Grains Higher With Some Short Covering
Grains are higher. SH is up 4 cents and near 14.76. SMH is near 449.1. BOH is near 64.20. CH is up 3 cents and near 6.63. WH is up 6 cents and near 7.68. KWH is up 5 cents and near 8.71. MWH is up 1 cent and near 9.24. US stocks are higher. US Dollar is lower. Crude, metals, softs and cotton are higher.
Could be some short covering and evening up before the long holiday weekend. CBOT grains are closed Sunday night and Monday. Weather remains a focus with US winter storm blast effecting US logistics and stressing US livestock. Chicago wind chill this am is -37F. Actual temp is -10F. There is talk of improving US supply chain improvements.
Grain analyst are suggesting US farmers increase 2022 wheat crop sales. This suggest 80 pct of 2022 corn would be sold, first 2023 sales, 40 pct of 2023 soybean crop sold and 60 pct 2022 wheat sold.
Central Argentina could see additional .50-1.50 inches of rain over next 72 hours. This after west Argentina saw .20-.80 inches. Argentina will turn drier Dec 26-Jan 5. Key is if then warming Pacific Ocean allows for normal Argentina rains mid Jan after. Weekly US soybean crop sales dropped to 27 mil bu Total commit is 1,560 mil bu vs 1,498.9. China commit is 924 with 216 in unknown. US sales could slow as early Brazil harvest is underway.
Corn futures rallied over 6.60 on new technical buying. Corn could be following higher Crude. CH support is now near 6.54 CH. US export sales were only 25 mil bu. Total commit is 812 vs 1,554 last year. China commit is only 145 mil bu with only 59 in unknown. Some hope for increase sales as Brazil supplies drop. Need to average 35/week to reach USDA goal. Any additional price premium due to Black Sea export uncertainty could be used for additional cash sales. Move from La Nina to El Nino could suggest favorable 2023 north hemisphere weather.
Wheat futures trying to decide what is more important dry and cold US weather and lower Argentina supply and lower EU export supply versus some long liquidation of Paris wheat futures and improving Russia export loading weather. Ukraine, Russia and US geopolitical risk offers support to wheat futures. There remains concern about a global recession is 2023 slowing food demand. US domestic wheat prices could increase feed use versus corn. US wheat export commit is 530 mil bu vs 574 last year. Russia prices are still lowest.
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.