Carl German, Extension Crops Marketing Specialist; clgerman@udel.edu
Slow Planting Progress Bolsters Commodity Prices
U.S. corn planting progress was 7% complete as of Sunday, April 17, one point behind the five-year average and nine points behind last year’s pace. Corn Belt states were reported to be mostly behind schedule with only Illinois in line with the five year average. Another storm system is moving across the Midwest on Tuesday with rain expected the remainder of the week. The storm system is expected to delay planting further. Corn planting is not expected to make much progress this week.
New-crop contracts for soybeans are expected to lose ground to corn on the idea that continued delays in corn and spring wheat planting could lead to increased soybean acreage later this spring. Spring wheat planting progress was reported at 5% complete as compared to 12% for the five-year average. The weather situation across the various wheat growing areas remains poor. The condition of the winter wheat crop continues to weigh-in on wheat futures prices, with only 36%of the U.S. crop rated as good to excellent compared to 69% last year. Dry weather persists in the U.S. Plains. Hard red winter wheat in the region has been too dry since it was sown last fall. Dry weather continues to be a concern in China.
Market Strategy
Outside market forces have turned supportive to commodity prices this week. The Dow is currently at 12,462, nearby crude at $110 per barrel, and the U.S. dollar index at 74.391. The recent strong sell-off in the U.S. dollar index could drive demand back to U.S. soybean supplies. Dec ‘11 new crop corn futures are currently trading at $6.83 per bushel (a new life-of-contract high); Nov ‘11 soybeans at $13.81; and July SRW wheat at $8.39 per bushel. May ‘11 old crop corn futures are trading at $7.62; May ‘11 soybean futures at $13.69, and May ‘11 SRW wheat futures at $8.05 per bushel. Commodity prices are expected to remain strong this week, barring any unexpected external factors, due to weakness in the dollar and the slow U.S. planting pace. The next USDA Supply and Demand report will be released on Wednesday, May 11.