Written Commentary
Daily Grain Outlook
Month end. Grains are higher. SX is up 14 cents and near 9.64. SMV is up 4.20 and near 308.4. BOV is up 58 and near 33.68. CZ is up 5 cents and near 3.64. WZ is up 8 cents and near 5.57. KWZ is up 7 cents and near 4.80. Dry US Midwest weather is supporting higher grain futures. US stocks are higher. US Dollar is lower. Crude is higher. World financial and energy markets are trying to put a value on increase money liquidity, virus impact on economies and now, US Fed inflation policy?
For the month, SRW Wheat prices are up roughly 19 cents; HRW up 26; HRS up 18; Corn is up 37 cents; Soybeans up 72; Soymeal up $16.00, and; Soyoil up 300 points. Crushing margins are down 3 cents at 96, Oil share unchanged at 34%.
Chinese Ag futures (January) settled up 25 yuan in soybeans, unchanged in Corn, up 28 in Soymeal, up 46 in Soyoil, and up 90 in Palm Oil.
The 6 to 10 day forecast for the US Midwest has both models indicating little in the way of rains for most of the region. Some light rains are seen for Wisconsin and western Minnesota but, both models indicate little to no rains for IA, IL, IN and OH. Temps will run average to below in most of the region for the week ahead and then temps look to fall to below average for the weekend and first half of next week. The 11 to 16 day outlook for the Midwest is average to below average rainfall and below average temps across the Midwest.
Soybean futures are testing 2019 higher. Futures are overbought but supported by dry US Midwest weather and China buying US. SX in Real suggest prices to Brazil farmer is up 40 percent from last year.
Corn futures are testing the July highs. Dry weather in key US crop areas is supporting prices and Managed funds have liquidated most of their large net short. Open interest has collapsed. US farmers should look to sell CZ21 near 4.00. Some feel US 2020/21 Supply and Demand is comfortable despite talk of lower yields especially when US farmer begin harvest and USDA Sep 11 crop report.
Wheat futures are also testing 2020 highs near 5.80. Lack of EU and Russia farmer selling is helping World prices. Dryness in Argentina is currently the only hot spot for World 2021 crops.
On Friday Managed funds were net sellers of 2,000 contracts of SRW Wheat; bought 3,000 Corn; bought 12,000 Soybeans; net bought 5,000 lots of Soymeal, and; sold 3,000 Soyoil. We estimate Managed Money net long 15,000 contracts of SRW Wheat; short 49,000 Corn; net long 149,000 Soybeans; net long 11,000 lots of Soymeal, and; long 73,000 Soyoil.
Preliminary Open Interest saw SRW Wheat futures up roughly 1,300 contracts; HRW Wheat down 8,100; Corn down 18,300; Soybeans up 5,600 contracts; Soymeal up 6,500 lots, and; Soyoil down 3,700.
Deliveries were 379 Soymeal; ZERO Soyoil; ZERO Rice; ZERO Corn; 40 HRW Wheat; ZERO Oats; 2 Soybeans; ZERO SRW Wheat, and; 1,386 HRS Wheat.
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