Afternoon Market Highlights
5/20/2020 3:07:20 PM
The grain markets wrestle with big crop ideas and hopes for continued Chinese buying interest. The wheat market traded higher on ides of additional crop losses around the globe and slowed spring wheat plantings in ND.
- No grain markets Sunday night and Monday in observance of the Memorial Day Holiday. Trade resumes Monday evening at 7 PM Chicago Time.
- The energy markets are stronger with July crude oil up 1.74 at 33.70 (resistance seen at $35/barrel).
- The US$ is weaker, down 0.229 at 99.142, the gold market is stronger, up 6 bucks at 1751/ounce and the CD$ is off a hair at 0.7199.
- DJIA down up 354 at 24561, S&P up 49 at 2968 and NASDAQ up 179 at 9364.
The corn market traded lower on planting progress and mostly favorable weather conditions. There are concerns of corn not getting planted in parts of ND and the crop getting too much rain in parts of Ohio and Illinois, as the plants are fairly young yet. There has been some chatter about areas needing to get replanted. Another positive week in ethanol production and strength in the energy markets provided underlying support to the corn market.
- Closes: July at $3.19 ¼, down 2 cents, September at $3.23 ¾, down 1 ¾ cents, December at $3.33 ½, down ¾ cent.
- July broke through its 30-Day MA but failed to hold, closing between its 10&20-Day MA’s.
- Gulf premiums were 2 cents weaker for May, 3-4 cents weaker for June and 3 cents weaker for July.
- Weekly ethanol production was up again this week, up another 46k barrels per day to 663k barrels per day. Stocks saw a 600k barrel draw to 23.6 million barrels.
- Weekly export sales estimates: 700 tmt-1.4 mmt.
- Spreads: N/U 4 ½ carry, U/Z 9 ½ carry, N/Z 14 ¼ carry, Z/H 12 ¾ carry, Z/N 25 ¼ carry.
The soybean market traded higher on hopes for more Chinese buying of US beans. Prices drew additional support from a strengthening Brail Real and reports of Brazil being nearly sold out of the recently harvested soybeans.
- Closes: July at $8.46 ½, up 4 cents, August at $8.49 ½, up 4 ¼ cents, November at $8.54, up 3 ¾ cents. The products were stronger with meal up 90 cents and oil up 26 points.
- Gulf premiums were steady for May and June and 1 cents weaker for July.
- Weekly export sales estimates: 800 tmt-1.6 mmt for beans, 75-300 tmt for meal and 15-50 tmt for soyoil.
- The canola market traded slightly higher, garnering underlying support from the US soy complex, in thin trade. Gains were limited from strength in the CD$.
- Spreads: N/Q 2 ½ carry, N/X 7 ¼ carry, Q/X 4 ¾ carry, X/F 3 carry, X/H 4 inverse, X/N 1 ¾ carry.
The wheat market got some legs today from renewed concerns of dryness in The EU, Russia and the Black Sea Region. More production cuts for the EU and Black Sea are expected from the extended periods of hot/dry conditions. Mpls drew strength from delayed plantings in ND and NW MN. Insurance planting dates for that area is said to be May 31st and June 5th.
- July closes: Mpls at $5.20 ½, up 12 ¼ cents, KC at $4.53 ¾, up 12 ¼ cents, Chicago at $5.15 ¼, up 16 ½ cents.
- Weekly export sales estimates: 200-650 tmt.
- EU wheat prices were stronger on renewed concerns of crop losses in Europe from returning war/dry weather conditions. The next rain event is expected to take place over the weekend.
- More rain events for ND are expected to come over the weekend. Lots of activity happening in Eastern ND and NW MN this week, with hopes of getting most or all of the crop in before the rain comes.
- Spreads: Mpls N/U 11 ¼ carry, N/N 52 ¾ carry, U/Z 12 ½ carry......Kansas City N/U 6 ½ carry, N/N 38 ¼ carry.CME variable storage for KC N/U is at 54% of full carry.