Afternoon Market Highlights
5/14/2020 3:19:11 PM
Super quiet day in the grain markets. Favorable weather conditions for much of the US Midwest seemed to take precedence over decent corn sales reported this morning and improving Chines demand for US soybeans. Forecast suggest a bit of rain for the weekend which should be beneficial to the row crops, along with a much needed warmup in temperatures next week.
- IEG Vantage pegs the 2020/21 US corn acreage at 94.160 million (USDA at 97.0 million) and soybean acreage at 85.890 million acres (USDA at 83.5 million). Spring wheat acres seen at 12.540 million (USDA at 12.590 million and Durum acres seen at
- The SX0/CZ0: $8.44 ¼/$3.31 ¼ = 2.5486......looks to favor soybeans at this juncture.
- The energy markets rolled over to the greener side of life with June crude oil up 2.45 at 27.74 (25.18-27.96).
- The USS is slightly higher at 100.32, the gold market is up 23 bucks at 1739 and the CD$ is up 0.0035 at 0.71240.
- DJIA is up 377 at 23625, S&P up 33 at 2838 and NASDAQ up 80 at 8943.
The corn market traded lower on favorable weather conditions for producing a record large crop in the US. Prices drew additional pressure from plentiful supplies of corn. The ethanol industry appears to be stirring again as folks begin driving around, picking up demand for gasoline. It may take some time yet to get back to where we were prior to CoronaVirus.
- Closes: July at $3.17 ¼, down 1 cent, September at $3.21 ¾, down ¾ cent, December at $3.31 ¼, down 1 ¾ cents.
- Gulf premiums were mostly unchanged for May and June.
- The corn market may get some life from ideas that we may not get 97 million acres planted as some areas are still very wet, along with some harvest activity needing to take place before planting this year’s crop.
- Weekly export sales were reported at 1.6 mmt. This compares to trade estimates form 1.1-2.1 mmt. This week’s big buyers were China, Mexico and Japan.
- Turkey bought 155k tonnes of optional origin corn for LH May/FH Jun shipment.
- Argentina corn harvest was last reported at 40% complete.
- Spreads: N/U 4 ¼ carry, N/Z 13 ¾ carry, U/Z 9 ½ carry, Z/H 13 carry, Z/N 25 ¾ carry.
The soybean market was on the defensive for another day on favorable weather conditions for the US bean crop. Losses were limited from recent Chines purchases for both this and next year.
- Closes: July at $8.37 ½, down 2 cents, August at $8.39 ½, down 1 ¾ cents, November at $8.44 ¼, down 1 ¼ cents. The products were mixed with meal down 2-3 bucks and oil up 28 points.
- Gulf premiums were 1-2 cents weaker for May and unchanged for June.
- Weekly export sales were reported at 1.1 mmt. this compares to trade estimates from 700 tmt 1.2 mmt. This week’s big buyers were China, Egypt and the Netherlands.
- The USD announced the sale of 198k tonnes of beans to China, 132k for this year and 66k for next year.
- The market awaits more new crop purchases from China.Hearing they are still poking around for US soybeans, mostly July through Jan.
- Argentina’s soybean harvest was last reported at 87.4% complete.
- Spreads: N/Q 2 ¼ carry, N/X 6 ¾ carry, Q/X 4 ½ carry, X/F 2 ¼ carry, X/H 7 ¾ inverse, X/N 4 inverse.
Wheat prices were mixed with Chicago moving into positive territory by the close. Mpls and KC saw pressure from lack of demand and plentiful supplies. Mpls garnered underlying support from ideas that we may not see a big increase in spring wheat acres with much on North Dakota experiencing cool/wet conditions. IEG Vantage estimated spring wheat acres below the USDA’s acreage forecast of 12.590 million acres.
- July closes: Mpls at $5.08, down ¼ cent, KC at $4.51 ½, down 2 ¾ cents, Chicago at $5.02 ½, up ¾ cent.
- Weekly export sales were reported at 353 tmt. This compares to trade estimates from 250-600 tmt. This week’s big buyers were the Philippines, Yemen and China. There were nearly 160k cancellations in wheat, spread across most all the classes of wheat.
- Russia peddled their second wheat cargo off to Saudi Arabia and also sends 25k tonnes of their wheat to Korea (said to be humanitarian aid).
- Europe and the Black Sea Region have gotten rain showers, although most of the area is in need of a lot more.
- Australia is expected to experience wet weather over the next three months. They are expected to harvest a decent sized crop after the past years of reduced production from extended periods of dryness.
- Paris milling wheat was slightly higher on a bout of technical buying.
- Egypt has purchased 2.0 mmt of wheat from their local farmers.This is thought to be a little over half of the 3-4.0 mmt they were thought to be planning to purchase locally.
- Spreads: Mpls N/U 11 ½ carry, U/Z 13 ½ carry, N/N 52 ¾ carry.......Kansas City N/U 6 ½ carry, U/Z 12 carry, N/N 39 carry......Chicago N/U 3 carry, U/Z 10 carry.