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CPI, Tidbits, Markets & Rain Days Update 04/13/2022

Highlights


Consumer Price Index (CPI) is the measure of inflation at the retail level. Yesterday morning’s monthly report said retail prices are 8.5% more than a year ago and the highest annual increase since December 1981. The market expects the Fed's next interest rate increase will be 50 basis points, which is a half percent. Some economic experts contend 8.5% is the high. Nobody in this outfit thinks that, but it is significant used vehicle prices were down 3.8% in March, the second straight monthly decline after an increase of 41% the past year.

 

Putin said yesterday peace talks with Ukraine are at a “dead end” and vowed to continue his war.

Officials in Shanghai will loosen strict Covid-19 restrictions around the city’s financial hub, but keep the vast majority of its 25 million residents locked-down.

Gasoline with 15% ethanol blends will be available for purchase by consumers from June 1 to September 15 this year due to the high price of gasoline.

For crude oil, futures contracts quit trading on the third business day prior to the 25th calendar day of the month preceding the delivery month. Options expire 3 days before futures quit trading. That means May crude oil options expire tomorrow because Friday is a holiday.

 

Gulf corn basis was 7 to 8 cents weaker for April, 5 to 6 cents weaker for May, and off 5 cents for June. The soybean basis was 2 to 4 cents weaker for April, 2 cents weaker for May, and unchanged for June.

Processor bids for both can and beans were mostly unchanged.


Wheat was strong (again) yesterday as deliverable supplies become more difficult to find. Russia continues to move their wheat as Ukraine’s wheat sits in bins and stalled in rail cars at the Polish border. Dry soil in the US Southern Plains with 90+F degrees yesterday and a powerful winter storm in the spring wheat areas arrived yesterday afternoon and continues this morning. However, most spring wheat producers will accept planting delays in exchange for the moisture. Prospects are good for a decent start to this year’s spring wheat crop.


More and more farmers are pushing a pencil and come to the conclusion oats are more profitable than soybeans. Yep, that is what they say. It is possible high test weight oats could do it.


The urea market is holding its breath at US$1000 per mt at Brazil’s ports as the market waits for India's urea tender, which is expected any day. India is by far the world’s biggest buyer of urea.


Former Minnesota farmer turned Brazilian agriculture consultant, Kory Melby, says do not worry about second crop corn in Mato Grosso, but maybe a little worry is justified in Goias and Mato Grosso do Sul. Mato Grosso is two and half times the size of Texas and grows 30% of Brazil’s corn and beans.


Brazil’s soybeans are 85% harvested.

 

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Market Data


This morning: Crude oil is at $100.48, down $0.12 The dollar index is at 100.28, up 0.09 July palm oil is at 5,977 MYR, down 17. The contract high was made March, 9th at 6,531 MYR. Palm oil owns 36% and soybean oil owns 28% world market share. December cotton is at $119.63, down $0.40 per cwt. The contract high was made yesterday at $120.29 per cwt. Cotton competes with soybeans and corn for acres. July natural gas is at $6.867, up 0.038. The contract high was made yesterday at $7.088. Natural gas is the primary cost to manufacture nitrogen fertilizer. July ULSD is at $3.2332 per gallon, down 0.0164. The contract high was made March, 9th at $3.7675. ULSD stands for Ultra Low Sulfur Diesel.


 

Rain Days Update


The Western Corn Belt has 1 less rain days in the 10 day forecast than yesterday and the Eastern Corn Belt has 7 less rain days than yesterday.


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