Written Commentary
MORNING COMMENTS
Geopolitics:
Get ready to hear about the upcoming election and how the difference in policy proposals may or may not effect the market. I am hoping we do not see a black swan event between now and November 5th, and that includes activity overseas. The possibility of a change in trade policies or a abrupt halt tot the Ukraine/Russia conflict would both effect prices dramatically.
Ag Fundamentals:
China is still quiet. Knowing the United States is 15 days away from new leadership, and their stimulus details still unclear, China remains patient. China grew a solid corn crop so corn imports are not necessary and this last year’s South American production has been able to sustain. The window of time that consists of dense Chinese buying from the US is now through March. A large 23/24 South America bean production, a large Chinese corn crop, an economic slow down, and a huge US harvest has all given China a good reason to wait until after the election to show all their cards. We have about 4 months before that window starts to close. Brazil has gone from 8% to 25% week over week in the north/central growing regions. If they continue to see appropriate weather over winter, they could break records.
Weather:
The Midwest may see some small rains come across Iowa and into Illinois on Tuesday, but it will not be much. Additional rain could make it’s way through northern Missouri, eastern Iowa, eastern Minnesota and Wisconsin by Friday morning. It is raining almost every day in Sao Paulo, Brazil this week. The only areas that may see drier than normal weather is the southern tip of Brazil and this area had already received plenty of rain earlier this summer.
The CFTC Commitment of Traders Disaggregate shows managed money increasing their corn short about 63K contracts and increasing their soybean short about 19K contracts.
The CFTC Commitment of Traders Supplemental shows Index funds selling 32,698 contracts of corn.
Export & World News
Taiwan bought 65K MT of corn from Brazil. South Korea is believed to have bought 65K MT of animal feed corn from the US. Iran is looking to buy 120K MT of animal feed barley.
Malaysian palm oil futures were up overnight 47 ringgit, at 4302.
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.
