Written Commentary
SOYBEANS
Soybean futures ended lower and near session lows. SX rejected 14.88 and ended near 14.61 on concerns over increase global geopolitical tension. Some funds were also net sellers on concern over combination on talk of larger US final soybean crop, reduce US soybean exports and record large South America 2023 crops could weigh on futures. Weekly US soybean export sales are estimated at 500-1,000 mt vs 845 last week. China downturn in their economy, increase tension between China and US with US administration talking about new sanction on China due to Taiwan And lower South America soybean, soymeal and soyoil prices could drop US soybean exports closer to 1,900 mil bu which could increase carryout from 200 to 385. Talk that US farmers net farm income is the highest since 2012 could also increase 2023 soybean planted. acres.
CORN
Corn futures ended lower. CZ is ended near 6.85 with range of 6.79-6.98. Some feel 7.00 plus strong basis may be too high going into harvest. Russia President basically declaring war rallied markets but now funds have turned into sellers before US Central Bank meeting today. US Fed raised interest rates 75 basis points as expected. US weekly ethanol production was down 6 pct from last week and 3 pct from last year. Stocks were down 1 pct from last week but still up 12 pct from last year. Weekly US corn export sales are estimated at 400-850 mt vs 583 last week. Some funds were also net sellers due to concern over a combination of reduce US corn exports due to lower Ukraine, Brazil and Argentina corn prices and talk of record large South America 2023 crops. Trade trying to balance value between talk of lower US corn crop and talk of lower exports. US corn exports could drop to closer to 2,000 mil bu which could increase carryout from 1,219 to 1,494. Talk that US farmers net farm income is the highest since 2012 could also increase 2023 corn planted. acres.
WHEAT
Russia President has the wheat market all in a frenzy with referendums and what this means for the war and directionally what Russian next steps? Expect increase in extreme volatility with headline risk. US still uncompetitive for exports, so spreads could widen. OND US wheat domestic cash basis could remain steady with a firmer tone until crop row harvest is done. Bakers are 70-75 pct covered for Q4. On Tuesday, WZ wheat options increased 13,000 calls. There are 134,000 wheat calls vs 55,000 puts. Wheat vol was up 9 pct yesterday. Weekly US wheat export sales are estimated at 200-500 mt vs 217 last week. WZ ended near 9.03 with a range of 8.73-9.19. KWZ ended near 9.67 with range of 9.44-9.82. MWZ ended near 9.64 with range of 9.41-9.75.
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