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Black Sea Futures at All-Time Highs

Grains Outlook

Grains are mixed. SX is unchanged and near 10.44. SMZ is near 356.3. BOZ is near 33.20. CZ is up 2 cents and near 3.87. WZ is unchanged and near 5.93. KWZ is up 2 cents and near 5.36. US stocks are higher. Crude is lower. Gold is lower. Fact POTUS reversed his stance on stimulus may be helping US stocks. Managed funds near record long grains and soybeans. Funds looking for friendly USDA report and dry weather in Russia, Argentina and US south plains.

CME Black Sea wheat futures traded at all time highs since contract started in 2017. Australia highest since May.

Chinese Ag futures are closed for a week long holiday (Oct 1st thru 8th). Malaysian palm oil prices were up 34 ringgit at 2,852 (basis December) at midsession as wet weather concerns and tighter virus curbs raises output fears.

The US Midwest 6 to 10 day forecast for the Midwest after staying mainly dry for the rest of the week. Models differ going from midweek forward. The GFS has light to moderate rains for MN and WI with lesser amounts to mostly dry the further south you go in the region. The European model has moderate rainfall for all of the Midwest. Temps will move to above average by the weekend and stay a bit above average through most of next week.

The Southern Plains over the 6 to 10 day period has the models differing with the GFS mainly dry for the region while the European model has light to moderate rainfall for areas except the western third of TX and OK. Temps will be running above average.

The Brazilian growing regions still has little rainfall for most areas through Friday. Rainfall looks to develop in the north over the weekend favoring the state of Mato Grosso with light to moderate amounts. The 6 to 10 day forecast does have rainfall developing north of Parana with light to moderate amounts and 85% coverage.

The Argentine growing regions has mostly dry weather over the next 10 days with some light rainfall in Buenos Aries later in the weekend.

There is talk that China soybean crushers may have bought 5-7 US Dec-Jan soybean cargoes on Tuesday.

Brazil old crop soybean supply is tight. Potential late plantings has Feb values trading higher. Argentina is dry and farmer is not selling. Farmer also looking for currency devaluation.

Managed funds are net long 277,000 soybean contracts. Key is USDA report, SA weather and China buying

Dec soymeal futures are making new contract highs on concern over SA weather and crush rates.US corn futures testing key resistance an talk of lower US supply and slow US/SA farmer selling. Chicago and KC wheat futures trading near 2019 highs on dry Russia, US and Argentina weather.

Average trade guess for US 2020 corn crop is 14,808, range 14,604-14,963. USDA is 14,900

Average trade guess for US 2020 soybean crop is 4,282, range 4,182-4,350. USDA is 4,313

Average trade guess for US 2020/21 corn carryout is 2,113, range 1,859-2,333. USDA is 2,503

Average trade guess for US 2020/21 soybean carryout is 369, range 285-460. USDA is 460

Average trade guess for US 2020/21 wheat carryout is 887, range 830-917. USDA is 925

Average trade guess for World 2020/21 corn carryout is 300.1 mmt, range 291.3-305.0. USDA is 306.7

Average trade guess for World 2020/21 soybean carryout is 91.6, range 88.0-94.1. USDA is 93.6

Average trade guess for World 2020/21 wheat carryout is 317.2, range 310.9-322.0. USDA is 319.3

On Tuesday, Managed funds were net buyers of 7,000 contracts of SRW Wheat; net bought 25,000 Corn; net bought 20,000 Soybeans; bought 10,000 Soymeal, and; net bought 4,000 Soyoil. We estimate Managed Money net long 52,000 contracts of SRW Wheat; long 190,000 Corn; net long 277,000 Soybeans; net long 97,000 lots of Soymeal, and; long 98,000 Soyoil.


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.

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