Morning Ag Commentary 2019-04-02T14:00:40+00:00

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Jan 23 Morning Ag Commentary

by Steve Freed,

Grains are mixed. SH is down 4 cents and near 9.09. CH is up 1 cent and near 3.89. WH is up 4 cents and near 5.82. USDA weekly US export sales report is delayed until Friday. US stocks are mixed. US Dollar is mixed. Crude is lower. Gold is lower.

The Malaysian Palm Oil market was down 50 ringgit at 2,923 (basis April) on money flow, unconfirmed rumors of India import duty cuts.

Wednesday grain futures found some weakness on lack of confirmation of China buying US Ag goods. Wheat saw some profit taking after making 4 year higher. Lower palmoil prices overnight is triggering selling in soyoil. Wheat is trying to gain back yesterday’s losses on higher World prices.

The outlook for global wheat prices is bearish for Rabobank which notes that the global wheat balance sheet is still showing a surplus of over 9 million metric ton in 2019-2020 and an almost similar preliminary deficit in 2020-21. “We acknowledge that, in the short term, lack of snow cover [in the U.S.] is a risk too large to ignore, and there is a possibility of a further price spike.” However, Rabobank forecasts that CBOT Wheat prices are likely to return to 550 cents a bushel.

Weakness in US soybean prices is expected to continue for the next 2-4 weeks, says British research firm Marex Spectron The pricing weakness is in reaction to lower-than-expected Asian demand for soybeans and Brazil’s record harvest of soybeans expected to hit the market within the next 2-3 weeks.

Some key Asian feed makers are having to pay more for higher-quality corn from the Black Sea region as a key traditional supplier, the United States, struggles with a weather-damaged crop; China, South Korea and Bangladesh have turned to Ukraine for a part of their feed corn demand for February arrival.

Russia exported 25.3 million tons of grain between July 1, 2019 and January 16, 2020, the Russian Agriculture Ministry said, citing preliminary Federal Customs Service (FCS) data. This includes 21.8 million tons of wheat, 2.2 million tons of barley and 1.2 million tons of corn. Exports in the current farming year (July 2019-June 2020) are less than in the previous year. From July 1, 2018 through January 17, 2019, exports came to 30.1 million tons of grain, including 25.3 million tons of wheat, 3.2 million tons of barley and 1.3 million tons of corn. Russia’s grain harvest for 2019 may exceed 121.2 million tons, according to a study by the Center for Agricultural Analytics. The harvest of 2019 is likely to be at least 120.8 million tons and may even exceed 121.2 million tons

The South American weather forecast for Brazil remains with rainfall for much of the growing regions favoring the north over the next 6 to 10 day period with lesser amounts in the south. The Argentine weather forecast has light to moderate rainfall for much of the growing regions early next week with things turning quieter for the remainder of the week.

The information conveyed by ADMIS or its affiliates to the audience is intended to be instructional and is not intended to direct marketing, hedging or pricing strategy or to guaranty or predict future events, including the pricing and pricing movements of commodities and commodity futures contracts.

January 23rd, 2020|
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Jan 23 Morning Ag Commentary

by Steve Freed,

Grains are mixed. SH is down 4 cents and near 9.09. CH is up 1 cent and near 3.89. WH is up 4 cents and near 5.82. USDA weekly US export sales report is delayed until Friday. US stocks are mixed. US Dollar is mixed. Crude is lower. Gold is lower.

The Malaysian Palm Oil market was down 50 ringgit at 2,923 (basis April) on money flow, unconfirmed rumors of India import duty cuts.

Wednesday grain futures found some weakness on lack of confirmation of China buying US Ag goods. Wheat saw some profit taking after making 4 year higher. Lower palmoil prices overnight is triggering selling in soyoil. Wheat is trying to gain back yesterday’s losses on higher World prices.

The outlook for global wheat prices is bearish for Rabobank which notes that the global wheat balance sheet is still showing a surplus of over 9 million metric ton in 2019-2020 and an almost similar preliminary deficit in 2020-21. “We acknowledge that, in the short term, lack of snow cover [in the U.S.] is a risk too large to ignore, and there is a possibility of a further price spike.” However, Rabobank forecasts that CBOT Wheat prices are likely to return to 550 cents a bushel.

Weakness in US soybean prices is expected to continue for the next 2-4 weeks, says British research firm Marex Spectron The pricing weakness is in reaction to lower-than-expected Asian demand for soybeans and Brazil’s record harvest of soybeans expected to hit the market within the next 2-3 weeks.

Some key Asian feed makers are having to pay more for higher-quality corn from the Black Sea region as a key traditional supplier, the United States, struggles with a weather-damaged crop; China, South Korea and Bangladesh have turned to Ukraine for a part of their feed corn demand for February arrival.

Russia exported 25.3 million tons of grain between July 1, 2019 and January 16, 2020, the Russian Agriculture Ministry said, citing preliminary Federal Customs Service (FCS) data. This includes 21.8 million tons of wheat, 2.2 million tons of barley and 1.2 million tons of corn. Exports in the current farming year (July 2019-June 2020) are less than in the previous year. From July 1, 2018 through January 17, 2019, exports came to 30.1 million tons of grain, including 25.3 million tons of wheat, 3.2 million tons of barley and 1.3 million tons of corn. Russia’s grain harvest for 2019 may exceed 121.2 million tons, according to a study by the Center for Agricultural Analytics. The harvest of 2019 is likely to be at least 120.8 million tons and may even exceed 121.2 million tons

The South American weather forecast for Brazil remains with rainfall for much of the growing regions favoring the north over the next 6 to 10 day period with lesser amounts in the south. The Argentine weather forecast has light to moderate rainfall for much of the growing regions early next week with things turning quieter for the remainder of the week.

The information conveyed by ADMIS or its affiliates to the audience is intended to be instructional and is not intended to direct marketing, hedging or pricing strategy or to guaranty or predict future events, including the pricing and pricing movements of commodities and commodity futures contracts.

January 23rd, 2020|
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