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E-Visor Reports: Market Watch

 
Friday, June 12, 2020
Very few changes were made to the US balance sheets from May to June, which is not that surprising. Corn ending stocks were bumped higher by 5 million bu to a 2.1 billion bu total. This carried over to new crop where ending stocks increased to 3.23 bbu. Soybean carryout increased 5 mbu on old and decreased 10 mbu on new crop. This put ending stocks at 585 mbu for old crop and 395 mbu for new crop. We did see and adjustment to 2019 production from a resurvey of harvested acres in North Dakota. This decreased old crop corn production bu 45 mbu and old crop soybeans by 4 mbu. The only change to old crop wheat demand was a 5 mbu decrease in exports to punt ending stocks at 983 mbu. New crop wheat demand was left unchanged, but we did see an 11 mbu increase to production. This caused a 16 mbu increase in new crop wheat ending stocks, putting them at 925 mbu. The average cash projections on new crop contracts is now $3.20 on corn, $8.20 on soybeans, and $4.60 on wheat.  We will now start to see more positioning for the quarterly stocks and revised planting figures that will be released at the end of the month. Going into those reports, most interest will be on the acreage numbers to see if they change much from the March intentions. The real interest should fall on stocks data though, as same as in March, these numbers are more concrete than acreage. Stocks at this time of the marketing year also give us a much clearer picture of what we could see for ending stocks. We will also see more emphasis on wheat as the crops move to their next critical stages.

Highlights
* Attention now to reports at month end
* China showing interest in SAM commodities
* Export basis firm on corn, steady on soybeans 
* Gulf ethanol $1.37/gal; +5% in last week
* Ethanol at 31 cent premium to gasoline
* Equity markets post significant losses
* Concerns build over Covid-19 resurgence
* Some weather outlooks turn dry
* Demand becoming more of a market factor
* Lower commodity values predicted
* current weather remains favorable

Corn
* Production unchanged at 16 bbu
* 19/20 carryout 2.1 bbu
* 20/21 carryout 3.32 bbu
* World carryout 337.9 mmt
* Fast Safrinha harvest indicates smaller crop

Soybeans
* US production 4.12 bbu
* 19/20 carryout 585 mbu
* 20/21 carryout 395 mbu
* World carryout 96.3 mmt
* China bus large volume US new crop 

Wheat
* US crop 1.87 bbu
* 19/20 carryout 983 mbu
* 20/21 carryout 925 mbu
* World carryout 316 mmt
* Low protein on US crop a concern

Livestock
* 2020 pork production +330 mil pounds at 27.76 billion   
* 2nd quarter pork production +145 mil pounds; 6.18 billion
* 2020 beef production at 26.67 billion pounds
* 2nd quarter beef production 6 bil pounds, +370 million
* Concerns on consumer spending grow

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