2/11/2020 7:30:44 AM
- There are now 1,016 people that have passed away due to the coronavirus with 42,638 cases confirmed. The director of the World Health Organization said that 99% of the cases are in China and remains an emergency for that country, coronavirus also holds a very grave threat to the rest of the world.
- The US dollar has reached levels overnight not seen since October of last year. World stocks are higher as well as a Chinese epidemiologist expert expects the coronavirus will peak in the next few weeks.
- The USDA will release the February WASDE report today at 11:00 am CT.
- As of 7:00 am CT: US Dow futures are up 106, WTI crude oil is up 89 cents and USD is up .026 to 98.740.
- Corn is weaker overnight, trading above support levels as the market waits for the USDA report.
- The WASDE report is set for release this morning with the market expecting ending stocks to decrease to 1.864 billion bushels vs. 1.892 billion bushels in January.
- CONAB out of Brazil released their production estimates for February this morning, increasing their total corn estimate to 100.5 MMT vs. 98.7 MMT in January.
- Corn has been stuck on the low end of the range recently, waiting for news to come. The USDA will hold its annual Outlook Forum next week where they will release their acreage expectations for this year and beyond.
- Spreads are quiet: H/K 4 ¾ carry, H/N 8 ¾ carry, H/Z 11 ¾ carry.
Outlook: Weaker market as prices hang around the low end of the range, waiting for supportive news to come.
- Soybeans are mixed overnight in quiet trade with the market waiting for the WASDE report.
- The February WASDE report is set for release this morning with the market expecting ending stocks to decrease to 443 million bushels vs. January’s estimate of 475 million bushels.
- CONAB estimated Brazilian soybean production at 123.250 MMT vs. expectations of 124-128 MMT and USDA’s January estimate of 123 MMT.
- The market is still trying to figure out how the coronavirus is going to impact the Chinese demand. As it is now, they are still buying soybeans, but mostly from Brazil.
- Dalian soybeans were 15 ¼ cents higher, soymeal was unchanged and corn 1 ¾ cents lower. Malaysian palm oil futures were down 59 ringgits to 2,695 ringgits.
- Spreads are tighter this morning: H/K 13 carry, H/N 25 ¾ carry, H/X 34 ½ carry, N/X 8 ¾ carry.
Outlook: Trend is turning higher but without a strong export market, upside is limited as South America is harvesting a large crop.
- Wheat is slightly lower overnight as EU Matif wheat futures are weaker.
- Today’s WASDE report is not expected to show much changes from January’s report as the market is expecting all wheat ending stocks to be at 954 million bushels vs. 965 million bushels in January.
- Texas, the only state that released a condition report this week, showed a drop in HRW conditions as rain is needed.
- GASC announced a tender for March 21-31 shipment yesterday.
- Spreads a little wider: Mpls H/K 9 ¾ carry, Kansas City H/K 6 ½ carry, Chicago H/K ½ cent carry.
Outlook: Wheat is weaker to start the week, but the good international business should provide support as the market watches what the Chinese do as the partial trade agreement goes into effect on the 14th.