Written Commentary
MORNING OUTLOOK
Grains are mixed. SN is up 9 cents and near 15.33. SX is up 7 cents and near 13.52. SMN is near 416.4. BON is near 63.80. CN is up 8 cents and near 6.87. CZ is up 3 cents and near 5.66. WN is down 1 cent and near 7.17. KWN is down 1 cents and near 6.87. MWN is unchanged and near 7.59. US stocks are mixed. US Dollar is higher. Crude is higher. Gold is lower.
Chinese Ag futures are closed for holiday until Thursday. Malaysian palm oil prices were down 17 ringgit at 4,044 (basis July) at midsession as virus cases surge globally.
Wire story reports anyone having a quick look at commodity prices could easily think we’re in the middle of the kind of commodities super cycle last seen in the China-driven boom in the aftermath of the global financial crisis. While iron ore is the flag carrier for the boom in resource commodities – prices are at record levels – but oil, copper, nickel, cobalt, lithium and even coal have rebounded quite dramatically from their pandemic lows. Copper is back at 2011 levels. There’s also a boom occurring in agricultural commodities. Wheat, corn, other grains and soy prices are at six-year highs and cotton and live cattle prices have bounced back strongly from their pandemic lows. The sheer strength of the price movements raises the question of whether there has been a structural change in commodity prices – a new super cycle – or something more cyclical.
US rains forecast across, MO, Ohio river and Delta. 6-10 day calls for cool temps north warm south and normal rains. US east Midwest corn is rated above average. West and NW corn need rain. Brazil corn crop est 5-12 mmt below USDA. US dropped winter wheat rating. US export prices not competitive to buyers. Tightening US soybean supply supportive into USDA May 12 report.
US Winter Wheat was rated 48% good to excellent (trade estimate was 48%) versus 49% a week ago and 55% a year ago. US Spring Wheat planted was 49% (trade estimate was 48%) versus 28% last week, 27% a year ago, 32% average.
US Corn planted was 46% (trade estimate was 44%) versus 17% a week ago, 48% last year, and 36% average. US Soybeans planted was 24% (trade estimate was 25%) versus 8% a week ago, 21% last year, and 11% average.
For the week ending Apr 29th, Wheat exports are running unchanged versus a year ago and versus the USDA forecasting a 2% increase on the year, Corn up 82% with USDA up 50% and Soybeans up 64% with the USDA up 36% on the year.
Deliveries were 9 Soymeal; 12 Soyoil; 55 Rice; ZERO Corn; 311 HRW Wheat; ZERO Oats; 64 Soybeans; 36 SRW Wheat, and; 33 HRS Wheat.
On Monday, Managed funds were net sellers of 12,000 contracts of SRW Wheat; net even in Corn; sold 10,000 Soybeans; net sold 7,000 Soymeal, and; bought 6,000 Soyoil. We estimate Managed Money net short 1,000 contracts of SRW Wheat; net long 392,000 Corn; net long 171,000 Soybeans; long 46,000t Soymeal, and; net long 104,000 Soyoil.
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.
