Morning Highlights


Highlights

  • The USDA announced on Friday that they will look to resurvey farmers in ND, SD, MN, MI and Wi due to the delayed fall harvest.
  • U.S Treasury Secretary Mnuchin stated yesterday that the commitments for China in Phase 1 were not changed in translation, and that China is still expected to purchase $40 billion to $50 billion of U.S agricultural products.
  • A case of the H5N8 bird flu has been reported in northwestern Hungary, resulting in the culling of 50,000 turkeys.
  • Rains in northern Brazil and northern Argentina will continue for the next 6-10 days, further improving soil conditions for the growing areas, however, more rainfall is needed to completely end the dryness.
  • As of 7:00 AM: Crude oil down 0.07 at 58.97, Dow futures up 81 points at 28,858, and the U.S$ index up 88 ticks at 97.444.                          

 Corn

  • The corn market is trading mostly unchanged overnight after seeing a non-eventful USDA report on Friday that surprised traders with a higher than expected 2019 production.
  • Open interest for corn is up 21,659 contracts. With the largest changes in March, up 4,576 contracts and December up 6,328 contracts.
  • The CFTC Commitments of Traders report on Friday showed corn specs were buyers for the fourth consecutive week, buying just 500 contracts, leaving their net short position at 108,700 contracts.
  • Spreads: H/K 6 ¾ cent carry; K/N 6 ½ cent carry; N/Z 3 cent carry .

Outlook: The market will remain steady this morning and continue to be rangebound until it can find some fresh news to trade.

 Oilseeds

  • The soybean market is lower overnight as the market awaits the signing of Phase 1 of the trade deal this week.
  • The CFTC COT report showed that soybean specs were small sellers last week, selling a total of 7,400 contracts and leaving their net short position at 23,800 contracts.
  • Malaysian palm oil futures were lower today due to a stronger ringgit and a smaller than expected production drop. The benchmark contract closed 1.4% lower at 3,091 ringgit.
  • Spreads: H/K 13 carry, H/N 25 carry, N/X 4 ¼ carry

Outlook: Steady to lower as traders await more details regarding the signing of Phase 1 this week.

 Wheat

  • Wheat markets lower overnight, with Kansas City and Minneapolis losing a good portion of their gains from Friday’s report.
  • Ukraine’s economy ministry stated that Ukraine’s 2019 grain harvest is expected to rise to around 75 million tonnes vs 70 million in 2018.
  • Russian agriculture consultancy IKAR cut its 19/20 wheat export forecast to 33.5 million tonnes. The USDA also lowered their Russian wheat export estimate from 35 million tonnes to 34 million.
  • According to the CFTC COT report, wheat specs were sellers last week, selling a total of 1,900 contracts and flipping their net long to a net short of 300 contracts.
  • Spreads: Chicago H/K 1 ¾ cent carry; Kansas City H/K 7 ½ cent carry; Minneapolis H/K 8 ¼ cent carry.

Outlook:  Sideways to lower as traders focus on the singing of Phase 1 this week, with some optimism that wheat will gain some business from China.