Written Commentary
MORNING OUTLOOK
Grains are mixed. SX is down 17 cents and near 14.43. SU is near 16.02. SMZ is near 425.1. BOZ is near 66.12. CZ is up 5 cents and near 6.69. WZ is down 7 cents and near 7.97. Overnight high was 8.14. KWZ is down 11 cents and near 8.70. Overnight high was 8.89. MWZ is down 10 cents and near 8.99. Overnight high was 9.14.
US stocks gapped open lower and are near key support. US Dollar is making new highs. Crude is higher and near the upper end of a range since June. Gold, silver, copper, coffee and cotton are lower. Cocoa and sugar are higher. Gold is making new lows on the drop since early August high. Copper is erasing gains since mid-August lows. Concern about US retail sales could be putting a top in cotton.
US Fed Chairman Jackson Hole comments could have long term impact on US equities, US Dollar and commodity prices. Large 2023 global crops could prove negative to grain and oilseed prices if demand does not increase and there is more competition for US exports from Black Sea and South America.
Corn futures are higher after Pro Farmer 168.1 US corn yield. Most are still near USDA 175.4. Talk of increase Ukraine exports and approaching US harvest could limit the upside in futures. Some feel CZ could have 25-40 cent downside into harvest. Same group could see a rally post-harvest and before South America 2023 harvest on tight global supply, dry Argentina weather, an uncertain Ukraine export pace. NOAA 6-10 day US Midwest forecast is warm and dry. NOAA 8-14 day forecast is also warm and dry.
Wheat futures continue to remain range bound. Biggest bearish influence is lower Russian wheat export prices. Russia needs to be aggressive to sell a 94 mmt crop. Russia though will need to increase export pace to reach USDA forecast of 42 mmt. Some feel nearby Chicago wheat futures may be in a 7.40-8.40 range. Wheat supported by fact World exporters stocks to use ratio is record low.
Pro Farmer soybean yield equal to USDA should offer resistance to SX. Brazil will soon start planting 2023 soybean crop and CONAB first crop estimate was a record 150.1 mmt. US old crop soybean supplies are tight. SU is near 16.02. Rains over the weekend across MN and IA will help soybean crop there. US new crop soybean open export commit is record high. China Covid lockdown and their slowing economy could reduce their total soybean imports.
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