Latest Report Hits Key Feed Markets

By December 10, 2019 February 11th, 2020 No Comments
December 10, 2019
Tuesday’s USDA WASDE report didn’t change the outlook much on corn or soybeans, but we’ve already seen the report’s news bear out in the price of commodities used by the vast majority of California dairymen.
First, the biggest impact has been on cottonseed. The USDA confirmed what we wrote in last week’s newsletter that the Texas crop has been a mess. According to the WASDE, cotton-bales in Texas were decreased by 500,000.
That cottonseed decreased total U.S. oilseed production slightly and is responsible for the $25 per ton run-up in the last month.
Because of the adjustment, more seed will be shipped from the Mid-South instead of Texas, costing more in shipping. Also, rail transit times will be slower, which hopefully won’t cause any shortages and/or extreme spikes.
Our advise is to be 100% covered on your cottonseed.

The board was mostly neutral, with wheat and beans leading the way.

According to Statistics Canada, canola seed production is down 8% and the smallest canola crop seen in 4-years.

Still, the spread between canola and soybean meal seems to be holding. While not great compared to years past, low soybean meal prices seem to be helping keep canola from running.

However, there is a pretty good spread in the soybean meal futures, with nearby meal trading at $297 on the board, and September meal at $311. Hence a nearby price in the low $280s delivered and a clock price in the $290s for canola. Now may be a good time to get covered through the winter on any tonnage you’ve kept open to play the market.

To get prices on these or any feed delivered to you, call your Penny-Newman sales rep.

Thank you,
Paul Quinn