Written Commentary
MORNING OUTLOOK
Grains are higher. Higher May corn and soybean is offering support. SK is up 8 cents and near 15.70. SN is near 15.22. SX is near 13.28. SMN is near 422.4. BOK is near 70.70. BON is near 61.68. CK is up 11 cents and near 6.97. CN is near 6.51. CZ is near 5.46. WN is up 4 cents and near 7.27. KWK is up 4 cents and near 7.00. MWN is up 5 cents and near 7.37. US stocks are higher. US Dollar is mixed. Crude is higher. Copper is lower. US Fed to keep rates low. US President wants to increase spending and taxes. Demand for commodities should increase.
Chinese Ag futures (September) settled down 4 yuan in soybeans, up 2 in Corn, down 18 in Soymeal, down 2 in Soyoil, and up 74 in Palm Oil. Malaysian palm oil prices were closed for holiday.
Wire story report had price action for corn and soybeans on the CBOT has been nothing short of impressive this month, and more could be in store for the new-crop contracts as April is historically an uncommon time for their high-water marks. Since 1973, new-crop SX have made their annual highs in April only twice: 1986 and 1981. December corn 4 times. June is historically the month when new crop contracts make their highs.
Over last 60 days US north plains have been drier than normal. Parts of the central Midwest and Delta have seen normal to above rainfall. This next week rains are expected across parts of east south plains, west Delts and most of the east Midwest. US PNW and north plains will remain dry. Brazil is still dry. There is talk of improving rains for west Europe, Russia and Ukraine
Weekly US old crop corn sales are est near 400-1,00o mt new crop 100-600. Key is Brazil supply and exports. Brazil crop below 95 mmt could help support CZ. There is talk of US imports from Argentina. Soybean old crop sales are est -100-200, new 200-500. There is talk of US imports from Brazil. South America soymeal and soyoil also work into US. Weekly US wheat sales are 0-300 mt old crop and 200-450 new. US wheat prices are not competitive to World buyers. World prices are also historically high and slowing new buying.
Estimates of World 2021/22 soybean production is up to 345 mmt vs 312 this year, US 121 vs 112, Brazil 141 vs 135 and Argentina 55 vs 47. Export trade is also up 7 mmt to a record 172 mmt. Crush up 4 mmt to 167. This suggest soybean/soymeal stocks at 9 year low of 42 mmt. World soybean exporters stocks could drop to 3 year low near 73 mmt. This could support SX.
On Wednesday, Managed funds were net sellers of 10,000 contracts of SRW Wheat; net sold 40,000 contracts of Corn; sold 7,000 Soybeans; sold 4,000 Soymeal, and; net even in Soyoil. We estimate Managed Money net long 35,000 contracts of SRW Wheat; net long 494,000 Corn; net long 204,000 Soybeans; long 50,000t Soymeal, and; net long 118,000 Soyoil.
Preliminary Open Interest saw Corn down 26,800; Soybeans down 28,300 contracts; Soymeal down 5,900 lots, and; Soyoil down 1,000. There were no changes in registrations—Registrations total 10 contracts for SRW Wheat; ZERO Oats; Corn ZERO; Soybeans ZERO; Soyoil 968 lots; Soymeal 175; Rice 1,013; HRW Wheat 1,291, and; HRS 235.
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