Written Commentary
MORNING OUTLOOK
Grains are mixed. SK is up 7 cents and near 16.03. SMK is near 449.4. BOK is near 66.93. CK is down 1 cent and near 6.48. WK is down 4 cents and near 8.00. KWK is down 1 cent and near 8.26. MWK is up 1 cent and near 9.58.
US stocks are higher. US Dollar is unch. Crude is lower. War of disinformation continues with US increasing chances of Russia invading Ukraine vs. Russia saying they do not intend to invade Ukraine and are pulling troops out of Crimea.
CBOT will be closed Monday due to US President’s Day holiday. Be safe and enjoy the long Holiday weekend.
Dalian soybeans, soymeal and RSO were lower. Soyoil, palmoil and corn were higher. Argentina, S 1/3 of Brazil, most of Paraguay and US south plains forecast are mostly dry. East US HRW, E Midwest, Delta and SE saw heavy rains. Lakes snow. 2 week forecast calls for more rain in US EAST, Delta and SE which could delay early plantings.
Overnight SK is over 16.00 on more talk of lower SA crops and higher demand for US crush and exports. Some feel losses in SA could be 1,320-1,360 mil bu. Where does they market find that shortfall? What price will it take to slow demand? China was 44 pct of US weekly old crop soybean sales and 92 pct of new crop. Some feel China soybean crushers have limited coverage after March. US soybean export price competitive to China versus Brazil. US soyoil exports commit is 80 pct of USDA goal. Increase interest building for next week’s USDA Outlook Conference estimate of US 2022/23 soybean supply and demand.
Corn futures remain reluctance to close over 6.50 CK. Some feel losses in SA corn crop could be 900-990 mil bu. Ukraine also needs to export 600 mil bu of corn. Where does they market find that shortfall especially if Russia invades Ukraine? What price will it take to slow demand? US corn export commit is down 20 pct from last year versus USDA estimate of a 12 pct drop. Argentina dropped their corn crop rating to 19 pct G/E vs 28 last week. Some could see the crop below 40 mmt v USDA 54. Dry S Brazil weather is lowering Brazil corn crop outlook and rains in north is delaying 2nd and 3rd crop planting. Increase interest building for next week’s USDA Outlook conference estimate of US 2022/23 corn supply and demand.
Wheat futures are mixed. Misinformation from Russia and NATO limits new US futures short covering. Dry US south plains and N Africa is supportive. US wheat export commit is down 25 pct versus last year versus USDA 18 pct drop. This offers resistance. Most estimate that to date, Russia wheat exports are 23 mmt with quota 30-33 mmt versus USDA 35 mmt. EU wheat export pace is closer to 30 mmt vs USDA 35. Ukraine is estimated near 24 mmt. Where does the market find 10-15 mmt (370-550 mil bu) shortfall especially if Russia invades Ukraine? What price will it take to slow demand? Informa estimates a 15 mmt increase in World 2022 wheat crop production, US +11, Canada +10 and Australia -7.
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