Written Commentary
MORNING OUTLOOK
Happy Friday the 13th. Grains are higher. SH is up 8 cents and near 15.26. SMH is near 482.9 BOH is near 63.09 CH is up 2 cents and near 6.73. WH is up 2 cents and near 7.45. KWH is up 4 cents and near 8.39. MWH is up 1 cent and near 9.14. US stocks are higher. US Dollar is lower. Crude, gold, copper and cotton are higher. CBOT closed Monday.
USDA surprised the trade by lowering US 2022 crop 200 mil bu. Dec 1 corn stocks were estimated down 840 mil bu vs ly. At the same time, USDA dropped US exports 150 mil bu. Net result was carryout down only 15 mil bu from Dec. Dec 1 supply was down 1,200 mil bu from last year. Oct-Dec use was down 370 mil bu, exports down 150 mil bu. Some feel rally in corn futures was overdone. USDA dropped Brazil crop 1 mmt to 125 and Argentina down 3 mmt to 52. BAGE is near 50 with worst case scenario 38. Key is demand for corn.
USDA also surprised the trade by lowering US 2022 soybean crop 70 mil bu. Dec 1 soybean stocks were estimated down 130 mil bu vs ly. At the same time, USDA dropped US exports 55 mil bu. Net result was carryout down only 10 mil bu from Dec. Dec 1 supply was down 130 mil bu from last year. Oct-Dec use was down 67 mil bu, exports down 68 mil bu. USDA increased Brazil crop 1 mmt to 153 and Argentina down 4 mmt to 45.5. BAGE is near 41 with worse case scenario 35. USDA raised China crop 2 mmt to 20.3 and lowered imports 2 mmt to 96.0. China Oct-Dec imports were down 2 pct vs ly. USDA annual forecast is up 5 pct. Key is Argentina weather.
Wheat futures followed corn higher. KC gained on SRW. USDA Dec 1 wheat stocks were down almost 100 mil bu from last year. Dec 1 total supply was up 6 mil bu with total Oct-Dec demand up 127 mil bu vs ly. Residual was up 97, exports 27. There is chances of rain and snow across north south plains. USDA est US 2023 winter wheat acres up 11 pct at 37.0. SRW was up 20 pct. USDA left Australia crop unchanged? and Russia unchanged?
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