Written Commentary
CORN
Prices were $.02-$.03 lower settling at about the midpoint of the day’s range. Spreads were mixed. Not even supportive export news could keep corn prices higher in the face of very favorable US weather. The Trump Administration did strike a trade deal with the UK which they claim will open $5 bil. in opportunities for the US. Pres. Trump stated this deal will increase US beef and ethanol access into the UK. July-25 posted a fresh 5 month low before recovering into the close. Next support is the November low at $4.36 ¾. Fresh 5 month low for Dec-25 with next support $4.28. Exports at 66 mil. bu. were above expectations. YTD sales at 2.378 bil. are up 27% from YA, vs. the USDA forecast of up 11%. Commitments represent 93% of the USDA forecast, above the historical average of 88%. Noted buyers were Japan – 13 mil., Taiwan – 11 mil. and Spain with nearly 10 mil. The USDA also announced fresh sales to Mexico and an unknown buyer.
SOYBEANS
Prices were mixed today. Late day strength enabled beans to close $.03-$.06 higher. Meal was slightly lower while oil surged late closing more than $.01/lb higher. Spreads were steady to higher across the complex. July-25 beans held support at this week’s low of $10.36 ½. July-25 meal continues to consolidate just above its contract low at $289.70. Inside trade for July-25 oil as it recovered yesterday’s losses. Spot board crush margins jumped $.06 to $1.20 ½ bu. with bean oil PV back above 45%. Pres. Trump today said he feels this weekend’s talks with China will become more substantive while also leaving the door open for lowering tariffs on Chinese imports, in contrast to what was said yesterday. Away from the SE a warm/dry pattern will remain intact until early next week across the rest of the nation’s midsection. Week 2 of the outlook brings better prospects for rain, nearly ideal for early crop development. Exports at 14 mil. bu. were in line with expectations. YTD commitments at 1.753 bil. are up 13% from YA vs. the USDA forecast of up 8%. Commitments represent 96% of the USDA forecast, in line with the historical average. Noted buyers were Mexico and unknown with roughly 5 mil. each. In addition the USDA announced the sale of 225k mt (8.2 mil. bu.) of 25/26 soybeans to Pakistan. Outstanding sales to China have slipped to 2 mil. bu. with another 63 mil. to unknown. The BAGE raised their Argentine production forecast 1.4 mmt to 50 mmt, now just above the USDA forecast of 49 mmt. Dry conditions enabled harvest to surge 21% to 45% complete, just shy of the YA pace at 48%.
WHEAT
Prices range from $.02 lower in MGEX to $.05 lower in CGO and KC. Despite the weakness spreads firmed a bit. New contract low for KC wheat. Exports at 21 mil. bu. (3 mil. – 24/25, 18 – 25/26) were above expectations. Old crop commitments at 787 mil. bu. are up 14% from YA, vs. the USDA forecast of up 16%. Commitments represent 96% of the USDA forecast, in line with the historical average. YTD by class commitments vs. USDA est. are: HRW +53% same as USDA, SRW -27% vs. -24%, HRS +4% vs. +8.5%, and white +44% vs. +45%. Stats Canada reports all wheat stocks (including durum) at 15.421 mmt as of Mch 31st were slightly below YA 15.601 however above expectations of 14.9 mmt. My US 2025/26 ending stocks forecast at 888 mil. bu. would represent a 6 year high. US winter wheat acres in drought slipped 1% to 22% matching the YA level. Spring wheat acres in drought held steady at 37%.
Charts provided by QST.
>>See more market commentary here.
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.
