USDA Yields No Surprises
USDA’s latest grain acreage and stocks report had no big surprises and drew yawns from the markets. Both corn and soybean acreage is down around 1% from last year, but that will likely be offset by higher average yields with current crop conditions. Soybean stocks are up 26% from last year, most of it sitting in elevator bins. Corn stocks are up only 1%, with farms holding 3% less and elevators with 7% more.
Crop Report
The main US corn/soybean states are getting plenty of moisture and heat - too much in some cases. Southern MN is drowning - over 10 inches of rain in last few days in some places - on top of already wet soils. Overall, crops look very good. Here’s what the corn looks like in SD:
And in Iowa:
While in north Missouri and NW Ohio they could do with a drop or two more of rain:
Meanwhile, Canadian Prairie farmers would love to see more of the MN rain systems move north:
ADM Makes A Big Feed Move
ADM is planning to scoop up large French animal feed concern Neovia for $1.8 billion. It would give ADM a big boost to its animal nutrition business which has much greater potential for higher margins than its core commodity trading business. It bought food ingredient company Wild Flowers for $3 billion in 2014 but was rebuffed in a takeover attempt of Bunge earlier this year. Neovia had revenue of $2 billion in 2017 and makes a range of products in areas such as pet care, aquaculture, and livestock feed. It has a global footprint, but a weak presence in the US, making it a good fit for ADM. A new animal nutrition unit called ADM-Neovia will be created to sell each company’s brands together and leverage increased scale in ingredient purchasing and logistics.
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