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Grain Outlook Growers are holding on to corn ... for now

Financial Focus Care for aging parents a national concern

PHYLLIS NYSTROM

CHS Hedging inC. St. Paul

See NYSTROM, pg. 19

Cash Grain Markets corn/change* soybeans/change* Stewartville $5.74 -.54 $12.33 -1.14 Edgerton $5.54 -.84 $12.53 -.69 Jackson $6.18 -.15 $12.38 -.85 Janesville $6.12 -.14 $12.28 -1.02 Cannon Falls $5.74 -.34 $12.23 -1.24 Sleepy Eye $5.74 -.39 $12.50 -.76 Average: $5.84 $12.38 Year Ago Average: $3.05 $8.94 Grain prices are effective cash close on Aug. 31. *Cash grain price change represents a two-week period. See JOHNSON, pg. 19

The following marketing corn. Thanks to healthier life- gies to medication. analysis is for the week ending Aug. 27. CORN — Corn found support to begin the week after slipping to six-week lows. The energy market showed a marked recovery of the previous week’s losses and corn followed suit. The Aug. 24 drought monitor showed 42 percent of the Midwest is in “abnormally dry” conditions vs. 39 percent in the previous week. Rain in the forecast over the next two weeks should help with test weights in corn and soybeans, but that window will quickly close as we head into September. U.S. corn conditions as of Aug. 22 fell 2 percent to 62 Weekly ethanol production fell for a seventh straight week and to a 22-week low at 933,000 barrels per day, down 40,000 bpd. Ethanol stocks fell for a fourth week, down 335,000 barrels to 21.2 million barrels. Margins improved 8 cents per gallon to 14 cents per gallon. Gasoline demand over the last six weeks has averaged 2.7 percent below pre-Covid 2019 levels and 7.8 percent above 2020 levels. On Aug. 26, it was reported by news services the Environmental Protection Agency submitted blending mandate recommendations to the White House Office of Management and Budget. It is styles and advances in modern medicine, the worldwide population over age 60 is growing. The United Nations estimates that by 2050 the number of people aged 60 and older will have more than doubled (per The United Nation Department of Economic and Social Affairs, 2017). As our nation ages, many Americans are turning their attention to caring for aging parents. For many people, one of the most difficult conversations to have involves talking with an aging parent about extended medical care. The shifting of roles can be challenging, and emotions It is also important to know the location of medical and estate management paperwork, including: the individual’s Medicare card, insurance information; durable power of attorney for healthcare; and a will, living will, trusts and other documents. It should be noted Power of attorney laws can vary from state to state. An estate strategy which includes trusts may involve a complex web of tax rules and regulations. Consider working with a knowledgeable estate management professional before implementing such strategies. percent good/excellent to the third- believed they recommended retroac- often prevent important information Be thorough lowest in the last 12 years. Illinois was tively lowering the 2020 blending rate, from being exchanged and critical deci- Remember that if you can collect all down 7 percent, Iowa steady, Minnesota lower 2021 beneath the 2020 level, and sions from being made. the critical information, you may be down 1 percent, North Dakota down 4 percent, and South Dakota improved 1 percent. Corn was 41 percent dented vs. 38 percent on average and 4 percent was mature, spot on the average. raise 2022 above both the 2020 and 2021 levels. The 2020 mandate is currently at 15 billion gallons to come from conventional biofuel and 5 billion gallons from advanced biofuel. No When talking to a parent about future care, it’s best to have a strategy for structuring the conversation. Here are some key concepts to consider. able to save your family time and avoid future emotional discussions. While checklists and scripts may help prepare you, remember that this conversation could signal a major change in Weekly export sales were within expectations and will probably miss the U.S. Department of Agriculture’s target this year. This week’s sales were 300,000 bushels to bring total commitments to 2.768 billion bushels. This is slightly below the 2.775 billion bushel details have been announced on the recommendations the EPA submitted. In April, the deadline for refiners to show compliance with 2020 requirements was extended to Jan. 31, 2022, so no one is out of compliance yet. If Cover the basics Knowing ahead of time what information you need to find out may help keep the conversation on track. Here is a checklist that can be a good starting point: Primary physician; specialists; edications and supplements; and alleryour parent’s life. The transition from provider to dependent can be difficult for any parent and has the potential to unearth old issues. Be prepared for emotions and the unexpected. Be kind, but do your best to get all the information you need. USDA projection with limited time left. Don’t procrastinate China canceled 5.3 million bushels of The earlier you can begin to commuold crop sales, leaving them with 59 nicate about important issues, the more million bushels of old crop sales to ship likely you will be to have all the inforwith just under two weeks left in the mation you need when a crisis arises. marketing year. There hasn’t been a How will you know when a parent corn sale for either crop year to China needs your help? Look for indicators since late May. New crop sales this like fluctuations in weight, failure to week were 26.9 million bushels to bring take medication, new health concerns, total new crop sales to 759 million and diminished social interaction. bushels, the highest in at least 15 years These can all be warning signs that by this date. Last year we had sold 527 additional care may soon become necmillion bushels for new crop by this essary. Don’t avoid the topic of care just date. China has so far purchased 421.2 because you are uncomfortable. million bushels of U.S. new crop corn. Chances are that waiting will only Columbia popped up this week to buy make you more so. nearly 10 million bushels of new crop

MARISSA JOHNSON

Profinium Wealth Management Advisor

NYSTROM, from pg. 18

any mandate is lowered, it reduces the demand for biofuels unless overall fuel demand can make up for the loss.

