We are still in the price discovery process for 2017 crop insurance price elections. Currently, oil type sunflowers are at $18.40 and confections are $27.40 per cwt, both are higher than last year at this same time. In 2016, oil types were at $17.00 and confections were $26.80 per cwt. To follow sunflower price election trends, watch the 2017 CBoT December soyoil contract through February 28. Final price elections will be announced in early March. Traders continue to focus on South America crop prospects. Recent weather events have done nothing to change thoughts that South America will harvest a big oilseed crop. Brazil's soybean harvest is moving along rapidly. Traders also got a reminder about the potential for a big increase in soybean acres this spring, when USDA released its 10-year baseline projections for agriculture this week. While the forecasts didn't include anything new about 2017 planting intentions, it reinforced the idea that soybean acres could increase significantly. USDA will update its statistical guesses at its annual Agricultural Outlook Forum next week. Traders will pay close attention to USDA’s expectations for 2017 planted acres, supply & demand outlooks along with ending stocks figures. This will give the market some numbers to crunch ahead of the March reports.
New crop sunflower prices are out at the crush plants with cash and Act of God (AOG) contracts available. Something else to consider is the oil premiums that crush plants pay on sunflower. Sunflower is the only oilseed that pays premiums for oil content above 40%. Considering oil premiums that are offered at the crush plants on oil content above 40% at a rate of 2% price premium for each 1% of oil above 40%; this pushes a contract with 45% oil content gross return 10% higher per cwt.