Morning Highlights


Highlights

  • CHS Hedging will be attending the Commodity Classic in San Antonia February 27-29. For those that will be attending, please stop by booth 2071 to visit with Scott Strand and Kent Beadle. 
  • This Friday is First Notice Day for March futures, with all long positions being reported after the close on Thursday.
  • The White House stated that Trump and Indian Prime Minister Modi have agreed to “promptly” finish trade talks in order to lead to the first phase of a U.S.-India trade deal.
  • According the Bloomberg, China has begun to show some interest in U.S sorghum, showing that they are willing to buy U.S agriculture products if prices get cheap enough.
  • Three new cases of coronavirus have been confirmed in France, with one of the cases resulting in the second death so far in France.
  • As of 7:00 AM: Crude oil down 0.65 at 49.25, Dow futures up 10 ticks at 27,127, and the U.S$ index up 197 ticks at 99.165.                          

 Corn

  • The corn market is trading a fraction of a cent lower this morning, with the March contract trading within a very narrow range of $3.70 ½ to $3.72 ½.
  • South Africa’s 2020 maize harvest is seen at 14.560 million tonnes, up 29% from the 2019 crop due to good weather conditions.
  • The Argentine government is expected to change export taxes by the end of the month, with corn taxes possibly decreasing by 2%. This could make Argentine corn even more competitive in the global market.
  • South Korea’s NOFI continued the Korean buying streak of corn, purchasing 67,000 tonnes of corn in a private deal, with traders believing the corn will be sourced from South America.
  • Spreads: H/K 3 ¾ cent carry; K/N 3 ½ cent carry; N/Z 2 ¼ cent carry .

Outlook: Trading steady to lower today as traders keep an eye on headlines regarding the virus and its global economic effects.

 Oilseeds

  • The soybean market is trading steady to lower this morning as fears of the coronavirus continue to shake the markets.
  • With the coronavirus fears and Brazilian harvest progression, the soybean market will continue to be under pressure.
  • The Argentine government is expected to increase export taxes on soybeans, which would most likely cause Argentine farmers to hold onto their soybeans after harvest.
  • Heavy rainfall is expected to continue in northern Brazil over the next week, continuing to delay soybean harvest and safrinha corn planting and possibly leading to flooding concerns across Goias and Minas Gerais.
  • Malaysian palm oil futures were lower today as cases of coronavirus outside of China continue to increase, causing fear of the virus becoming a pandemic.
  • Spreads: H/K 10 carry, H/N 21 ½ carry, N/X 11 ¼ carry

Outlook: Trading steady to lower today as the coronavirus continues to progress, causing unease in the markets.

 Wheat

  • Wheat markets are mixed this morning with Chicago and KC wheat contracts trading lower and Mpls trading steady to slightly higher. News continues to focus on the spread of the coronavirus, causing traders to be nervous about the effects of the virus on the world economy.
  • Ukraine grain exports are up 23% so far in 19/20, with wheat exports pegged at 16.5 million tonnes so far vs 15.6 million tonnes in 18/19.
  • Open interest for Chicago wheat is down 16,120 contracts.
  • South Korean flour mills purchased around 85,000 tonnes of milling wheat from the U.S.
  • Syria issued a new tender to purchase 200,000 tonnes of milling wheat sourced from Russia only.
  • Ten companies are now believed to be offering in Jordan’s tender for 120,000 tonnes of wheat, no purchase has been made yet.
  • Spreads: Chicago H/K 2 ¼ cent inverse; Kansas City H/K 7 cent carry; Minneapolis H/K 14¼ cent carry.

Outlook: Trading steady to lower today as the market continues to be pushed by fears of the spreading coronavirus.