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.  
  • Chinese agriculture futures fell during today’s session, with some contracts seeing multi-week lows. The weakness in the market continues to stem from the coronavirus, as new cases multiply rapidly.
  • The first case of the coronavirus in sub-Saharan Africa has been reported, officials are concerned that the disease will spread widely in Africa and Latin America.  
  • The CME group announced that they will be increasing the daily trading limits for lean hog futures in April due to the increased volatility caused by Africa Swine Fever.
  • As of 7:00 AM: Crude oil down 1.38 at 45.71, Dow futures down 163 ticks at 25,390, and the U.S$ index down 74 at 98.434.                          

 Corn

  • The corn market continues to trade lower as coronavirus fears control the markets, now looking towards the May contract, prices stayed within a 2 ¾ cent range overnight.
  • A trusted industry source sees U.S. 2020 planted corn acres at 96.6 million acres, the most corn acres seen since 2012.
  • Pressure on the corn market also comes from the expectation that safrinha planting will be almost complete next week, and BAGE’s increased Argentina corn production estimate.
  • Weather in Brazil is expected to dry up, allowing for safrinha corn planting, however, the dry conditions could stress the germination of the corn.
  • Open interest for corn is down 16,080 contracts
  • Spreads: H/K 3 ½ cent carry; K/N 4 cent carry; N/Z 5 cent carry .

Outlook: Trading lower today as markets continue to be pressured by fears of the coronavirus developing into a pandemic.  

 Oilseeds

  • The soybean market is trading lower overnight, continuing to see pressure due to the spreading coronavirus.
  • Export demand for beans is decreasing as demand switches over to Brazilian beans, yesterday’s export sales were disappointing at 339,300 tonnes.
  • Malaysian palm oil futures saw the largest weekly loss this week in 12 years, with the futures ending 6% lower during todays session.
  • BAGE increased their Argentine soybean production estimate by 1.4 mmt to 54.5 mmt due to good weather conditions in the growing season so far.
  • Deliveries: Soybean Meal 1,237, Soybean oil 1,107.
  • Open interest for soybeans down 18,840 contracts, soymeal down 17,660 contracts, and soyoil down 20,550 contracts.
  • Spreads: H/K 6 ½ carry, H/N 16 ¼ carry, N/X 8 ½ carry

Outlook: Trading lower today, continuing to trade off coronavirus headlines.

 Wheat

  • Wheat markets are all trading lower this morning, with the Chicago market set to see the biggest monthly drop since last July.
  • Pressure on the market stems from coronavirus and a lack of worldwide export business, with the U.S not priced competitively enough to get much business.
  • FranceAgriMer estimates that French soft wheat is 64% G/E vs 65% G/E the previous week.
  • Philippines buyers purchased about 275,000 tonnes of feed wheat to be sourced from optional origins.
  • Deliveries: Mpls 436, Chicago 0, and KC 9
  • Spreads: Chicago H/K 4 ¼ cent inverse; Kansas City H/K 7 ¾ cent carry; Minneapolis H/K 13 ¾ cent carry.

Outlook: Trading lower today as the market continues to sell off due to fears of the spreading coronavirus.