Written Commentary
MORNING OUTLOOK
Grains are mixed. SX is down 7 cents and near 14.01. SMZ is near 411.2. BOZ is near 61.26. CZ is down 1 cent and near 6.66. WZ is up 8 cents and near 8.80. KWZ is up 9 cents and near 9.52. MWZ is up 9 cents and near 9.57.
Soybean futures are lower due to renewed concerns over the Chinese and global economies and potential lack of Chinese interest for US beans. World Bank lowered China growth from 5 pct to 2.8 and first time in 30 years below 3.2. Argentina farmer selling during US harvest has dropped Argentina export prices levels below US prices which offers resistance. Brazilian plantings going well which suggest US soybean export demand window could be over by mid-January.
Corn futures are lower due to higher Dollar and lower commodity prices. US Dollar is at new 20 year highs. Recession fears continue to raise concern about feed demand. Increase US harvest offset dry Argentina weather and additional concerns over Black Sea grain exports. Fact US export sales are 50 pct of last year to date and lower Mississippi river levels could weigh on domestic corn basis. Still, crushers, feeders and exporters need to buy corn before harvest.
US wheat futures are higher as funds covered shorts. Drought in the US plains offers support. The Ukraine export corridor is increasingly under threat, even before the expiry of the first 120 day period in late November. Russia farmers may not be exempt from a military call-up. Market trying to assess Putin’s next move following the referendum results showing 90-99 pct voting to become part of Russia.
US Dollar is higher. US stocks, silver, coffee, cocoa, sugar and cotton are lower. Interest rate futures are higher. Crude, gold and copper have turned higher.
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