Mar 14 Afternoon Ag Commentary

by ADMIS Research Team


May soybeans have turned lower after trading to an early morning high at 1054. The May soybean contract is trading at 1037, down 11 ½ at midsession. The market was led lower by the November contract that is trading down 10 cents at 1034. The bearish slant came from the Allendale soybean acreage estimate of 92.104 million acres versus the USDA estimate at 90.0 million and compared to last year’s 90.1 million. Egypt bought 29,500 tonnes of sun oil and 37,000 tonnes of soybean oil this morning. The CME raised margins on both soybeans and soybean meal by $100 per contract. The weather continues to lean on the wetter side for Argentina with three systems over the next two weeks. Rains will favor the northern and eastern growing regions with 0.50 to 2.0 inch totals starting later today into the weekend. The extended 11-15 day forecast has additional rains for the northern half of the belt. The southern Brazil state of Rio Grande du Sol should receive 0.50 t0 1.0 inch rains this weekend aiding the late development of soybeans. The February NOPA crush will be released on Thursday with the average estimate at 149.4 million bushels in a range of 145.1 to 153.4 million. The record February NOPA crush was at 148.3 million bushels in 2010. Oil reserves are expected at 1.766 billion pounds in a range of 1,653 to 1.840 billion pounds. The open interest in soybeans went up 861 contracts on Tuesday with soybean oil down 726 contracts and soybean meal up 4,529 contracts.


May corn has traded with an inside day and is at 391 ½, down ¼ cents at mid-day. The annual Allendale acreage survey has corn at a three year low of 88.514 million acres versus the USDA Ag Forum estimate at 90.0 million and compared to last year’s 90.2 million. Argentina could see three storm fronts over the next two weeks into the northern and eastern growing regions aiding nearly 50% of the crop. The first system should bring 0.50 inch rains starting tonight in northern Buenos Aires, eastern Santa Fe and Entre Rios. The western and southern growing regions should miss out on any meaningful moisture. Still, this event would be the most rain in Argentina since January. The open interest in corn went up 22,524 contracts on Tuesday with total open interest at a record high of 1.860 million contracts. The CME raised corn margins by $500.00 to $600.00 per contract. Ethanol production for the week ending March 9 was a bit negative at 1.025 million barrels per day. This is down 3.03% vs. last week and down 1.91% vs. last year. Total ethanol production for the week was 7.175 million barrels. Corn used in last week’s production is estimated at 106.6 million bushels. This crop year’s cumulative corn used for ethanol production for this crop year is 3.05 billion bushels. Corn use needs to average 104.69 million bushels per week to meet this crop year’s USDA estimate of 5.575 billion bushels. Stocks as of March 9 were 24.281 million barrels. This is up 4.91% vs. last week and up 6.65% vs. last year.


Chicago May wheat pushed up to 490 ½ early in the session but fell down to 483 into the midday. Kansas City May is trading 1 ¼ higher at 521 ½ at mid-day and Minneapolis May is 1 ¼ lower at 624 ¼. The Allendale acreage survey has all wheat at 46.88 million acres compared to the USDA estimate of 46.5 million. Winter wheat is estimated at 32.55 million down 150,000 acres, spring wheat at 11.92 million up 900,000 acres, and durum at 2.42 million up 114,000 acres. IKAR has raised their 2017-18 Russian wheat export estimate to 38.5 million tonnes from their June estimate of 37.5 million tonnes. The USDA’s Russian wheat export estimate is at 37.5 million tonnes. Kansas Governor declared a drought in 28 counties yesterday and issued a drought warning for the rest of the state. The declaration allows impacted counties to access water from some lakes. Some crops didn’t even germinate with poor root structure and is in danger of dying. The latest National Weather Service 6-10 and 8-14 day outlook continues to hold a drier trend for Oklahoma, Texas and southern Kansas. The wheat growing region from Texas to southwest Kansas has had the driest December-February period on record according to the National Weather Service. French wheat exports are now seen at 17.1 million tonnes, down 2.4% from last month’s estimate according to FranceAgriMer. Wheat stockpiles at the end of the season were seen at 3.17 million tonnes down from the previous estimate of 3.25 million tonnes. Barley exports were seen at 6.6 million tonnes down 1.9% from the previous estimate. Europe’s agricultural traders will be watching the weather closely as a cold snap is forecast for next week into France, Germany and Poland. Temperatures are forecast to drop sharply to as low as 7 to 15 degrees Fahrenheit. Open interest in Chicago went up 17,194 contracts on Monday and Kansas City went down 336 contracts.

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2018-03-14T20:38:19+00:00 March 14th, 2018|