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Soybeans Are Sharply Higher

MORNING OUTLOOK

Grains are mixed. SK is up 18 cents and near 14.06. SX is up 12 cents and near 12.24. SMK is near 429.0. BOK is near 47.76. CK is up 3 cents and near 5.54. WK is down 6 cent and near 6.63. KWK is down 8 cents and near 6.43. US Dollar is higher. Crude is higher. Gold is lower. US stocks are lower.

Chinese Ag futures (May) settled up 21 yuan in soybeans, down 31 in Corn, up 27 in Soymeal, up 52 in Soyoil, and up 36 in Palm Oil. Malaysian palm oil prices were up 126 ringgit at 3,670 (basis May) following rival oils.

Net drying will continue across most of Argentina through next Monday. Last evening’s GFS model was drier than the midday GFS model for week 2 of the outlook; though, it continued to showed greater coverage of meaningful moisture compared to week 1. Most of Brazil will continue to be favorable; though, some areas will still be wetter than preferred.

Brazil soybean harvest is near 15 pct. Continue to here concerns about yields in MG below est and quality concerns on MG  and Parana. China soybean, soyoil, rapeseed oil and palmoil futures all made new highs. Argentina forecast is dry. USDA Ag forum US 2021/22 soybean numbers were bullish.

Brazil second crop corn plantings are at 15 pct vs 50 ly. Rains continue in north Brazil. Argentina is dry. Matif March corn futures made new highs for the 6th straight day. There is talk of a squeeze on the March contract. EU domestic demand is taking away form exports. Imports should slow. Some feel corn futures need to trend higher to ration demand and add 2021 US acres.

Wheat futures may be down on fact US wheat crop ratings were mostly lower but not as low as feared. There is talk of a squeeze on the March Matif wheat futures contract.  Russia has exported 32 mmt of wheat through Feb. Some feel final exports may be near 34 mmt versus USDA 39. There are no export prices for March-June.

On Monday, Managed funds were net buyers of 12,000 SRW Wheat; net bought 25,000 contracts of Corn; bought 6,000 Soybeans; sold 2,000 lots of Soymeal, and; bought 2,000 Soyoil. We estimate Managed Money net long 27,000 contracts of SRW Wheat; long 369,000 Corn; net long 160,000 Soybeans; net long 64,000 lots of Soymeal, and; long 114,000 Soyoil.

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.

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