Afternoon Market Highlights
4/15/2020 3:49:42 PM
A total red day in the grain markets today on lack of fresh supportive news for anything. Corn fell on weakness in the energy markets and another damaging ethanol report. Soybeans lost ground on worries about future meal demand from meat processing plant closures, despite a decent NOPA Crush number for March.
- Egypt’s GASC is in this afternoon for a jag of optional origin wheat for LH May/FH June.
- The President Trump administration is planning to buy milk and meat from US farmers in an effort to soften the blow of the CoronaVirus situation.
- The energy markets are mostly weaker with crude oil up 9 cents at 20.20/barrel (19.20-20.89/barrel).
- The US$ is up 673 at 99.56, the gold market is down 25-26 bucks at 1733 and the CD$ is down 0.0102 at 0.7094.
- DJIA down 445 at 23504, S&P down 71 at 2771, NASDAQ down 122 at 8393.
- StatsCan delayed their 2020 acreage estimates until early May.
- May options expire at the close on April 24th. First Notice Day for May futures is April 30th with all long positions being reported after the close on the 29th.
- The next USDA report is scheduled for May 12th. Any necessary changes to the harvest ed acres (from the USDA ‘s re-survey of unharvested corn and beans) are expected to show up in the May report.I believe this will also be the first assessment of the 2020 winter wheat production.
Corn prices suffered more losses from the fallout of ethanol from limited travel over the past month. The corn market dropped to 3 ½ year low with the past few weeks of losses in the crude oil market. There is also concerns of loss of feed usage from the plummeting livestock markets.
- Closes: May at $3.19 ¼, down 6 ¾ cents, July at $3.26 ¾, down 5 ½ cents, September at $3.32 ½, down 4 ½ cents, December at $3.42 ¾, down 3 ¾ cents.
- Gulf premiums were 3 cents weaker for April and May and 1 cent weaker for June.
- Weekly export estimates for corn are between 750 tmt and 1.6 mmt.
- Weekly ethanol production was down another 102k barrels per day to 570k barrels per day. Stocks are at 27.1 million barrels.
- Rosario Exchanged estimates the Argentine corn crop at 49.8 mmt versus their previous estimate of 50.0 mmt, from extended periods of hot/dry weather conditions.
- Spreads: K/N 7 ½ carry, N/U 5 ¾ carry, N/Z 15 ¾ carry, Z/N1 24 ¾ carry (possibly could see this go toward 40-45 cents with increased monthly storage rate).
Soybean prices were lower on continues reports of meat processing plant closures because of the CoronaVirus and fears of slowing meal needs for livestock.
- Closes: May $8.42, down 5 cents, July at $8.51 ¾, down 3 ¾ cents, August at $8.54, down 4 ½ cents, November at $8.59 ¾, down 5 ¾ cents. The products were mixed with meal up 4-5 bucks and oil down 19 points.
- May beans closed below the $8.50 support level.November came within ¼ of the April 6 low of $8.57 ½.
- Gulf premiums were steady for April and May and 1 cent weaker for June.
- Weekly export sales estimates: 375-900 tmt for beans, 100-275 for meal and 8-40 tmt for soyoil.
- March NOPA Crush report: 181 million bushels of soybeans crushed, well above trade the average trade estimate of 175 million bushels. Oil stocks were 1.9 billion pounds, well below the 2.1 billion pounds the trade was expecting to see.
- The canola market was stronger on weakness in the CD$.
- Rosario Grain Exchange estimates the Argentine soybean crop at 50.5 mmt versus 51.5 mmt previously because of extended periods of hot/dry weather conditions.
- Spreads: K/N 9 ¾ carry, N/Q 2 ¼ carry, N/X 8 ¼ carry, Q/X 6 carry, X/F 2 ½ carry, X/H 9 ¾ inverse, X/N1 1 inverse.
The wheat market got pounded a good one today on technical selling, improving conditions in Europe and the Black Sea Region. Price drew additional pressure from strength in the US$. There are concerns about damage to the US winter wheat crop from recent frigid temperatures. Hearing reports that the spring wheat that has gotten planted is up and looking good.
- May closes: Mpls at $5.14, down 7 cents, KC at $4.78 ½, down 5 ¼ cents, Chicago at $5.40 ¼, down 8 ½ cents.
- Weekly export sales estimates range from 250-650 tmt.
- Japan is in for their routine food tender of 133k tonnes optional origin wheat for June shipment (32k US white, 13k HRW, 9k NSW, 50k Canadian spring wheat and 30 Australian white wheat).
- Ukraine suggest they will ban wheat exports if exports exceed 20.0 mmt. they are at 18.0 mmt so far this year (year end is June). Next year they expect wheat exports to be well below this year at 12-15 mmt, because of unfavorable weather conditions this spring could lead to lower production.
- France AgriMer estimates wheat exports outside the EU at 13.2 mmt, above last month’s estimate and above the record 12.9 mmt that were shipped back in 2011.
- Spreads: Mpls K/N 13 ¼ carry, N/U 11 carry, Kansas City K/N 7 ½ carry, N/U 7 ½ carry, Chicago K/N ¼ inverse, N/U 5 ¼ carry.