I suspect that bulls in the grain and soy markets are beginning to feel a bit like Sisyphus, the king from ancient Greek mythology. If you recall the story, after cheating death on several occasions, Sisyphus, who was actually not a very nice person, was sentenced for all eternity to push a boulder up a hill, only to have it roll back down time and again. While I do not think we are destined for this type of price action throughout all eternity, it does appear to have been the pattern for these markets as of late. Each time we have been able to push up against resistance or even push into a slightly higher high, prices roll back lower, and we have to start the climb all over again. Maybe this time will be different.
Overall, news was sparse again this morning. The planting progress update for corn was a bit less than trade expectations, 4%, but considering the average pace for this date is just 3%, they were evidently expecting a bit much. It was interesting to note that 2% of the corn in North Dakota was planted. Spring wheat was running ahead of pace with 11% in the ground compared with 6% on average. Barley was 13% planted versus 11%, sorghum 14% compared with 17%, and cotton 8%, versus 7% on average. The weather forecast, while a bit cool looks favorable for good progress over the next 10-days to two weeks.
Brazilian bean harvest has reached 85% complete, which is just a smidge ahead of average. Production estimates seem to have settled into the 133 to 137 MMT range at this time, which sets a new record even at the low end. Dry weather is beginning to raise a minor concern for the development of the safrinha corn crop but not quite to the extent to begin trimming yield estimates. In Argentina, bean harvest has reached nearly 4% complete, versus an average of 16%, and early yields have been disappointing. Dr. Cordonnier lowered his crop estimate 1 MMT to 45 MMT this week. Corn harvest has reached 12% complete, compared with 21% average, and here as well, early yields have been a disappointment.
We do have a few economic releases to pass along this morning. The March CPI increased .6% month over month, which was just a touch more than anticipated. The core number, minus food and energy, rose .3%. Energy alone was up 5%. Year over year, the March CPI was up 2.6%. Keep in mind that a year ago, we had not really moved into panic shutdown mode, so in the months ahead, we could see some surprising numbers. Case in point, retail sales for the first week of April were also released this morning and jumped 13.2% from a year ago. While equity markets never seem to need much of an excuse to advance, the S&P 500 has snuck into a new high once again this morning.
