Morning Highlights


Highlights

  • Equity markets were higher overnight with the Dow implied open over 1,000 points higher but that is roughly half of the loss yesterday.
  • The Trump Administration plans on providing support to the US economy such as a possible tax relief measure but will meet with House and Senate Republicans to determine the best course of action.
  • Crude oil prices have bounced back overnight with WTI crude oil around $3.25 higher but still over $7.00 below last week’s close.
  • USDA WASDE report is to be released this morning at 11:00 am CT.
  • As of 7:00 am CT: US Dow futures are up 946, WTI crude oil is up $3.25 per barrel and USD is up 0.920 to 95.795.

Corn

  • Corn is around three cents higher, finding support from a rebound in crude oil prices. The gaps from yesterday have already been filled on the overnight session.
  • Very quiet farmer selling is noted as futures touched contract lows yesterday.
  • Spreads are still very tight, even with a sharp drop in futures, signaling the end user doesn’t have the corn they need on top of the expectation’s acres will see a sizable increase from a year ago.
  • USDA’s WASDE report out this morning isn’t expected to be too exciting with the market expecting US ending stocks to be at 1.888 billion bushels vs. 1.892 last month. South American production is expected to stay flat as well from last month’s estimates.
  • Spreads have narrowed slightly this morning: K/N 2 ¼ carry, K/Z 3 ¼ carry, N/Z 1 ¼ carry.

 Outlook:  Back and forth market, taking its guidance from the energy and equity markets.

 Oilseeds

  • Soybeans have recovered some of the ground lost from yesterday, trading 10 cents higher on the overnight market.
  • Farmer interest at these levels is non-existent by the farmer. Futures were within 15 cents of contract lows at one point yesterday.
  • The Brazilian real was sharply weaker yesterday, making it even more attractive for the Brazilian farmer to sell their soybeans they are currently harvesting.
  • USDA will release their WASDE report this morning with the market expecting a mundane report as the average trade guess for US ending stocks is 426 million bushels vs. 425 million bushels last month.
  • Dalian soybeans were 10 ½ cents higher; soymeal was $2.20/ton higher and corn was up 5 ½ cents. Malaysian palm oil futures were up 10 ringgits to 2,342 ringgits.
  • For deliveries, there were 43 in soybeans, 123 in soymeal, and 219 in soyoil.
  • Spreads are narrower this morning: K/N 8 ¾ carry, K/X 15 ¼ carry, N/X 6 ½ carry.

 Outlook: Firmer market, finding support from stronger energy and equity markets.

 Wheat

  • Wheat is higher across the board. Matif wheat is higher as well.
  • Chicago wheat was the lone bright spot yesterday as most everything else was weaker. The impressive recovery yesterday in the Chicago market doesn’t appear to be more than money driven as global wheat prices were weaker and demand was quiet.
  • USDA’s WASDE report this morning isn’t expected to show much change in wheat as the average trade guess for US ending stocks is at 944 million bushels vs. 940 million in February.
  • Winter wheat ratings in Kansas and Oklahoma improved from last week while ratings in Texas declined.
  • Spreads are narrower this morning: Mpls K/N 10 carry, Kansas City K/N 7 ½ carry, Chicago K/N ¾ cent inverse.

 Outlook: Firmer price action today as outside markets are firmer.