World Perspectives
feed-grains soy-oilseeds wheat

PM Post - Position Evening Ahead of Report

THE OPEN

November beans:  10 1/2 higher

December meal:  4.40 higher

December soyoil:  14 higher

December corn:  6 3/4 higher

September wheat:  4 higher

The markets opened as expected with further short-covering in grains and technical buying in wheat.  Traders returned to a buy meal/sell soyoil trade, pushing soyoil back to the lower end of its trading range.    Macros were negative, with crude lower which was the major reason for a weaker soyoil trade.  Argentina's grain markets remain closed today and Friday due to a public holiday.  

SOY

  • The major feature in the soy complex was that of weaker oilshare as traders continued to sell soyoil on weaker macros.  
  • Stocks and energies were lower, with crude trading back below $40/barrel as more concerns emerge over the impact of the virus on economies.  Sep. oilshare traded down to 32.17% with crush values trading firmer at 76.85c/bu.  December soyoil charts turned decidedly negative after placing a new top trade this week at 2964c, filling a gap but unable to make further gains.  Prices triggered sell-stops under 29c as futures turned lower against meal.  
  • December meal prices took another run at current highs of $308.00, but also turned lower as macros continued to sell-off throughout the day.  
  • November beans remained well bid as funds are net long, but also saw profit-taking from longs willing to lock in a profit close to recent highs this week at $9.12.  
  • Spreads were slightly weaker as the farmer has been engaged more after target prices of $9.00 were traded.  August/Nov beans widened back out to 5 3/4c from 3 3/4c, while Sep/Dec meal traded from $5.20 out to $ 5.90.  

GRAINS

  • Grains remained well supported as wheat values continued to see more short-covering.  
  • Open interest declined for both wheat and corn yesterday indicating that funds continue to opt out of both markets, reducing risk in front of tomorrow's USDA report and extended weather outlooks.  
  • Reports out of the country are that crops are in good shape, but slightly behind due to recent dryness.   This makes it imperative that weather for the second half of July offers up better chances for rainfall.  Further dryness during the bulk of pollination will create further short-covering for corn, which probably drags wheat higher as well.  
  • Spreads were also firm with Sep/Dec corn narrowing into 6 3/4c before finding a bit of bear-spreading activity.  Sep/Dec wheat values traded from 2c out to 5 3/4c, but remain very firm.  Wheat continued to gain on corn with Sep wheat/corn trading from 1.75 3/4c from lows of 1.64 1/4c.  

AT 12:00 THE MARKETS ARE AS FOLLOWS:

                                                         HI                                  LO

November beans:  4 higher          9.09 1/2                        8.96 1/2

December meal:  3.60 higher        307.10                         301.60

December soyoil:  28 lower          2944                             2890

December corn:  4 higher            3.62                               3.53 1/4

September wheat:  10 higher      5.29 3/4                         5.15 3/4

November canola:  1.00 higher   481.50                          478.00

OUTSIDE MARKETS

The stock market opened defensively but found more pressure throughout the trading session as virus counts accelerate across the country.  Big money buys the US dollar, (jobless claims not as bad as expected), while selling energies, (crude down as economies suffer from virus).  Stocks are down 350 pts.  

CLOSING COMMENTS

Look for continued position - evening heading into the data tomorrow.   Look for pullbacks in beans and meal to see buying interest, and pullbacks in grains to see continued short-covering.  The USDA report will find prices reacting with elevated volatility given post June 30 data, but it will be back to weather after the numbers are released.  With hot and dry conditions called for into July 24, look for any weakness in grains to probably be a buying opportunity for another leg higher.  Rumors of China around the bean market and any hint of corn biz also will find futures higher for the short term.

The markets could have reached some temporary highs, but all in all there is still not a good reversal to indicate that further strength would not be ahead. 

 

WPI on Twitter

Related Articles

Good Friday

Tomorrow, 29 March is a holiday for the CBOT/CME markets in observance of Good Friday. Please note that our office will also be closed. The next Ag Perspectives will be published Monday, 1 April. ...

feed-grains soy-oilseeds wheat

Market Commentary: Wow, Some Fun Information!

USDA’s much anticipated Prospective Plantings and Quarterly Stocks reports had few shockers, but they did shuffle the board a bit. First, the top line stuff: Corn Planted area was expected to drop due to higher input costs and lower prices, but USDA’s 90-million-acre number was at t...

livestock

Livestock Roundup: Hogs and Pigs Report Neutral with Bearish Undertones

Today, USDA released its quarterly Hogs and Pigs report for the December through February quarter. The total inventory of hogs and pigs on 1 March was 74.6 million head, which was 101 percent of March 2023 and the highest since 2020. That was slightly higher than pre-report expectations. Total...

Good Friday

Tomorrow, 29 March is a holiday for the CBOT/CME markets in observance of Good Friday. Please note that our office will also be closed. The next Ag Perspectives will be published Monday, 1 April. ...

feed-grains soy-oilseeds wheat

Market Commentary: Wow, Some Fun Information!

USDA’s much anticipated Prospective Plantings and Quarterly Stocks reports had few shockers, but they did shuffle the board a bit. First, the top line stuff: Corn Planted area was expected to drop due to higher input costs and lower prices, but USDA’s 90-million-acre number was at t...

livestock

Livestock Roundup: Hogs and Pigs Report Neutral with Bearish Undertones

Today, USDA released its quarterly Hogs and Pigs report for the December through February quarter. The total inventory of hogs and pigs on 1 March was 74.6 million head, which was 101 percent of March 2023 and the highest since 2020. That was slightly higher than pre-report expectations. Total...

Divergent Perspectives

China doesn’t offer the best business environment for American companies and FDI has plummeted. But Xi Jinping told CEO’s that his country will continue building a “first class business environment.” Meanwhile, Joe Biden tells American companies that they are monopolies...

Image
From WPI Consulting

Forecasting developments in production agriculture

On behalf of a private U.S. agricultural technology provider, WPI’s team generated an econometric model to forecast the movement of concentrated corn production north and west from the traditional U.S. Corn Belt. WPI’s model has subsequently provided quantitative support to a multi-million-dollar investment into short-season corn variety development. WPI’s methodology included a series of interviews with regional grain elevators and seed consultants. Emphasizing outreach and communication with stakeholders who possess intimate sectoral knowledge – on-the-ground insights – is a regular component of WPI’s methodologies, made possible by WPI’s ever-growing network of industry contacts.

Search World Perspectives

Sign In to World Perspectives

Don’t have an account yet? Sign Up