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House passes farm bill; legislation now goes to president's desk


Erin Brown / Grand Vale Creative

Dry weather fueling bulls


State winter wheat ratings released March 5 showed a 1 percent increase in the good to excellent ratings for the state of Kansas winter wheat crop. Kansas is now rated at 13 percent good to excellent and 50 percent poor to very poor. This compares to 12 percent good to excellent last week and 43 percent good to excellent last year. Oklahoma showed a 2 percent increase in the good to excellent ratings at 6 percent good to excellent, 17 percent fair and 77 percent poor to very poor. This compares to 4 percent good to excellent last week and 43 percent good to excellent last year. Colorado deferred to the monthly state ratings released last week. Those ratings show 31 percent good to excellent for Colorado versus 40 percent last year. These slight improvements to ratings gave the wheat complex a negative tone to start the week.

UKAgroConsult stated that most of Ukraine's winter crops were not damaged from the recent cold snap as snow cover helped to insulate the crops. Egypt purchased 175,000 tons of Russian wheat with no U.S. wheat offers. At current pricing with currency exchanges, U.S. wheat is less competitive versus Russia into Egyptian markets.

The U.S. Department of Agriculture monthly World Agricultural Supply and Demand Estimates supply report March 8 raised both U.S. and world ending wheat stocks. U.S. stocks were increased to 1.034 billion bushels versus the average trade guess of 1.013 billion bushels and USDA's February number of 1.009 billion bushels. World ending stocks were increased to 268.89 million metric tons compared to the average trade guess of 266.2 million metric tons and the February report of 266.1 million metric tons. This added to the negative tone of the market, although funds were buyers on the break limiting losses in Chicago and Kansas City.

Funds continued to reduce their net short position according to Commodity Futures Trading Commission data ending Feb. 27. All wheat contracts are now at 61,000 net short versus 67,000 net short the previous week. The good news is that this is still a net short position, so we would likely see buying back on breaks. This was evident on March 8 in both Chicago and Kansas City.

Weekly export sales March 8 totaled 428,400 metric tons which was at the higher end of trade expectations. Cumulative export sales for the year are running 12 percent behind last year at 809.3 million bushels.

For the week ending March 8, May contracts for Minneapolis wheat were up 4.5 cents at $6.2475, down 0.75 cents at $4.9925 for Chicago wheat, and down 0.5 cents at $5.3325 for Kansas City wheat.


Corn saw a friendly WASDE report this week as the USDA lowered U.S. ending stocks more than anyone was expecting. Exports were increased by 175 million bushels to 2.127 billion bushels due to recent good demand and problems in South America. The USDA increased expected corn ethanol use 50 million bushels to 5.575 billion bushels. Demand is moving in the right direction to help eat through the troublesome stocks in the U.S. World ending stocks were lowered close to 4 million metric tons to 199.17 million metric tons.

In South America, the USDA decreased Argentina's corn crop 3 million metric tons from February estimates to 36 million metric tons (1.42 billion bushels) due to drought conditions. USDA's Brazil corn crop is projected at 94.5 million metric tons (3.72 billion bushels), down 0.5 million metric tons from the February estimates. The USDA is significantly higher than CONAB's forecast of 87.3 million metric tons (3.4 billion bushels) and larger than Informa estimates of 89 million metric tons. The USDA left room to lower Brazil estimates more in April.

Safrina corn planting is behind the five-year average pace, and it estimated that 25 percent of safrina corn will be planted beyond their optimal planting window. As of March 2, safrina planting is at 65 percent complete versus 79 percent last year and an average of 86 percent planted for this time of year.

Old crop corn prices are up more than 35 cents since the lows set on Jan. 12. Corn futures are at highs last seen in the middle of August and are still in a nice uptrend on the charts. Resistance for old crop is the $4 mark for July and $4.1175 for December new crop. Both old crop and new crop corn futures are testing these levels currently.

CFTC data on Feb. 27 showed the funds adding to their net long stance, moving from net long 19,000 contracts to net long 59,000 contracts.

Final 2018 crop insurance prices were set on March 1 for corn at $3.96 compared to $3.95 for 2017. For the week ending March 8, May corn was up 8 cents, July was up 7.5 cents, and December corn was up 5.5 cents.


Soybeans made new contract highs this week as concerns mount over Argentina's drought and a slower than normal harvest pace in Brazil. November soybeans saw a 12-day winning streak snapped on March 8 but still are continuing their nice climb higher after making lows on Jan. 12. November soybeans have seen 75-plus cent gains since those lows. The WASDE report on March 8 was slightly bearish compared to the trade expectations on the U.S. side.

The USDA lowered U.S. exports again in this report, 25 million bushels lower than February estimates. The USDA did increase domestic soybean crush by 10 million metric tons though. The USDA increased ending stocks for the 2017-18 crop to 555 million bushels, higher than the pre-report estimates and February's number of 530 million bushels.

World ending stocks are estimated to come in at 94.4 million metric tons, 1 million metric tons less than pre-report average estimates and lower than the 98.1 million metric tons estimated by the USDA in February. In South America, the USDA bumped up Brazil's expected soybean crop by 1 million metric tons to 113 million metric tons (4.15 billion bushels), matching the estimate of CONAB. Informa estimates Brazil's soybean crop at 114 million metric tons.

Argentina's crop was lowered 7 million metric tons to 47 million metric tons (1.7 billion bushels), again due to drought in Argentina, slightly lower than analyst's average estimates. Informa's estimates cut the 2018 Argentina soybean crop 7 million metric tons from their prior forecast to 44 million metric tons.

The Brazilian soybean harvest progress remains slower than average. As of March 2, Brazil is 31 percent harvest versus 46 percent last year and an average of 39 percent harvested. Argentina is expecting some rains this weekend, but the amounts forecast will not be enough to help much.

The trade is nervously watching how Trump's tariff war will play out as tensions escalate between the U.S. and China. China could start picking on soybean imports from the U.S. in retaliation for our tariffs on steel and aluminum. China seems to be waiting to get a handle on how South America's crop ends up before they do anything drastic. They still need soybeans; it is just a matter of where they get them from.

Final 2018 crop insurance prices were set on March 1 for soybeans at $10.16 compared to $10.19 for 2017. For the week ending March 8, May soybeans were down 9 cents, July soybeans were down 8.25 cents, and November soybeans were up 6.25 cents


For the week ending March 7, May canola futures in Winnipeg were down $4.90 Canadian at $522.20 per metric ton. The Canadian dollar was down .0056 to .7743. This brings the U.S. price to $18.35 per hundredweight.

• Velva, N.D., $17.99 per hundredweight, September at $17.17.

• Enderlin, N.D., $18.69 per hundredweight, September at $17.69.

• Hallock, Minn., $17.98 per hundredweight, September at $17.49.

• Fargo, N.D., $18.95 per hundredweight, September at $17.85.


Cash feed barley bids in Minneapolis were at $2.85, while malting barley received no quote. The Berthold, N.D., bid is $2.45 and the CHS Southwest New Salem, N.D., bid is $2.75.


Cash bids for milling quality durum are $6 in Berthold and at $5.75 in Dickinson, N.D..


Cash sunflower bids in Fargo were at $17.45, October at $17.70. For the week ending March 7, soybean oil was down 34 cents at $31.93 on the May contract.