The Morning Vibe

29/03/12 -- It's all very exciting isn't it boys and girls, only one more sleep to go to the Big Day. To clarify on something I read yesterday but couldn't confirm. Corn has staged a limit move on six of the last seven times that the quarterly stocks report has been released. This week's stocks report just happens to coincide with the planting intentions numbers.

It was the stocks numbers as opposed to the acreage numbers that caused a limit up move this time last year, as they came in lower than even the lowest trade estimate.

This time round the trade is expecting a corn stocks number of 6.15 billion bushels for corn, from within a range of 5.925-6.288 billion and 6.523 billion a year ago. Soybean stocks are estimated at 1.387 billion (1.270-1.585) and wheat stocks at 1.223 billion (1.181-1.251).

For acres we are looking at an average of 94.72 million for corn (from a range of 93.6-95.6 million); for soybeans 75.4 million (74.0-76.7) and for wheat 57.4 million (55.5-58.2).

It is worth remembering that the acreage numbers are based on a Mar 1st survey. Since then corn prices have declined 34 cents, whilst soybean prices have risen 50 cents. Production estimates in South America for the latter have also declined, so it may be that some US growers will think that soybeans may have a bit more upside potential than corn or wheat going forward. I certainly do. That could mean a bit more land going into soybeans than tomorrow's report might suggest.

With front month May soybeans currently standing at USD13.74/bu in the overnight market we are within 6 cents of the highest close for soybeans in more than six months. Conversely corn has slipped below USD6.20/bu overnight, a close there tonight would be a two month low and place it only 41 cents above the mid-December low of 2011. Soybeans are currently USD2.74/bu above their mid-December low.

It looks like we are shaping up for a quiet one today, but there's plenty of potential for fireworks tomorrow!