Afternoon Market Highlights
4/22/2019 11:26:53 AM
A shortened Afternoon Market Highlights report for today. I will be out of the office this afternoon. Trade talks continues this week with meetings to be held in China. Grain markets were on the defensive this morning from lack of fresh supportive news.
- May options expire at the close on the 26th. First notice day is April 30th with all longs reported after the close on the 29th.
- StatsCan’s 2019 plantings report is scheduled for April 24th.
- The annual Wheat Quality Council’s winter wheat tour takes place next week.CHS Hedging will have a crop scout out with the tour. Follow @hedgeit for the daily scoop of the tour.
The corn market saw pressure from continued weakness in the wheat market. Funds are said to be holding a seriously short position in the corn market, with little or no reason to turn the ship around at this juncture. China continues to suffer from cases of African Swine Fever as nearly all their major provinces are dealing with ASF.
- Weekly export inspections were impressive at 1.3 mmt (800 tmt-1.1 mmt).
- Fund were thought to be short nearly 320k contracts of corn (a new record I think).
- Planting has begun in the US with crop progress expected to be between 6 & 8% complete versus 12% on average.
- Spreads: K/N 8 ¾ carry, N/U 7 ½ carry, U/Z 11 ¼ carry, Z/H 14 ¼ carry, Z/N 28 carry.
- Dec 19 corn is well below $4, but the July and Dec 20 is 12 cents over $4.
The soybeans saw pressure from ideas of increased bean acres in the US, because of unfavorable weather conditions coming into the spring planting season. The US is still lagging significant market share in the soybean arena. Any resolution in the current trade war with China probably will have little or no effect on old crop but can impact new crop price direction.
- Weekly export inspections were poor at 382 tmt (400-800 tmt).
- SA crops get bigger.
- Planting begins in the US with progress expected to be 1-2% complete.
- Rain events across the Upper Midwest this week continues to delay field work and corn plantings, which can ultimately turn into more soybean acres for the US.
- Spreads: K/N 13 ¾ carry, N/Q 5 ½ carry, N/X 18 ¾ carry, X/F 10 ¼ carry, X/N 33 ½ carry.
The wheat seems overwhelmed with plentiful global supplies of wheat. This week’s inspections were decent for wheat, probably the best we seen yet this marketing year. The new marketing year begins June 1st. Mpls continues to make contract lows (a new low in the May was made overnight).
- Weekly export inspections rocked at 811 tmt, well above trade estimates of 350-600 tmt. The breakdown was 189 spring (21 out of the Lakes), 410 HRW, 92 SRW 101 White and 19 HAD.
- More rain is scheduled for the Southern Plains this week.The winter wheat crop is thought to be looking pretty good.
- Spreads: Mpls K/N 7 ¾ carry, U/Z 15 carry, Kansas City K/N 6 ½ carry, N/U 9 ½ carry.