Written Commentary
Grains are mixed to lower. SU is down 1 cent and near 8.82. CU is unchanged and near 3.16. WU is down 6 cents and near 5.26 US stocks are lower. ADM earnings were better than expected. US Dollar is slightly higher. Crude is higher. Gold is lower. US Fed talked about keeping interest rates low. Virus impact of global economy still offers resistance to commodities. Johnson and Johnson human virus test was successful.
Chinese Ag futures (Sep) settled up 19 yuan in soybeans, up 3 in Corn, down 18 in Soymeal, up 92 in Soyoil, and up 60 in Palm Oil. Malaysian palm oil prices were up 5 ringgit at 2,649 (basis October) at midsession looking for its biggest monthly jump in seven months.
Showers and thunderstorms will bring moderate rainfall to central/southern sections of the US Midwest over the next 5 days. The 6 to 10 day forecast for the Midwest still has limited rains for most of the region with any rainfall favoring southern/eastern sections of the Midwest. Temps run below average over the next 10 days.
The 11 to 16 day forecast for the Midwest is mixed with the GFS model showing a bit below average rainfall for the region with temps running below. The European has above average temps and limited rainfall.
Weekly US wheat export sales are estimated near 250-650 mt, corn old and new crop 600-1,500 mt and old and new crop soybeans 1,800-2,500.
Soybean futures are slowly given back US 202 weather premium and China buying premium. Some fear China will only buy basic needs from US until Brazil new crop harvest in 2021. This plus a higher US crop than USDA current estimate will add to carryout and push prices lower. Soyoil continues to trade higher and grab a higher percent of crush value.
Us corn futures are near contract lows and now 7 cents below pre USDA acreage reports prices. Large US 2002 corn crop potential and less than average demand continues to weigh on prices. China corn futures continue to traded higher. The may need to import corn but no signs of US interest. Argentina lowered their corn crop estimate but farmer selling increased.
Wheat futures continue to struggle between lower World supplies and even lower demand. Drop in corn prices also offers resistance to wheat futures.
On Wednesday, Managed funds were net buyers of 7,000 contracts of SRW Wheat; net sold 14,000 Corn; sold 4,000 Soybeans; net sold 1,000 lots of soymeal, and; bought 2,000 Soyoil. We estimate Managed Money net short 4,000 contracts of SRW Wheat; short 161,000 Corn; net long 76,000 Soybeans; net short 25,000 lots of Soymeal, and; long 34,000 Soyoil.
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