Morning Highlights


Highlights                                 

  • The U.S. government granted Huawei a limited 90 grace period, which has calmed equity markets for now. China says they will fight the blacklisting, with China’s envoy to the EU adding that Chinese civilization has been around for 5,000 years. “Why not another 5,000 years?”
  • The Organization for Economic Cooperation and Development says tariffs could slow U.S. and Chinese economies 0.2%-0.3% by 2021/22, with U.S. consumer prices up 0.3% by 2020.
  • U.S. milk production in April rose just 0.1% from 2018 to 18.430 billion pounds. The milking herd was down 1,000 head from March, but milk per cow set a monthly record, up 21 pounds from last year.
  • As of 7:00 am CT, crude oil is up 29 cents to $63.39/barrel, gold is down 5.20 at $1,272.10, DOW up 101 to 25,797, dollar index up 171, and Euro is down 230 pts.

Corn

  • Forecasts have not changed from yesterday, still showing 4-6 inches of rain for the Central and Western Corn Belt over the next 7 days.
  • Crop Progress showed corn 49% planted as of May 19 vs estimate of 50% and an average pace of 80% complete. IL is 24% planted vs 89% average, IN 14% vs 73%, and OH 9% vs 62%.
  • Funds were estimated buyers of 10,000-15,000 contracts yesterday, but it was likely not short covering as open interest soared 49,780 contracts!
  • The CZ19/CZ20 spread continues to narrow, now up over 30 cents in the past week to -3 ¾.
  • Weekly corn export inspections totaled 820,916 MT vs 1 MMT last week and 1.547 MMT in 2018. Current marketing year sales are 37.454 MMT vs 36.329 MMT in 2018.

Outlook:  July futures up 3 ¾ to up 7 overnight.. prevent plant decisions are fast approaching, and some analysts are starting to beat the drum of 1.0 – 1.5 billion bushel ending stocks in 2019/20, with weather models indicating a 168 bpa yield.

 

Oilseeds

  • Crop Progress showed soybeans 19% planted vs 47% average pace. Beans are 5% emerged vs 24% last year and 17% average.
  • China’s Dalian soybeans were up 7 ½ overnight, soymeal up 5.60, and soyoil down 3. Malaysian palm oil futures were back from holiday and fell 41 ringgits overnight.
  • Weekly soybean export inspections were 497,070 MT vs 513,986 MT last week and 907,202 MT in 2018. Marketing year sales are 33.153 MMT vs 45.658 MMT in 2018.

Outlook:  July beans up 4 to up 11 overnight.. futures are advancing on record slow planting pace, and ideas that insurance prices will drive more corn acres to prevent plant rather than switch to beans.               

 

Wheat

  • Parts of KS, OK, and MO saw 2-6 inches of rain over the past 24 hours and are forecast to receive another 3-7 inches over the next 7 days.
  • Spring wheat is 70% planted vs estimates of 63% and 80% average. Winter wheat condition ratings rose from 64% to 66% good-to-excellent, and the crop is 54% headed vs 66% average pace.
  • Weekly wheat export inspections were 757,704 MT vs 878,299 MT last week and 349,742 MT in 2018. Marketing year sales are 23.579 MMT vs 23.052 MMT in 2018.

Outlook:  July KC wheat up 4 to up 14 ½ overnight..  wheat is higher, following other markets despite better than expected planting progress and condition ratings.