September 5, 2010
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Market Update
September 03, 2010
SIOUX CENTER GRAIN DEPARTMENT WILL BE
CLOSED WEDNESDAY, SEPTEMBER 8!
MORNING COMMENTS
At 0530 CZ0 up a ½, SX0 up $0.08 ½ with Chi and KC wheat up $0.10 and $0.08 respectively.
Trade continues to absorb daily reports of yield checks well below expectations in many areas. Pendulum has swung solidly into the “Lower Yield” camp. Have been some wildly lower ideas being floated. Time will tell what is out there but in the meantime trade will be quick to add risk premium.
Chinese official suggesting animal feed manufacturing will top 150 mmt this year. Up from 148 mmt a year ago. By 2020 expected to be near 250 mmt.
Chinese food price inflation spiked 6.8 percent in July. Was noted that the poor majority in China spend over 50% of their income for food.
Strong historical evidence of US soybean exports growing when new crop sales exceed 35% of the Aug USDA forecast. This year we are at 42%.
Some will argue a 1435 export forecast is too conservative???
Informa production estimates later this morning. In their last report they pegged the corn yield at 166 bpa compared to USDA at 165. Their SB yield was .5 below the USDA at 43.5 bpa.
Informa Sep yield estimate has exceeded USDA Sep estimate in each of the past three years by .2 to 4.2 bu per acre.
Talk in trade circles that Berkshire Hathaway is interested partnering with two Brazilian firms to invest in Brazilian farmland.
Markets closed Monday for the Labor Day Holiday.
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