U.S. Corn Supplies Seen At 33 Year Highs

Good Morning from Allendale, Inc. with the early morning commentary for May 13, 2020.

Grain Markets were lower overnight as trade volumes remained light.  Traders continue to digest yesterday report numbers while turning their focus to demand and weather maps as growers continue to make strong progress in the fields.

USDA Monthly Supply and Demand report showed new-crop corn ending stocks at 3.318 billion bushels (3.389 bb estimated, 2.637 USDA Feb. Outlook), soybeans at 405 million bushels (430 mb estimated 320 mb on Feb. Outlook), and wheat ending stocks at 909 million bushels (814 mb expected, 777 mb Feb. Outlook).  Old-crop corn ending stocks at 2.098 billion bushels (2.224 bb estimated, 2.092. bb last report) for corn, soybean ending stocks at 580 million bushels (488 mb estimated, 480 mb last report), and wheat stocks at 978 million bushels (969 mb estimated, 970 mb last report).

USDA May World Ending Stocks showed new-crop corn ending stocks at 339.6 million tonnes (317.2 mt estimated, 314.7 mt last year), soybeans at 98.4 million tonnes (104.2 mt estimated, 100.3 mt last year), and wheat ending stocks at 310.1 million tonnes (292.7 mt expected, 295.1 mt last year).  Old-crop world corn ending stocks at 314.7 million tonnes (306.5 mt estimated, 303.2 mt last report, 320.9 mt last year), world soybean ending stocks at 100.3 million tonnes (99.8 mt estimated, 100.5 mt last report, 112.5 mt last year), and wheat stocks at 295.1 million tonnes (291.8 mt estimated, 292.8 mt last report, 279.4 mt last year).

Senator Ted Cruz introduced legislation to help revive the U.S. rare earths industry with tax breaks for mine developers and manufacturers who buy their products, the latest attempt by the U.S. to break China’s control over the strategic sector.  China is the largest global processor of rare earths, a group of 17 minerals used to make electronics and military equipment. The country has threatened to stop exporting the specialized minerals to the U.S. amid the ongoing trade war, prompting efforts by Washington to help revive its domestic rare earths industry.  (Reuters)

South America weekly crop progress report showed Brazilian soybean harvest and Brazilian safrinha corn planting complete.  Brazil 1st corn crop harvest progress at 88% complete (85% last week, 87% last year, 91% average).

Private exporters reported to the USDA export sales of 136,000 metric tons of soybeans for delivery to China during this marketing year.

A new list of 79 U.S. products eligible for waivers from Chinese retaliatory tariffs has been approved by China, amid continued pressure on China to boost imports from the U.S.  China’s finance ministry said the new waivers will begin on May 19 and expire on May 18, 2021.  This list will waive tariffs on products including ores of rare earth metals, gold ores, silver ores and concentrates.

China has suspended beef imports from four of Australia’s largest meat processors, as the trade dispute between the two countries intensify over the origin of the coronavirus pandemic.  “Some politicians in Australia say too much, they need to stop this rhetoric with China, especially criticism and speculation regarding the origin of the COVID 19 virus,” said Sam McNiven, founder at Australian beef producer, Providore Global.

10,000 tonnes of frozen pork will be auctioned off from China’s state reserves on May 15, the China Merchandise Reserve Management Center said.  China has sold 310,000 tonnes of pork from reserves so far this year to boost their supplies.

Dressed beef values were mixed with choice up 6.81 and select down 2.00.  The Feeder cattle index is 123.11.  Pork cut-out values were down 8.84.

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