There are a handful of meteorologists on the planet that follow weather in all the places farmers grow commodity crops like corn, soybeans, wheat and rice. Each is likely to tell you, as Todd Gleason reports, the most difficult forecast to produce is for the Midwest.
by Todd E. Gleason
The CME Group Inc said today it will implement a new system for setting daily price limits for U.S. grain and oilseed futures starting next month. It will regularly change the limits to markets including corn, soybeans and wheat. These will reset twice a year with the change based on underlying price levels. CME will also remove price limits for all grain and oilseed options.
Both changes are set to take effect the first trading day of May which begins the evening of Wednesday April 30th. The semi annual adjustment of the limits will widen the trading range during periods of higher prices and narrow the limits when market prices are lower.
The reset dates will be the first trading day in May and the first day in November.
On May 1, the initial daily limit for corn will drop to 35 cents a bushel from 40 cents, rise to $1.00 from 70 cents for soybeans, and drop to 45 cents a bushel from 60 cents for CBOT soft red winter wheat.
by Todd E. Gleason
It can be lonely on the farm. However, it sure looks like Twitter is letting guys striving for the same thing talk in realtime when they're busy. This 'screen shot' is a 10pm Saturday night conversation from a western Illinois farmer. He simply asked for a roll call of who was still in the field. The answers came back from across the Midwest.
with tStorm.net's Mike Tannura
by Todd E. Gleason
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Dave Dickey & Todd Gleason
by Todd E. Gleason
Todd E. Gleason
I love out of the way places to travel and explore. A blacktop (a rural road) is one of my favorite things in all the world. They look the same just about everywhere I've ever been, but always hold a surprise or two. If you play your cards right you'll find something of interest and a great place to eat. Coming straight south from East Peoria, Illinois is a great road.
This one is wider than usual, and even has a name on the map, Springfield Road. There are many treats to see. If you are a "Lord of the Rings" fan you'll love the hobbit hole along the west side of the road. It sits there with a perfectly round door, just like those in the shire.
Once you drop down the mountain of a hill - for central Illinois - pass all the white fences, and mount the other side of the little valley, keep your eyes open for a pair of pines on the east side of the road (see the red pin on the map along Springfield Road). Hunkered down in those pines is a rock and plaque.
I think only those that have knelt upon the earth, filled their lungs with its sweet fragrance, and reached into it searching for a kernel of corn, can truly appreciate the rock and the acreage.
It is the birthplace of yellow dent corn. This is the place where a poor stand prompted Robert Reid to intra-seed a second open pollinated variety hoping for a good nick. It worked, and over the next forty years Reid and his son James diligently developed the new yellow dent corn variety. Eventually, it became the primary parent line behind nearly all modern corn hybrids.
If you farm, this is a sacred place to visit.
Given that, I doubt it is a sacred place for the rest of the people in the vehicle. They'll need another reason. I would suggest the Harvest Cafe in Delavan. Bring your wallet, but do plan to have a magnificent meal in one of the most luxurious little spaces in rural route Illinois.
EIA Press Release
APRIL 3, 2014
Note: RBOB is reformulated blendstock for oxygenate blending gasoline, a motor gasoline blending component intended for blending oxygenates to produce finished reformulated gasoline.
Ethanol spot prices have increased steadily since early February. By late March, New York Harbor (NYH) spot ethanol prices exceeded prices for RBOB (the petroleum component of gasoline) by more than $1 per gallon. Ethanol spot prices in Chicago and Gulf Coast markets also rose above NYH RBOB prices.
The premium of New York Harbor over Chicago spot ethanol prices, which averaged 25 cents per gallon in January (close to the typical transportation costs of moving ethanol from production centers in the Midwest to terminals on the East Coast in recent years) widened to $1 per gallon in early March. Logistical constraints in and around ethanol production centers in the Midwest, mainly involving railroads on which approximately 70% of ethanol is shipped, appear to be a key factor driving recent prices.
Ethanol futures prices suggest that market participants expect the recent price increase to be short-lived as both rail system congestion improves and ethanol producers respond to the strong incentive that higher ethanol prices provide.
Source: U.S. Energy Information Administration, based on Railroad Performance Measures .
Note: Manifest trains combine cars carrying different products and are often broken up for delivery in a smaller number of cars. Railcar dwell time is the time that loaded railcars spend in a terminal awaiting movement.
Extremely cold temperatures this winter led to rail congestion in and out of midwestern terminals that delayed shipments to other regions and resulted in significant ethanol stock draws. Railcar dwell time, the time that loaded railcars spend in a terminal awaiting movement, at Burlington Northern Santa Fe Corporation’s Galesburg, Illinois terminal, which handles many ethanol cars from Iowa, nearly doubled in early 2014 to reach a peak of 60 hours in February and remain above year-ago levels.
While more than 70% of ethanol producers are equipped to load unit trains (trains running a single product), only about 35% of gasoline blending terminals are equipped to receive them. The average speed of manifest trains (trains running multiple products), which are often used to deliver ethanol to gasoline blending terminals that are not equipped to handle unit trains, decreased by 23%, from 22 miles per hour (mph) to 17 mph over the past 12 months.
Ethanol stocks were drawn down nationwide by nearly 2 million barrels (bbl) from mid-February to mid-March, partially recovering to 15.9 million bbl on March 28. This is more than 4 million bbl below typical March levels, which averaged more than 20 million bbl from 2011 through 2013. East Coast inventories were especially hard hit and on March 14 reached their lowest level (4.5 million bbl) since EIA began recording data in June 2010. For a more detailed analysis, see the April 2 edition of This Week in Petroleum.
Principal contributors: Arup Mallik, Sean Hill
by Todd E. Gleason
USDA has released the March 2014 Quarterly Hogs & Pigs report. It, by most accounts, shows more inventory than the trade expected. However, the figures reported do show an impact from PED-V. This impact is, simply put, not as dramatic as the price rise has been in lean hog futures. The futures are still looking forward to what most expect to be a short market ready supply of hogs in April, May, June, and July. The following is excerpted from USDA's March 28, 2014 Quarterly Hogs & Pigs report.
United States Hog Inventory Down 3 Percent
United States inventory of all hogs and pigs on March 1, 2014 was 62.9 million head. This was down 3 percent from March 1, 2013, and down 5 percent from December 1, 2013.
Quarterly Hogs and Pigs Inventory – United States: March 1
Breeding inventory, at 5.85 million head, was up slightly from last year, and up 2 percent from the previous quarter. Market hog inventory, at 57.0 million head, was down 4 percent from last year, and down 5 percent from last quarter.
The December 2013-February 2014 pig crop, at 27.3 million head, was down 3 percent from 2013. Sows farrowing during this period totaled 2.87 million head, up 3 percent from 2013. The sows farrowed during this quarter represented 50 percent of the breeding herd. The average pigs saved per litter was 9.53 for the December-February period, compared to 10.08 last year. Pigs saved per litter by size of operation ranged from 7.70 for operations with 1-99 hogs and pigs to 9.60 for operations with more than 5,000 hogs and pigs.
Quarterly Litter Rate - United States
United States hog producers intend to have 2.88 million sows farrow during the March-May 2014 quarter, up 2 percent from the actual farrowings during the same period in 2013, but down 2 percent from 2012. Intended farrowings for June-August 2014, at 2.96 million sows, are up 2 percent from 2013, and up 1 percent from 2012.
The total number of hogs under contract owned by operations with over 5,000 head, but raised by contractees, accounted for 48 percent of the total United States hog inventory, up from 47 percent last year.