Afternoon Market Highlights
2/24/2020 2:46:46 PM
The grain markets tumbled on outside influences. Wall Street, the US$ and crude oil were all lower on economic concerns of the spread of the coronavirus to countries outside China. Plentiful supplies (of most everything) and slowed demand leaves the market vulnerable to increased selling pressure. The investment crowd bails out of grains and energy in search of a safer place to put their monies, like gold.
- First Notice Day for March futures is Friday, with all long positions being reported after the close on Thursday.
- The next USDA S&D report is scheduled for March 10 at 11 AM CDT.
- The energy markets are lower, with crude oil down 1.96 at $51.54/barrel.
- The US$ opened lower but has turned to the greener side of life, up 0.41 at 99.30, the gold market is higher, although is currently up 11 bucks, at 1656, well off its earlier highs and the CD$ is a freckle lower at 0.7523.
- Wall Street is weaker with the DJIA down 827 at 28165, S&P down 103 at 3236 and NASDAQ down 292 at 9284.
Corn prices traded lower on weakness in the soy complex and wheat markets. Fears stem from the spread of the coronavirus to more countries than just China. Prices drew additional pressure from ideas of plentiful supplies and slowing demand from the spread of the Chinese virus. Many months have dipped down to new contract lows. The Dec 2021 contract sits just below its contract low of $3.94 ¼.
- Closes: March at $3.72 ¼, down 4 ¾ cents, July at $3.79 ½, down 4 cents, September at $3.77 ¾, down 4 ¼ cents, December at $3.82 ¼, down 3 ¾ cents.
- CIF premiums were mostly unchanged for Feb/Mar.
- Weekly export inspections were 913 tmt, near the top end of the trade estimates (600-950 tmt).
- Spreads: widened out slightly with the H/K at a 4-cent carry, H/N at a 7-cent carry, N/Z at a 2 ½-cent carry and Z/N1 at a 16-cent carry.
Soybean prices were lower on lack of trade with China, fresh worries of the coronavirus spreading to countries other than China and big crops coming from South America. The products were on the defensive as well. The November 21 contract dipped down to a new contract low (9.02 versus contract low of 9.05).
Closes: March at $8.74 ¼, down 16 ¼ cents, July at $8.94, down 15 ¾ cents, August at $8.98, down 15 cents and November at $9.05, down 12 ½ cents. The products were down sharply with meal down 3-4 bucks and oil down 115 points.
- CIF premiums were 2cents weaker for Feb/Mar.
- Weekly export inspections were 595 tmt, below trade estimates (600-1.1 mmt).
- The USDA announced the sale of 164k tonnes of soybeans to Mexico for the current marketing year.
- The canola market tanked in sympathy with the US soy complex and weaker Palm oil. Prices drew additional pressure from big vessel lineups off the coast of British Columbia from protests that were disrupting rail car movement.
- Spreads: H/K 8 carry, H/N 19 ¾ carry, N/X 11 ¼ carry, X/F 3 ¾ carry.
Wheat prices slumped on broad-based selling from coronavirus worries. Supplies of wheat are plentiful amidst lack of Chinese demand and fears from the spread of the Chinese virus. Saudi Arabia was thought to have purchased 715k tonnes of wheat form Germany and Poland.
- March closes: Mpls at $5.14, down 12 cents, KC at $4.52 ¾, down 15 ¾ cents and Chicago at $5.36 ¼, down 14 ¾ cents.
- Weekly export inspections were 412 tmt, in-line with trade estimates (350-600 tmt).
- EU wheat prices fell, in sympathy with the US wheat market.
- Spreads: Mpls H/K 14 carry, Kansas City H/K 7 carry, Chicago H/K 1 ¾ inverse.