Written Commentary
MORNING AG OUTLOOK
Grains are higher. US stocks are slightly lower. USD is lower and below key moving averages. Crude is lower and also below key moving averages. Gold is lower but continues to trade sideways. Trade uncertain about US Fed independence. US Midwest forecast is dry but cool.
SOYBEANS
SX is near 10.54. Soybeans up after news a Chinese delegation will come to Washington. Problem is that delegation will not meet key US officials. China US ambassador suggested US protectionism hurts US Ag buying outlook. Dalian soybean, soymeal and palmoil futures were lower. US soybean exports are up 11 pct vs USDA up 10 pct. Pro Farmer est US soybean yield may be a gift to US farmers. USDA rated US soybean crop 69 pct G/E up 2 pct with 89 pct setting pods and 4 pct dropping leaves. Rating suggest a US yield closer to 54.5 vs USDA 53.6. Soyoil remains uncertain while market struggles to make sense of US soyoil biofuel outlook. EU oilseed crush is lower which could drop protein supply.
CORN
CZ is near 4.14. 4.17 is next resistance. CU-CZ spread at -23 suggest adequate corn supply. Dalian corn futures were lower. US lakes are competitive to W EU. US gulf to EU and N Africa and PNW to Asia. US corn export are up 22 pcr vs ly and USDA up 25. Pro Farmer US corn yield at 182.7 may be a gift to US farmers. One group est US corn yield closer to 187.1 with states MN, OH,IN, NE,IA and SD higher than last year and offset lower MI, IL and ND yields vs ly. USDA rated crop 71 pct G/E, unch from last week but up vs 65 ly. 7 pct of crop is mature.
WHEAT
WZ is near 5.31. WZ range 5.00-5.50. KWZ is near 5.20. MWZ is near 5.90. Even in 2016 a year of global wheat oversupply wheat futures bottomed in September. US wheat exports were up 11 pct vs ly and USDA est up 6. USDA est US winter wheat harvest almost done at 98 pct. USDA rated US spring wheat crop 49 pct G/E vs 69 ly. Harvest is near 53 percent. Matif futures were lower with increase carries. There is talk of a crop near 141 mmt vs USDA 138.2. Still, there remains concern over quality in EU and Black Sea vs good quality US HRW crop. Both Australia and Argentina futures were lower to start the week.
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