Written Commentary
CORN
Prices plunged $.08-$.13 as speculators pare back from the recent surge in ownership. Support for May-26 is at its 100 day MA at $4.47. MM’s were net buyers in the Ag. space for an 8th consecutive week adding nearly 231k contracts extending their net long position to 780k contracts, the largest since May-22. MM’s bought just over 140k contracts of corn, the most in a week since May-19, extending their long position to 193K contracts. The producer/merchant short position surged by nearly 144k contracts, also the most in a week since May-19, an indication of huge farmer selling. AgRural reports Brazil’s 1st crop harvest has reached 50% while 2nd crop plantings are at 91%. Export inspections at 65 mil. bu. were in line with expectations and just above the 63 mil. bu. needed to reach the USDA forecast. YTD inspections at 1.688 bil. are up 39% YOY vs. the USDA forecast of up 15.5%. Noted buyers were Mexico – 17 mil., Japan – 11 mil. while Colombia, South Korea and Spain all took 5-7 mil. bu. each.
SOYBEANS
Prices plunged across the complex with beans off $.40-$.70, meal was down $5-$11.50 while oil was also down the daily limit of $.03 ½ lb. The 50% retracement from the Jan-26 low to last week’s high is at $11.45 ½. May-26 meal violated support at its 100 day MA with next support at the March low at $307.50. Headlines from US Treasury Sec. Bessent and USTR Greer’s talks with Chinese trade officials in Paris this weekend were overshadowed by Pres. Trump’s threat to postpone his meeting with Xi unless China agrees to work with the US to reopen the Straits of Hormuz. That threat for now has at least temporarily broken the spirit of soybean bulls. Spot board crush margins (based of synthetic’s) rose another $.09 at $2.35 ½, the highest since Nov-23, with bean oil PV slumping to 50.4%. MM’s bought just over 75k contracts across the soybean complex extending their combined long position to a record large 411,606 contracts. Index funds are holding a record long position in soybeans at just over 219k contracts. Wire services reports talked centered on China’s purchase of US Ag. goods, US export controls on high tech goods, China’s rare earth metals and US tariffs. AgRural reports Brazilian soybean harvest has reached 61% while harvest in Mato Grosso, their largest production state, has reached 96%. Export inspections at 35.5 mil. bu. were above expectations. YTD inspections at 1.031 bil. are down 28% from YA vs. the USDA forecast of down 16%. China took 20 mil. while Egypt to 8 mil. NOPA crush at nearly 209 mil. bu. was above expectations of 199-206 mil. Higher than expected crush however led to bean oil stocks growing to nearly 2.1 bil. lbs. at the high end of expectations and well above the 1.503 bil. from Feb-25.
WHEAT
Prices ranged from $.10 lower in MIAX to $.17 lower CGO. Despite the weakness, CGO May-26 held within Friday’s range. KC May-26 experienced 2-sided trade as wild temperature swings this week and growing drought in the SW plains provided underlying support. Over the weekend Russia’s Ag. Ministry raised their export tax from zero to 135.4 roubles/mt for the period ending Mch. 24th. SovEcon reports Russia’s export price ended LW between $238-$240/mt FOB, the highest since last Aug-25. They forecast their exports in Mch-26 will range between 3.7-4.4 mmt. The combined MM position in wheat is net long across the 3 classes for the first time Oct-22. Export inspections at 13 mil. bu. were at the low end of expectations and below the 16 mil. bu. needed to reach the USDA forecast. YTD inspections at 715 mil. bu. are up 19% from YA, vs. the USDA forecast up 9%.
Charts provided by CQG
Risk Warning: Investments in Equities, Contracts for Difference (CFDs) in any instrument, Futures, Options, Derivatives and Foreign Exchange can fluctuate in value. Investors should therefore be aware that they may not realise the initial amount invested and may incur additional liabilities. These investments may be subject to above average financial risk of loss. Investors should consider their financial circumstances, investment experience and if it is appropriate to invest. If necessary, seek independent financial advice.
ADM Investor Services International Limited, registered in England No. 2547805, is authorised and regulated by the Financial Conduct Authority [FRN 148474] and is a member of the London Stock Exchange. Registered office: 3rd Floor, The Minster Building, 21 Mincing Lane, London EC3R 7AG.
A subsidiary of Archer Daniels Midland Company.
© 2021 ADM Investor Services International Limited.
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.
