Written Commentary
MORNING OUTLOOK
Grains are mixed. US stocks are lower. Crude is lower. Gold, silver, copper, coffee, sugar and cotton are lower. SN is up 1 cent and near 16.95. Overnight high was 17.02. SX is near15.22. SMN is near 461.3. BON is near 77.66. CN is down 1 cent and near 8.05. Overnight high was 8.14. CZ is near 7.50. WN is down 3 cents and near 11.25. Overnight high was 11.43. KWN is down 1 cent and near 11.87. Overnight high was 12.02. MWN is down 2 cents and near 11.76.
Ukraine war escalated with Russia push to take Donbas region. US Fed poised to raise interest rates to fight inflation.
Corn futures made new highs overnight. Talk of lower Ukraine exports, higher US exports, higher US ethanol margins and higher US domestic wheat prices increasing US corn feed demand helped prices rally. US estimated US corn planting only 4 pct vs 6 average. US Midwest weather will be cool and wet for another week. 2nd week looks drier. US corn exports 1,306 mil bu or down 16 pct vs last year. Managed funds long 387,000 corn contracts and raising concern futures may be overbought and do for a correction. Central Brazil dry. Brazil corn near $8.20.
July soybeans tested 17.05 overnight. Rally without increase in open interest. Trade watching for new China demand. US exports are near 1,689 mil bu or down 17 pct vs last year. US soybean export prices are compettive August foreard. Some concern about China commodity demand due to lower economy and covid lockdown. China announced they will release 500 mt
Soybean reserves to COFCO. Crushers are having trouble sourcing beans? China Jan-Mar pork production up 14 pct from last year. US March soybean crush record high. Cash margins near $3.00. Higher World vegoil prices has BOK near 80 cents. Soyoil as pct of crush near 46 pct or highest since November. Argentina infaltion hit new highs. Government considering taxing companies including grain who are making profits due to Ukraine war to give money to poor.
Wheat futures are giving back some of Mondays gains. Ukraine war continues. 57 vessels are locked on Ukraine ports or 1.25 mmt grain and oilseed. There is risk of grain spoiling. USDA lowered US 2022 winter wheat crop rating 2 pct to 30 pct G/E and lowest since 1996. US wheat exports are near 664 mil bu or down 18 pct versus last year. US south plains forecast is warm and dry especially in west. USDA estimated US spring wheat plantings 8 pct vs 9 average and 6 last week. Recent heavy snows is slowing US and Canada spring wheat plantings.
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