Written Commentary
MORNING OUTLOOK
Grains are mixed. SK is up 8 cents and near 16.43. SMK is near 452.1. BOK is near 70.75 and new high. CK is down 3 cents and near 6.68. WK is down 4 cents and near 8.48. KWK is down 6 cents and near 8.86. MWK is down 2 cents and near 9.85.
US stocks are higher. US Dollar is lower. Crude is lower. Gold and silver ae lower. Copper, coffee, cocoa and cotton are higher. Is there hope sanctions will slow Russia invasion of Ukraine?
Grains are mixed in front of this weeks US Outlook conference and Friday US export sales data. Are grains beginning to trade less South America news and more trying to look ahead of 2022 World crops and demand? Some feel soybean and corn can trade higher on increase demand. Wheat may follow the latest headline concerning Russia and Ukraine.
Rains are forecasted for the east half of Argentina and S Brazil. Drier weather should help C/N Brazil soybean harvest. Market is concerned that China is not buying US old crop soybeans with inverse, new crop is more attractive. US soybean exports are down 22 pct vs last year. Soyoil is trading over 70 cents with all time highs in sight. Malaysian and Dalian palmoil futures are at all time highs. Brazil soybean fob values continue to trade higher despite increase harvest. Matif rapeseed futures are at 6 week highs. Dalian soybean were lower, soymeal higher.
Corn futures are taking a breather after setting new contract highs on concern over Ukraine exports and lower Argentina crop supply. US weekly corn export was season high but total exports are down 11 pct from last year. EU needs 4-5 mmt Ukraine corn. What will Putin do next? Matif corn is higher. Brazil domestic corn prices are higher and near $8.25. Most still look for US 2021/22 corn carryout near 1,200 versus USDA 1,540 with March-June US corn demand estimated to be record high. It does not feel like corn futures are overvalued yet. Dalian corn futures were higher.
Wheat futures may also be taking a breather after Tuesdays sharp gains. Wheat trade waiting for Putin next move. Some feel USDA could be overstating EU, Russia and Ukraine wheat exports by as much as 15 mmt or 550 mil bu. USDA estimate of World import needs could also be 4-5 mmt too low. Yesterday Nigeria bought US old and new crop HRW. USDA dropped KS crop rating to 26 pct G/E vs 30 last month and 40 ly, OK 9 vs 16 and 48 and TX 10 vs 10 and 40 last year. 20 pct of US HRW soil moisture is adequate vs 50-70 last year. It does not feel like Wheat futures are overvalued yet.
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.
