Grain Marketing Highlights – August 20, 2010

Carl German, Extension Crops Marketing Specialist; clgerman@udel.edu

Countdown to Harvest
The first load of new crop corn on the Eastern Shore was delivered on or about August 5. Reports are also trickling in concerning new crop corn deliveries now being made in the Corn Belt. The 2010 harvest is now underway. It is going to be early and near record breaking for both U.S. corn and soybeans. A Perdue grain merchant predicted this morning that the Eastern Shore will be heavily into harvest by next week. The same is true for large portions of the Corn Belt.

The extent of harvest pressure on corn and soybean prices is likely to be minimized by production concerns in other parts of the world. Russia is in the news again concerning the possibility of having to make large increases in the amount of grain imported for the 2010/2011 marketing year due to their worst drought in over 100 years. The most recent estimate for Russian grain production indicated their 2010 grain harvest to be slashed by at least one-third of normal.

USDA Export Sales Report 08/19 07:35
Pre-report estimates for weekly export sales of soybeans (combined old-crop and new-crop) ranged from 69.8 to 80.8 million bushels. The weekly report showed total export sales of 82 million bushels, with old-crop sales of 6.7 million bushels bringing year-to-date sales to 1.51 billion bushels, above USDA’s demand projection of 1.47 billion bushels. Total shipments of 18.3 million bushels were below the 21.8 million bushels needed this week. This report should be viewed as bullish.

Pre-report estimates had weekly corn export sales at 51.2 to 66.9 million bushels. The weekly report showed total export sales of 107.3 million bushels, with old-crop sales of 23.4 million bushels bringing year-to-date sales to 2.06 billion bushels, above USDA’s revised demand projection of 1.975 billion bushels. Total shipments of 39.6 million bushels were below the 76 million bushels needed this week. This report should be considered bullish.

Pre-report estimates for wheat ranged between 34.9 to 45.9 million bushels. The weekly report showed total export sales of 51.9 million bushels, well above the 19.3 million bushels needed this week to stay on pace with USDA’s revised projection of 1.2 billion bushels. Shipments of 21.2 million bushels were below the 24.8 million bushels needed this week. This report should be viewed as bullish.

Market Strategy
Currently, Dec ‘10 corn futures are trading at $4.34 per bushel; Nov ‘10 soybean futures at $10.23; July ‘11 SRW wheat futures at $7.16 per bushel; Dec ‘11 corn futures at $4.39; and Nov ‘11 soybean futures at $10.07 per bushel. These prices represent good pricing opportunities for both the 2010 harvest and for pricing a portion of the 2011 crop.

World production concerns will make it necessary to revisit sales decisions on any unsold portion of the 2010 harvest later in the season to determine whether storage is warranted.

For technical assistance on making grain marketing decisions contact Carl L. German, Extension Crops Marketing Specialist.

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