Afternoon Market Highlights
3/12/2020 6:20:12 PM
Another down day on Wall Street as the world aches from the effects of the CoronaVirus. Many businesses have opted to have employees work from their homes. Many schools and colleges have opted to shut their doors for several weeks. College students are to continue their studies online versus face to face with their professors in the classroom. Hotels are taking room cancellation calls rather than calls to book a room. Bigtime uncertainty and fear of what is to come has taken over much of the commodities markets.
- The financial market continues to look for any broad intervention to the meltdown on Wall Street by the Federal Reserve or the President.
- President Trump banned travel to the US from Europe, which created additional confusion and uncertainty over market direction.
- Fundamentally the market awaits the USDA Planting Intentions and March 1 Grain Stocks reports to be released on March 31st at 11 AM CDT.
- The energy markets were lower with crude oil dipping down to $30.75/barrel.
- The US$ rose 985 ticks to 97.49, the gold market fell apart, trading down 52 bucks at $1,590/ounce and the CD$ was down 0.0034 at 0.71875.
- DJIA saw another meltdown of 2,353 ticks to 21,201, S&P down 11 at 2455 and NASDAQ down 750 at 7202.
The corn market tumbled on heightened fears of a global economic recession because of the continued spread of the CoronaVirus. Farmers have returned to the fields in Northwestern MN to harvest their remaining corn crop, or as much as they can. Moisture levels have come down and test weights have increased.
- Closes: May at $3.65 ¾, down 8 ¾ cents, July at $3.68 ¾, down 7 ¾ cents, September at $3.67 ½, down 6 cents, December at $3.71 ¾, down 6 cents. Support in the May is seen at the September low of $3.52
- CIF premiums were 2 cents firmer in March and 1 cent firmer in April.
- Ethanol margins remain weak (last heard 13-14 cents in the hole for NE and IA).
- Selling Dec 20 corn today at $371 ¾ versus Dec 19 on this day at $3.91 ½ is not all that rosy, but you could look at July 21 with a close today at $3.89 ¼. Over the past couple of years, it seems to have been advantageous to look further ahead for selling opportunities.
- Weekly export sales were decent at 1.6 mmt but did little to provide strength to the corn market.
- Spring and summer weather is thought to be decent for growing crops.
- Spreads: K/N 2 ¾ carry, N/U 1 ¼ inverse, N/Z 3 ½ carry, Z/N1 17 ¼ carry.
Soybean prices got hammered again on the fallout on Wall Street. South America’s crop is ginormous and am hearing they have a huge lineup at their export facilities. Many boats to load from mega farmer sales amidst a falling currency during the gut of harvest.
- Closes: May at $8.59 ½, down 13 ¾ cents, July at $8.65 ¾, down 14 ¾ cents, August at $8.68 ¼, down 14 ¼ cents, November at $8.73, down 13 ¾ cents. The products were mixed with meal up 1-2 bucks and oil down 115 points.
- CIF premiums were 1 cent firmer for March and steady for April.
- The Rosario Exchange lowered their production for Argentina to 51.5 mmt. The BA Grain Exchanged lowered their Argentine soybean production estimate to 52.0 mmt from the hot/dry spell they encountered. The USDA had them last at 54.0 mmt.
- Spreads: K/N 6 ½ carry, N/Q -2 ¼ carry, Q/X -4 ½ carry, X/F -3 carry, X/N1 2 ¾ carry.
Wheat prices tumbled with the plummeting equity market. Mpls made contract lows in many months. Rain events move into the Southern Plains area this week. Chicago was the weakest on fund long liquidation.
- May closes: Mpls at $5.09, down 3 cents, KC at $4.32 ¾, down 3 ¼ cents, Chicago at $5.05 ½, down 7 ½ cents.
- Algeria bought just shy of 7ook tonnes of soft million wheat.Ideas are that France will be the source of the tender.
- Russian exports expected to be unchanged at 45.0 mmt along with leaving export tariffs at zero.
- Spreads: Mpls K/N 11 ¼ carry, KC K/N 7 carry, Chicago K/N 1 ¼ carry.