Written Commentary
MORNING AG OUTLOOK
USDA report day. Grains are higher. US stocks are higher. US Dollar is higher. Crude is mixed. Gold is lower.
Soybeans are higher before USDA numbers following higher soymeal trade. Soymeal rallied after USDA weekly export sales were higher than expected. Some feel this could be the first sign that World soymeal demand could be switching to US. It is still dry in Argentina and their economy is worsening with Central Bank claiming they are broke, Argentina has imported 950 mt of soybeans Jan-April from Brazil. Tuesday NOPA crush could be high at 174.2 mil bu. World vegoil prices continue to drop on demand concern and higher sunoil and RSO supplies. All up to market reaction to USDA today. USDA should lower US soybean exports and increase carryout.
Corn is mixed. Weekly export sales were lower than expected. US Midwest weather is favorable for crops. US export commit remains down 35 pct from last year. CONAB raised slightly their corn crop to 125.5 mmt. USDA should increase Brazil corn crop and lower Argentina. Key could be USDA est of 2024 Brazil and Argentina crops with El Nino should bring rains back to Argentina. Argentina economy is worsening with Peso near 495 vs official rate of 229. All up to market reaction to USDA today. USDA should lower US corn exports and increase carryout.
Wheat futures are higher led by KC. Some of the driest HRW crop areas missed needed rains. There is still too much rains in US HRS areas, not enough in Canada, Argentina and Australia. Australia est crop near 28 mmt vs last year record 39. Key to USDA number is US crop and World 2023/24 crop production especially Black Sea and EU. Weekly US export sales were only 26 mt with US exports now down 80 mil bu from USDA with only 3 weeks to go before season end.
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