12:19 PM 4/24/2019

In corn, another week goes by and the markets still are showing no improvement. Managed money or funds continue to add large volumes to their already short positions. It is estimated that funds are short (Sold) 372,000 contracts in corn alone. This is record short, as the previous record short was 239,000 contracts. Last Friday's Committment of Traders Report put out by the USDA showed these speculative hedge funds were short a record 1.6 billion bushels as of April 16th, and it is believed these funds have added to their position this week. This situation does leave the market vulnerable to a massive short covering rally if these funds get scared out of their short positions. Everyone is still waiting for verification of rumors of corn, ethanol, and DDG sales to China. Planting delays due to wet conditions seems to have no effect on this market due to a drying weather pattern predicted for the Midwest in the 16 to 30 day outlook. Eventually, cheap corn prices and rising livestock prices should increase demand.

Soybeans continue to grind downward, largely due to the fact of large supplies and big carryout numbers. Possible weather delays in corn planting would also favor more soybean acres. Prices would have to drop several dollars per bushel to see any decrease in Brazilian acreage. African Swine Fever has severely cut Chinese demand, leaving a large surplus to deal with.

Stats Canada released their wheat acre estimates. All Canadian wheat acres are up 3% over what the trade estimated. Spring wheat acres are 12% over what was estimated. Canadian durum acres down 19% from estimates.

The following is part of an article taken from ADM Investors Research Team:
The U.S. Department of Agriculture's statistical arm will not collect data on the volume of harvested grain lost
when farms from the Dakotas to Missouri were hit by flooding in March that burst grain storage bins, a
government official said; however, the figures in the USDA's regular quarterly stocks report for June will
reflect losses due to flooding as well as from more typical usage by processors, exporters and livestock feeders
over the preceding three months; the USDA is scheduled to release its next quarterly stocks report on June 28 --- the stocks report will reflect (grain) inventories as of June first, so any losses that occurred will no
longer be represented in the stocks at that time --- at least 1 million acres (405,000 hectares) of U.S. farmland were flooded after a "bomb cyclone"
storm; Indigo Ag, an agriculture technology company, identified 832 on-farm storage bins within
flooded Midwest areas; the bins hold an estimated 5 million to 10 million bushels of corn and
soybeans that could have been damaged in the floods.

Jim Gallagher
Grain Division Merchandising Manager

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