Morning Highlights


 

Highlights

  • USDA planted acres and June 1 stocks report on Friday, June 28th, 11 am CDT.

  • First Notice Day for July futures is this Friday, with all long positions being reported after the close on Thursday, June 27th.

  • StatsCan to release their updated acreage numbers this morning, 7:30 am.

  • Nymex crude oil is up $1.00, the US$ index is 54 ticks firmer and Dow futures are up 100 points.   

     

Corn

  • The corn market has been choppy this week ahead of Friday’s USDA reports. Average trade guesses for planted acres are around 86-87 million, down from the June 10th report of 89.89 million and well below the March planting intentions of 92.8 million as the US has grappled with wet weather.

  • The USDA has said they will allow corn for silage to be planted on PP acres. This changes the dynamics as we can have corn planted for silage that will be considered PP acres, freeing up planted acres to be combined.

  • Firm domestic cash markets provide underlying support as the market works to get available corn supplies in the areas of need. CIF is firm as the river continues to battle logistical issues. Overall farmer selling is slow as many are “price friendly”.

  • Forecasts show a weather pattern change to more favorable warmer and above normal temps with a short term ridge being talked about. Precip chances remain above normal.

  • Managed money is estimated to carry a net long position of 155k. Open interest changes yesterday saw CN down 36,100, CU increased 14,000 and CZ gained 21,400 contracts.

  • Spreads are fractionally mixed: N/U 5 ¼ carry, U/Z 4 ¾ carry, Z/H 5 carry, Z/N 7 carry. N20/Z20 is a 43 cent inverse, in from a 55 cent inverse to begin the week.

     

Outlook: Weaker as weather turns to much needed warmer temperatures. Planted acres is a big unknown and may be subject to resurvey as planting has been historically late.

 

Oilseeds

  • The soybean market is lower with SN headed toward first notice day near $9.00 and SX below $9.25 and trying to hold technical support.

  • The USDA acres report on Friday has a possibility of a need to resurvey with the wet fields and late planting experienced. Average trade guesses are around 84.35 million, only down slightly from the March intentions of 84.6 million.

  • Malaysian palm oil was lower overnight for the third day this week and China’s Dalian beans were modestly weaker.

  • Managed money remains an estimated net short position on soybeans, soyoil and soymeal.

  • A meeting between President Trump and President Xi is planned at this week’s G20 summit. Nothing of substance is expected to result.

  • StatsCan Acres this morning:  2019/20 canola acres are expected near 20.7 million, down from last year.

  • Spreads: N/Q 5 ¼ carry, N/X 23 carry, X/F 11 ½ carry, X/N 28 ¾ carry.

 

Outlook: Lower as the US has ample supply and global demand seems to be slowing.

 

Wheat

  • The wheat markets are modestly weaker ahead of Friday’s USDA acres and stocks report. The average trade guess for the June 1 carryout stocks is 1.1 billion bushels, just slightly below the June 11th balance sheet of 1.102 billion. All wheat acres are expected to be lowered on smaller than intended spring wheat.

  • Ukraine is reported at 2% harvested, Russia has begun harvest too. Chinese winter wheat harvest is nearly complete with favorable yields and quality. Hot/dry conditions begin to spread out of the Black Sea into other EU wheat producing regions.

  • US Winter wheat harvest continues at a relatively slow pace and combines battle a crop that is behind in development with higher moisture and some soggy fields.

  • Overall, the US remains uncompetitive in the global export arena.

  • StatsCan acreage report is scheduled for release this morning. The acreage estimate is 25.7 million acres for all wheat (25.2-26.3). This compares to 24.73 million acres planted last year.

  • Spreads: Mpls N/U 9 ¾ carry, U/Z 12 ¾ carry, Kansas City N/U 13 carry, N/N 70 carry, WN/U 3 ½  carry, N/N 21 ¼ carry.  

     

Outlook: Weaker and possibly getting some direction from corn.