Written Commentary
MORNING OUTLOOK
Fed day. Grains are lower. SH is down 9 cents and near 14.75. SMH is near 450.9. BOH is near 62.50. CH is down 4 cents and near 6.49. WH is down 7 cents and near 7.43. KWH is down 11 cents and near 8.54. MWH is down 8 cents and near 9.14. US stocks are higher. US Dollar is lower. Crude, gold, silver, copper, cocoa, sugar and cotton are lower. China Covid cases are increasing especially among hospital workers.
Large winter storm is moving across US north plains. Maps differ on how far south snow drops. One NE another KS. This is key with cold temps forecast for next week. Rain in Delta and SE. US south plains still dry. S Brazil and Argentina remain dry.
US soybean export premium firmed. China bought 40 soybean cargoes last week. US PNW and gulf? for Dec-Jan . Brazil Jan-April. Some est China now 70-75 pct covered for Jan-Feb. This suggest US export window is closing. Argentina soybean crop 37 pct planted vs 56 ly. Dalian palmoil and soyoil prices are higher after Malaysia reported stocks lower for first time in 6 months. Stocks are down 5 pct, production is down 7 pct and exports are up 1 pct. US soymeal export price $539/mt vs Argentina $528.
Corn prices slid lower overnight. Trade trying to find value with Argentina crop outlook lower but US ethanol and exports demand slowing. Some est Argentina corn crop closer to 47 mmt vs USDA 55. Brazil Dec corn exports were 6.8 mmt bs 3.4 ly. Some feel last years Brazil corn crop may have been underestimated. China Dalian corn futures continue to drop and near 2 month low. USDA Ukraine Ag attaché lowered Ukraine corn crop to 23 mmt vs USDA 27 but raised exports to 20 mmt vs 17.5 previous. Only 60 pct of 2022 crop is harvest which leaves 9 mmt still in fields until spring. Odesa port may be partially back working but vessel insurance soared. US corn export prices $310 vs Ukraine $271.
Not much new wheat news expect prices continue to slide lower despite new uncertainty over Black Sea exports, lower Argentina supply and dry and cold US south plains forecast. This weeks US export sales are not expected to offer any new bullish surprise. India wheat stocks are only 19 mmt vs 38 ly and lowest in 6 years. Domestic prices are record high. Some doubt USDA Indian wheat crop est at 103 mmt and exports of 2.5. Some feel crop could be 6 mmt lower. US SRW export prices $332 vs Russia $318.
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