Free Commentary

By: Dan Hueber –

In one of the most significant weeks yet this rain-plagued spring, farmers were able to get another 16% of their corn planted, bringing the total to 83%.  Granted this is still 16% behind the average pace for this time of year but was at the upper end of trade estimates and enough to inspire minor selling in the overnight trade.  This would suggest that as of June 9th we still have somewhere in the neighborhood of 16 million acres of corn to plant, the majority of which is concentrated in Illinois, Indiana, Ohio and South Dakota. Needless to say, the final corn acreage number remains a moving target and no doubt there will be significant progress made this week, but I believe that ultimately, we will end up with between 87.5 and 86.5 million acres planted.  This was also the first week for corn crop rating, and it was not a surprise to see 59% of the crop rated good/excellent.  Last year, 77% of the crop was in this range, but of course, there were quite a few more acres in the ground.  Granted, the only place any of this may show up on Tuesday report could be in yields but even if that were to be the case, look for the USDA to be conservative with any changes.

Planters were more active in beans as 21% more made their way into the earth, and the total planted stood at 60%, compared with the average 88%.  This would imply that there are still around 33 million acres left to plant.  As with corn, the Midwestern states east of the Mississippi have the most work to do.  At this point, it is difficult to make a guess as to where the acreage will ultimately come through.  The USDA projected 84.6 million acres back on the March Prospective Planting report, and that number may yet be reasonable.

As far as the report to be issued later this morning, here again, are trade estimates; Total 2019 corn production is pegged at 14.251 billion bushels with an average yield estimate of 172.4 bpa.  Bean production of 4.123 billion using a yield of 49 bpa. Domestic ending stock for 2018/19 are estimated to be 2.123 billion for corn, 1.004 billion in beans and 1.121 billion for wheat.  2019/20 ending stocks are then expected to come through at 1.917 billion for corn, 983 million for beans and 1.118 billion for wheat. The 2019/20 wheat crop is expected to total 1.883, which 1.251 billion coming from winter wheat.  The average estimate for Argentine corn is 49.28 MMT and Brazil 99.86, making a combined total of 149.14 MMT or 5.87 billion bushels.  Argentina beans are expected to total 56.09 MMT and Brazil 117.22 MMT for a combined 173.31 MMT or 6.368 billion bushels. 2018/19 Global ending stock are estimated to be 325.44 MMT for corn, 113.33 MMT beans and 274.7 MMT in wheat. Then for 2019/20, the estimates look for 304.96 MMT corn, 112.99 MMT beans and 290 MMT of wheat.

With all the issues we have confronted in the U.S. this spring, it is easy to forget there is still harvest taking place in South America.  Brazilian beans are pretty well wrapped up, but safrinha corn is in full swing and is estimated to be 5% complete.  Further south into Argentina, bean harvest is now estimated to be 96.1% complete and corn 39.3%.  There remains quite a bit of buzz concerning corn sales to Mexico from both of these nations, and it will be interesting to see, not that the U.S. and Mexico are on better terms if that will continue.  It should just break down to economics once again as should be.