Written Commentary
MORNING OUTLOOK
Post USDA report day. April Fool? Grains are mixed. Trade still trying to factor in USDA report and Ukraine war. SK is down 6 cents and near 16119. SMK is near 467.8. BOK is near 69.44. CK is down 1 cent and near 7.47. CZ is up 3 cents and near 6.87. WK is up 19 cents and near 10.25. KWK is up 13 cents near 10.43. MWK is up 14 cents and near 10.94.
US stocks are higher. US Dollar is higher. Crude is higher. Gold, silver, copper, cocoa and sugar are lower.
Soybeans, soyoil and soymeal continued to trade lower overnight. Market still trying to recover from higher than expected USDA estimate of US 2022 soybean acres. USDA Outlook Conference US 2022/23 soybean carryout was 305 mil bu. All things equal the increase acres would add 150 mil bu to carryout, Key now is US soybean export commit with Brazil having limited supplies August forward. China demand for US soybean also key, Dalian soybean futures were higher but soymeal, palmoil and soyoil were lower.
Dec corn continues to gain overnight especially versus the May. USDA estimate of US 2022 corn acres lower than expected. Some now est US 2022/23 corn carryout near 770 versus USDA Outlook Conference estimate of 1,965. This includes 2021/22 carryout near 1,120 vs USDA 1,440. Lower 2021/22 carryout due to higher exports. Combined US 2022 corn and soybean acres may be peeking near 181 million acres due to increase in CRP and lower corn margins due to higher cost of production.
Wheat futures rallied sharply post USDA report. This due to lower than expected US 2022 spring wheat acres. Wheat then sold off on no new news. Ukraine war continues with Russia moving troops and accusations Ukraine attacked a Russia fuel depot near Ukraine Russia border. Inflation cutting into global food demand. Some using US 2022/23 wheat carryout near 425 mil bu vs USDA Outlook Conference estimate of 736. This due to lower crop.
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