The USDA announced they accepted 2.8 million acres into the Conservation Reserve Program for 2021. This included 1.9 million acres through the general CRP signup and 897,000 acres through the continuous signup.

Conab is anticipating Brazil’s 2021-22 corn production at 116 million metric tons, slightly lower than the USDA’s 118 mmt outlook. Total corn acreage is anticipated to increase 3.9 percent with the safrinha portion up 5.2 percent.

Outlook: After the previous week’s price plunge of 36 cents in December corn, it looked as if prices were preparing for further losses. However, this week’s recovery suggests we have once again found support in the low $5.30’s with resistance coming in near $5.55 to $5.75 per bushel. The usual suspects of weather, demand, money flow from funds, and political events are the drivers. Grower sales are minimal with many comfortable with their previous sales and more than adequate space waiting to be filled. This should limit basis weakness in the longer term. Big swings on little news will be with us for a while longer, so be prepared for volatility.

For the week, December corn rallied 16.75 cents to $5.53.75, March up 15.75 cents at $5.60.25, and December 2022 15.5 cents higher at $5.14.5 per bushel.

SOYBEANS — Soybeans saw a 40-cent one-day rally early in the week as soyoil jumped higher and pulled soybeans with it. This was the largest single session soybean move higher since late June. The energy market bounced from big losses to end the previous week to jumpstart the rally in soybeans and soyoil.

A decline in crop ratings was supportive with conditions down 1 percent at 56 percent good/excellent and the third-lowest for this week in 12 years. Illinois ratings were down 4 percent, Minnesota up 2 percent, Iowa up 3 percent, North Dakota down 2 percent, and South Dakota up 3 percent. Setting pods was 88 percent vs. 87 percent average and 3 percent were dropping leaves, matching the average.

At this writing, a tropical storm is brewing in the Gulf. It is expected to build into a “viable hurricane” and reach landfall by Aug. 30. This could delay corn and soybean harvest in the Delta. Cotton and rice will be at risk as well as corn and soybeans.

Dry forecasts for South America during their upcoming planting season are gaining attention. La Niña is reportedly setting up to last through the end of the year and usually means below normal rainfall for Argentina and southern Brazil. This is on top of the dry conditions they experienced this year. The National Oceanic and Atmospheric Administration is giving the chances of La Niña from November through January at 70 percent. This is a bigger chance than last year when we had the strongest La Niña in a decade. Mato Grosso in northern Brazil will begin soybean planting after Sept. 15, but current conditions are not conducive to planting. Brazil’s farmers have begun planting their first corn crop in the center-south region with 4.1 percent complete. Argentina begins corn planting in September and goes into January while significant soybean planting takes place in November. There is a stronger correlation for lower La Niña yields in Argentina vs. Brazil. Conab is estimating Brazil’s 2021-22 soybean production at 141.3 mmt vs. the USDA’s 144 mmt estimate. Soybean acreage is expected to increase by 3.6 percent.

Weekly export sales were big after several consecutive days of announced new crop sales during the reporting period that ended Aug. 19. Old crop sales were 2.8 million bushels. Total old crop sales are 2.284 billion bushels, surpassing the USDA’s 2.26 billion bushels forecast. China has 28 million bushels of old crop sales left to ship. New crop sales were 64.3 million bushels to bring total sales to 573.7 million bushels. Last year we had sold 823.9 million bushels by this week. China has purchased 246.2 million bushels for new crop, well behind last year’s 459.3 million bushels by this date.

The government in Argentina is moving ahead with plans to create a new government agency to manage dredging operations on the Parana River. Until now, cargo ships paid tolls directly to the private dredging company doing the work. Under the new setup, toll would be paid to the governments, who will then pay the dredger. Shippers and farmers are concerned about the timeliness of payments to the dredgers to avoid any disruptions as well as a new layer of government adding to costs.

Outlook: Finishing rains across the eastern and western grain belts should increase pod fill or at the least stifle further deterioration. We’ll see what effect Hurricane Ida has on any early harvest activity in the Delta. The dryness in South America is gaining attention as their planting season approaches. It doesn’t look like we’ll be solving our tight soybean carryout situation in one year if there are any issues in Brazil and Argentina this year.

November soybeans staged a good rally early in the week after plunging over 74 cents in the previous week, but technical resistance limited the recovery. Good daily export sales weren’t enough to push through the resistance levels but were enough to bring prices back above $13.00 per bushel. Can this last? I would anticipate consolidation as the market evaluates what happens in the Delta with Hurricane Ida and any details released about the biofuel blending mandates. The direction of the energy market will also play into where soyoil, and then beans, head over the next few weeks. In general, if the weather allows for additional yield to be added, the trend will likely be lower.

For the week, November soybeans were 32.5 cents higher at $13.23.25, January was 31.5 cents higher at $13.27.25, and November 2022 beans rallied 40.75 cents to $12.67.25 per bushel.

Nystrom’s notes: Contract changes for the week as of the close on Aug. 27 (December contracts): Chicago wheat up 4.25 at $7.32.5, Kansas City 8.25 cents higher at $7.24, and Minneapolis jumped 15.5 cents to $9.17.75 per bushel. v

Open communication is key

JOHNSON, from pg. 18

Remember, whatever your relationship with your parent has been, this new phase of life will present challenges for both parties. By treating your parent with love and respect — and taking the necessary steps toward open communication — you will be able to provide the help needed during this new phase of life.

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