Written Commentary
SOYBEANS
Soybeans and soyoil ended lower. USDA lowered World soybean use 6 mmt. China was 2 mmt. Some still looking for the other 4 mmt. USDA dropped World soybean production 10 mmt or 350 mil bu. Still, USDA raised US soybean exports only 40 mil bu. USDA lowered World soybean imports 6 mmt, 3 mmt China. USDA dropped World Soybean stocks 3 mmt, 1 mmt each US, Brazil and Argentina. The big question will come in May when USDA will have to come up with their first estimate of US/World 2022/23 supply and demand with zero South America soybean export supplies available until their next harvest. Most feel USDA may be 10 mmt too high in South America soybean crop size and atleast 100 mil bu too low in US total soybean demand and too high in the carryout. Weekly US old crop soybean exports are estimated near 900-1,700 mt vs 857 last week and 900-1,500 mt new crop versus 1,386 last week.
CORN
Corn futures ended lower and near session lows. Risk off in Crude weighed on most commodity prices including corn. Corn futures ended near session lows. USDA really did not change their World corn outlook much and not enough to satisfy the bulls. USDA lowered World corn production only 1 mmt with Brazil unchanged and Argentina down 1 mmt. Some feel final South America corn crop could be down another 10 mmt. USDA increased World corn demand only 1 mmt. They raised Ukraine demand 3 mmt? USDA dropped World corn imports 3 mmt of which Egypt was 1 mmt. USDA dropped Ukraine exports 6 mmt and raised US 2 mmt. They kept Brazil exports at 43 mmt and Argentina at 39 mmt. Some feel Ukraine may not ship 15 mmt. USDA raised Ukraine domestic corn feed use 3 mmt? There is also concern that Ukraine may not plant the 40 mmt 2022 corn crop. USDA raised US ethanol use 25 mil bu. Weekly US ethanol production was up 3 pct from last week and 9 pct from last year. Stocks were up 1 pct from last week and up 14 percent from last year. USDA raised US corn export 75 mil bu. This despite the fact Sep-Jan census exports are even with last year versus USDA est down 9 pct. Weekly inspections do not include rail to Mexico and truck to Canada.
WHEAT
Wheat futures ended sharply lower and down the daily price limit. The reversal in US Dollar and Crude weighed on many commodities including wheat. Most were looking for a neutral USDA report but fact they raised World wheat end stocks was especially negative. As expected USDA finally raised Australia wheat crop 2.3 mmt and exports to 27.5. Problem is that some feel their export capacity may be only 24-25 mmt. USDA also raised India wheat export from 7.0 mmt to 8.5. USDA raised World wheat feeding 1.5 mmt. Mostly in Ukraine? USDA dropped World wheat exports 3.5 mmt. Russia was down 3 mmt and Ukraine down 4 mmt. Some feel final Black Sea wheat exports could be down another 8 mmt. USDA still estimates EU wheat exports at 37.5 mmt which some feel is 3-5 mmt too high. USDA lowered US wheat exports 10 mil bu due to slow export sales pace. They raised HRW and SRW end stocks and lowered HRS. While some could see support on corn and soybeans they feel that the wheat futures market may have a daily chance of limit up or limit down until more is known about Black Seas exports and US 2002 crop size.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
