November 1 Afternoon Comments

By ADMIS Research


January soybeans surged higher on Thursday trading up to 888 ½ up 36 ½ cents at one point. The market is holding the gains trading at 884 into the close. January soybeans meal is up over $8.00 at $317.60 and January soybean oil is up 0.21 points at 28.45. January crush margins are losing ground trading down 11 cents at $1.26. A tweet from President Trump stating that he had a very good conversation with China’s President Xi with heavy emphasis on trade leading up to a scheduled meeting at the G-20 meetings in Argentina later this month gave soy markets reason to run higher. Earlier in the day the soybean export sales showed 582,230 tonnes of cancellations with 62,755 by China and the balance by “unknown” destinations. Since July 1st, these two destinations have cancelled roughly 2.5 million tonnes for the 2018/19 marketing year. According the Chinese customs data, China imported 132,000 tons of soybeans from the U.S. in September, compared to 937,000 tonnes last year, an 86% decline. Brazil’s October soybean exports were seen at 5.35 million tonnes up 115% from last year’s 2.48 million tonnes according to the Trade Minister.

Soybean Futures Chart


December corn turned higher on optimism for the US-China trade issues after a tweet from President Trump stating discussions were moving along nicely and a meeting at the G-20 in Argentina has been scheduled. However, the market closed well off the highs of 371 at 366 up 2 ¾ cents on the day. The market was down early in the session from poor weekly export sales for corn that came in at 394,400 tonnes for the current marketing year and 5,000 for the next marketing year for a total of 399,400 tonnes. There were cancellations of 66,000 tonnes from Vietnam and 62,756 tonnes from South Korea. As of October 25, cumulative corn sales stand at 34.7% of the USDA forecast for the 2018/2019 (current) marketing year versus a 5 year average of 36.0%. Sales of 912,000 tonnes are needed each week to reach the USDA forecast. China sold 1.6 million tonnes of corn at auction out of 4.0 million offered. Since April 12th China has sold 100.1 million tonnes of corn out of state reserves. The Buenos Aires Grains Exchange pegged Argentine corn planting progress at 35.5% up just 1.1% from last week’s 34.4%. The open interest in corn went up 16,211 contracts on Wednesday.

Corn Futures Chart


Wheat markets found support from a very weak US dollar, trading down nearly 1.0% on the day and from soaring soybean prices after a positive statement from President Trump about trade relations with China. Chicago December wheat settled up 7 ½ cents at 508 and Kansas City December settled up 8 cents at 501 ¼. The Buenos Aires Grains Exchange estimated Argentina’s wheat harvest at 4.5% complete compared to 2.8% last week. Wet weather last week has slowed progress but the extended forecast is drier. Kansas City hard red wheat gains were tied to slow planting concerns in Kansas with 76% planted as of October 28th compared to the average of 89%. Kansas has had one of the wettest October’s on record with eastern and central Kansas receiving triple the amount of normal rainfall. The heavy rains have slowed the soybean harvest, at 42% versus 70% average, which in turn is slowing winter wheat plantings on the same ground. Analysts had expected Kansas to seed 10% more wheat this year from last year’s 7.7 million acres, but most of those acres are now in question. Minor support was also seen from comments from the Egyptian Supply Minister stating that US wheat will probably continue to be offered in upcoming tenders held by Egypt’s state run buyer. His hopes are to increase competition and draw lower offer prices. Russia’s agriculture agency Rosselkhoznadzor may ask a court to close down 5-6 grain loading ports in the southern region of Rostov. This could slow the pace of wheat exports. Saudi Arabia issued a tender to purchase 1.0 million tonnes of barley today. The open interest in Chicago went up 8,441 contracts on Wednesday and Kansas City went up 9,341 contracts. Over the last six sessions Chicago is up over 60,000 contracts and Kansas City is up over 34,000 contracts..

Wheat Futures Chart

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2018-11-01T20:23:00+00:00 November 1st, 2018|