Written Commentary
Grains AM Outlook
Grains are mixed to higher. SX is up 3 cents and near 10.26. SMZ is near 340.8. BOZ is near 34.82. CZ is up 1 cent and near 3.71. WZ is up 4 cents and near 5.59. KWZ is up 5 cents and near 4.93. US stocks are mixed. Crude is higher. US Dollar is higher. Gold is lower.
Grains opened higher after steep losses on Monday. Grains traded lower as China futures and Malaysian palmoil prices traded lower but in line with US losses. Now grains are higher on rebound in equities and energies.
Chinese Ag futures (January) settled down 56 yuan in soybeans, down 7 in Corn, down 30 in Soymeal, down 122 in Soyoil, and down 166 in Palm Oil. Malaysian palm oil prices were down 65 ringgit at 2,942 (basis December) at midsession weakened by falling global equities, weaker Dalian vegoil prices, and new fears of Europe restrictions over the pandemic.
The 6 to 10 day forecast for the US Midwest has another front to work through later Monday into Tuesday bringing light to moderate rainfall. Those rains look to fall mainly in the northeast sections of the Midwest. Temps over the next 5 days look to run average and stay average over the 6 to 10 day period.
Brazil weather outlook in most production regions is unchanged. Showers and a few thunderstorms are still expected in center west and center south Brazil tonight and Wednesday which will begin to moisten the topsoil moisture a little. Greater rainfall will be needed though to promote better flowering conditions.
Yesterday’s U.S. weekly export inspections had Wheat exports running 8% ahead of a year ago (up 8% last week) with the USDA currently forecasting a 1% increase on the year, Corn 7% ahead of a year ago (up 28% last week) with the USDA up 32% for the season and Soybeans are up 6% on the year (up 49% last week) with the USDA having a 26% increase forecasted on the year
USDA estimated US corn crop is 61 pct good/ex versus 60 last week. Best crops remain in KY, MN, WI, IL, MO, and SD. Lowest rated crops are in IA, OH MI and IN. USDA estimated US corn harvest near 8 pct done. One crop watcher is still estimating US corn yield near 176.0 versus USDA 178.5
USDA estimated US soybean crop is 63 pct good/ex versus 63 last week. Best crops remain in KY, TN, MN, WI, MO, IL, and SD. Lowest rated crops are in IA, OH, LA, MI, ND and IN. USDA estimated US soybean harvest near 6 pct done. One crop watcher is still estimating US soybean yield near 51.0 versus USDA 51.9.
One group estimates Brazil 2021 soybean acres near 95.0 million versus 91.1 in 2020 and production 132 mmt versus 126 in 2020. Argentina 2021 soybean acres near 42.7 million versus 42.4 in 2020 and production 52 mmt versus 49.7.
Same group estimates Brazil 2021 corn acres near 48.4 million versus 45.4 in 2020 and production 110 mmt versus 102 in 2020. Argentina 2021 corn acres near 15.3 million versus 15.3 in 2020 and production 50 mmt versus 50.
It remains dry across most of Russia and Ukraine. Ukraine lowered their 2020 wheat crop to 25 mmt versus USDA 27. Winter wheat is 60 pct of Russia total wheat crop and 95 pct of Ukraine total wheat crop.
On Friday Managed funds were net sellers of 20,000 contracts of SRW Wheat; sold 35,000 Corn; sold 16,000 Soybeans; sold 4,000 Soymeal, and; net sold 7,000 Soyoil. We estimate Managed Money net long 25,000 contracts of SRW Wheat; long 66,000 Corn; net long 225,000 Soybeans; net long 61,000 lots of Soymeal, and; long 95,000 Soyoil.
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