Old crop prices were unchanged this week. New crop NuSun prices were down 10 to 30 cents with high oleic down 25 cents to up 10 cents. USDA updated its statistical guesses at its annual Agricultural Outlook Forum this week. USDA predicts 94 million acres of corn to be planted in 2020, 2 million more acres than predicted at last year’s outlook and up 4.3 million acres from 2019. 2020 soybean acreage will take the majority of last year’s 16 million prevented plant acres. Around 85 million acres of soybeans are forecasted to be planted this year, up nearly 9 million acres from last year. Both estimates were higher than industry guesses. If realized this will not be helpful and could cause ending stocks to build pressuring 2020 prices for corn and beans if Chinese demand remains subdued. Traders are anxiously awaiting new Chinese purchases to materialize, with the phase-one trade deal signed a month ago and recently enacted. China continues to battle a coronavirus outbreak, which has impacted soybean import needs in the short-term. There is only one week left in determining 2020 crop insurance spring prices. The price election for oil type sunflowers is expected to be around $16.70 with confections at $22.50 per cwt. Final price elections will be announced in early March. In the week ahead, US export demand news and South American weather will continue to be the main market movers.
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.