Morning Highlights


Highlights

  • Grain and oil seed markets are trading lower ahead of this morning’s export sales. Prices are seeing a technical set back after yesterday’s rally. The Brazilian real closed Wednesday at its highest level since September 2015, a strong Brazilian currency benefits U.S. agricultural exports.     
  • As of 6:39 am: Crude oil futures are up 28¢ at $53.39 per barrel, gold is $7.00 higher an ounce at $1,240.10, Asian equity markets were mixed overnight, U.S. stocks are lower and the U.S. dollar fell .410 to 100.670.   
  • U.S. egg and turkey retail prices rose to their highest levels since 2015.  Egg prices in January were up 16% compared to December and turkey prices increased an average of 5.8% in January versus December. 
  • Presidents’ Day: Grain markets are closed Sunday PM and Monday. CHS Hedging will have staff in the office from 8:00 am until noon CT on Monday, February 20th to take orders Energy markets are open until noon and will resume trading at 5:00 pm CDT.
  • We will be holding Energy Hedging classes on Thursday, March 16 in Colby, KS at the City Limits Convention Center and Wednesday, March 22 in Champaign, IL. Sign-up and the agenda will be available soon at www.chshedging.com.
  • March open interest continues to deteriorate due to liquidation and spreading ahead of first notice day.  The March Agricultural contracts expire on March 14. 

Corn

  • Weekly export sales will be released at 7:30 am CT.  Estimates for corn are coming in at 900,000-1,250,000 MT. for 2016/17 and 0-150,000 MT. for 2017/18. 
  • U.S. corn exports are up 67% year on year.
  • Spreads; H/K 7¢ carry with an overnight range of 7-7 ¼¢ carry, K/N 6 ¾¢ carry and N/Z 10 ¼¢ carry.
  • Open interest: March corn 368,135, May 524,509 and July 277,789 contracts. Total open interest was up nearly 53,000 contracts. 

 

Outlook:  Looking are slightly lower calls ahead of this week’s export numbers.

 

Oilseeds

  • Overnight in China the soybeans traded down 10 ¾¢, soymeal was up 90¢ and soyoil dropped 28 points.   
  • Yesterday’s NOPA crush came in higher than estimates. Crush totaled 160.21 million bu with the average estimate of 159.1 million nu.  Soyoil stocks came in a massive 1.629 billion lbs compared to an estimate of 1.510 billion lbs. 
  • Weekly export sales for beans are thought to be 550,000-750,000 MT for 2016/17 and 50,000-150,000 for 2017/18. Soymeal 150,000-350,000 MT for 2016/17 and soyoil 8,000-30,000 MT for 2016/17.
  • Palm oil closed down 39 ringgits to 2,929 basis the May contract. Palm oil prices are down 67 ringgits this week. 
  • Spreads: H/K 10 ½¢ carry, K/N 8 ½¢ carry and N/X widened back out to a 44 ¼¢ inverse.
  • Open interest: March soybeans 181,098, March soymeal 76,492 and March soyoil 88,165 contracts.

Outlook:  The oilseed complex is trading lower.

 Wheat

  • Export Sales estimates for wheat are 300,000-500,000 MT for 2016/17 and 0-50,000 MT for 2017/18.
  • Strategie Grains raises soft wheat exports for the European Union in 2017/18.  Exports are expected to increase 8.1 MMT or 6% to 143.8 MMT this month compared to last year’s figures.   
  • Iraq is looking to buy 50,000 MT of optional origin wheat. Libya is tendering for 100,000 MT of milling wheat and 50,000 MT of durum.    
  • Spreads; Mpls H/K 2 ¼¢ carry, Kansas City H/K 12 ¾¢ carry and Chicago H/K last traded at 13 ¼¢ carry.   
  • Open interest: March Chicago wheat: 122,725, March KC 41,735 and Mpls March 21,056 contracts. 

Outlook:  All three wheat markets are slightly lower to start the day.