Written Commentary
by Steve Freed,
SOYBEANS
Soybeans and soymeal traded lower. Lack of New China buying US soybean offers resistance. Concern about US meat production and demand is weighing on soymeal. US Midwest forecast calls for better US planting weather. Noon GFS added rains to the US Midwest but may be adding too much rain. Weekly US soybean exports were near 19 mil bu vs 14 last year. Season to date exports are near 1,209 versus 1,140 last year. Exports are running 69 mil bu above last year. USDA estimate exports to be 27 mil bu above last year. Brazil prices are lower than US to China. Total US soybean export commit is near 1,382 mil bu vs 1,625 last year. Commit is running 243 mil bu behind last year. USDA estimates US exports to be 27 mil bu above last year. This suggest final exports could be below USDA guess. Key to 2020 prices besides weather will be China demand for US soybeans.
CORN
Corn prices continued to trade lower. Unprecedented drop in Crude oil prices continues to weigh on ethanol margins. In April, USDA dropped US ethanol corn use to 5,050 mil bu or down 350 mil bu. They tried to offset the drop in increasing feed use 150 mil bu. Some feel final ethanol demand could be lower. Drop in US meat demand and processing could also reduce feed Use. US Midwest 2 week weather should aid 2020 corn plantings. Weekly US corn exports were near 27 mil bu vs 53 last year. Season to date exports are near 834 versus 1,310 last year. Exports are running 476 mil bu below last year. USDA estimate exports to be 340 mil bu below last year. Total US corn export commit is running 395 mil bu behind last year. USDA estimates US exports to be 340 mil bu below last year. Some forecast total US 2019/20 corn demand could be down another 300 mil bu. US offering aid to farmers. Total could be $19 billion dollars. $3 billion for food banks. $9.6 billion for Livestock. $3.9 billion for crops. $2.1 billion for fruits and vegetables.
WHEAT
Wheat futures traded higher. Initial buying was due to concern over dry weather in parts of East Europe and Black Sea. News that Russia might suspend exports pushed prices higher. Russia set a wheat export quota of 7 mmt for April-June. They may have shipped 4.5 mt in April. They could suspend exports for 6 weeks. Noon GFS weather model added some showers for the dry areas especially Ukraine and south Russia. Drop in Energy futures may have weighed on wheat futures into the close. Weekly US winter wheat crop ratings should remain near 62 pct good/ex. Weekly US wheat exports were near 17 mil bu vs 30 last year. Season to date exports are near 807 versus 763 last year. Key to prices will be weather. Some doubt wheat futures can move much higher with North Hemisphere wheat harvest just 6 weeks away.
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.
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.
