farmers in Renville County. Sure, a few mistakes now and then, but for the most part these folks think diligently with positive ambitions.” Petersen is optimistic some black ink will be working for most of his farmers this year. “It’s been a turbulent year for livestock producers with processing plants shutting down. But most are pretty well positioned to do just fine.” And he’s positive on this new industry called hemp farming now ramping up in Renville County. v
