Explore Special Offers & White Papers from ADMIS

Grains Mostly Lower After Wild Overnight Trade


Grains are now mostly lower. A new and highly contagious strain of Covid virus in UK has the Pound lower, US Dollar higher, Crude sharply lower, gold and copper lower. SH is down 5 cents and near 12.18. SMH is near 406.2. BOH is near 38.87. CH is down 4 cents and near 4.33. WH is down 9 cents and near 5.98. KWH is down 9 cents and near 5.59. US has agreed to a new stimulus package. Despite the new aid, US stocks have turned sharply lower on the UK emergency lockdown. There is a new Europe travel restriction to and from the UK.

For the week, SRW Wheat prices were up down roughly 5 cents; HRW down 11; HRS down 2; Corn was up 14 cents; Soybeans up 58 cents; Soymeal up $24.00, and; Soyoil up 160 points. Crushing margins were up $0.13 at $1.04 (March); Oil share down 1%% at 32%.

Chinese Ag futures (May) settled up 144 yuan in soybeans, up 24 in Corn, up 67 in Soymeal, up 52 in Soyoil, and up 48 in Palm Oil. Malaysian palm oil prices were down 39 ringgit at 3,405 (basis March) despite higher export reports and a weaker ringgit

Brazil weekend rainfall was erratic, but some of the rain from Argentina moved into the far south late Saturday and Sunday morning and it was advancing to the interior southern areas. Brazil weather over the next two weeks will become more typical of La Nina years meaning rain will fall more frequently from Mato Grosso, Goias and Tocantins to Minas Gerais, Sao Paulo and Parana.

Argentina rainfall was a little lighter than expected in some areas, but not by much. Argentina rainfall will be minimal this week. Any showers that evolve will be too light and brief to counter evaporation and those areas missing the greatest rainfall Friday and early Saturday will experience rising stress of significance as the second week of the outlook begins unless greater rain evolves. The early next opportunity for generalized rain will occur Dec. 30-Jan. 2, but confidence is low. Argentina temperatures will be warmer than usual during the next two weeks and that on combination with the limited rainfall will lead to moisture depletion, crop moisture stress and rising worry over 2021 production potentials.

New virus news is weighing on soybean futures. Last week, nearby soybean futures traded over 12.00 and soymeal over 400. Talk of lower South America supply could increase demand for US soybean and soymeal exports offered support. Bulls still feel this could push nearby soybean futures higher. Some estimate Dec 1 US soybean stocks near 2,800 mil bu versus 3,252 last year. Last week, nearby corn futures traded over 4.30.

Again, talk of lower South America supply could increase demand for US corn exports offered support. Bulls feel this could push nearby corn futures higher. Some estimate Dec 1 US corn stocks near 12,030 mil bu versus 11,327 last year. Dry US soils also raised some early concern about the start of the 2021 US corn crop. Some feel prices may need to rally in 2021 to encourage US farmers to increases 2021 acres.

Nearby Chicago wheat futures continues to struggle above 6.00. Large World 2020 crop supplies limits gains. Talk of lower US and Russia 2021 crops could eventually help push prices higher. Some estimate Dec 1 US wheat stocks near 1,685 mil bu versus 1,841 last year.

On Friday, Managed funds were net buyers of 25,000 corn, 18,000 soybeans, 8,000 soymeal and 3,000 soyoil and sold 2,000 wheat  We estimate Managed Money net long 11,000 contracts of SRW Wheat; long 305,000 Corn; net long 222,000 Soybeans; net long 92,000 lots of Soymeal, and; long 107,000 Soyoil.

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.

Latest News & Market Commentary

Explore Special Offers & White Papers from ADMIS

Get Started