Written Commentary
CORN
Prices were $.01 – $.03 higher as spreads continue to firm. May-24 stalled out right at yesterday’s high while just shy of the 50 day MA at $4.36 ¼. Dec-24 consolidated near its 50 day MA of $4.68 ¾. Heavy rains continue to impact the US Gulf coast and Delta region. Localized flooding will cause planting delays and the need for some replanting. Ethanol production slipped to 1,056 tbd last week, down from 1,073 tbd the previous week, however was still up over 10% from YA. There was 106 mil. bu. of corn used in the production process, or 15.1 mil. bu. per day, vs. 14.45 mbd needed to reach USDA. Ethanol stocks slipped to 26.2 mil. barrels, above the 25.1 mb from YA however at the low end of expectations. Implied gasoline usage fell 6.8% last week to 8.612 mbd, and was down 3.6% YOY. Ukraine’s grain exports since July-23 have reached 37.1 mmt, down 4.4% from YA. Their corn exports have reached 20.1 mmt, vs. the USDA forecast of 24.5 mmt for the 23/24 MY. A Ukraine grain group expects they’ll ship 1 mmt of corn to China in April/May with 360k mt already shipped. Tomorrow’s export sales are expected to range from 30 – 55 mil. bu.
SOYBEANS
Prices were mostly lower as a late day recovery in oil resulted in a slightly higher close. Beans were down $.08 – $.10, with meal $4 – $5 lower. May-24 beans closed below last week’s low keeping the downward trend intact into tomorrow’s USDA reports. May-24 oil for now rejected trade below $.47 and its 50 day MA. Spot board crush margins were little changed with BO PV rebounding to 41.8%. The US $$$ index surged to a 5 month high following a hotter than expected CPI report. Consumer prices rose .4% in March vs. expectations of a .3% rise. YOY prices are up 3.5% vs. 3.2% in Feb-24 and above expectations for a 3.4% rise. The higher for longer interest rate mantra rolls on. Forecasts for South American remain mostly favorable however needed rainfall relief for MGDS and Parana may be a bit slower to arrive than previously expected. Good rains will blanket much of the SE half of the Midwest over the next 5 days. Days 6-7 are now offering good coverage of .75–1.5” of rain for the NC Midwest including the eastern half of the Northern plains. The USDA announced the sale of 254k mt (9.3 mil. bu.) of 24/25 soybeans to an unknown buyer. Brazil’s soybean exports are expected to reach 12.73 mmt in April, steady with Mch-24 however down 11% from April-23. Look for export sales tomorrow to range from 10 – 24 mil. bu. for soybeans, 150 – 350k tons meal, and -5 – 10k tons for bean oil.
WHEAT
Prices were higher across all 3 classes with KC leading the way, up $.12 – $.17. MGEX and Chicago were steady to $.02 higher. Higher trade overnight in May-24 Chicago and MGEX both stalled at their respective 50 day MA’s. Next resistance for May-24 KC is at $6.05 ¼, last month’s high. KC May-24 premium to Chicago surged $.16 today to $.36, the highest in 2 weeks as markets price in additional weather premium for HRW wheat. Good rains will blanket much of the SE half of the Midwest over the next 5 days. Days 6-7 are now offering good coverage of .75–1.5” of rain for the NC Midwest including the eastern half of the Northern plains. Rains are being pulled away from Western KN and NE. Ukraine’s wheat exports since July-23 have reached 14.5 mmt, vs. the USDA forecast of 16 mmt for the 23/24 MY. Two cargoes of Russian wheat that were held up at Russian ports due to quality concerns are now in transit after Egypt’s Foreign Minister stepped in. Export sales tomorrow are expected to range from 0 – 20 mil. bu.
Chart source: QST
>>See more market commentary here.
Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. The information and comments contained herein is provided by ADMIS and in no way should be construed to be information provided by ADM. The author of this report did not have a financial interest in any of the contracts discussed in this report at the time the report was prepared. The information provided is designed to assist in your analysis and evaluation of the futures and options markets. However, any decisions you may make to buy, sell or hold a futures or options position on such research are entirely your own and not in any way deemed to be endorsed by or attributed to ADMIS. Copyright ADM Investor Services, Inc.
