Morning Highlights


Highlights

  • StatsCan production report out this morning. Weekly ethanol production numbers out this morning also.
  • The energy markets are mostly higher with crude oil up 73 cents at $55.66/barrel.
  • The US$ is stronger at 98.17, the gold market is 3 bucks higher at $1,554/ounce and the CD$ is off a bit at 0.75135.
  • DJIA down 120 at 25777, S&P down 7-8 at 2857 and NASDAQ last at 7826. 

Corn

  • The corn market traded lower on non-threatening weather, lack of demand and no trade deal yet with China.
  • The US has been faced with serious competition from Argentina, Ukraine and Brazil this year (all who have produced a record or near record corn crop).
  • There are only a few days left in the current marketing year and the last USDA report showed ending stocks at 2.4 bb for 2018/19 & 2.181 bb for 2019/20.
  • Weather conditions are expected to be cool for much of the US Midwest.
  • December corn is hovering just above its contract low while March, May and July have made new contract lows.
  • Spreads: Z/H 11 ¾ carry, Z/N 26 ¾ carry, N0/Z0 9 ¾ carry. 

Outlook:  lower, choppy trade ahead of month end and lack of fresh inputs 

Oilseeds

  • The soybean market traded lower on lack of fresh supportive news.The idea of looking for a resolution seems to be getting over shadowed by whether there was an actual phone call made over the weekend, with the end result being what it has been for some time now.
  • The weather looks cool this week for crop development, but the rain events are said to be beneficial to the crop.
  • November palm oil closed up 14 ringgit at 2,253 and China’s beans were up 8 cents.
  • Spreads: U/X 13 ¼ carry, 84% of full carry at 16 cents, X/F 14 carry, F/K 24 ½ carry, X/N 48 ¾ carry. 

Outlook:  Softer trade to continue on no trade war deal seen for some time and crop progress   

Wheat

  • The wheat market traded lower on lack of fresh news, plentiful supplies and lack of decent demand. Prices drew additional pressure from weakness in the row crops.
  • France is expected to export 20.0 mmt of wheat with reports of the 2nd largest crop on record.
  • Romania looks to have some quality issues to enable them fit for exporting wheat to Egypt.They did not participate in this week’s Egyptian tender.
  • StatsCan production estimates: All wheat at 32.3 mmt (31.1-33.3) and 31.77 mmt last year, Durum at 5.1 mmt (4.7-5.5) and 5.74 mmt last year.
  • Spreads: Mpls U/Z 16 ½ carry .......Kansas City U/Z 12 carry. 

Outlook: lower trade on weakness in the row crops, harvest progress and plentiful world supplies