The soybean complex was higher across the board with beans up $.12 – $.18, meal $1 – $2 better, while oil jumped 90 – 110 points. After matching yesterday’s low at $13.03, Nov-23 beans recovered to settle very near its 50 day MA. Oct-23 oil pulled back after trading above the $.65 level for the first time in 3 weeks. Yesterday’s NOPA crush report suggests soybean oil usage for July-23 was the 2nd highest ever. As of Aug. 13th EU soybean imports for the 2023/24 MY have reached 1.33 mmt, down from 1.58 mmt YA. Over the same timeframe meal imports have reached 1.71 mmt, matching YA totals. While Friday’s USDA report showed continued tightened supplies in the US, global stocks/use among major exporters if forecast to rebound to their highest levels in 5 years. Long way to go here however as Brazil is once again expected to raise a record crop, while their Argentine forecast is nearly double this year’s drought reduced production.
Prices were up $.05 – $.06 today after trading to 23 month lows yesterday. After trading $.00 ¼ below yesterday’s low overnight, selling seemed to dry up for the Dec-23 contract. Prices came within $.01 of yesterday’s $4.85 ½ high. Key growing areas across the Midwest are forecast to remain void of moisture looking out toward the end of August. Combined with soaring temperatures, late maturing corn and soybean crops are expected to come under significant late season stress. Ukraine’s Ag. Ministry states that grain exports since July 1st have reached 3.3 mmt, of which 1.6 mmt was corn and .4 mmt of barley. APK-Inform raised their Ukrainian grain production forecast 4.2 mmt to 53.1 mmt. Their corn production est. at 25.5 mmt however is still below the Aug-23 USDA forecast of 27.5 mmt. US ethanol production jumped to 1.069 tbd in the week ended Fri. Aug. 11th, up 4.5% from the previous week and well above expectations. Despite the increased corn usage, it was just below the pace needed to reach the current USDA forecast of 5.225 bil. Ethanol stocks jumped to 23.4 mil. barrels, matching a 15 week high as implied gasoline usage fell 5% from the previous week. Export sales tomorrow are expected to range from 20 – 48 mil. bu. While the upcoming hot/dry spell will have greater impact on the soybean crop, it could still push along the corn crop maturity preventing full kernel fill for later developing crops.
Prices were mixed today after early strength in Chicago stalled out enabling prices to close steady to $.01 lower. Both KC and MGEX held on to close $.04 – $.07 higher. KC Dec-23 held above the May low at $7.36 before reversing, while MGEX Dec-23 held a test of $8.00 before reversing. Overnight Russian drone attacks on Ukrainian grain warehouses along the Danube River added to today’s bullish climate. Several pictures of damaged grain bins have appeared on various media outlets overnight. Ukrainian officials maintain port operations have continued despite the attacks. If fact it’s also been reported that a Hong Kong flagged ship left the port in Odesa enroute to Istanbul. This is the first ship to navigate thru the temporary humanitarian corridor since the collapse of the BSGI. This particular ship had been stuck at the port in Odessa since Feb-22, just before the Russian invasion. APK-Inform raised their Ukrainian wheat production forecast to 20.6 mmt, still just shy of the USDA est. of 21 mmt. APK-Inform also raised their Ukrainian wheat export forecast to 12 mmt, above the USDA forecast of 10.5 mmt. EU soft wheat exports for 2023/24 MY have reached 3.72 mmt as of Aug. 13th, just below the 4.2 mmt from YA. Ukraine’s Ag. Ministry estimates wheat exports since July 1st have reached 1.3 mmt.
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.