Written Commentary
MORNING OUTLOOK
Grains are mixed. SX is up 9 cents and near 14.87. SMZ is near 427.0. BOZ is near 67.11. CZ is down 2 cents and near 6.90. WZ is up 4 cents and near 8.64. KWZ is up 3 cents and near 9.37. MWZ is up 4 cents and near 9.35.
US Dollar is lower. US stocks are higher. Crude is higher. Silver, coffee, cocoa, sugar and cotton are higher. Gold and copper are lower.
In general, markets are trying to recover from higher than expected US inflation data. S&P support is now near 3,880 with resistance near 3,960. US Dollar rallied on the news with support now near 107.62 and resistance 110.78. Crude support is near 80.48 with resistance near 92.70. Biden administration announced they will begin to buy Crude to replenish reserves at 80, They sold at 100.
There is talk that the Biden administration may soon add sanctions against China due to China talk of taking over Taiwan. This could slow even further China buying US soybeans. USDA will release 4 weeks of US export sales Thursday. There has been 1.93 mmt of daily sales, 755 to China, 805 to unknown and 230 to Mexico. Argentina soybean, soymeal and soyoil export prices are lower than US. China bought 5 soybean cargoes from Argentina yesterday. SX support is near 14.50. Resistance 15.10. BOZ is at 12 week high and oil share of board crush 3 month high.
Russia and Turkey are in talks about Ukraine export corridor deal. Russia and China are in talks about Ukraine war with Ukraine making advances in E Ukraine. USDA will release 4 weeks of US export sales Thursday. Some look for low corn sales due to lower Brazil, Argentina and Ukraine prices. US domestic corn demand remains strong. CZ support 6.70. Resistance 7.20. Some look for USDA to lower US corn yield on their October report. US exports could also be lowered. Matif corn traded higher on talk of lower French crop.
WZ could be in a 8.40 to 8.80 range. Dry US plains offers support. Lower Russia export prices, higher Dollar and higher US inflation offers resistance. US food inflation continues to rise which could lower food demand. An US recession could also increase unemployment. Some forecast US Central Bank could raise rates until unemployment hits 7 pct. Potential US rail strike could slow grain movement domestic and to export channels. This would be negative to basis.
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