Saturday, February 21, 2015

Wet week

Feb 21

Harvest was slow this past week in Mato Grosso. In some areas it rained
everyday. This is normal to have a two week wet spell this time of year.

It puts the 2nd crop corn planting at greater risk. One month delay in October
combined with another two weeks in February puts most of the crop to
be planted after the ideal planting window. Production potential is at risk.

Mato Grosso has a nice carryover of last year´s corn crop on hand yet.

The percent of 2nd crop planted as of March 1 will be important stat.

It will likely be the slowest planting pace ever.

With big toys and BT genetics, they can catch up quick.

The next Conab report will be out March 10th. I expect to see
cuts in Bahia soy crop as well as added cuts in Goias, Minas Gerais,
and Sao Paulo.

Spot soybean bids have been firm in Mato Grosso recently with weaker REAL
and demand for spot soy. Once the sun shines again, these bids will drop like a

Prices are better for soybeans than what I was thinking back in October.

Farmers will have a chance to sell some on a spot basis and then hold the rest
as an inflation hedge for later. They will make some money this year but the weak
Real means higher cost of production for 2016. This means growing pains ahead.
I doubt we will see any expansion in soy area for 2016.

The 2015 surge likely blew the top off the the recent Brazil soybean surge of
6 million + hectares in four years. Time to take a breather.

Argentina looking good, but they will likely sell their soybeans on their estate sale
and not in the immediate future. New government in early 2016 will force them
to hope for a better future and bet on the Come line. Come 7/11??? or Argentine
Craps?  stay tuned..........